Echostar has filed a petition with the FCC claiming that the Big Ten Network is price gouging.
The issue for Echostar is that its satellite competitor DirecTV is part of News Corp., which owns a 49% stake in the Big Ten Network, a channel that kicks off a full 24/7 service next month. DirecTV has signed a contract to carry Big Ten, which owns the other 51% of the network.
If Echostar can’t reach a deal to carry Big Ten, DirecTV could grab an advantage by going after Echostar subscribers in the eight states where multitudes of people are big fans of the 11 NCAA Division 1 schools in the geographical footprint. The eight states are Illinois, Indiana, Iowa, Michigan, Minnesota, Ohio, Pennsylvania and Wisconsin.
One prohibitive clause in the proposed Big Ten contract is its “demand for nationwide carriage on Echostar’s basic tier,” the petition states. Echostar is upset because just about all of the satcaster’s 12.5 million customers — the majority of whom reside outside the eight Big 10 states and couldn’t care less about the Big Ten teams — would get access to the games.
Echostar would be charged a stiff monthly fee of $1.10 a subscriber for its customers within the eight states and only about a dime a month for the subs outside the footprint. But Echostar says is would have to raise prices on all of its subscribers to slake the thirst of college-sports fans in eight states.
The petition asks that the FCC declare the Big Ten a regional sports network, not a national net. If the FCC agrees, Echostar would file another complaint with the FCC, invoking the agreement News Corp. signed with the government when it took over DirecTV in 2003. In that agreement, the petition states, News Corp. said it would make its regional networks available to competitors “on nondiscriminatory terms and conditions.”
Based on its frustrating negitiations with the Big Ten, Echostar said it thinks it would win the second complaint.