Fox and Disney have settled a pair of lawsuits sparked earlier this year by Fox’s decision to move local cablecasts of the Disney-owned Mighty Ducks games from the widely distributed Fox Sports West cable net to its fledgling spinoff, Fox Sports West 2.
The settlement unveiled Friday spurred more questions about Disney’s plans to launch a regional sports cabler of its own, possibly as an adjunct of its national ESPN cable sports services.
Reps for Fox and Disney declined to comment on the settlement, citing a confidentiality agreement. An ESPN spokeswoman declined comment on speculation regarding plans for creating a local version of ESPN to showcase Disney-owned sports franchises.
Disney’s Anaheim Sports subsidiary took its dispute with Fox Sports to court last February, claiming that Fox was using Disney’s NHL franchise as a carrot to give cable operators an incentive to pick up FSW2. Under the terms of the settlement, Ducks games will stay on FSW2 until the original contract expires at the end of the 1997-98 NHL season.
Disney’s suit claimed limited exposure on FSW2, which bowed in late January, would cost the Ducks sponsorship opportunities and hurt attendance at home games. At the time the suit was filed, Fox Sports West had a regional subscriber base of about 4.3 million, while FSW2 had fewer than 400,000 subs, precious few of them in the Ducks’ home turf of Orange County.
Fox Sports responded two weeks later by filing an federal antitrust lawsuit against the Mouse House, accusing Disney of trying to block its efforts to sell FSW2 to local cable operators by talking up plans for an ESPN-branded regional sports net.
Many local operators, already paying about $1 per sub to carry Fox Sports West, initially balked at Fox’s asking price of 70¢ per subscriber for FSW2. Nevertheless, FSW2 has been picked up by several major Southern California cable systems over the past few months.
The Disney-Fox cablecast dispute was further muddied by the fact that Fox has locked up local cable rights to Disney’s Anaheim Angels ball club through the end of the 1999 baseball season. In a small victory for Disney, Friday’s settlement ensures that Angels games will remain on Fox Sports West for the duration of the contract.
While Disney and ESPN officials have been tight-lipped about their plans for delving into the regional cable sports biz, Disney was in the running earlier this year to buy a 40% stake in Cablevision’s SportsChannel group of regional sports cablers. Disney was ultimately outbid by the Fox/Liberty Sports partnership.
Just as Disney appears to be looking for cable nets to make the most of its professional sports franchises, sources say Fox’s imbroglio with the Mouse House over FSW2 has been a driving factor in Rupert Murdoch’s interest in the Los Angeles Dodgers.
Sources say Fox is nearing the end of the due diligence process on its proposed $350 million purchase of the team from owner Peter O’Malley. One source close to the situation says Fox Sports brass will likely present the deal points for a vote by Major League Baseball owners by the end of September.