NBA Puts Turner on Net Duty

Jan 20, 2008  •  Post A Comment

The NBA is looking for a do-over on its cable channel.
The basketball league last week signed a deal to have Turner Broadcasting operate its Web businesses as well as program and market the NBA TV cable network.
NBA TV, launched in 2003, is in just 15 million homes, a disappointing number compared to ESPN, which is in more than 90 million homes.
NBA Commissioner David Stern blamed the slow rollout of the cable channel in part on a decision to let some cable operators put it on a sports tier.
“We initially accepted the view of the cable industry that they would get behind the sports tier,” Mr. Stern said. “I think it’s fair to say without being controversial that the tier penetration isn’t what the cable industry hoped for.”
The low penetration is due to the operators’ ambivalence about programming and promoting the sports tier, he said.
But all of NBA TV’s distribution agreements expire at the end of the season, which could mean a whole new ballgame.
The NBA is responsible for distribution of the channel, which means Turner will not be able to directly leverage its other channels, such as CNN and TNT, to make better carriage deals.
Mr. Stern said the league and Turner will be going out together to talk to the cable industry about the new NBA offer and a new value proposition being put together by the league to increase distribution. “Within 18 months, we expect to see significant distribution growth for NBA TV,” Mr. Stern said.
Part of that new value proposition is a willingness to lower the 30-cents-per-subscriber monthly fee the NBA charges distributors for the channel.
But the league also will be pitching improved programming, working with Turner’s talent and facilities. The channel shows live NBA games not seen on TNT or ESPN, plus WNBA games, international games and other programming of interest to basketball fans.
The league has been downsizing its TV production facilities in New Jersey in anticipation of the channel being operated out of Turner’s Atlanta production facility.
The NBA plans to broadcast in high definition and will be offering additional programming for cable operators’ on-demand and broadband services.
While other sports channels, particularly NFL Network and the Big Ten Network, have gotten into nasty fights over their demands to avoid being carried on sports tiers, Mr. Stern said he didn’t think the negotiations had to be contentious.
Unlike the NFL, which made an exclusive deal for carriage of its out-of-market games with DirecTV, the NBA’s League Pass out-of-market games package is available to both cable operators and satellite distributors.
“We think we’re in a very good place,” Mr. Stern said.
The NBA chose Turner to operate its Web and mobile business because of the strength of services like CNN.com. Turner Sports also handles Web businesses for NASCAR and the PGA Tour.
The NBA and Turner deal is a profit-sharing partnership.
“We see substantial upside for both partners in the new agreement,” said David Levy, president of Turner Sales and Turner Sports.


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