The following interview took place Wednesday, October 3rd, 2007 on
the Michigan Insider morning show on Sportstalk
1050, WTKA. Big Ten Network President Mark Silverman came on first... followed
directly by Director of Communications for Comcast Midewest, Patrick Paterno.
Sam Webb: Big Ten Network President, Mark Silverman. Mark
how are you doing this morning?
Mark Silverman: “I am doing good. How are you doing
this morning?”
Sam Webb: Doing great. So lets dive right into it about
the issues that are currently facing you and your negotiations or your lack
thereof with Comcast. The major, major issue that we hear come up, on various
ads is that the Big Ten Network is insisting upon having the highest per subscriber
rate on basic cable… right behind ESPN at $1.10 per subscriber. Is that
accurate or is this just a rate that is being suggested for the eight state
Big Ten footprint?
Mark Silverman: “You know, it is funny. I have seen
the ads and every time I read the ads, I just think Comcast digs themselves
a bigger and bigger hole. You know, I do not understand instead of negotiating
with us, why they have decided to go in a full scale advertising attack on the
network with lies that they know are inaccurate. They know full well. I think
they have four or five networks that they own themselves that cost more in our
region than the price we are asking for in our region. We have been asking Comcast;
it is well under a dollar now for quite a while. They continue to perpetrate
a higher number that was never even mentioned to them ever. And, they own Comcast
Sports Philadelphia, is more than triple in Philadelphia what we are asking.
Comcast Sports Chicago, you know where we are based, it is more than triple
what we are asking. They know that and they just continue to say these things
because they think that they can get away with them. We are past the point in
trying to delve into these wars with Comcast. You know, we have 30 million subscribers.
We have 140 cable affiliates that have all agreed to carry the network, so we
are focused on productive conversations, creating a great network so fans of
the Big Ten can see more programming than every before and that is where we
are going to keep focusing on and we are not just going to get wired in the
muck with Comcast with a lot of these inaccuracies and they know it is not true.
They are looking out for their bottom line and that is their prerogative as
a company, but you know to say things like they have been saying, it is just
completely inaccurate.”
Sam Webb: We are talking to Big Ten Network President
Mark Silverman here on Sportstalk 1050 WTKA. Mark, I guess one of the major
questions that subscribers would have is that the suggestion that whatever rate
the Big Ten Network is asking for, will somehow be passed along to the subscriber.
Now how exactly does that work, because my understanding is that with the recent
deals with WOW! and RCN, the network was added without an increase in rate,
so how exactly does that work?
Mark Silverman: “Sure. Well you know that cable operators
are given opportunities to generate revenue from a program. We are providing
advertising time in all our of programming to cable operators that they are
then selling to advertising and generating revenue from. We are providing at
the same time of turning our network into an HD network, which is costing a
substantial amount of money to produce. They then can sell an HD package for
extra money. Where they can generate revenue to offset the cost of the network
and that is just the nature of the way it works. You know, you do not pay for
networks. You pay a bill to a cable operator that decides how much they want
to charge you and the fact that we have gotten 140 deals done and none of those
other operators are saying that they are going to have to go charge every single
consumer for the network, which is not what we believe should happen at all
and Comcast keeps saying that, and you know, again they can keep saying it.
I believe that Comcast is arguing as if we were 2 months ago and the network
has not come on the air yet. You know, I think it is time for them to wake up,
it is October. We have some big Michigan games coming up. We have 140 affiliates
that have all signed up. I do not understand why they are not even negotiating
with us. You know the other piece regarding the price increase, here in Chicago
everyone just got a price increase in Comcast. There price just went up 3-4
bucks per month. You know, they are not carrying the network, so what happened?
What caused this price increase? Why is this one different? Your cable bills
go up. They raise your bills all the time and just blaming it on the network
is a complete fallacy in my opinion.”
Sam Webb: Now Mark, it is clear throughout the process
the major sticking point, it sounds like from your standpoint is not having
the Big Ten Network on a digital sports tier. So I guess one of the questions
that our listeners have, is how about the idea of having the Big Ten Network
on a digital sports tier outside the 8 state footprint and having it on extended
basic cable in the 8 state footprint. Would that be a viable option?
Mark Silverman: “Yes. We are open to that. Outside the
8 states, there is very little that we are not open to. I think that you can
see that with our getting a deal done with Wide Open West and getting a deal
done with Dish Network and a deal done with RCN; we are getting deals done.
