lastly what Granville, Refman, and I are saying is that the Astros didn't receive the full $80MM. I am assuming that the reason is that they are holding back carriage fee deals. if they sign the carriage fee deals, they get their full broadcasting rights ($80MM) plus the carriage fees.
No. Not that I've seen. The parties have filed exhibits (other than affidavits) under seal so that they're kept confidential. Even specific references to amounts of money have been redacted from the pleadings themselves.
Yes, that's correct. The Astros theoretically get $80MM in rights fees from CSN-H, and then their share (45%) of the net profits of CSN-H. With high carriage fees, that might total to $100MM, though I still find it hard to make that math work. Without the high fees, it's doubtful they'd make much, if any, profit on CSN-H. With the current 40% coverage, CSN-H is losing money, which is they didn't actually pay the Astros half of that $80MM. But even that may be an exaggeration if the rights fees grow over time, as they do in most cases. In that case, $80MM is an average and today would be much less. From Faos' latest Chronicle post, it may have been closer to $50MM this year, meaning the Astros likely got closer to $25MM. But both the original post referencing Bloomberg and the latest one are just estimates - no one knows the real numbers. The teams are believed to be receiving about $100 million combined in rights fees per year from Comcast; Crane has said the Astros were scheduled this year to get in the mid-$50 million range, while the Rockets have not commented. The Rockets' deal is believed to be among the most lucrative in the NBA. The Astros' fee, by comparison, is closer to the middle of the pack among MLB teams.
So from that article...the Astros were scheduled to get $50 million from the broadcast agreement....they ultimately were paid about half of that after payments were withheld. I'm guessing they're at the very bottom or near it in terms of actual dollars received from local TV revenue in 2013. I'm really rooting for a dismissal of this bankruptcy...CSN-H is an absolute mess that was very poorly constructed to deal with the sensibilities of each respective partner. It's time to blow it up. That would put the Rockets on the air sooner rather than later, I think. They'd rush to get their product on the air quickly through alternative broadcasters.
Yes, that's what I said in the very first sentence of what you quoted. The Astros theoretically get $80MM in rights fees from CSN-H
I hope you're wrong only because CSNH has been the best thing to happen to Houston sports coverage in this town...in terms of their on air product and daily coverage of the teams we like to follow. Yes, yes, it doesn't mean a thing if 60% of the people can't see them or the games. I fully understand that. I'm still holding out the slight sliver of hope that something can be worked out and worked out quickly. I can dream, right?
No, I'd say it was part of the legal requirements for breach of contract to ask for payment and give notice of intent to terminate if payment is not made. The Astros could have hoped or were even told that CSN H wasn't paying but they still have an obligation. Do you have a copy of the contract that treats 40 million as if it were a $1500 a month apartment lease? This is more like the Astros being the apartment complex since they are the property owners and are taking away their property (media rights)for non-payment.
That's what happens when you have had plenty of time to get things in place and take a stubborn course of action. Crane has to hold out because he lined up dozens of investors based on that fairy tale. He should have taken a much more conservative approach here.
No. I am saying that contractually they had to ask as part of the legal process to terminate the contract, whether they wanted it paid or not. I'm sure the judge wouldn't be too fond to hear that they just didn't ask for the money because they want out of the contract. That doesn't make the Astros look any better than what they are claiming Comcast is doing. You said they never asked or demanded the money. I seriously doubt that once this is over that Crane forgets about the 40mil either especially considering the Rockets likely were paid their entire amount for their media rights last season. Crane is the guy who wants fans to write checks to sign players, remember?
to avoid confusion, I will refer to the most current article as faos's post 2.0. in all seriousness, thank you faos for keeping up with the latest news articles. they are valuable. that being said, the $50MM in faos's 2.0 article is crane's claim, iow it disputes the $76MM from the forbes article. secondly, in crane's defense, he has walked a partnership that was already in the works, however, I don't think its clear who negotiated the current fees. the article seems to say the current fees (this year's broadcasting fees) were negotiated by drayton.
The media rights were negotiated by Drayton (on behalf of the Astros). The carriage fees to support 60% the media rights and additional profit garnered as an owner of the station are still not negotiated. Crane is holding on to some number (3.40 per subscriber as some are reporting) that he may have been told was realistic that is being shunned by 60% of the Houston market providers.
While I will admit that the CSN product seems to be much better than FSSW(from what I have been able to see at friend's houses), as a huge Rockets fan and a "I hope they do well but really dont care much fan of the Astros" I have to agree with MadMax. Whatever will get the Rockets on air as quick as possible. The other providers(Direct, Dish, etc) are not ever going to pay what the Astros want...so this will never get resolved with the ownership of CSN being the way it is at this point....you can give it more time if you want...but it wont change anything. Just break it up and lets get on with it. btw...big thanks to Max and Refman for helping make the complicated legal crap more understandable. Appreciate it.
if a trustee is assigned it could the carriage fees could get negotiated but Astros probably would find some way to delay a deal.
I think the difference is from an average vs escalating deal. The $76/$80MM figure often quoted is basically the value of the deal divided by the length (20 years). But in reality, most of these deals escalate over time. So the media rights the Astros get in 2033 would be higher than today, but they would average to $80MM or so per year. That would explain why it would only be $50ish this year.
I agree. This is the best situation for the Astros and Rockets. Honestly I cannot see how a Houston sports fan would not want a similar outcome.
The issue seems to be the Astros not getting enough money out of this deal. What deal is out there that gets Crane the revenue that he was seeking? The providers seem to be locked in at a rate that is below Crane's expectations. He'd have to sell his media rights for big dollars now to an RSN and let the RSN worry living off what they can get in carriage rates. Crane would get higher guaranteed money but no chance at the 45% of the Network's profit.
