Big Ten Scores Warner Deal


A Wall Street analyst predicts that two recent carriage agreements will nudge the Big Ten Network into profitability after only a year on the air--a swift pace for any cable start-up. Earlier this summer, BTN inked a deal with Comcast and this week announced one with Time Warner Cable.

Pali Research's Rich Greenfield wrote Tuesday that the deals will allow the network--which is half-owned by News Corp.--to operate with "a meaningful advertising platform for the first time," earning subscriber gains from the agreements.

Greenfield said the Comcast deal alone will allow BTN to cover its $70 million start-up costs.

TWC and BTN had been engaged in protracted and cantankerous negotiations. TWC had refused to pay the carriage fees BTN sought--and/or place it on an expanded basic service level. As a result, the cabler did not offer it to a massive number of homes in the heart of Big Ten country in Ohio and Wisconsin.



The deal, which puts it on expanded basic in Big Ten states, comes just before Ohio State and Wisconsin open their respective football seasons on BTN.

Greenfield estimates that under the deal, TWC is paying BTN $.75 a month per home in those states, covering 2.2 million homes.

Some cable operators had questioned the value of offering BTN, arguing that it only features lower-level games, not the marquee match-ups available on other networks they carry. BTN countered that fans want to view all their teams' games.

TWC had gone through a football and basketball season without the network, which was launched a year ago. But Greenfield wrote that it appears the "risk" of losing subscribers to satellite and telco TV competitors--which carry BTN--"became too significant for TWC to ignore."

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