Last year Time Warner Cable and the Los Angeles Dodgers struck a twenty-five year, $8.35 billion deal giving Time Warner Cable the exclusive broadcast rights to all Dodgers games in Los Angeles via its creatively-named regional sports network, Time Warner Cable SportsNet LA. Time Warner Cable then immediately turned around and demanded massive price hikes (rumored to be around $5 per subscriber) for any other pay TV provider that wanted to offer the channel. All of the regional cable operators (including AT&T, Cox, Dish and DirecTV) balked at the hike, resulting about 70% of fans in Dodgers territory being unable to watch the final six games of last season.
All sides had ample opportunity during the offseason to negotiate a fair price, but by all accounts Time Warner Cable simply refused to move on the price tag (though the fact it’s in a holding pattern over a Comcast acquisition also likely played a role). As such, the new baseball season kicked off this week and Dodgers fans remain unable to watch their favorite team’s games. Making matters worse, Time Warner Cable has refused to seriously answer questions about the logjam, offering some variation of the same statement over and over again:
“We want all Dodger fans to have access to SportsNet LA. Despite our repeated attempts, other providers are unwilling to engage in any discussions. If Dodger fans want to enjoy SportsNet LA this season, we encourage them to switch to a provider that carries the network.”
The problem with that logic? Time Warner Cable is the only cable operator offering access to its own sports network, and 70% of Los Angeles lives in an area where they can’t get Time Warner Cable. As such, Time Warner Cable’s recommendation is not only useless, it’s insulting. When that’s pointed out, the company just refuses to comment. When asked why it refuses to compromise on the price, the company provides similarly epic non answers:
“SportsNet LA is available on fair terms consistent with its value. We know that the rates for the network owned by this iconic franchise are in line with what other RSN’s around the country charge, including DirecTV’s own regional sports networks.”
While it’s understandable that Time Warner Cable wants to recoup its investment, the total inflexibility here is pretty well in character for a company that actually has worse customer satisfaction ratings than even the much-hated Comcast. The growing cost of sports programming and the steady increase in annoying retransmission fee dispute blackouts usually help drive cord cutting, but in this case there’s absolutely nowhere else to go to watch the content in question. Even over the air broadcasts aren’t an option thanks to the nature of the Time Warner Cable, Dodgers arrangement.
So far, regulators have chosen to treat these kinds of programming rate standoffs as just “boys being boys,” but it’s unclear how much longer they’re going to be willing to stand on the sidelines given how much politicians love to earn cheap, sports-related political brownie points. Last year FCC boss Tom Wheeler sent a letter to Time Warner Cable claiming that “inaction is no longer acceptable” and the FCC was “monitor(ing) this situation closely in order to determine whether intervention is appropriate and necessary.” But the FCC has said little since. Given that three of the companies involved in the standoff (AT&T, DirecTV and Time Warner Cable) are awaiting merger approval, conditions might be used to force the issue over the next few weeks.