Disney Deals With the Devil, Kills Regional Cable Channel

When the Angels return to Edison Field tonight, an advertising panel will be missing in right field. No longer will fans--and television viewers--see a sign promising, “ESPN West: Coming Fall 1998.”

ESPN West isn’t coming, not this fall and probably never. Despite Monday’s announcement that Disney’s Angels and Mighty Ducks would play on the cable network owned by rival Fox and not on Disney’s proposed ESPN West, Fox isn’t the only winner.

Disney wins--the cash registers ring again. Cable viewers win--the Angels and Mighty Ducks soon should appear on every cable system in Orange County. The Clippers, at first glance a disinterested party, lose.

The Clippers’ agreement with Fox runs for three more years. Fox recently discussed a 10-year extension with the Clippers, an attempt to keep them out of the potential grasp of ESPN West. When Disney essentially pulled the plug on ESPN West by signing 10-year deals for Fox to carry the Angels and Ducks, Fox--suddenly the only cable game in town--quickly withdrew its proposal to the Clippers.

“We have a good working relationship with the Clippers,” said Kitty Cohen, general manager of Fox Sports West and Fox Sports West 2. “There’s nothing that leads me to believe we won’t be able to extend and continue that relationship. We’d like to make a fair deal with them if and when the opportunity comes up.”

The Clippers had no comment, club spokesman Joe Safety said.

Two Orange County cable systems do not carry Fox Sports West 2, the channel that includes the Mighty Ducks. Century Cable in Anaheim plans to add the channel no later than the start of the NHL season, said Pennie Contos, regional manager of Century Communications.

Comcast Cable, which serves 103,000 subscribers in the county, is considering the addition of Fox Sports West 2, according to Linda Hossinger, the company’s vice president and general manager for Orange County.

“We have to believe it will be pretty difficult for them not to pick up our network now,” Cohen said. “If the reason they weren’t taking us was because the Angels and Ducks were moving to another channel, that reason is gone. I can’t think of any other reason that would be compelling to their viewers for not taking us.”

With cable space at a premium, no cable systems had agreed to carry ESPN West, ESPN spokesman Chris LaPlaca confirmed.

At a time when Disney wants to maximize exposure to the Angels and to Edison Field, which underwent a renovation that cost the company close to $100 million, scrapping ESPN West made more sense to Disney executives than spending millions to start a network that even Orange County cable systems refused to commit to carry.

“We felt very confident ESPN West would be a top-quality service and would get the distribution we wanted in time,” LaPlaca said. “What this came down to was the desire of the Ducks and the Angels to have immediate access to the largest possible audience. We respect that.”

Said Tim Mead, spokesman for Anaheim Sports, the division of Disney that operates the Angels and Ducks: “The bottom line is exposure to the products.”

Shed no tears for Disney. To ensure that Disney would not merely delay the launch of ESPN West for a few years, Fox demanded the Angels and Ducks commit for a minimum of 10 years. In return, Fox paid a premium amount for rights fees, estimated at $120 million by Daily Variety.

Christopher Dixon, who follows Disney for PaineWebber, pointed out that regional cable networks make the most money by allowing national advertisers to target desired groups of regional audiences. Fox operates 22 regional sports networks, including the two in Southern California. ESPN West would have given Disney one.

“I never thought they had a regional network strategy,” Dixon said.

The decision to abandon ESPN West should not tarnish ESPN, a jewel in the Disney crown.

“ESPN is the most successful television network in the United States,” Dixon said. “ESPN generates more cash flow than ABC, NBC, CBS and Fox combined.”

And, instead of spending millions upon millions in a possibly futile race against Fox in the regional cable race, Disney can accelerate its mission to leverage the valuable ESPN name. Disney launched its first ESPN Store in Glendale last year and started publication of ESPN magazine this year. The first ESPN Zone--a combination restaurant, sports bar, game center--opened in Baltimore last weekend.

“There were people there in sleeping bags on Saturday night so they could be the first ones in Sunday,” LaPlaca said. “If that doesn’t tell you about the relationship sports fans have with our company, nothing will.”