The same reason why good NBA or MLB players don't sign just 1 year deals, or play game to game. Long-term TV deals are the standard. Especially in this day and age of more outlets to view TV via online/streaming, who knows what the standard will be like in just 5 years (I know all the tv networks are against ala-carte... because they have the most to lose... and yet they're all preparing to be able to offer it via their current online apps). The Astros simply want what other comparable teams in baseball (and their division) have gotten.
Cml's question was my question as well. It is disingenuous of Crane to be crying about being stuck in a 'bad 20 year deal'. Right now he has a bad ZERO YEAR DEAL. His network is in bankruptcy, and his ratings are at ZERO POINT ZERO. He has nowhere to go but up. There is absolutely no downside to signing a shorter-term deal at a lost price, in order to get the games on TV, and then continue building the quality of the roster back up. In5-6 years, the Astros will likely be contending, and that will be the perfect time to negotiate a renewed deal, and oh yeah his team will be one which people actually WANT to see, so there will be higher demand. As it stands now, nobody in this town wants to hear him screaming about not wanting a bad 20-year deal when he has given us a team that is among the worst in the history of baseball.
Can the Rockets setup some alternate broadcast deal with another station while this CSN mess is being worked on since they are not delivering? Or is there something that only CSN can broadcast the games?
Sure, it makes total sense... just like it makes sense for all athletes to have incentive-based contracts, rather than guaranteed ones. Problem is, that's not how contracts are negotiated... and baseball teams don't sign short-term tv deals (especially not with RSN's that they have an ownership stake in). The worst thing for Crane would be for his team's performance on the field to dictate what sort of TV money he gets. He doesn't have the $$$ to commit to the team without a TV deal. As you said, there's no demand for the product right now... and they can't afford to not have a TV deal in place once the team starts improving within the next 2-3 years.
Both the Astros and Rockets are going to have a TV deal no matter what happens with CSN. This isn't an all-or-nothing proposition.
But that's the whole point. They don't have a TV deal AT ALL right now. They haven't even been paid what they are already owed. By the way, something is confusing me here. I thought the money going to the Astros and the Rockets has already been agreed-upon, and they are going to get their money from Comcast regardless of what happens with the carriage deals. That was my understanding from the beginning, and one of the primary reasons nothing has happened yet for carriage - The teams have no financial incentive to push for a deal because they are already locked into their '20 year deal' no matter what happens. The only outfit who benefits is Comcast. Now admittedly, Crane owns 46% of CSN, and I am sure he is interested in the profits of CSN - IF THERE EVER ARE ANY. But how did they enter into an agreement with Comcast to guarantee them their revenue if ultimately the only SOURCE of that revenue is subscribers? Won't they then essentially be paying themselves 75 cents out of every dollar? If that's the case, then every single day without a carriage deal is money out of their pockets. But that doesn't gibe with contention that 'they are already getting paid, so there is no urgency'. Which is it? Or both? It's unclear. To me anyway. But I am old and my brain leaks, so I have an excuse.
Are the Astros really "comparable" to other teams in baseball? Their payroll is lower, their record is the worst by a loooong shot, their attendance is bad, their TV rating even considering the limited carriage is bad. I wonder if there really are a ton of subscribers demanding carriage from their cable/satellite companies right now. Maybe hoops fans after the Rockets get good but not sure how many baseball fans are gung-ho about being able to watch the worst team in the league by a long shot.
I agree with you, it is confusing. I posted in the Astros forum that its like taking money out of the left pocket and putting in in the right, and saying you're getting "paid". The Astros, Rockets, and Comcast are all losing money every day the network is not on the air. The Astros are mad they aren't getting paid their rights fees, even though some of that money has to come from the network actually making a profit. The Astros being part-owner have to be partly "paying themselves"... and if there's no money coming in, there's nothing to be paid. But, they do have agreements with a company much bigger than either of them (and bigger than MLB and the NBA), which should guarantee them some set level of income.
Forget about on-field performance. They play in a top 10 TV market and top 6 radio market, they have traditionally drawn well at MMP, which is a lucrative stadium that provides an excess of revenues that some teams don't have access to. They also have very little competition in terms of surrounding teams that could cut into the baseball interest. The current payroll/performance is part of a radical rebuilding plan that is taking advantage of the current MLB system where its easiest to rebuild by having the most draft pool money, which goes to the team with the #1 overall pick. It has nothing to do with the "market" they play in, or the overall interest in the team. By all accounts, when the Astros are good... they generate more interest than when the Rockets have been good. Now, the Rockets have never been as good as they're expected to be now since MMP was first opened (2000), so things could change... but even the Yao Ming years coincided with the one of the best extended stretches of Astros success, both on the field and in the stands.
