Mike
03-02-03, 10:45 PM
Rockets, Astros flex muscles with regional network
http://www.chron.com/cs/CDA/story.hts/sports/barron/1801829
By David Barron in Monday's Houston Chronicle
Rockets president George Postolos is so confident of his plan for a Houston-based regional sports network that would include Rockets and Astros games, he's emulating his employees by laying down the smack.
The Astros filed suit Friday against Fox Sports Net, seeking a judge's order that will require FSN to match within 30 days Postolos' offer for the Rockets and Astros to partner in the proposed Houston Regional Sports Network in 2006.
FSN is part of one of the most powerful media companies in the world, Rupert Murdoch's News Corp., but Postolos isn't fazed. Asked if he was concerned FSN would make the Astros the proverbial offer they couldn't refuse, Postolos said, "The offer that can't be refused has been made, and that is the offer that the (new) network has made to the Astros."
This qualifies as major noise from Postolos, who normally pauses before confirming, for example, that the sun is shining. And it indicates his confidence that the Astros and Rockets, in concert, can make more money televising their games than they can by dealing with Fox.
This development, of course, is loaded with irony. The Rockets and Astros were the prime movers behind Houston's original RSN, Home Sports Entertainment, and Astros owner John McMullen owned the network before selling out in the 1990s.
But both teams have had troublesome dealings with FSN in recent months -- the Rockets over their inability to sign a new rights deal with the network this year, and the Astros over what they consider FSN's unwise delays in coming to a new over-the-air agreement this year with KNWS (Channel 51).
And although Postolos didn't say it, he reflects the suspicion of many Houston sports executives that FSN, which started as a Houston network, has abandoned its birthplace by focusing more of its attention on the Dallas-Fort Worth market.
"I'm not going to speak to what is good for Dallas-Fort Worth," he said. "If there is one place where I can see either a Rockets game or an Astros game or a Comets game or something else that is going on with Houston sports teams, that is a good place on the dial for me as a sports fan or as a cable subscriber.
"The closer you can get to that, the more likely that will be the first place that a viewer checks. That is what we are striving for. That was the fundamental idea behind Home Sports Entertainment 20 years ago."
The network would give the Rockets control of their own promotional and advertising rights, which becomes even more important with their move to the downtown arena. For the Astros, it would provide increased revenue in the one area where team owner Drayton McLane sees potential for growth.
Under the terms of their current contract, the Astros received or will receive $7.2 million from FSN in 1998, $9.19 million a year from 1999 through 2005, $11.9 million in 2006, $12.7 million in 2007, $13.6 million in 2008 and $14.6 million in 2009. This places them in the lower half of baseball in terms of broadcasting revenue; hence McLane's desire for a better deal.
The Astros' contract with FSN allows the team to terminate the deal after the 2005 season if it receives a qualifying offer FSN fails to match. Because the new offer includes part-ownership in a new network, advertising revenues and other assets, these terms "by their very nature simply cannot be met by a person or entity other than the network."
FSN has not commented on the lawsuit, but the network is expected to argue the Astros can opt out of their contract only after receiving a qualifying offer in 2005, not an offer in 2003 that would take effect after the 2005 season.
The Astros, in turn, promise litigation is imminent unless a state district court rules FSN must decide now whether to match the offer.
Both teams split their games between cable and over-the-air carriers. But Postolos said it is feasible the new Houston RSN could carry all of the Rockets and Astros' games. That would make it a much more attractive option for Time Warner Cable and reduce the possibility of a battle like the YES/Cablevision battle in New York City.
http://www.chron.com/cs/CDA/story.hts/sports/barron/1801829
By David Barron in Monday's Houston Chronicle
Rockets president George Postolos is so confident of his plan for a Houston-based regional sports network that would include Rockets and Astros games, he's emulating his employees by laying down the smack.
The Astros filed suit Friday against Fox Sports Net, seeking a judge's order that will require FSN to match within 30 days Postolos' offer for the Rockets and Astros to partner in the proposed Houston Regional Sports Network in 2006.
FSN is part of one of the most powerful media companies in the world, Rupert Murdoch's News Corp., but Postolos isn't fazed. Asked if he was concerned FSN would make the Astros the proverbial offer they couldn't refuse, Postolos said, "The offer that can't be refused has been made, and that is the offer that the (new) network has made to the Astros."
This qualifies as major noise from Postolos, who normally pauses before confirming, for example, that the sun is shining. And it indicates his confidence that the Astros and Rockets, in concert, can make more money televising their games than they can by dealing with Fox.
This development, of course, is loaded with irony. The Rockets and Astros were the prime movers behind Houston's original RSN, Home Sports Entertainment, and Astros owner John McMullen owned the network before selling out in the 1990s.
But both teams have had troublesome dealings with FSN in recent months -- the Rockets over their inability to sign a new rights deal with the network this year, and the Astros over what they consider FSN's unwise delays in coming to a new over-the-air agreement this year with KNWS (Channel 51).
And although Postolos didn't say it, he reflects the suspicion of many Houston sports executives that FSN, which started as a Houston network, has abandoned its birthplace by focusing more of its attention on the Dallas-Fort Worth market.
"I'm not going to speak to what is good for Dallas-Fort Worth," he said. "If there is one place where I can see either a Rockets game or an Astros game or a Comets game or something else that is going on with Houston sports teams, that is a good place on the dial for me as a sports fan or as a cable subscriber.
"The closer you can get to that, the more likely that will be the first place that a viewer checks. That is what we are striving for. That was the fundamental idea behind Home Sports Entertainment 20 years ago."
The network would give the Rockets control of their own promotional and advertising rights, which becomes even more important with their move to the downtown arena. For the Astros, it would provide increased revenue in the one area where team owner Drayton McLane sees potential for growth.
Under the terms of their current contract, the Astros received or will receive $7.2 million from FSN in 1998, $9.19 million a year from 1999 through 2005, $11.9 million in 2006, $12.7 million in 2007, $13.6 million in 2008 and $14.6 million in 2009. This places them in the lower half of baseball in terms of broadcasting revenue; hence McLane's desire for a better deal.
The Astros' contract with FSN allows the team to terminate the deal after the 2005 season if it receives a qualifying offer FSN fails to match. Because the new offer includes part-ownership in a new network, advertising revenues and other assets, these terms "by their very nature simply cannot be met by a person or entity other than the network."
FSN has not commented on the lawsuit, but the network is expected to argue the Astros can opt out of their contract only after receiving a qualifying offer in 2005, not an offer in 2003 that would take effect after the 2005 season.
The Astros, in turn, promise litigation is imminent unless a state district court rules FSN must decide now whether to match the offer.
Both teams split their games between cable and over-the-air carriers. But Postolos said it is feasible the new Houston RSN could carry all of the Rockets and Astros' games. That would make it a much more attractive option for Time Warner Cable and reduce the possibility of a battle like the YES/Cablevision battle in New York City.