Jeff Passan has an interesting piece out today about the LA Dodgers and how their mammoth TV deal has created an issue where 70% of household in the Los Angeles area do not have access to the games. Here is his Tweet and link to the story:
- Greed is bad: The Dodgers' $8.3B TV deal means 70% of LA can't watch them. How the team and Time Warner are to blame: http://yhoo.it/1mN8Fl4
Jeff Passan The question really comes down to at what point does the public stop paying ridiculous increases to their cable/satellite providers? Well, I think we may have just gotten the answer. Here is a line from the piece but I recommend reading through it:
"For an estimated $8.3 billion, Time Warner Cable bought the rights to the Dodgers and created SportsNet LA. Time Warner then suggested to cable and satellite providers that they pay at least $4 a month to carry the channel, a fee they would pass along to subscribers. Every one of them kindly told Time Warner to suck a lemon, and so here we are, with the most popular baseball team in the game's second-biggest media market practically blacking itself out on account of its own efforts to fatten its pockets."
The problem now for the Pirates is that we may have just seen the peak of the live sports television market. Who knows, maybe there are a few more good years left, I mean the Braves just signed a nice extension and that was pretty much after those in the business saw the LA disaster unfolding. In a way it feels like the bubble may be bursting though as it usually can take one obviously bad deal like this to make folks realize that the direction they were heading with this business model isn't going to work.
All the money is great but if no one is watching the games you will turn into boxing before you know it. Luckily for baseball this is only happening to this extreme in one market. Unfortunately for the Pirates the market may readjust itself prior to the time when they are up to renegotiate their deal. Timing really can be everything.