Fox, Mouse Spar in Sports
Rupert Murdoch’s News Corp. completed its bid to create a sports cable network to rival ESPN last week, buying a minority stake in eight regional sports channels and two pro sports franchises.
Long Island cable system operator Cablevision Systems Corp. agreed to sell a 40 percent interest in its sports channels in New York, New England, Chicago, Florida, Philadelphia, San Francisco and Ohio to a partnership between News Corp. and Liberty Media Corp. the programming arm of cable giant Tele-Communications Inc.
Under the $850 million deal, News Corp. and TCI also will get a 40 percent stake in New York’s Madison Square Garden, as well as the New York Knicks basketball team and the Rangers hockey team.
The regional sports channels will join nine other sports channels already owned by the News Corp./Liberty partnership, giving the group a combined reach of 55 million homes.
Walt Disney Co.-owned ESPN, the world’s dominant cable sports network, reaches 70 million homes.
Murdoch’s efforts to compete with Disney in the sports world have been the subject of intense behind-the-scenes maneuvering, in addition to numerous lawsuits. Disney reportedly bid $800 million for the Cablevision properties in an effort to block Murdoch’s ambitions.
Meanwhile, last week Disney’s Anaheim Angels baseball team filed suit against Murdoch’s local sports network, Fox Sports West, claiming the network is underpaying for the rights to air Angels games. The suit alleges that Fox is paying more for the rights to the Los Angeles Dodgers a team Murdoch is in negotiations to buy than it is for the Angels.
It is the fourth lawsuit between the Fox cable operation and Disney. Fox has accused the Angels of breaching a contract with the network, Disney’s Mighty Ducks hockey team sued Fox for switching the team’s games to a secondary channel, and Fox filed an antitrust suit against Disney, claiming Disney was trying to lock a new cable channel out of local markets.
Made in L.A.
Contradicting notions that Los Angeles no longer houses much of a manufacturing industry, the Economic Development Corp. of L.A. County released a report last week showing that local factories are enjoying employment growth and that L.A. is the second biggest manufacturing center in the nation.
After eight years of job shrinkage, Los Angeles County posted an increase in manufacturing employment last year, when there were 646,000 such jobs a gain of 1.2 percent over 1995. This year, the EDC projects an additional 2 percent gain, raising the total to 659,100 jobs.
Meanwhile, the Anderson Center for Economic Research at Chapman University, in a separate study released last week, projected job growth for all industries in L.A. County of 2.2 percent this year.
Most of the new manufacturing jobs are being created in the apparel, textiles and high-tech sectors. The defense industry is also enjoying a comeback, according to the EDC report.
L.A. County has more manufacturing jobs than any other region in the country except the three-county Chicago metropolitan area, the study stated.
Subway Makes Headway
The Metropolitan Transportation Authority’s troubled subway projects appeared to get back on track last week after Congress and the L.A. City Council separately freed up $276 million in funds for the lines at least tentatively.
In a unanimous vote, the City Council approved a settlement giving the MTA $200 million in city funds that had been frozen in return for an agreement from the MTA that it will start construction on the San Fernando Valley rail line by 2007, rather than the MTA’s suggested date of 2011.
Under a “recovery” plan prepared at the order of the federal government, the MTA had pushed back the start date for the Valley line to 2011. But city officials deemed that to be an unacceptable delay.
Under the agreement hammered out last week, the city can withdraw $50 million of its $200 million in payments if the MTA doesn’t begin construction of the Valley line by 2007.
Meanwhile, the House transportation appropriations subcommittee recommended the payment of $76 million in federal funds next year for subway extensions to East Los Angeles and North Hollywood. The recommendation still must be approved by the Federal Transit Administration, which is reviewing the MTA’s recovery plan.
The MTA had requested $100 million in federal funds for the extensions.
L.A. Housing Isn’t Cheap
Los Angeles is the third least affordable housing market in the nation, according to a study released last week by E & Y; Kenneth Leventhal Real Estate Group.
Rising home prices propelled L.A. from the fourth least affordable market in last year’s study to third this year. Homeowners in the L.A. region spend an average of 36.8 percent of their annual incomes on their homes, according to the report.
Expensive as that is, L.A. still ranks below New York where residents pay 38.3 percent of their annual incomes on housing and San Francisco, where 39.7 percent of yearly salaries are devoted to one’s residence. San Francisco displaced New York as the most expensive city to live this year.
Job growth in higher-than-average income positions, such as computer or animation specialists, is fueling increased housing demand in L.A., according to the study.
The three most affordable housing markets in the nation are Oklahoma City, Tulsa, Okla. and Richmond, Va., the study said.
