Stay Tuned: The Tennis Channel's Delays A Continuing Frustration -
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Stay Tuned: The Tennis Channel's Delays A Continuing Frustration

Stay Tuned: The Tennis Channel's Delays A Continuing Frustration

By Randy Williams

Perfectly timing their announcement to maximize impact, The Tennis Channel brought itself to the attention of American tennis fans at the U.S. Open. The 2001 U.S. Open.

While the company continues to promise a bright future just over the horizon – a promise its web site insists includes Tennis Masters Monte Carlo, scheduled to begin April 14th – the wide constituency energized by the possibility of 24/7 tennis on television is growing restless. The Tennis Channel has issued no press releases since December 2002. They have announced no advertisers, except for charter advertiser Wilson Sporting Goods, who signed up in August 2002. No distribution agreements have been announced since agreements with the National Cable Television Cooperative (NCTC) and TimeWarner last summer.

As recently as three weeks before Tennis Masters Monte Carlo, The Tennis Channel did not have a broadcast schedule for the event, yet Tennis Properties Limited, which negotiates broadcast rights for the Tennis Masters Series on behalf of the ATP, still expected the network to cover the year’s first major men’s clay court event “from the first Monday through to the final Sunday.”

If the launch date gets postponed until May, as seems increasingly likely, it will be the fifth time the rollout has been rolled back. (Tennis Week’s November 27th, 2001 profile of the new network promised a third quarter of 2002 launch.) Time may not be running out, but it is certainly moving on as Steve Bellamy and David Meister, The Tennis Channel’s visionaries, continue to struggle to add TTC alongside the other sport-specific networks, such as Speedvision, Outdoor Life and the Golf Channel, which have already staked their claims on the cable lineup. Several more sport-specific channels are in various stages of development, including Fox’s Extreme Sports channel, Black Belt TV, The Ice Channel and College Sports Television.

“There is no low hanging fruit out there in terms of carriage,” says Larry Gerbrandt, a media analyst for Kagan Associates. “You’ve got to fight with everybody else. One of the things we always tell consulting clients is that this is really a tough time in which to launch a cable network, but it’s going to be harder tomorrow. It doesn’t get easier down the road by waiting. Channel capacity has continually gotten tighter.”

The difficulty The Tennis Channel has been having getting on the air is certainly not for want of passion or experience. For Bellamy, the network’s founder and president, life is tennis. He is a player, coach, facility owner and promoter. CEO David Meister has been integral in cable startups including HBO, FNN/CNBC, The Learning Channel, Cinemax and The Sundance Channel. In addition to the principals, International Management Group (IMG) and a consortium led by former Universal Studios and Viacom CEO Frank Biondi constitute the major investors.

Despite the deep pockets behind this group, the economic turmoil of the last couple years has inhibited the achievement of their goals. “It’s the most bizarre period we’ve ever experienced,” Meister says. “You have people say it’s the worst economy in certain ways since the depression.”

Says Neal Pilson, former president of CBS Sports and now a media consultant, “The real question is can they keep their heads above water until such time they have sufficient penetration to be able to sell their subscribers to their advertisers.”

Delay probably is not caused by economic concerns alone. Ed Keller, a principal of BlueKnife, a New York-based marketing group specializing in cable/digital concerns, suggests that The Tennis Channel might not be adapting quickly enough to a changing television landscape. “I’m surprised that The Tennis Channel – or any new start-up – isn’t taking significant advantage of digital and video-on-demand technology to quickly leverage themselves with operators. They appear to be an ‘analog’ (i.e., traditional broadcasting) company, but need to adapt to the digital opportunities and offer interactive enhancements that address systems operators’ concerns about money or about reducing subscriber churn.”

In just the last couple of years, there have been changes in what viewers can expect from their televisions. The good news is the digital connection, which allows distributors to offer more channels to consumers. It also offers viewers the promise of interactive television (e.g., choosing when to view, programming out commercials or purchasing through their TVs). The bad news for viewers is they are only going to receive more options (e.g., The Tennis Channel) if the distributor is convinced that offering an additional choice will send cash to the bottom line, either in terms of increased loyalty, greater spending or a higher revenue stream attributable to that channel. Any new channel needs distribution to gain that critical mass of viewers necessary for advertisers. It is also likely that only when both advertisers and viewers are assured will [potential] backers be convinced enough by the likelihood of success to loosen their purse strings, even in these troubled times.

