FIOS/Sunday Ticket

[Maestro]

I have been on the phone with Verizon a few times this week with some issues with FIOS internet. I do not have FIOS TV. Every call to Verizon ends with the CSR asking me how come I don't have FIOS TV. I tell them I want the Sunday Ticket.

Now every CSR I have spoken to has said that VZ is really trying hard to get the Sunday Ticket for next season. I am 99.9% sure this is just them trying to get a customer. Am I right?

[Bschneider]

No.. They are telling the truth.. I posted this last year. Since Verizon and D* have a partnership they are hoping to have a deal for sunday ticket.

[LonghornXP]

First DirecTV has an exclusive deal with the NFL for NFL Sunday Ticket. This means that "NO" other company have have access to Sunday Ticket until 2010. Now DirecTV can make a choice to sell the package to another company but once they do this they must allow all companies the option to carry those channels because once they offer another company access (even in a partnership) at that point DirecTV becomes a programming provider and as such must follow all the laws and rules set forth for carriage deals between a programming provider and an MSO (ie cable and satellite companies). Just remember that its the NFL that has the exemption to allow them to have exclusive contracts and not DirecTV.

Again DirecTV doesn't have this exemption like the NFL does. Also we are also assuming that the NFL contract with DirecTV even allows DirecTV to sell the rights of carriage to another provider. My contacts say no they cannot without the consent of the NFL. If the NFL gives consent for DirecTV to sell carriage rights at this point DirecTV must offer those rights to all providers as again DirecTV doesn't not have the exemption and cannot withhold programming from any provider nor can DirecTV enter into an exclusive deal with another company.

I know this was a long post but I just wanted to make it very clear the specific details of making a move like this might cause. Once DirecTV sells those carriage rights to say Verizon they are making the choice of giving up their exclusive rights at that point as they must be fair with all providers like HBO etc must do today. Now DirecTV could sell carriage rights for just the base Sunday Ticket but still hold exclusive rights for SuperFan which means they can remain the only provider who can offer HD games etc. Only time will tell but for now its not nearly as easy and simple as made out that is for sure.

[Kendo]

What Lornhorn said is absolutely true! BUT I’ve heard something churning in the rumor mill over the past few months that Verizon might be looking to acquire DTV. Now if that actually happened (and the FCC approves it) Verizon would gain access to Sunday Ticket with out having to sell the rights of carriage to another provider. Just don’t hold your breath for that to happen.

Note: The apparent reason for the purchase is so Verizon can offer its TV & Internet services to more remote locations saving them billions on having to lay fiber in rural areas. Still with the FCC rejecting the merger of DTV and Dish some time ago, I’d be surprised if they would approve this. Further I would seriously doubt DTV would give up its exclusive NFL deal for any amount of money (even in 2010). It gives them quite an edge with Football fans over the competition.

[LonghornXP]

I'm sure the FCC won't allow Verizon to buy DirecTV unless Sunday Ticket and all Verizon/DirecTV owned programming is made available to all MSOs. This would create far too much power to allow.

Also because of some of my ties with the government I can say that things are changing quite a bit with regards to program availability and access. By the time 2010 comes around it wouldn't surprise me in the slightest if Comcast SportsNet Philly and Sunday Ticket are available to all MSOs. I'm also hearing some rumbling that Congress soon will start working on closing the antitrust exemptions with both the NFL and MLB. Once that is done the NFL cannot work an exclusive deal without breaking federal laws mainly federal antitrust laws. This also will apply to MLB as well.

I understand I cannot prove anything I said above but just keep that in mind and remember it was I who said this in 2007 when it ends up happening in 2010 okay.

I will say that with the rules in place today unchanged "and" if and this is a big "if" the FCC will still allow closed NFL Sunday Ticket access for Verizon than yes Verizon could offer Sunday Ticket to its DirecTV satellite customers and their new Verizon FIOS customers. But again it all comes down to the question of will the FCC require Sunday Ticket to be offered as part of the terms for buying DirecTV. My guess is no the FCC won't allow the exclusive if Verizon wants to buy DirecTV. Again unless the FCC approves the sale of DirecTV to Verizon the sale itself will never happen.

[Bschneider]

Welcome back to Florida LonghornXP..

And yes what LonghornXP stated is true but that still doesn't stop Verizon from trying to get access to the Ticket through that partnership regardless of the hurddles they have to go through..

