By Timothy Dwyer
Washington Post Staff Writer
Tuesday, June 28, 2005
There have been times in this inaugural season of the Washington Nationals when Mel Proctor and Ron Darling, the TV voices of the team, have sat in the booth talking into their microphones and thinking this crazy thought: No one out there was watching.
"Well, it was so strange early in the year when we were doing games that nobody was seeing," Proctor said. "That was one of the weirdest things I've ever done. Like this one night I gave out my cell phone number on the air and I said, 'If anybody's watching anywhere, call this number.' And the only one who called was the tape operator from the truck."
By now, they're used to the complaints. "We always ride the Metro back when we're at home," Darling said, "so invariably the question we get all the time is, 'Where are you guys on TV? What channel are you on? Where are you going to be tomorrow?' And literally, we don't have many answers."
A team enjoying surprising success in a city eager to embrace baseball for the first time in 34 years, the Nationals on many nights can be watched on TV only by the 185,000 subscribers to RCN, a small cable provider, and the 1.3 million customers of DirecTV, a satellite subscription service. Millions of other potential viewers are unable to watch the new team because of a dispute between two formidable and now estranged business partners -- Baltimore Orioles owner Peter Angelos and Comcast Corp., the giant communications company that provides cable service to two-thirds of the households in the Washington-Baltimore region.
"You have a first-place team and no penetration in the market," said Bob Gutkowski, CEO of Marketing Group International and former president of Madison Square Garden Network. It is, he said, "a unique situation." And, he might have added, in more ways than one.
Angelos, who fought for years to keep a team out of Washington, controls the TV rights to the Nationals. Granting the Orioles owner the rights to his competitor's games was the price Major League Baseball Commissioner Bud Selig was willing to pay to compensate the famously litigious Angelos for moving the Montreal Expos to Washington. That and guaranteeing Angelos a minimum sale price of $365 million for the Orioles if Angelos decides to sell the team.
With the broadcast rights to the Nationals in hand, Angelos this spring established the Mid-Atlantic Sports Network in partnership with Major League Baseball, which acquired a 10 percent share of the network in return for paying an additional $75 million to Angelos. The Orioles owner then told Comcast that starting in 2007, when the Orioles' contract with Comcast expires, the network would broadcast the games of both teams.
But Comcast SportsNet, which also wanted to broadcast the Nationals, sued the Orioles and MLB, charging it had been denied its contractual right to match any offer from a third party before the Orioles could move to another network. And, since it controlled the main cable system that would distribute MASN, it announced it would not air the Nationals.
"We have always expressed an interest in carrying Nationals games," said D'Arcy Rudnay, a Comcast spokeswoman. "We are not carrying the MASN network because it was created as a result of a breach of contract with Comcast SportsNet."
Following Comcast's lead, Cox Cable, which has about 260,000 subscribers in Northern Virginia, has also refused to carry Nationals games except for those on WDCA Channel 20, the network that carries some games, or those nationally broadcast by Fox and ESPN.
WDCA plans on airing 77 of the team's 162 games this season, with the next one scheduled for Saturday. But that schedule was front-loaded, according to MASN officials, on the assumption that a cable schedule would be worked out by now. That means the station will only air 36 of the Nationals' final 87 games. In addition, WTTG Channel 5 will broadcast three games, according to Sonya Shaw, program manager for the two stations, which are both owned by Fox.
Even when the Nationals' games are televised to the larger audience on Channel 20, they draw lower ratings than the Orioles in the Washington area. When the two teams have gone head-to-head, the Orioles have done better each time.
"It is a bad deal for the Nationals no matter how you cut it," Gutkowski said. "But he [Angelos] had some leverage and he took advantage of it."
Yet if Angelos has leverage, so does Comcast, which grew from a local suburban Philadelphia cable company to the dominant cable operator in 22 of the top 25 television markets in the country and along the way became a huge player in professional sports. In addition to being the majority owner of a National Basketball Association and a National Hockey League team, Comcast has regional sports networks in Philadelphia, Chicago, Northern California, Baltimore-Washington and, beginning next baseball season, New York.
A few blocks west of City Hall in Philadelphia, work has begun on a $435 million, 57-story skyscraper that will be the tallest in the city and that will serve as headquarters for Comcast Corp. It is a company that is used to getting what it wants with one high-profile exception -- an attempt to swallow up Disney in a $66 billion hostile takeover was fought off by the entertainment and media giant.