TTC executives remain confident. Their internal research suggests “over 77 million tennis enthusiasts in America.” More than a third of the nation’s adult population either watches, plays or reads about tennis and has an affinity for the sport. “That’s a very large market,” says Bruce Rider, TTC’s executive vice president of Programming and Marketing, “and to deliver a targeted network to that audience is exactly what digital television should be doing.” (Boasting of their $250,000 investment in “the largest survey done for any sport in the U.S. in history,” the USTA and TIA just announced 23.5 million tennis players.)

The network sees a particular strength in serving a female audience for sports. “We are the best sports channel you could ever dream of to reach women,” Bellamy says. “Baseball, NASCAR, golf, basketball… Cable operators have a plethora of ways to reach men, but its very difficult to reach women. [Among athlete endorsers], three of the Top 10 out of all sports are women tennis players. Venus (Williams), Serena (Williams), and Anna (Kournikova). So there is no sport that’s more gender equivalent than tennis. That’s a big boost for us.

“Cable operators are facing a paradigm that as America becomes even more of a melting pot, they need to reach the Hispanic, Asian and African-American communities. There’s no bigger melting pot than tennis. Over 60 nations were represented at [the 2002] U.S. Open.”

The Tennis Channel also finds opportunity in tennis’s competing ruling bodies, who leave the sport without a unified broadcast rights system like the NBA or the NFL has, and the nature of the game, which doesn’t lend itself to precise time frames for scheduling. “[Tennis] is underserved by television,” Bellamy says. “There’s very little on outside of the Grand Slams. It is a hard sport to program because there is no definitive timetable.”

Says Rider, “If we’re covering a match and it runs short, has an injury or rain delay, we don’t to have to worry about bumping it for the upcoming auto race or baseball game. We can throw it back to our studios, where we have a lot of creative programming possibilities. Moreover, unlike football or basketball, tennis has virtually a year-round schedule and it’s seven days a week.”

The Tennis Channel can also cover major tennis events for which it does not hold broadcast rights in the same way that ESPN’s Sportscenter, for example, will cover the Super Bowl around the clock even though the actual game airs on another network. Another example: The Masters is the Golf Channel’s biggest week. Dedicated fans go to the Golf Channel to get updates and in-depth stories throughout the week, even though the station doesn’t air the actual event. Though not likely to air any live tournament action of the Grand Slam events, at least initially, The Tennis Channel will follow that proven concept with its own news hub.

Bellamy points to the Golf Channel model as providing credibility for TTC’s eventual acceptance, “They succeeded essentially because golf is a lifestyle sport, as is tennis. There’s no one in the world who would say, ‘Oh, a golf channel makes sense, but a tennis one doesn’t.”

Who will have access to the channel? TTC’s press releases have repeated a claim of having already established distribution to 38 percent of the cable world, but the figure appears to represent the entire universe of potential subscribers, not necessarily the likely number of subscribers.

TimeWarner Cable confirmed it stands ready to live up to the terms of the 15-year deal it signed with The Tennis Channel last June. According to TimeWarner Cable spokesperson Keith Cocozza, they are ready to provide The Tennis Channel across their 34 divisions and 27 states. While there may be a rare individual system that believes The Tennis Channel will work best as part of a digital tier package (i.e., viewers will first need to be paying for service beyond basic cable and then will need to pay extra money for a bundled group of special interest channels), Cocozza expects almost all of TimeWarner’s subscribers to have access to the channel when they trade up from basic cable service to the digital “platform,” presently a subscriber subset of about 3,750,000.

Additional viewers are likely to come from the other distribution agreement, subscribers to the member systems of NCTC, whose senior vice president, Frank Hughes, enthused that TTC’s programming would likely be a “great fit for our members, who have urban, suburban and rural systems in all parts of the country.” While NCTC negotiates one standard contract for its 6,500 cable system operators (representing 14 million or so households), none of the individual systems are actually committed to anything, and none are likely to sign up until TTC finally commits to launch.

On its own, The Tennis Channel posted a “petition” on its web site to give potential viewers a “voice” with which to speak to their cable distributors. The search for additional distribution has been delegated to Comedy Central’s field force for the “heavy lifting” of educating the many individual cable systems. Says Meister, “It saves us a lot of money, allowing us to keep rates low and still maintain the key cable relationships with the leading MSOs ourselves. And since they represent more than 98 percent of all cable subscribers, we will clearly control our own financial destiny.”

