So as of right now, millions of television viewers in the New York Metropolitan area, will not be able to see the 2010 MLB playoffs on Fox 5, due to a contractual dispute between Fox parent company, News Corporation and local cable provider Cablevision.
This isn’t the first time a local New York television cable provider has gone head to head with local and national channels and it won’t be the last. With a poor economy still looming in the background, broadcasting companies are losing advertising revenue at an exponential rate.
Unfortunately the bottom line, as usual in these battles between media power brokers, the everyman becomes the victim one way or another.
The symbiotic relationship professional sports have had with television broadcasting companies have existed since the days of black and white and the smooth play by play calling of the great Mel Allen. However with the dawn of the super-stations, professional sports franchises have learned – the hard way – over time, that the true financial power lies in the flexibility to provide millions of viewers, access to their favorite sports teams from the comfort of their homes.
Case in point when the YES Network was founded in part by the Steinbrenners in March of 2002, it displaced the MSG Network as the official broadcasting home of the New York Yankees which had a hold on the broadcasting rights of the team since 1989. According to advertisingage.com, the YES network earned $400 million dollars in revenue for 2009.
It’s an astonishing figure to say the very least. SNY which is partially owned by the New York Mets, Time Warner Cable and Comcast, falls under an umbrella of sports channels owned by Time Warner and Comcast which earned over $17 billion in revenue, and that was for 2008.
Broadcasting rights are the true lifeblood of any Major League Baseball team, trumping even the time old attendance figures that once were known to make or break a major league club. Take for example the Tampa Bay Rays who have finished 1st in the American League East 2 out of the last 3 years, having represented the American League in the 2008 World Series which they ultimately lost to the Phillies.
As successful as they have been, talks are abound that team owner Stuart Sternberg is contemplating moving the ballclub to a more profitable location. Attendance for the Rays in 2010 according to ESPN was at 1,864,999 million, or an average of 23,000 a game. Pitiful that a team so successful was ranked 22nd in the majors in attendance, that it even prompted star players Evan Longoria and David Price to publicly admonish fans for their lack of support.
The low attendance figures could have been offset if Tampa Bay had a more advantageous broadcasting contract in place. Unfortunately Tampa Bay resigned a contract in 2008 lasting until 2016 with Fox Sports Florida; the bulk of the advertising revenue going to FoxSports Florida and not the Rays.
Now is that the fans fault or just bad business decisions made by Rays executives with a myopic vision for the teams’ future? That’s something that not even a brand new state of the art stadium, which has been floundering about in the Florida legislature for years, could ever soothe.
All of this leads me back to the Mets situation this season, where attendance was down another 17.2% according to Adam Rubin at ESPN. As attendance plummets for the Mets, due to a variety of reasons as we all know, the flaccid arguments that many people this year made that if attendance drops, so will the Wilpons reason to spend, falls flat if you take into account the revenue which is generated by SNY.
Granted SNY isn’t the money printing machine that is the YES network, but it’s gradually becoming one of the premier sports broadcasting outlets in the United States.
Just like the argument that is currently underway with News Corporation and Cablevision , the old guard thinking that team attendance receipts determine a teams’ vitality is as false as holding television viewers hostage to get corporations to capitulate to one’s demands. In this day and age of digital, viral online access, any viewer can access any games or television shows at their will.
Obviously many executives in the sports and entertainment industries haven’t read the memo.