All we need to get a deal done is another party who has the same interest, and
Wide Open West, they showed an interest. They wanted to work this out and get
a deal done. So we were able to do that and the same thing with RCN and the
satellite companies. But you need 2 parties, and Comcast is not interested.
I do think that a lot of this goes to this new SEC Network that they are looking
to launch in the south and I think we are being held hostage by Comcast until
that SEC Network gets worked out, because they do not want to show that they
were weak and allowed a Big Ten Network on their air so that then the SEC Network
could go and partner with somebody other than Comcast. Because Comcast is the
one down there wining and dining them to try and go do an SEC Network, but of
course they carry on extended basic. So I find the whole thing to be a very
frustrating situation. I do not understand why fans in Michigan cannot watch
Big Ten programming in their expanded basic lineup, when they get 70 channels.
It makes absolutely no sense to me.”
Sam Webb: Now, one of the other questions is, is their
a precedent, because a lot of folks say well do whatever you have to do to get
it on in the Big Ten region this year. So is there is a precedent for a channel,
a startup channel going on a specialized tier and then eventually moving on
to the extended basic cable package after they show some sort of viability?
Mark Silverman: “You know I have heard that. You know
from what I have seen, I have never seen that happen. Just so everyone understands
this issue… Comcast is launching a brand new sports network in Portland.
They are launching it in the next few weeks. It is a Portland Trailblazer Network.
There are 50 Trailblazer games. They are charging cable operators $2.00 a month
for 55 Trailblazer games; it is on expanded basic. Expanded basic is where these
type of networks all live. There are probably 15 different networks across the
country, maybe more, probably 20 that are all on expanded basic, that have a
regionalized sports focus. You know, Comcast likes to say that they are looking
out for the best interest of the consumers, but really what they need to add
to that is ‘when it is a network that we do not own.’ But when it
is a network they own, they are more than comfortable putting it on expanded
basic everywhere and I really believe, as you look at this, this network belongs
on expanded basic. We are producing 400 live events. We have 40 Michigan and
Michigan State basketball games. We are going to end up with 10 Michigan/Michigan
State football games. This is a network that of course should be broadly distributed
and everyone should be able to see it and everyone is paying enough on their
cable bills that it should be something that their cable company puts on their
system and goes and generates revenue with the opportunities that we have given
them and you know we should be well passed this point at this stage.”
Andy Evans: Mark, it is Andy Evans, thanks for coming
on the show this morning. (Mark Silverman, “Hey
Andy”). Besides the price that we have already discussed that Comcast
is putting out there, I guess just go over some things that people might have
misconceptions about you. Because we have heard both sides of the story. I have
talked to both of your representatives and a lot of people go back and forth
and you run into this issue, what are some of the things that maybe you can
dispel that people have missed notions about with the Big Ten Network?
Mark Silverman: “Sure. I think, I guess I really do
not want to, but I guess I should respond to some of their advertising. In terms
of what is a best game, I would believe and Michigan and Michigan State fans
would tell that the best games are the games they are playing, not the game
that a national network would put on the air. You know the fact that we are
having three Michigan games in a row. We are going to have three out of four
weeks, I believe we are going to have Michigan State games on. In terms of what
is the best game, for Comcast headquarters in Philadelphia to tell the Big Ten
what the best game is, I think they are a little off base. The best game in
Indiana is Indiana and Purdue and the best game in Michigan are the Wolverines
and Spartans, and we are going to have those games. We are going to have 41
football games this year. We are going to have 140 basketball games and if you
are a Big Ten fan this is why the network was created to show more Big Ten programming
than ever before. You know last year there were 10 Michigan basketball games
that were not even on the air, anywhere. This year every single Michigan game
is going to be on and if you have Comcast unfortunately, they are preventing
you from seeing it. But if you have a WOW! or RCN or one of the dish companies,
satellite companies, it is available to you. So the fact that Comcast has all
the best games is wrong. The best games are the games you want, and we have
the Big Ten games, which are the games you want. You know the only thing preventing
this from happening is Comcast being stubborn and not seeing what 140 other
cable companies have all agreed to. And that is really unfortunate and we are
trying to do all that we can and you know AT&T U-Verse is out there as a
competitor to Comcast has the network. And every single competitor has the network,
you know we are trying to negotiate but there is only so much we can do when
the other party is not really interested.”
