Cabler's $800 mil baseball deal ends dispute
NEW YORK — On the day Major League Baseball was set to haul ESPN to federal court over a contract dispute, the two parties settled their grievance and signed a new six-year deal worth an estimated $800 million.
Under the new contract, ESPN’s license fee will more than triple from $37.2 million a year to an average of $133 million a year, starting in 2000.
“I’ve learned not to let personal disagreements cloud a relationship with ESPN that both sides wanted to perpetuate,” said Bud Selig, commissioner of MLB, in a conference call with reporters.
ESPN is not whining, either: ESPN2 will be able to add a number of MLB games and baseball-news programs to its schedule, increasing its coverage from 30 hours in 1999 to 290 hours a year, including a minimum of 44 games on Wednesday nights and selected Sunday nights and holidays.
Ironically, the amity between ESPN and baseball blew up when ESPN insisted that three Sunday-night MLB games originally slated to run in September on ESPN (reaching 78 million subscribers) be shifted to ESPN 2 (in 67 million homes) to make way for three National Football League games.
These gridcasts were going to be available to ESPN during the first half of the football season for the first time because the cabler had outbid TNT to get them. (Under the previous contract, TNT and ESPN shared the NFL games, with ESPN getting the second half of the season.)
It was MLB’s angry refusal to allow the shift of the Sunday games that resulted in the legal action that Monday’s deal made unnecessary.
The new deal throws out the remaining three years on the current ESPN contract for regular-season MLB games and creates a fresh agreement that ramps up both the license fee (making MLB happy) and the number of games available to ESPN and ESPN2 (making the two webs happy).
In the call with reporters, ESPN prexy George Bodenheimer stressed the broad reach of the deal, which also includes reruns of old games on ESPN Classic through 2005; radio rights to both regular-season and post-season games, including the World Series; the right to produce a daily video highlights package for ESPN.com; and a license to develop and market baseball vidgames.
Other sources say ESPN found itself in a bind because it lost as much as 200 hours a year of high-rated auto racing programming when NBC and Turner won the new NASCAR agreement. ESPN also failed to stop CBS from renewing its long-term deal for the post-season NCAA basketball games.
“ESPN couldn’t afford to walk away from a baseball deal,” said one sports consultant, who requested anonymity. “The last thing ESPN wanted was to go to court with baseball and wind up without a contract because the jury was swayed by baseball’s arguments.”