March 8, 2007 5:08 PM PST
DirecTV, MLB get two strikes on competition
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Previous reports had suggested that DirecTV was about to sign an exclusive deal to air the MLB Extra Innings package of out-of-market baseball games over its satellite network. However, Dish Network and In Demand--a joint venture between cable companies--will also get an at-bat, MLB and DirecTV said in a press release Thursday.
But they must sign up for seven years, they must agree to the same rates, they must carry a channel developed by MLB on the basic tier of their subscription packages, and they must finalize a deal with MLB by opening day. The first game of the 2007 season takes place on April 1 between the New York Mets and the St. Louis Cardinals.
Financial terms of the deal were not disclosed, but earlier reports put the figure around $700 million. DirecTV has a similar exclusive relationship with the National Football League to broadcast games shown outside the viewer's home market.
Extra Innings allows baseball fans to watch games between teams other than the ones in their home markets on a day-to-day basis. ESPN and Fox show select games to national audiences, but most viewers can only follow a team in a distant market if they sign up for Extra Innings or a similar service on MLB.com.
It looks like cable customers who had signed up for the Extra Innings package will have to switch providers to follow their favorite team.
"Major League Baseball has chosen to cut a de facto exclusive deal--including conditions for carriage that MLB and DirecTV designed to be impossible for cable and DISH to meet--with one satellite operator, and disenfranchise baseball fans in the 75 million multi-channel households who do not subscribe to DirecTV," said Robert Jacobsen, president of In Demand, in a statement. In Demand is backed by Comcast, Time Warner, Cox Cable, and other companies.
EchoStar Satellite, which operates DISH Network, did not officially decline the offer, but balked at the requirement that operators be forced to include the MLB Channel if they want to offer the package. "Our concern is that an offer for Extra Innings that's tied to the MLB Channel as well will force more sports on people who might not want to pay for it," said Kathie Gonzalez, an EchoStar spokeswoman.
The reports about the exclusive deal had angered baseball fans who had already signed up to watch their favorite teams through their existing cable or satellite provider. The sticking point appeared to be including the MLB Channel on the basic subscription tier: MLB called it a "major factor" in signing the deal with DirecTV. DirecTV customers also accounted for half of all Extra Innings subscribers last season, according to the press release.
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