Sam Webb: We are talking to Big Ten Network President
Mark Silverman here on the Michigan Insider on Sportstalk 1050 WTKA. Now Mark,
I want to play devil’s advocate a little bit and put you in the shoes
of Comcast and ask you this. If you make this deal with the Big Ten Network,
is it a dangerous precedent to set when say for instance, you've got Mike Illitch
out there and he has the Tigers and Red Wings, and you have Steinbrenner and
he has the Yankees... lets say that they decide to make a network and now they
want to come see you and say, ‘Hey we you know what, we want our own station,
we want our own channel, and we want to charge a certain subscriber rate. You
did it with the Big Ten Network, why not do it with us?' If they do it with
you, are they setting themselves up to have to follow through on deals like
this with other parties?
Mark Silverman: “You know Sam it is interesting, I do
not disagree with some of that. I think there are interested parties in seeing
how this plays out, absolutely and the FCC in particular has made public notion
that they are watching this to see what happens. But the piece that is missing
is Comcast is the one that is talking to all of them already. So, Comcast is
the second leading regional sports network that there is and Comcast is trying
to do these networks for themselves. So, I would have a lot more empathy if
they were just the cable operator that would be forced to pay all this money.
But the reality is that they are trying to launch these networks and they have
10 of them. You know they have all these sports networks, in addition to Versus
and Golf Channel and these sports networks in Portland and Chicago and Philadelphia;
they are all carried on expanded basic. They are trying to grown their sports
network business, which is their right and it is their right to negotiate along
with Fox and other competitors to try and go launch these networks, but what
strikes me as being a bit acting in an inappropriate way is that if you lose
the business and Comcast tried to be a partner of the Big Ten Network and the
Big Ten conference decided on Fox as a partner and I think a lot of what you
are seeing here is a result of that decision and a lot of that has not exactly
been played out. That is where I believe they are acting beyond what there right
is as a cable operator that is supposed to be providing a service to the consumer
in that area.”
Andy Evans: Mark, I guess to clarify on this. Is Time
Warner also not onboard with Big Ten Network?
Mark Silverman: “That is right. In Ohio, we have five
of the top six cable operator onboard and Time Warner is also not onboard. If
someone wants to sit there and make the link between Time Warner and Comcast,
I would not exactly doubt it either. I think that the big cable companies have
tended to act in a certain manner and things are always more difficult when
you are dealing with them. I think when you look in Ohio and the fact that we
have Buckeye Cable onboard in addition to Wide Open West and Insight cable and
the satellite companies, again I think that you see a company that is willing
to compromise, a company that is willing to negotiate and get deals done. I
know we have sent this out and you guys have probably said it already but no
other network ever has 30 million subs in its first 30 days. The first network
ever to do that and we have done that as a result of being willing to compromise
and try to get deals done and it is really difficult for me to sit here and
say that we have 30 million subs and then realize and be fully aware that a
large part of Michigan and Ohio in particular don’t have the network because
their big cable companies are taking in what is my opinion is a very drastic
anticonsumer stand.”
Sam Webb: Alright Mark, we can go on and on forever with
you, but to wrap it up 2 pressing questions. 1) Is there any plan for streaming?
2) Are you going to reach the revenue sharing goals with the Big Ten schools
that you guys set forth at the beginning of this venture?
Mark Silverman: “Yeah, actually we are going to be streaming
some basketball games this year. And we will look at football in the future.
There will be no football games streamed this fall. We are probably going to
stream 8 to 10 games. I want to experiment with a few different types of ideas
on how we can stream that and make it an interesting experience for the fan
and that will start sometime this fall. I think we are hoping to get a couple
of games on the air in November for streaming. Then for the revenue share; you
know the schools are getting their share for 20 years. You know, the network
is a 20 year deal, and the network will eventually get into all these homes
I believe. We are sharing the revenue. We are paying the conference a fee and
then the conference then distributes it to all the schools equally, so all the
schools are getting their revenue. There is an interest in this network and
I know people in your market only hears what Comcast says and I can tell you
a good part of the rest of the market here has moved on and people are getting
the network and watching the games and they should be able to watch them too.”
Sam Webb: That was Big Ten Network President Mark Silverman
coming on to give us his side of the ledger. Hey Mark, we really appreciate
it and it has been very informative this morning, thanks a lot.
Mark Silverman: “Thanks you guys, take care, have fun.”