Posts Tagged broadcast networks

What’s The Verdict: Comcast and Houston Sports battle over bankruptcy and alleged scheming, who is behind it?

What’s The Verdict: Comcast and Houston Sports battle over bankruptcy and alleged scheming, who is behind it?

Houston Regional Sports Network has been in an involuntary bankruptcy phase but most recently, a litigation trustee filed a complaint accusing Comcast of doing everything in its power to impair the Network in an attempt to acquire the rights to broadcast Houston Astros (baseball) and Houston Rockets (basketball) games at a significant discount.

Robert Ogle makes clear that the cable giant has a track record of poor customer service and that since Houston Regional Sports Network was set up in 2003, they have experienced Comcast’s ‘dishonesty’ firsthand.  It was in 2010 that Comcast became a partner with a 22.5 percent interest in the network and the teams, Astros and Rockets, owned the rest of the percentage.  At this point, Comcast said it would use its power to achieve promised rates, gave an advanced loan for $100 million, amongst other things.  In addition, the sports teams granted the Network exclusive rights to games through the year 2032 for hundreds of millions.  This all happened in 2010 and then in 2013 is where problems arise.

The complaint (filed by the Network) asserts that Comcast has been doing everything in its power to acquire its primary and most valuable assets, the right to telecast programming related to Houston Astros and Houston Rockets, as well as the right to receive revenue from affiliation agreements with MVPDs that carry CSN Houston.  What’s interesting is that Houston Regional Sports Network was never able to reach affiliations with a major MVPD; thus, the lawsuit claims this was intentional on Comcast’s part.  Other regional sports networks owned by Comcast were able to make deals but the major difference is that with these other networks, Comcast owned most, if not all, of the equity.

In effect, Houston Regional Sports Network began to experience liquidity constraints because they couldn’t make any big distribution deals.  This caused the Astros and Rockets to offer to sell their own equity to Comcast, but they didn’t take the offer.  So what happened next? The financial situation of Houston’s Regional Sports Network continued to grow worse, which eventually led to a buy-out offer from Comcast at a much lower price.  Mr. Ogle says that all of it was part of Comcast’s plan and that Houston’s RSN was basically a scheme.  How was it a scheme?

Comcast would put the Debtor (HRSN) into bankruptcy and automatically its value would drop substantially. With that, Comcast would make a statement of its intention to offer a great amount of money to acquire the Debtor plus assets, which would scare away other potential buyers.  Once it was clear that Comcast was the only likely buyer,  Comcast could buy the Debtor plus assets at an even smaller price than it had stated.  This is because there would be no other buyers  so HRSN would have no other option but to take the offer regardless of how small it was.

Point being, Rockets and Astros were in terrible position and the truth is that Comcast played a role in this.  The teams ended up selling to AT&T and DirectTV for $5000 which is a lesser value than they would’ve made if they simply liquidated all their assets in 2013.  Comcast of course denies all claims and allegations as entirely without merit.

What do you think will happen? Stay tuned for more on What’s The Verdict!

, , , , , , , , , , , , ,

Leave a comment

Whats the Verdict: Is Binge Watching the New Normal? NBC takes the plunge!

Once reserved strictly for online content streaming platforms like Amazon, Hulu, and Netflix, binge watching seems to have gone mainstream, with big networks beginning to release whole seasons online. The adoption of the binge model by big networks comes precisely at the same time that platforms like Netflix are moving away from it.

Tomorrow NBC will release the the first season of David Duchovny’s new period drama, Aquarius in its entirety online, while at the same time airing one episode a week on TV. In a Hollywood reporter article, NBC Entertainment Chairman, Bob Greenblatt proclaimed this decisions would push new boundaries, while also giving the consumer what they want.

NBC’s jump into the binge party comes at the same time as other’s are begining to question its merit. On May 21, Netflix began airing its new show, Between on a week to week basis. Hulu is also questioning the model and is looking at non binge options for its lineup, and Yahoo’s sixth season of Community is also being released over several weeks.

At the root of this shift is the need to create buzz. Content creators want to be able to build buzz around their shows, that continue over a period of time. The binge model allows for much of this build up. However, once the show is released the hype plummets. Serial releasing of content, on a week by week basis allows for hype to be built throughout a season.

As big networks like NBC move to catch up to online content providers like Netflix, more and more shows will be released on the binge model. The implications of this for the industry could be huge. Networks will have to create more and more content. This means that season story lines will become much longer. This also means that Networks will have to green light more shows. If they no longer have to worry about the physical confines of airtime, networks will be able to produce more shows for online viewers.

The real question is wether or not this is what the consumer wants. Will weekly entertainment transition into becoming fourteen hour obligations to watch an entire season in one weekend? What implications will this have on hiring patterns? What does this trend mean for payouts in the industry?

What do you think the verdict will be?

, , , , , , , , , , , , ,

Leave a comment

Vertical Integration?

ABC and CBS have been experimenting with vertical integration, as more network-affiliated studios have been selling to other broadcast networks.

ABC just committed to a CBS comedy, as CBS is trying to sell shows to other broadcast networks. For example, it has set up an untitled comedy at ABC , which revolves around a two sisters. In fact, many of the successful shows at large networks hail from other studios, like Warner Bros TV, 20th TV, and Sony TV. 

With these changes, it seems that vertical integration is not temporary, but in fact here to stay. Do you think its influence on networks’ decisions  is beneficial or harmful?

http://www.deadline.com/2013/08/blurring-the-lines-on-vertical-integration-network-affiliated-studios-agressive-in-selling-to-other-broadcast-networks/

, , , , , , , ,

Leave a comment

Update in Time Warner and CBS negotiations

Three LA-area customers have hit Time Warner Cable with a class action suit over the CBS blackout. The plaintiffs seek subscription fees and reimbursements on behalf of fellow Time Warner subscribers affected by the blackout. In the complaint filed yesterday, they claim unjust enrichment, breach of contract and more. Plaintiffs are also arguing that they received no notice of the blackout and that Time Warner has not offered credits in light of what has happened.

No word from Time Warner on the case.

http://www.deadline.com/2013/08/time-warner-cable-class-action-cbs-showtime-blackout/

 

, , , , , ,

Leave a comment

%d bloggers like this: