August 20, 2011

Eager receivers for Longhorn Network a long shot for now

The Longhorn Network is supposed to launch this week, but will anybody be able to see it?

The University of Texas proudly boasts the Longhorn Network and is more than happy to reap all the advantages that come with it. There's recruiting, exposure, prestige and, don't forget, $300 million.

There are also a few potential sticks in the Forty Acres less than a week before LHN's launch. What are viewers going to get on LHN, and will they even be able to watch it?

TV networks are chiefly about content, content, content. That's not the only issue in play with the ESPN-backed LHN. There's also distribution, distribution, distribution.

With the network going live Friday, Texas and ESPN have yet to announce a distribution deal with any major cable, satellite or telecommunications carrier. That means subscribers of DirecTV, Dish Network, Charter Cable, Time Warner, Fios, AT&T and others won't get to watch those practices Mack Brown didn't want you (or his competitors) to watch anyway.

"ESPN is in active discussions with all of the distributors, and we expect there to be an announcement in the new few weeks," Texas spokesman Nick Voinis said Thursday.

Voinis also said these kinds of announcements often happen at the last minute, and Texas and ESPN officials aren't worried about a distributor blackout. ESPN's promotions department has a campaign titled "Don't Make Bevo Angry," urging Time Warner customers to ask for LHN. Charter, the largest cable provider in Tarrant County, hasn't made much progress in adding the burnt orange channel to its lineup.

"We've had discussions with ESPN to try to come up with a reasonable agreement to carry the Longhorn Network, and so far we haven't reached one," Charter spokesman Kevin Allen said. "As of now, we don't have a timetable."

The clock is ticking, especially when it appeared that Texas' football opener against Rice on Sept. 3 would be the only game on LHN this season. That changed with Thursday's announcement of a second game, which could be Big 12 foe Kansas State on Nov. 19.

'Radio silence' till hoops?

Having another Texas game may alleviate some of the content concerns and make for a better sell to distributors. According to several television industry insiders, if Texas-Rice remained the only game for this season, some carriers might pass on LHN for an entire year if agreements weren't reached by Sept 3.

"If anything," one industry source said, "it could be radio silence until basketball comes around."

LHN will have eight men's basketball games. The Big Ten Network, by comparison, shows 35 to 40 live football games and 350 events per year.

The desire to televise Texas high school football, a key point for ESPN in its contract with Texas, has been scuttled by the NCAA for at least a year. That was another blow in the quest for exclusive content, but high school football highlights could make it onto LHN. (The NCAA is holding meetings Monday in Indianapolis on the topic.)

"If I look at the programming schedule and I'm a Texas fan, do I have to get the channel? Right now I say no," said sports business writer Darren Rovell, who added that coaches' and studio shows don't sustain networks.

Another point of negotiation between ESPN and potential distributors is the service level at which LHN is carried. ESPN is pushing for LHN on basic service plans, according to industry officials, guaranteeing the highest level of penetration and subscriber fees.

The general reception among distributors is to place LHN within premier sports packages that require an extra monthly charge. A similar stalemate has existed with the NFL Network for years with certain distributors, such as Time Warner. Some carriers were only interested in the NFL Network if it could be put on a higher-priced tier.

Charter, for example, has about 150,000 subscribers throughout Texas. If LHN is carried on basic packages at a monthly rate of about 40 cents, that revenue dwarfs what would probably be available from subscribers willing to pay extra on a premium package.

"It's about interest, niche vs. broad," another industry executive said, "and the price-value relationship at the end of the day. How much value would Longhorn Network subscribers get out of volleyball and track?"

Texas is one of a handful of schools with the national clout and history of success to merit its own channel. The Longhorn Network is not only a groundbreaking 20-year agreement with ESPN, it could alter the future of the Big 12.

Texas A&M's renewed interest in the Southeastern Conference is being portrayed in many circles as a byproduct of LHN and of Texas' influence in the Big 12. The Aggies, Rovell said, might be better off letting things play out before seeking a new conference.

LHN 'hasn't worked yet'

"The jury has already said that the Longhorn Network has worked. It hasn't," Rovell said. "In order to make these jumps, the Longhorn Network has to work. It hasn't worked yet."

The Aggies don't seem too inclined to wait. Texas A&M remains opposed to high school-related content on LHN because of recruiting implications.

Texas A&M president R. Bowen Loftin did not take part in the Big 12 board of directors' call approving a conference game on LHN. With the absence of A&M, the decision was recorded in Big 12 minutes as a unanimous vote.

As for other power schools able to pull off what Texas is attempting, the list isn't as long as one might think. Notre Dame can do it, as evidenced by its longtime marriage with NBC.

But for a number of other "brand" names, such as Michigan, USC and Alabama, conference affiliations largely prohibit going it alone. The Big Ten has had its profitable network in place for four years. The Pac-12 recently announced the formation of seven networks -- one national and six regional -- to begin next year.

The SEC considered its own network, but those plans were tabled because the league receives so much exposure through its ESPN and CBS partnerships. Possible expansion in the SEC could change those plans.

The schools in the Big East, which TCU joins in 2012, aren't barred from starting individual networks. A conference spokesman said it "wouldn't be practical given the limited inventory available" because of the numerous games already televised by existing Big East broadcasters.

There's been talk of the Big 12 members other than Texas aggregating their content into a network similar to the Big Ten. And as Texas athletic director DeLoss Dodds reminded Thursday, the opportunity is there for other schools to create their own networks.

Texas' motivation to go it alone after last summer's flirtation with the Pac-10 is understandable. Being able to monetize the rights to third-tier events (games not picked up by the Big 12's broadcast partners ESPN/ABC and Fox Sports) is a no-brainer.

"Texas had to do this because there's no risk," Rovell said. "They're packaging assets for TV that they never sold before."

Texas is promised $15 million annually for access to its sporting library and other university events. A similar setup at Kansas State is available online for $9.95 per month to Wildcats fans around the world.

The inequity seems jarring, a product of one school flexing its muscle with a willing media giant and another staying in house. The goal for both schools remains the same. At least that's the view of Kansas State's athletic director, who believes the Big 12 system largely is just.

The difference in payout for Texas and K-State is, well, not that big of a deal for John Currie.

"For us it's about four stages: content, distribution, production, and maybe eventually there's some money involved," said Currie, going into his third year leading the Wildcats' athletic department. "We've started from the beginning point, which is content."

Kansas State believes K-StateHD.TV is on the cutting edge of live streaming. The high-definition network will principally be used for athletics (football, basketball, Olympic sports) and other programming.

Profit margin isn't the top priority for K-State. While other schools would love to have the Longhorns' new revenue stream, including Texas A&M, the avenues exist to broadcast those sports traditionally out of the spotlight.

Texas is merely doing it on the grandest scale ever seen in college athletics... if and when anyone gets to see it.

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