Comedy Central will receive a combination of fixed base and incentive fees. The Channel’s entrepreneurs expect to pay far less than the typical entry fee of $100 million to launch, operate, program and market their network over the next three years.

Unfortunately, the response has not yet been what was expected. According to SportsBusiness Journal, Cox Communications, the nation’s fourth-largest cable operator, has almost no interest in adding channels like TTC to its lineup, and while DirecTV, a cable alternative, has discussed possibilities with the prospective channel, they are not convinced in the actual audience potential. In addition to the search for distributors and the fees they will pay per subscriber (estimated at 10 cents to 15 cents per subscriber, although some startups have given their channel away free for a year or more to cable operators in order to gain a foothold), financial success requires advertising. In a strong show of support, Wilson (the only advertiser unveiled thus far) has announced it is ready to do more than simply place and pay for advertising. Wilson has committed to aiding in program development, and, according to Vice President and General Manager John Embree, they will go the extra mile by “using our 32 sales reps to go around to our accounts to create interest and awareness and get The Tennis Channel up on local cable systems and [further] to increase and grow subscribers.”

Wilson’s goal was to demonstrate to the tennis industry how enthusiastic they are about this new programming outlet. “A lot of our marketing story was based on The Tennis Channel having been launched,” Embree says.

Understandably, Wilson is disappointed the channel hasn’t yet launched, but Embree suggests a realistic take on the impact the delays have had to his business. “With weather and war and economic concerns, it is not clear if anything would have helped the tennis business [so far] this year,” he says.

The programming that will [eventually] deliver those viewers to advertisers is expected to be wholly original and divided in a percentage of 40 percent tournament play, 40 percent instruction and 20 percent coverage of tennis news and personalities. According to programming chief Rider, tennis personalities will be a major selling point of the channel. “No Strings” will feature celebrity news, while “Center Court” will be an interview program hosted by Chris Myers. “Gearheads” will feature the latest in equipment and accessories, while “Destination Tennis” will highlight tennis resorts around the world. There will also be coverage of other racquet sports, including squash, paddle tennis, table tennis and badminton, and other shows – with elements of ESPN Classic, the History Channel and Access Hollywood – using a vast library of vintage tennis matches, documentaries and features.

Of course, all the excitement – and the disappointment – centers on tournament coverage. The Tennis Channel secured rights to ATP, WTA and senior circuit tournaments, as well as World TeamTennis matches. The disconnect between promise and present is never clearer than with a visit to the Channel’s web site, which at press time was continuing to promise coverage of seven of this year’s ATP events (five of which have already ended, obviously without TTC coverage) and four WTA tournaments (the Bank of West Classic is highlighted twice), one of which has already passed.

A big splash was achieved with the December announcement of an agreement to provide live coverage of the European Tennis Masters Series events: Monte Carlo (April 14-20), Rome (May 5-11), Hamburg (May 12-18), Madrid (Oct. 13-19) and Paris (Oct. 27-Nov. 2). The press release heralded it as the first time the events would be showcased in their entirety in America. Again, the delay increases the disappointment.

Despite all the desire for its success throughout the industry and among tennis fans, the uneasy feeling about when and if The Tennis Channel will go live is hard to ignore. It is easy to write off the protracted delays as a case of bad timing – as in the tanking of the economy – but one can’t help questioning the choices made by some very smart and experienced people.

Between the increasing number of stations trying to fit into a decreasing amount of cable system bandwidth, the advent of viewer controlled services such as TiVo and the improving broadband capabilities, it should have been more apparent that the television landscape was changing. Additionally, there is the attention to detail, which leaves an outdated web site as the primary communication vehicle to prospective viewers. And in a case that seems to suggest too many chiefs (last October, TTC announced the hiring of four vice presidents with more than 50 years of combined, relevant experience) and not enough indians concentrating on the details, there is the anecdote Bellamy uses to describe the unexpected hurdles: Nobody ever checked to see if the company had the right under zoning laws to put a commercial satellite dish on their building’s roof, a manageable, but presumably avoidable and expensive delay.

In a February interview with web editor Richard Pagliaro, Bellamy stressed that despite the delays, The Tennis Channel “is ahead of schedule in many areas,” and excused the overly optimistic launch projections. “Virtually no channel has ever launched when they first said they were going to launch. It’s very much like building a house. You plan for an eight-month remodel and it takes 29 months. There are so many variables involved and it takes time to build.”
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