Disney, Espn Likely To Increase Cable Fees

ESPN is paying billions of dollars to air Sunday night NFL games in coming seasons. You’d better believe your share of the bill is coming due.

Industry sources say ESPN (via its parent company, Disney) has proposed a 20 percent per year rate hike in fees cable operators pay ESPN per viewer each month. That fee is currently about 80 cents per subscriber. If it were 96 cents next year and $1.15 the next year, the monthly fee after seven years would be more than $3.

Cable companies probably would pass most of that cost on to subscribers, in essence creating a fee for watching football on Disney stations.

“ESPN is basically turning the screws on the cable operators,” said Andrew Johnson, TCI’s spokesman for its San Francisco Bay Area operations. “This is like pay-per-view.”

ESPN spokesman Chris LaPlaca neither confirmed nor denied that a 20-percent proposal has been issued. But an increase is coming, he acknowledged, making anything that lowers the bill, even the many 30-second commercials ESPN is adding within games themselves, sound like good news.

“The NFL is by far the most valuable product in all of cable. The NFL is about the only sure thing there is out there in the fragmented marketplace,” LaPlaca said.

And because ESPN generates 21 percent of local advertising revenue on cable, LaPlaca said, ESPN’s proposal for “policy changes that would provide savings and revenue opportunities” would be effective, easing the burden on cable operators.

But surely not enough to keep them from passing the lion’s share of the NFL bill to consumers.