Other cable-operator deals in works
The Tennis Channel has delivered its opening serve, landing Time Warner Cable as its first customer in an unusually stretched-out 15-year carriage deal.Other cable-operator deals are in the works, said Dave Meister, chairman-CEO of the Tennis Channel, whose goal is to open for business by the end of the year. These agreements are likely to run for closer to 10 years, the usual term for a deal between a network and a cable operator. Steve Bellamy, prexy and founder of Tennis Channel, said the network will be able to keep its programming costs relatively modest. “We won’t have to pay an arm and a leg” for such out-of-reach, high-visibility tournaments as the French Open, the U.S. Open, Wimbledon and the Australian Open, Bellamy said, because there are so many tennis matches going on constantly that don’t get TV coverage. “Every big tennis star is playing in a match every other week,” he continued, and the net will be able to cover these unostentatious tournaments at low cost, deploying only five cameras, compared to the 30 or so trotted out for a typical golf event. The channel’s entrepreneurs expect to pay far less than $100 million to launch, operate, program and market the network over the next three years, which means that it could begin to show a profit by the fourth year. Like just about all cable nets, Tennis Channel will siphon dollars from two revenue streams, monthly license fees from cable operators and income from advertisers who buy time on the network. Meister is counting on the continued aggressive upgrading of cable systems to make room for more digital nets like Tennis Channel. For example, the network points to the fact that 92% of Time Warner’s 12.8 million customers pay their bills to large systems of 100,000 or more subscribers, just about all of which are providing digital service; digital opens space on the spectrum to add more networks to the mix. Tennis star Pete Sampras, an investor in the network, will appear in instructional videos that will supplement Tennis Channel’s extensive schedule of live matches. Other programming, according to Bellamy, will include a daily half-hour news show, a travel show focusing on areas of the world where tennis tournaments take place and profiles of the players. The sports-marketing firm IMG is an investor in the network, and its board of directors is a who’s who of former Viacom exec: Frank Biondi, Philippe Daumann, Tom Dooley, Terry Elkes, Ken Gorman and Ed Horowitz.