Friday, September 09, 2011

When Your Business Model is Held Hostage by ESPN

Dish Network Crying Foul Instead of Uncle

Cable and satellite TV companies take a perverse pleasure in bitching and moaning about how much they have to pay to carry the ESPN suite of channels, which is already nearing five bucks a subscriber. And that's without the $15.2 billion in additional coin the gang in Bristol will fork over to the NFL for the rights to Monday Night Football through 2021.
Since Disney doled out the cash for less-than-altruistic reasons, there's every expectation that subscriber fees will be jacked up once again to pay the pigskin tab.
Now, the New York Post reports Dish Network doesn't want to play ball and may pull the plug on the Worldwide Leader in Sports. But can it?
I mean, it could, but is that the satellite equivalent of hari-kari. This is ESPN, not the Cooking Channel or Current TV. It's ESP-friggin-N, as in no way can you not have it as part of your channel offerings.
Actually, Dish's threat has a proviso. It would reluctantly pay the presumably higher fee if it could put the ESPNs on a higher-priced sports tier and not as part of its basic cable package. It's obvious why ESPN wouldn't want that. But would it risk losing access to Dish's 13.5 million subscribers? On the other hand, would Dish suffer mass defections if ESPN wasn't on its roster?
The company may take that chance. It already took a hard line against regional sports networks, which is why you don't see YES, MSG or SNY--and why Dish probably doesn't have much penetration in the New York area.
But ESPN? C'mon. Dish may have to suck this one up. If it doesn't, you know DirecTV will be ready with open arms---and satellite dishes of its own beaming down ESPN. Sure, it won't be cheap, but not having the network will be a lot more pricey.

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