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Satellite Networks Want Comcast to Liberate SportsNet

Posted on: Monday, 25 July 2005, 21:00 CDT

Jul. 26--Satellite television networks DishNetwork and DirecTV are trying once again to liberate Comcast's SportsNet channel.

Comcast has long refused to sell rights to its regional sports channel to satellite competitors, much to the consternation of Philadelphia sports fans who don't want to subscribe to Comcast.

There's little reason for Comcast to share: The Philadelphia cable company gets a competitive advantage from its exclusive use of the channel -- which carries most home games of the Phillies, Sixers and Flyers. And federal rules that would otherwise require Comcast to share the channel don't apply to SportsNet because of a technical loophole.

But now the satellite firms have a bit of leverage. The Federal Communications Commission is considering whether to approve the proposed purchase of bankrupt cable operator Adelphia Communications Inc. by Comcast and Time Warner Inc.

The commission asked interested parties to comment on the the deal; in their comments, the satellite firms suggested that as a condition of approval, Comcast should be required to make SportsNet available to them.

Of course, that's not likely to happen, says David Cohen, the Comcast executive vice president who oversees the company's legal and regulatory affairs.

"An observation that is frequently made," he said, "is that when the FCC asks for comments on a major media merger, it provides an opportunity for anyone to come out of the woodwork and air whatever grievances they think are active."

Cohen thinks this issue died long ago. The FCC has several times upheld the so-called terrestrial loophole, which allows Comcast to keep SportsNet to itself.

The loophole works like this: A television channel doesn't have to make its shows available to satellite companies if it does not use satellites to transmit its programs from one place to another -- say from the Wachovia Center to the SportsNet control room.

SportsNet fits the bill and takes full advantage of the exception.

The exception was created, Cohen said, to encourage investment in local programming. It meant that Comcast, after it bought the old Prism local sports and entertainment channel, could invest in and improve the channel knowing that it alone would enjoy the eventual benefit of that investment.

EchoStar, the company that owns DishNetwork, argues that this case is different. Citing the commission's previous refusals to alter the exception, EchoStar said the size of the proposed acquisition "raises substantially greater risks of anti-competitive conduct."

DirecTV, owned by Rupert Murdoch's News Corp., has exclusive programming of its own -- a weekly package of pro football games called the NFL Sunday Ticket.

"When DirecTV is ready to talk about releasing NFL Sunday Ticket" to cable operators, Cohen said, "we'll be happy to talk to them about SportsNet."

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Source: The Philadelphia Inquirer

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