* Channels will offer Major League baseball, college
* Fox to use channels to raise cable fees, advertising rates
* Regis Philbin in discussions on afternoon talk show
By Ronald Grover
Feb 8 News Corp will unveil its
long-rumored national sports channel to advertisers in early
March in its drive to siphon viewers and advertisers from sports
behemoth ESPN, according to two people with knowledge of the
The Fox Corp unit will soon send advertisers invitations to
its first sports "upfront" presentation, the TV industry's
annual unveiling of new shows, for a splashy New York City
event, the sources said. It will make sales pitches for both its
22 regional sports channels and its new Fox Sports 1 and Fox
Sports 2 national channels.
Daytime talk show host Regis Philbin is in talks to host a
daily afternoon show with other hosts on Fox Sports 1, according
to one of the sources, and could appear at the event.
Fox will convert its motorsports channel Speed into Fox
Sports 1. It will convert its extreme sports channel Fuel into
Fox Sports 2, the person said, and would also offer subscribers
the ability to get the channels on mobile devices.
The main offerings will include Major League baseball,
college football, NASCAR races, professional soccer, and
ultimate fighting, the person said.
The two new channels are expected to begin broadcasting
games in August and would expand its offerings in 2014, the
News Corp's new offerings will likely lose money in the
early years, according to analysts, which mirrors the company's
money-losing launches over the years of its Fox News and Fox
Business channels. The Fox Business channel, started in 2007, is
expected to become profitable this year, News Corp president
Chase Carey said in an earnings call on Feb. 6.
"The company has shown in the past that it's willing to
consider its new channels as investments for its portfolio, said
James Dix, an analyst with Wedbush Securities in Los Angeles who
rates News Corp. "outperform."
"Their regional channels are a great business, but sports
contracts are forcing channels to charge more and more,
especially for people who don't care about sports," he added.
Fox Sports spokesman Lou D'Ermilio had no comment.
The company has positioned itself over the last few years to
create the national channels by signing deals with sports
leagues that contain provisions that allow it to carry sports on
a national cable channel that it been carrying on its regional
sports channels and its general entertainment channel FX.
In October, it signed a nine-year extension of its agreement
with Major League Baseball that allows it to carry up to 40
games on a national cable channel, according to an MLB press
release. It carried Pacific-12 and other college football games
last year on its FX channel that can be transferred to the new
channel, according to one of the people.
Disney Co's ESPN said it welcomes the competition.
"We like our position and the fact that others recognize
what we've known for a long-time, which is the power of live
sports," said ESPN spokesman Mike Soltys.
Carrying national sports would allow Fox to charge more to
the cable and satellite operators who carry its channels and
expand its carriage to more homes to sell higher priced ads.
The Speed Channel, which is seen in 87 million homes,
currently gets 22 cents a month for each subscriber, according
to media consulting firm SNL Kagan. Fuel TV get 15 cents monthly
for each of its 37 million subscribers.
By contrast, ESPN gets $5.13 cents a month and is seen in
well over 101 million homes, according to the National Cable &
Fox is asking 90 cents to $1 per subscriber for its Fox
Sports 1 channel, according to a person with knowledge of the
discussion, and expects to increase that price in future years.
Some of Fox's contracts with the cable and satellite
channels also have provisions that allow some increases in the
monthly fees they pay to carry its sports channels that would
escalate if they were to add more popular programs, such as
Major League baseball, said one of the people.
"MLB and college football will get them some viewers and sub
fees," said Brad Adgate, senior vice president and research
director of marketing and advertising firm Horizon Media, "but
many other premiere sporting events are lined up into the next