[LonghornXP]

Welcome back to Florida LonghornXP..

And yes what LonghornXP stated is true but that still doesn't stop Verizon from trying to get access to the Ticket through that partnership regardless of the hurddles they have to go through..

First if the NFL contract with DirecTV says that DirecTV "cannot" resell the rights for Sunday Ticket carriage with another provider than Verizon will "never" see this package no matter what partnership they create. This is a cold hard fact. Again that is assuming that the contract forbids the right of DirecTV to resell the package and my contacts at the NFL say that the contract doesn't allow DirecTV to resell the package.

Now lets assume my contacts are wrong because they can and have been wrong in the past. So if I'm wrong than yes DirecTV can resell the rights as part of a Verizon partnership "but" once they offer Sunday Ticket to "one" Verizon customer DirecTV must allow other companies to obtain carriage rights with DirecTV at that point. The risk of such a partnership is that DirecTV is selling the rights for Sunday Ticket and "not" the NFL and as such DirecTV doesn't have an antitrust exemption like the NFL does.

Again I'm just making it clear that having a partnership doesn't make any difference in what can and cannot be done. So if the NFL forbids reselling of ST rights this means that only DirecTV can offer the package. Just because DirecTV creates a partnership with Verizon doesn't change the fact that DirecTV doesn't own Verizon and as such if Verizon offered this package as a partnership it requires DirecTV signing a carriage contract with Verizon which cannot be done if the NFL contract with DirecTV says it cannot.

Also if DirecTV "can" resell ST rights than DirecTV becomes a programming provider with no antitrust exemption. Also creating a partnership with Verizon doesn't allow DirecTV to keep exclusive control of ST between DirecTV and Verizon as it again requires that DirecTV create a carriage contract with Verizon as part of their partnership. And again once a contract is created between DirecTV and Verizon for ST at this point DirecTV is now a programming provider who must follow all the rules and laws for carriage of channels "without" an antitrust exemption. This means that DirecTV "cannot" withhold programming nor price it unfairly with another company. So say Comcast wanted the same exact deal that Verizon got from DirecTV because if DirecTV doesn't try to work a contract Comcast can sue and win the carriage rights for Sunday Ticket.

Yes it may take Comcast until next NFL season to win but they will win and get carriage as its "only" a matter of time. I hope now most of you see the huge risk involved with DirecTV if they made such a move. It would for the most part end their exclusive rights for Sunday Ticket.

The only way DirecTV "and" Verizon could offer Sunday Ticket while still maintaining exclusive rights would be if DirecTV bought Verizon "or" if Verizon bought DirecTV "or" if in 2010 the NFL didn't create another exclusive contract. Those are the "only" three ways to end an exclusive contract without government intervention. If Congress passed a low banning exclusive contracts and closed the antitrust exemptions this would also the other remaining way.

[Kendo]

Longhorn, you seem very knowledgeable on the in and outs of carriage so let me change the subject and ask another question –

Why don’t our providers (DTV, Verizon, BHN) offer out of market sports channels? For example if the sports packages would include stations like YES (& YES HD), Sportsnet NY, MSG, Sportnet Philadelphia (SN Philly HD)…etc. they would probably garner more subscribers (including myself).

You’d figure down here in the Tampa Bay area with so many x-New Yorkers and Yankee fans, carrying YES would be a hit either ala carte or part of a sports package.

[LonghornXP]

Longhorn, you seem very knowledgeable on the in and outs of carriage so let me change the subject and ask another question –

Why don’t our providers (DTV, Verizon, BHN) offer out of market sports channels? For example if the sports packages would include stations like YES (& YES HD), Sportsnet NY, MSG, Sportnet Philadelphia (SN Philly HD)…etc. they would probably garner more subscribers (including myself).

You’d figure down here in the Tampa Bay area with so many x-New Yorkers and Yankee fans, carrying YES would be a hit either ala carte or part of a sports package.

Honestly for companies outside of those regions its a waste of time and money to get contracts for those channels when they still must blackout all of the games. So its just the talk shows people would watch and if a customer is that much of a die hard fan they would now be a DirecTV customer as DirecTV would carry those RSNs for the talk shows on a national level as part of the Sports Pak. Its the sports leagues that require those blackouts so its not a choice to the cable/satellite companies. The blackouts are based on the customers zip code. So MLB could say that only these zip codes can view Yankees games and all other zip codes must be blacked out. So the satellite/cable companies can just authorize those games for just those zip codes and all other zip codes no matter where they are (ie state, city etc) are ignored.

