(Ed Note: This article appears courtesy The Outside Corner where our own Joe Lucia serves as Managing Editor.)
News Corp, the behemoth company that owns Fox and formerly owned the Los Angeles Dodgers, has purchased 49% of the YES Network, which exclusively airs New York Yankee games in the New York area media market.
This is flying under the radar, but it's a pretty big deal. With News Corp now as the majority owner in YES, purchasing shares from Yankees Global Enterprises, Goldman Sachs, and other investors, Fox has firmly planted their flag in the New York market in advance of negotiating for control of the lucrative rights for the Dodgers television package.
Baseball fans need to be at least a little worried about the Rupert Murdoch owned corporation getting its paws on YES. With Rutgers University joining the Big Ten, News Corp now has a valuable asset in forcing New York area cable carriers to pick up the Big Ten Network: the YES Network. Don't be surprised if News Corp holds the YES Network hostage until BTN is picked up locally on New York-area carriers. The point of "New York City doesn't care about Rutgers athletics" has been beaten to death, but New York City *does* care about the Yankees. Time Warner and the NFL Network couldn't come to an agreement for years when it came to carriage in New York, and the same may happen with BTN. The only difference is that while the NFL really had no bargaining chip with Time Warner, Fox and the BTN do in the form of YES Network.
Considering that the Yankees are exclusively signed to YES until 2021, and are expected to stay on for another 20 years after that rights agreement expires, there really is no recourse for a cable company in New York that doesn't want to provide BTN on its basic cable package. This could get ugly going into the summer 2014 join date for Rutgers joining the Big Ten. That my friends, is why News Corp's purchase of such a large stake in YES is such a big deal. They know that the carriers in the tri-state area will have to bow to their demands regarding BTN, or they can just take their ball and go home in regards to YES.
News Corp's potential master plan is really unparalleled. We've seen carriers get into fights with regional sports networks about carriage rates, but there really hasn't been an all-out war like we could see here. There haven't exactly been many package deals regarding RSNs, but just a lot of whining about money (with the launch of CSN Houston being a prime example). What happens in New York could set a dangerous precedent for the future, and regional networks across the country could begin to get tied together like never before, especially with college football's neverending thirst for conference expansion and conference-specific networks becoming all the rage as well.
