With little fanfare, cable giant Comcast (CMCSA) announced on Dec. 9 that it was launching a sports online streaming service. It may be yet another piece in the company's strategy to create a joint venture with General Electric's (GE) NBC Universal. Basketball fans in Philadelphia can now go to the Web site of Comcast's regional sports network and, for a subscription fee, view Philadelphia 76ers professional basketball games streamed live. While this may not sound like a big deal, it's significant on two fronts. First, pro sports leagues have maintained tight restraints over the digital rights to games. Only recently have they entertained allowing local teams to control online rights and take in subscription fees and local advertising dollars. The Sixers are among the first pro teams to roll out a local service. Second, the Sixers' online package is launching as Comcast aims to merge its 11 regional sports networks with NBC's national sports properties to take on the dominant leader in multimedia sports, ESPN. "Our objective," says Comcast Sports Group President Jon Litner, "is to be the first place local fans go for coverage of their favorite teams—on air, online, and wherever technology takes us." Comcast has a big advantage in Philadelphia in that the company owns both the regional sports network and the Sixers. It didn't have to go through feverish negotiations to stream the games. Fans can pay $76 for a season pass to see all the Sixers games online, or $17.76 for a month of games. The service is restricted to fans in the Philadelphia region, where Comcast SportsNet Philadelphia airs under a so-called gated model. NBA just turned over local rightsThe only other team streaming games locally in the National Basketball Assn. is the Portland Trailblazers, via the team's Web site. For $24, fans can watch online the TV games that appear throughout the season on KGW, the local Portland NBC affiliate. Fans can also pay $4 to view a single game. This is the first year that the NBA has turned over local rights to its teams. Since 2006, the NBA has offered league-wide broadband service of games to fans for $100 a season. In cities where Comcast has regional sports networks with the rights to air NBA games, a spokesman says, the company is actively negotiating for the online rights to offer those games on the sports networks' Web sites, as with the Sixers model in Philadelphia. Like the NBA, the National Hockey League has agreed to turn over digital rights to local teams. The league recently began talks with regional sports networks, including Comcast and rival Fox Sports (NWS), about setting up streaming services. In other sports, the leagues still control most of the digital rights. For the past decade, Major League Baseball has offered a popular online subscription service that allows fans to watch every game except those in their local cities, which have been blocked because of preexisting TV deals. Last year, however, the New York Yankees and its YES sports network began streaming games for a subscription fee in the New York area to eligible customers of Cablevision. Sports made Comcast eye NBC UniversalThe NFL doesn't offer its teams local rights. Customers of the NFL Sunday Ticket on DirecTV can watch those games online, and NFL Mobile streams some games to mobile phones through Sprint. Internationally, fans can buy a service to see NFL games online. "You are seeing all local sports teams pushing really hard on getting back their digital rights," says sports TV consultant Mike Trager. "When they turned over those rights to the leagues, digital wasn't even in its infancy yet. Teams hadn't even thought it through. It's inevitable more rights will get turned over locally." When Comcast first began negotiating with GE earlier this year to create a joint venture with NBC Universal, its executives saw sports as a big opportunity for the combination. By marrying Comcast's local sports properties and other cable sports channels (Golf and Versus) with NBC's national sports properties, the company believed it could become a serious rival to ESPN. The Comcast-NBC Universal deal, announced Dec. 3, is awaiting regulatory approval. By giving fans more of what they want locally, such as having the option to stream games, Comcast is clearly taking a swing at ESPN, which is making its own move into local markets. Since April, ESPN has launched local Web sites in Chicago, Dallas, and Boston. It hopes to add sites in New York and Los Angeles in the coming months. ESPN does not control any local video rights to stream live games on those sites, however. (It does have rights to stream radio.) With Comcast going after streaming rights in cities beyond Philadelphia, says Syracuse University sports management professor Rick Burton, "it builds an inherent tension between ESPN and Comcast, not only for other sports rights deals, but between a cable distributor and a programmer."
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