DirecTV CEO: L.A. Dodgers Channel ‘Worth Less to Us Than It Was A Year Ago’

DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck a 20-year deal valued at $7 billion with the team to create SportsNet LA, which has virtually no distribution in Southern California beyond TW Cable’s own systems as other MVPDs balked at the asking price for the channel.

White sounded like a CEO with nothing to lose on the call as he asserted his confidence that the satcaster’s $48 billion merger with AT&T will be approved by the second quarter. When asked for his opinion about the programming cost issues, White pointed to the deal that Time Warner Cable made with the Dodgers’ franchise with the expectation that it would reap high carriage fees from other MVPDs.

“It was a reckless deal at many multiples above what anybody else would have bid, and then they tried to force consumers to pay for it,” White said. And DirecTV hasn’t been hurt much in terms of customer defections by not having a deal for the Dodgers.

“My view is we made a very fair offer and it was rejected out of hand. We haven’t lost any customers. The channel’s probably worth less to us than it was a year ago,” White said. Beyond the Dodgers’ channel, there’s a tendency among in the TV biz, White said, “to abuse customers by overpaying for stuff and then try to jam them. There’s a lot of that in this industry. It behooves all of us to be more responsible when striking these deals with sports teams, to recognize that there is a limit beyond where customers will go.”

Meanwhile, White was very enthusiastic about the results of Saturday’s Floyd Mayweather-Manny Pacquiao pay-per-view bout, which “blew the doors off in terms of sales.” He said DirecTV logged more than 1 million sales — a record for the satcaster. There were some technical hitches but not significant enough to prevent customers from accessing the fight.

As for the first quarter, DirecTV added 279,000 new subscribers in the first three months of the year, but profit for the first quarter dropped on higher programming costs, lower margins in Brazil and expenses related to its pending merger with AT&T.

Revenue climbed 4% to $8.14 billion thanks to gains in the U.S. while adjusted net income declined to $730 million, from $842 million in the year-ago quarter. DirecTV said it had its lowest monthly churn rate in the U.S. in six years, at 1.37% with a total of 60,000 net new customers added.

White, who has headed DirecTV since January 2010, and other DirecTV execs said goodbyes and thank-yous to Wall Streeters on the call, noting that it would likely be the company’s last earnings report as a separate company. White’s role in the merged company is not entirely clear yet, but his comments on the big-picture industry issues spoke volumes.

More Biz

  • Paul Haggis Lawsuit

    Paul Haggis Hit With Lawsuit for Alleged Rape, Claims a $9 Million Shakedown

    DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck […]

  • Sirius Logo

    SiriusXM Hit With Big Rate Hike by Copyright Royalty Board

    DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck […]

  • Warner Music Group Logo

    Warner Music Taking Disciplinary Action Against Exec VP Jeff Fenster for Sexual Harassment

    DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck […]

  • Leonardo Da Vinci Salvator Mundi Auction

    How a Restored da Vinci Became the Most Expensive Artwork Ever

    DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck […]

  • Barry Diller Hollywood

    Barry Diller Eyes $30 Million Gondola to Hollywood Sign (EXCLUSIVE)

    DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck […]

  • Terry Crews WME

    Terry Crews Signs With UTA After WME Battle

    DirecTV CEO Mike White was frank in his assessment of the issues facing MVPDs during the satcaster’s earnings conference call with analysts. He cited Time Warner Cable’s Los Angeles Dodgers’ channel as a prime example of programming costs run amok and distributors counting on subscriber fee hikes to cover the mess. Time Warner Cable struck […]

More From Our Brands

Access exclusive content