Turner Broadcasting's deal to snag a majority of the NCAA's March Madness college basketball tournament is likely to give it leverage to charge more money to the cable and satellite distributors that carry its cable channels. The distributors then turn around and pass the costs on to you know who.
As part of its $10.8-billion pact with CBS to share the rights to the NCAA tounament, Turner will put games on TNT, TBS and TruTV. By doing this, viewers will be able to see all the games. Currently, CBS has the exclusive rights to the tournament, but with only one channel it could not show every game in the event from start to finish. It tried to make up for that by offering the early games online.
That's the good news for sports fans. But the downside is that in a few years Turner will go out and ask the companies that carry its channels to cough up. The channel that Turner is most likely looking to help the most is TruTV, formerly known as Court TV. Turner renamed the channel and is trying to broaden its focus.
According to industry consulting firm SNL Kagan, cable and satellite operators only pay about 10 cents per subscriber per month for TruTV. That pales in comparison to the $1 that TNT gets and the 50 cents that TBS is averaging. Both TNT and TBS have lots of sports on them. Starting to get the idea?
Conspiracy theorists are already speculating that the reason Turner doesn't get the rights to either the Final Four or the NCAA championship until 2016 is because it is around then that many of its distribution deals come up for renewal.
That might also be the time to take out a second mortgage.
-- Joe Flint