[Maestro]

Longhorn,

I have a different take on the issue. Tell me what you think. The # of viewers on satellite compared to cable/broadcast must be tiny. I think part of the reason the NFL gets such huge money for the broadcast rights to the NFL (not sunday ticket) is because they know they have a "captive" audience. What I mean is that the particular market has to watch what the network broadcasts. So even a stinker game is going to get big ratings which translates to big advertising bucks.

Now, if the NFL lets just a small % of viewers (directv) watch any game they want, this really has no impact on revenue. However, if the NFL lets all cable/fios providers in on this, then this will severly impact the advertising. We are talking about millions of viewers able to switch. I don't think the networks would be thrilled with that option.

Make sense?

[bdraw]

That seems like a reasonable explanation. I'm pretty sure I've heard it before, but I can't remember where.

[LonghornXP]

Longhorn,

I have a different take on the issue. Tell me what you think. The # of viewers on satellite compared to cable/broadcast must be tiny. I think part of the reason the NFL gets such huge money for the broadcast rights to the NFL (not sunday ticket) is because they know they have a "captive" audience. What I mean is that the particular market has to watch what the network broadcasts. So even a stinker game is going to get big ratings which translates to big advertising bucks.

Now, if the NFL lets just a small % of viewers (directv) watch any game they want, this really has no impact on revenue. However, if the NFL lets all cable/fios providers in on this, then this will severly impact the advertising. We are talking about millions of viewers able to switch. I don't think the networks would be thrilled with that option.

Make sense?

What you said is exactly why the NFL is happy with just DirecTV. If the NFL allowed full open access they believe it would greatly devalue their network contracts again for the reasons you said above. Now if the NFL wasn't still living in the 90s they would understand that with hundreds of channels plus thousands of titles available On Demand why do they think people would watch a crap game. Also many of the customers that would order Sunday Ticket on cable most likely have DVR boxes "without" much recording space and as such I believe that most of those customers would rather watch their recorded shows over a three plus hour crap football game for no other reason but they need to free up the room for all the Monday shows.

Also the other reason is that people with Sunday Ticket access most likely will switch to another game during other games commercials (this applies to local network football games) thus reducing eyeballs for those ads. Now when I had Sunday Ticket for the first half of the season I would switch to four or more games until I got a game "not" showing an ad lol.

Also the last question is one that is hard to answer. This question is how many customers "would" order Sunday Ticket if cable had it and while I believe that enough would order it to justify the contracts I don't believe enough people have that kind of dough to spend on it who wouldn't have it today. I do see this as allowing many fans the ability to get Sunday Ticket who want it but cannot get DirecTV. I consider these customers as not being lost advertising revenue as if they could get DirecTV they as in the local networks would never have had them in the first place. The networks should consider themselves lucky to get them for any amount of years.

If I had to guess I believe that 80% of non satellite customers that would order Sunday Ticket would be customers that for whatever reason cannot get DirecTV reception or they have a specific reason for never getting DirecTV. For example maybe some customers don't want to pay hundreds of bucks for HD DVR boxes just to get Sunday Ticket at 300+ bucks a season. The value versus benefit isn't there. Maybe some customers don't want to pay that kinda money when the NFL now shows eight more games on NFL Network.

Maybe some customers have standard cable included in their rent/HOA fees and as such the cost of switching is far greater if they are on a budget. Maybe they would rather keep that 45 bucks a month and use it for presents for their kids. I just think these are tons of reasons why Sunday Ticket would be a benefit for cable customers. In my case I have standard cable included in my rent and I still "tried" to get DirecTV service but I just had no chance to get a signal on my porch. I'm just one of those 80% of Sunday Ticket cable customers "if" ST was available on cable. I wouldn't be lost advertising revenue if I had ST on cable because I consider myself as being gained revenue for the networks. Also that assumes I watch the crappy games on local TV because last I checked I never have watched a crappy game.

Sorry for going long on this post its just I get tired of companies just not having a clue about what customers want and what they do. Sorry a CEO who can buy a huge house and order anything he/she wants and do anything he/she wants just cannot understand the choices that average joes/janes make. They just have a very large disconnect with the people which is why at some point they feel the country has shifted and they act shocked. Now the country never changed they just didn't bother looking at the changes in front of them.