jim wrote:2. The cable companies have no intention of meeting the offer, and is simply putting out something to make it look like they did right by their customers. If this is true, then it's smart because right now there is no way MLB is going to come out on top of this PR battle.
I was sitting down pondering the situation and this is exactly what came to mind.
The fact that it was claimed to be matched, only later to be absolutely shot down by MLB ("[fell] short on nearly all material conditions") leads me to believe this is just a public relations move. And like you're saying, jim, that isn't such a bad strategy...
"iN Demand's strategy of negotiation is a failed one," MLB Exec VP/Business Tim Brosnan said. "Our offer to them to match DirecTV remains open, but time is running short." Late Tuesday, iN Demand faxed Brosnan an offer that it said would match DirecTV's terms, guaranteeing the same rates and household distribution as the satellite operator over the next seven years. Brosnan bashed the offer, saying that it does not. "Time and again, we have given iN Demand an opportunity to respond to legitimate offers," he said. "And time and again, they have responded by making misleading statements."
I haven't read the whole thread but am I missing something?
Why wouldn't MLB jump at the chance to get extra money for the same product? The already have 700 mill in their pocket from DirecTV and they can make close to that again with the cable companies and appease a lot of angry customers at the same time.
cardsfansince82 wrote:I haven't read the whole thread but am I missing something?
Why wouldn't MLB jump at the chance to get extra money for the same product? The already have 700 mill in their pocket from DirecTV and they can make close to that again with the cable companies and appease a lot of angry customers at the same time.
To summarize, MLB cut an exclusive deal with DirectTV earlier this winter. Congress got involved saying it was illegal, I think they felt the heat and then opened it up to the other carriers. The bid is really high, but if they match it then they can carry it.
Why would MLB want this? Well, DirectTV gave them alot of money for one. Two, MLB has it's own product called mlb.tv. If you can't get out of town games on your cable, then that is your only source. It's a win-win for MLB, they get a ton of money from DirectTV and they get a boost in subscriptions.
I guess I will be waiting till April 1st to make a decesion. I think MLB is screwing with the Cable providers. Things looked so good yesterday and now I find this out today. What a joke...
PHILLYCARD wrote:I guess I will be waiting till April 1st to make a decesion. I think MLB is screwing with the Cable providers. Things looked so good yesterday and now I find this out today. What a joke...
I think that's the best strategy. I don't like this tug of war that I feel like I'm caught in.
cardsfansince82 wrote:I haven't read the whole thread but am I missing something?
Why wouldn't MLB jump at the chance to get extra money for the same product? The already have 700 mill in their pocket from DirecTV and they can make close to that again with the cable companies and appease a lot of angry customers at the same time.
Obviously MLB will jump at the chance at getting 2 700M contracts, but I am sure that their contract with DirectTV states that unless iNDemand matches exactly, DirectTV will get exclusive rights. DirectTV would need to watch out for their themselves. MLB would be selling them down the river if they let MLB give in to iNDemand at a lesser price.
By RICHARD SANDOMIR
Published: March 22, 2007
Major League Baseball spurned a revised offer by leading cable operators yesterday to retain the Extra Innings package of out-of-market games, which may now become the exclusive satellite domain of DirecTV.
The rejection sets up two showdowns: one on Tuesday, when M.L.B. and DirecTV officials are to testify before the Senate Commerce Committee about their seven-year, $700 million agreement; and another March 31, the deadline for cable and the Dish Network to meet baseball’s terms.
InDemand — the cable consortium owned by Comcast, Time Warner and Cox — said yesterday that it had offered to renew Extra Innings on the same financial terms promised by DirecTV, and to guarantee the same number of subscribers for the MLB Channel, which is to make its debut in 2009, that have been assured to baseball by DirecTV.
In rejecting InDemand’s offer in less than an hour, Bob DuPuy, M.L.B.’s president, said in a statement that it “falls short in nearly all of the material conditions” laid out in baseball’s deal with DirecTV.
Tim Brosnan, baseball’s executive vice president for business, said in a telephone interview that “the correspondence they sent us amounts to a misleading press release and a failed strategy if their intention is to make a deal and to truly deliver this package to their customers.”
Robert D. Jacobson, the president of InDemand, said by telephone that he was surprised by baseball’s quick rejection of his proposal because “we understood that if we matched the terms of the DirecTV offer, we’d have a deal. We feel we’ve done that.” He added, however, that he was never shown the contract between baseball and DirecTV.
With opening day looming, the sides appear locked into different definitions of how to make a deal. Jacobson used as his guide baseball’s announcement of its agreement with DirecTV, in which InDemand and Dish were invited to make deals “at consistent rates and carriage requirements” as those met by DirecTV. Jacobson interpreted that earlier this month as a requirement to match the 15 million subscribers guaranteed by DirecTV.
But Brosnan said that InDemand and Dish had to guarantee that the channel would be made available to 80 percent of all their digital customers, because that was the terms of the deal with DirecTV, which as a satellite network is all digital. Cable operators have about 32 million digital customers in total.
“We laid all this out in painstaking detail to them in our meeting on March 9,” Brosnan said. “We could not have been any clearer.”
In its offer to baseball yesterday, InDemand said it would match DirecTV’s total subscribers for the channel in 2009, however much it increases from 15 million.
The parties were also split on how to count Extra Innings subscribers and, thus, how to calculate what baseball would be paid for those digital cable customers.
Later in the day, Jacobson issued a statement that said, “By rejecting this matching offer, M.L.B. has proven it never intended for InDemand to have a fair and equal opportunity to bid for Extra Innings.”
Baseball and DirecTV officials were headed to an exclusive deal on Extra Innings when fans who watched out-of-market games on cable voiced their outrage in e-mail messages, chat rooms and petitions. The fans’ anger prompted baseball to give InDemand and Dish 23 days to make a deal. (Dish is still in talks with M.L.B.) But one thing they would not get is a stake in the channel; DirecTV owns 20 percent of it.
