COMCAST STILL CHARGING FOR SPORTS: THERE’S NOTHING TO WATCH!

By Peter Gleason

You may have noticed that there is precious little sports to watch on TV lately because of the pandemic that has cancelled all games worldwide with the exception of some darts leagues and Belarus soccer.

But your cable bill still includes a charge for a sports package.

Comcast and other cable and satellite TV companies are still providing subscribers with sports channels, of course, even though all you get are re-runs of games like the Eagles victory over the Pats in the 2018 Super Bowl.

But you can watch that on YouTube!

Nobody knows when major sports might be played widely again. Games would certainly be embraced by fans, but the sports ecosystem has taken a back seat to deeper concerns of public health and the global economy.

But already sports leagues, television networks and television distributors are firing the opening salvos in what will be an exhausting war to determine who should pay for hundreds of millions — perhaps billions — in economic damages.

“You always lawyer for the thing that will never happen,” Erin McPherson, the head of consumer content and partnerships at Verizon, told the New York Times. “And the thing that you think will never happen, happened.”

“They won’t throw money at their customers when their costs of goods hasn’t changed,” Craig Moffett, a co-founder of the media research firm MoffettNathanson, said of TV distributors.

Television is the biggest source of revenue for American sports. When people pay their monthly television bills, their money goes to television distributors, like Comcast, which in turn pay television networks, like ESPN, which in turn pay sports leagues, like the NBA. Along the way, everybody keeps a cut.

But even if customers do not watch a single game, the majority of what they spend on bundled television packages goes to sports networks. This is because of the structure of the bundles, where customers pay one monthly price for dozens or hundreds of channels.

“Sports are the glue that holds the bundle together,” Moffett said. “Without live sports, the value proposition to most households just isn’t terribly compelling anymore.”

Television viewership, especially of news programming, is up lately, no doubt the consequence of nearly 300 million Americans under orders to stay at home. But with jobless claims reaching a record high, how many more people will look to cut the cord or, at the very least, push back on being charged for sports without getting live games?

McPherson, the Verizon executive, said the company had been recently reviewing its contractual relationships with networks and leagues in an attempt to reduce what the roughly four million Fios TV subscribers are paying.

“We don’t want to charge our customers for content they aren’t watching and receiving,” she said. “Whether that is going to be in the form of a refund or discontinued billing, we are looking at all of those options right now.”

In at least being willing to discuss whether subscribers are currently getting what they pay for, McPherson is alone. AT&T, Comcast, Charter Communications and Dish Network — the four largest pay TV providers in the United States — all declined to make an executive available for an interview or answer questions about what subscribers should expect.

Television distributors have historically felt they held little leverage in negotiations with sports networks. What networks pay sports leagues goes up each year. Sports networks raise prices as a result and pass large price increases on to distributors, who pass them on to subscribers.

One way distributors have pushed back — and tried to deflect subscriber wrath — is by listing the costs for sports as a separate line item in bills, often terming it a “regional sports fee.” It is purposefully made to look like the actual fees and taxes imposed by state or federal regulators, but it is not the same.

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