The astros are hot garbage and their average attendance is close to 20 thousand fans despite having 82 games. It the astros were good they have a much larger fan base in Houston than the rockets. Basketball is surprisingly unpopular especially among the older white crowd.
They're bad *today*. This is a 20 year TV deal. Look what the Rockets have been though in 20 years. That's like signing a TV deal based off of their 2001-2002. It's not fair when the team obviously has a plan to improve, and they have a history of drawing well and pulling great TV ratings when winning. I hate Jim Crane, but I'm in total agreement with him on this. Astros don't deserve to be low balled for 20 years.
$5 get you in the 400s at mmp. basketball is much more expensive but your $5 outfield seats idea hasnt been true since the astrodome.
1. I agree that the product is worth something despite their current record given the market-- it's not like the carriers offered $0 for carriage. The fact, though, is we don't really know what $ figures are being discussed in the negotiations and how they compared to what other teams and regional networks are getting. So, it's really hard to say who is being unreasonable here. We do, however, know that Comcast and the Rockets seem to think the offer is reasonable while the Astros disagree. 2. I wonder if the Astros are being honest when they say that whatever carriage deal that the other CSN parties would agree to would render them economically the equivalent of Oakland/Pittsburg/Tamba Bay. Given the size of the market alone, it would be hard for the Astros to be as poor as these small-market teams even with a mediocre or below-average carriage deal. If baseball really is popular in Houston, then they shouldn't have trouble making substantially more revenue than these teams. 3. I don't think there's any basis to think that Crane is somehow victimized by relying on whatever representations that Drayton and/or Comcast made while negotiating for the purchase of the team. He is sophisticated enough a businessman to have his team of lawyers and financial guys do his own diligence. He had to know there is a risk that there would be a fight over a carriage deal and that the CSN Houston business, like any other business, can enter bankruptcy proceedings if it becomes insolvent. Yes, Comcast and Drayton gave Crane some info as to what kind of $ figures other RSN deals have brought in for teams in other markets (which Crane can independently verify) but this would not be any kind of warranty that the Astros are 100% certain to make a $X million dollars from the RSN.
Take this FWIW. A 25 year friend of mine is a good friend and neighbor of Matt Hutchings. He says MH is completely sick to death of all of this. He describes it as Matt Schaub times 1000. At first it was Crane being difficult, so the Rockets and CSN were somewhat on the same side. Now, he says that Crane is trying to cash in on what of course should be an exciting season with the Rockets. Apparently CSN keeps flip flopping and Hutchings has just had it. It has literally made him sick, so he's out.
Again, says who? Crane? A reasonable person could think it entirely within the bounds of common sense to go ahead and get a short-term deal done NOW (something is better than nothing) and then negotiate the higher fee deal in 4 years or so, after fans have been able to actually SEE a young and improving baseball team and a title-contending basketball team. They would have the leverage THEN that they simply do not have now. There is no law or rule written in stone that this has to be a '20 year deal'. The only person insisting that is Crane, and who cares what other teams got? Crane has given us hot puke garbage and nobody is lining up to pay for it on the other providers. Signing a short-term deal now at a lower price will garner goodwill and give him greater bargaining power when it is time to get a new deal done.There is absolutely no downside, other than greed on SOMEONE'S part.
So am I to understand that none of this is really going to affect if we can watch Rocket games on Dish this year or not? Because that's really all I care about. I am but a simple Rockets fan who has Dish Network. I am not a bankruptcy attorney.
Chances are that you won't be able to watch Rockets games on Dish any time soon with or without the legal proceedings. The parties were deadlocked before the lawsuit is filed. They still are deadlocked now. The bankruptcy filing is an effort to resolve the deadlock, but the legal proceedings are likely going to take months at least to resolve. If things go in favor of Crane, then we still have a deadlock. Back to square one, Crane still has veto power over any carriage deal and the carrier are not offering a deal that would satisfy Crane. If things go in favor of Comcast (the Rockets are staying out of the dispute for the moment at least, but it seems that economically they agree with Comcast), then Crane could lose his equity stake in CSN Houston and his veto rights. But getting to this point will likely take most of the NBA season.