"At the end of the day," said David Cohen, executive vice president of Comcast, "the way in which Peter Angelos is being paid off either appropriately or inappropriately, I mean, that is up to Major League Baseball to make a decision whether they need to pay him off legally or under the rules in which they conduct business."
Cohen, a legend in Philadelphia for his role in winning a decisive victory in contract negotiations with the city's municipal unions when he was chief of staff for former mayor Edward G. Rendell, said Comcast did not want to take Angelos to court. "You have to look long and hard to find cases where Comcast is a plaintiff," he said. "I mean, it is not our preferred course of action. Clearly we are a company that likes to resolve things on business-like terms and on a business-like basis and in a largely non-public way . . . so it takes a lot to provoke this company to be a plaintiff in a piece of public litigation."
But once the company filed suit in Montgomery County Circuit Court in May, Cohen said: "The Comcast culture kicks in. I think we have a justifiable reputation as tough, but fair, negotiators and for sticking to our guns if we think we are right and for holding out for the right deal for the right terms. And that is what we are going to do."
Fred Wilpon, chairman and chief executive of the New York Mets, who formed a broadcast partnership with Comcast and Time Warner that takes effect next season, said he is hopeful that MLB -- meaning Selig -- will broker a deal between Comcast and Angelos.
"I think it is in the best interests of everybody that it does get worked out," Wilpon said. "I'm an optimist."
But both the Mets and the Yankees have had their own cable disputes that were resolved only after the intervention of New York Attorney General Eliot Spitzer. The Yankees' dispute was particularly long-lasting and bitter. Cablevision's refusal to carry the Yankees-owned YES Network meant that nearly 3 million subscribers were unable to see Yankee games for the entire 2002 season.
How the Nationals' dispute could be worked out is unclear, though a parallel can be found in Chicago, where Comcast
SportsNet Chicago has the broadcast rights to both the Cubs and the White Sox. The regional sports network was formed last year and televises not only the two baseball teams, but the NHL's Blackhawks and the NBA's Bulls. The network has two channels so that when the two teams are playing at the same time, one game is carried on the "Plus Channel," according to Jack Williams, president of Comcast SportsNet.
Comcast owns a 30 percent equity interest in the network, according to Rudnay, the Comcast spokeswoman. The White Sox, Bulls and Blackhawks, along with the Tribune Co., which owns the Cubs, have a combined 70 percent equity in the network.
Cohen, however, denies that Comcast is after an equity stake of MASN. "We have never asked for and are not interested in an equity position in MASN," he said. Angelos did not respond to two requests to discuss MASN.
For now, the two sides are trying to win the hearts and minds of baseball fans and portray each other as the bad guy. Comcast likes to talk about its ties to the Washington community. MASN accuses it of betraying that same community, even as Comcast continues to broadcast Orioles games.
"Despite Comcast's disingenuous statements about its desire to distribute Nationals games 'to the largest possible fan base,' Comcast is currently preventing millions of viewers in the D.C. metropolitan area from seeing those games on its dominant cable television distribution network," MASN attorneys wrote in a complaint they filed with the Federal Communications Commission after Comcast's law suit. "It is doing so for reasons that flout this Commission's rules."
Over the weekend MASN began an advertising campaign urging baseball fans to call Comcast, Cox and two other system providers -- Adelphia and EchoStar -- to demand that they broadcast Nationals games.
As Angelos and Comcast fight it out, one party with a vital interest in the broadcast revenue of the Nationals has not even been chosen -- the team's future owners. MLB has asked for two bids from the groups competing for the team -- one for the team and one for the team and MLB's stake in MASN -- and is expected to choose a new owner in the next few months.
Members of potential ownership groups are reluctant to comment on the situation for fear of alienating Selig and MLB President Robert DuPuy, who will choose the new owners, but their concerns are obvious: a future in which Angelos decides what games to televise and how the team is marketed, not to mention one in which they forgo the $20 million that by some estimates a regional sports network owned by the Nationals could earn. Besides ticket sales, broadcast revenue is a baseball team's greatest source of income, and unlike ticket sales it is not subject to revenue sharing with other teams.
One source familiar with the bidding process estimates the deal with Angelos has driven down the value of the Nationals by tens of millions of dollars, but most of the eight bids submitted to MLB are believed to be between $300 million and $400 million for a team that MLB bought in 2002 for $120 million.
Staff writers Thomas Heath, Barry Svrluga and John Maynard contributed to this report.