The company has promised to broadcast about 125 of its baseball games on the channel from next season as well as selected English soccer giants Manchester United games, with whom it last year signed a joint marketing deal.
The YES network will be 60 percent backed by YankeeNets, the parent company of the World Series champions, the National Basketball Association’s New Jersey Nets and the National Hockey League’s New Jersey Devils. The remaining 40 percent of YES has been sold to consortium, including Goldman Sachs and Quadrangle Group, Amos Hostetter Jr and Le Hindery, for $345m (B385m).
YES should be up and running by March 1 when spring training begins for the Yankees. Coverage on YES of New Jersey Nets matches will start in October 2002 when Nets' contract with Cablevision Systems runs out. Coverage of New Jersey Devils games will not be broadcast until its contract expires with Cablevision six years from now.
The main incentive for the Yankees is to increase their broadcasting revenue, already the highest in baseball.
“Over the next few years, I think it will dramatically increase the revenue stream for the New York Yankees,” said former CBS Sports president Neal Pilson, now a television consultant. “They have some short-term issues which they have to address for next season, but in the long term I think the Yankees should be able to double the revenue stream they’ve been receiving from the MSG [Cablevision’s Madison Square Garden] Network.”
In addition to forming the new network, the Yankees will also halve the amount of games sold to free-to-air television to about 25 games a season.
MSG is currently paying the Yankees a $52m (B58m) rights fee as part of an agreement worked out after the MSG sued to prevent the Yankees from forming their own network for 2001. The club is paying MSG $30m (B33.5m) to settle the lawsuit that stopped it forming the network.
YES must now negotiate to be carried by New York cable operators Cablevision and AOL Time Warner. Hindery, the network’s new chief executive, says talks have so far been quite fraught. “It’s a difficult relationship. I’ve been fairly outspoken for the need for responsible behaviour here.”
Cablevision’s president James Dolan said: “Cablevision has a long tradition of carrying Yankee telecasts and we expect to continue to carry the games. We know that many of our customers want the programming and that the Yankees want to reach our customers. We look forward to hearing specifics from the new network.”
YES plans to carry pregame and postgame shows for the Yankees, Nets and Devils games. The YankeesNets will also show selected games on tape from English soccer champions Manchester United following its recent marketing deal with the club earlier this year.
