Big Mess in the Big Ten: Why Die-Hard Fans Can't Tune In

Friction Between Conference Net, Cable Companies Irks Would-Be Viewers

By Published on .

Saturdays at Chris Pedon's house are all about football. For decades, the Columbus, Ohio, resident and Ohio State University alum has watched Buckeyes football games from the comfort of his couch. But a stalemate in negotiations between the nascent Big Ten Network and his cable provider, Time Warner, has forced the 43-year-old father of three to break tradition and head to the local pub instead.
Not on TV: Many Midwest pigskin enthusiasts missed the historic Appalachian State upset of Big 10 heavyweight Michigan.
Not on TV: Many Midwest pigskin enthusiasts missed the historic Appalachian State upset of Big 10 heavyweight Michigan.

"Last week, I had to sit at the dang bar with my six-year-old because it was the last seat in the house. I don't want to have them at the bar," Mr. Pedon said.

It's a dilemma repeating itself in the homes of millions of Big Ten Conference football enthusiasts, from die-hard Michigan Wolverines fans in Ann Arbor, Mich., to Penn State fans in University Park, Pa., as the sometimes nasty negotiations remain stalled between the Big Ten Network (49% owned by Fox) and three major cable providers: Time Warner, Comcast and Charter.

Dollars signs
Regardless of who's right, one thing is clear: The fans aren't being served, and neither are advertisers. Detroit Free Press columnist Michael Rosenberg perhaps summed it up best in a recent column when he asked: "So whose side are you on in this Big Ten Network-Comcast showdown? Are you with the guys trying to make money? Or are you with the guys trying to make money?"

The brainchild of Big Ten Conference Commissioner Jim Delany, the Big Ten Network was conceived leading up to the expiration of the conference's deal with ABC and ESPN in the summer of 2007, according to Mark Silverman, president of the Big Ten Network. Mr. Silverman, who previously worked at the ABC cable group as senior VP-general manager, said creating the network was a way to address the problem of fewer Big Ten games being broadcast by ABC and ESPN, with more games relegated to ESPNU and even to an online site, ESPN 360.

Getting cable providers to play has been more difficult. The big sticking point is that the Big Ten Network wants placement on basic cable and $1 per customer per month from cable providers. The cable companies want to place the network in its sports tier. "We want to bring the Big Ten Network to our customers, but in the fairest way. We want it available in our sports-entertainment package," said John Demming, spokesman for Comcast.

"They want to charge our customers hundreds of millions of dollars whether they are interested in it or not," Mr. Demming continued. "We think the fairest and best way to offer it is to offer it on our sports-entertainment package, so if they are interested in it, they can pay for it, and if they're not interested, they will not be burdened."

Mr. Silverman doesn't see it that way. "They charge grandparents to get MTV, they charge men for Lifetime and Oxygen, and they do it every month. The industry is what it is; we didn't make it," said Mr. Silverman.

Besides, he said, Comcast can rake in big advertising gains.

Although Mr. Silverman said the network does not expect to reach profitability for "years," he said the investment is significant enough that it will inevitably pay off. He said publicized numbers putting Fox's investment in the network at $18 million to build out new studios in downtown Chicago and pony up $50 million in programming-rights fees are inaccurate. "Those are low."
Big Ten Conference Commissioner Jim Delany
Big Ten Conference Commissioner Jim Delany

But Mr. Silverman said Comcast is not accurately portraying the true cost to consumers. "They are saying one thing out of one side of their mouth and then saying something else," he said. To get the sports tier, a customer has to be a digital subscriber. "That alone wouldn't be enough," he said. "It's another $5 to $10 to get it in a sports tier and it's roughly going to cost you $200 more a year to see it.

"I find this whole thing to be a serious abuse of a cable company's power in the marketplace. They know a consumer doesn't want to switch [providers], so they want to dig in here," he said.

Only game in town
And what provider would consumers switch to? Dish Network. The satellite-TV company, which recently inked a deal to carry the Big Ten network, has been running newspaper ads in Big Ten markets luring people to switch by playing up the benefits of its "America's Top 100 or Higher" package. Dish Network does not disclose any figures on local subscriptions or increases in subscription numbers, so it's unclear if fans have been switching over. A Dish spokesman said the print campaign was designed to "make pay-TV subscribers aware Dish carries Big Ten," not necessarily switch to Dish service.

And in an obvious bid to put pressure on the cable companies, the Big Ten Network has been running spots during games featuring the head coaches of teams imploring fans to call their cable operators.

But those pleas don't sit well with Mr. Pedon, who said on principle, he has no plans to switch. "It shows the greed of Corporate America in general," he said. "They squeeze the average man trying to go to the game and then squeeze you out of even watching it at home. That's the part I felt so manipulated by."

Given those sentiments, shouldn't Big Ten stop digging in and allow the cable providers to put the network on its sports tier? "The network would not live if we did that," said Mr. Silverman. "We are pretty much going down the path that we will not have a deal done this season."

No game of chicken
When asked about the comparison of the negotiations to a game of chicken, Mr. Silverman replied: "I don't think so. We have a 20-year deal. The Big Ten Network is not going away. We are in 30 million homes. We've got millions of people watching this network who love it. The cable companies think they can decide the fate of a network."
Big Ten Network wants placement on basic cable and $1 per month per customer from cable providers.
Big Ten Network wants placement on basic cable and $1 per month per customer from cable providers.

Time Warner Cable, which provides service in two of the conference's key states -- Wisconsin and Ohio -- does not currently carry the network but has been in active discussions to work out possible deals. Echoing Comcast, a spokeswoman said, "We believe this programming belongs on a sports tier," adding that a new proposal was submitted two weeks ago.

A spokeswoman for Charter said, "We would like to offer to customers a better value proposition, but obviously a better business proposition for us would be to offer the Big Ten Network on our sports-tier lineup. We are working on something that is [in the customers'] best interest."

Mr. Delany, the Big Ten's commissioner, is also realistic about the network's appeal outside its core markets. "I can't argue that this should be widely distributed in New York or Kentucky or Mississippi," he said. "If you ask me, are there 70% of people [in those markets] who would choose to have it? I would say no. But I would also tell you there's not 70% who would choose to have anything. If you were to take 70 networks and knock out 50, there's no doubt that it would be a top-20 choice for those people."
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