DirecTV Group Asking FCC to Prevent Shutout in Sports Deals

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Time Warner Cable and Comcast Corp. could be getting a taste of their own medicine from DirecTV Group Inc.


The El Segundo-based satellite broadcaster, which is controlled by News Corp., petitioned the Federal Communications Commission to impose conditions on the sale of bankrupt Adelphia Communications Corp. to its rivals, Comcast Corp. and Time Warner Cable.


DirecTV wants to restrict Comcast and Time Warner from forming regional sports broadcasting partnerships that shut out satellite providers, a move that even if not completely successful could persuade FCC officials to impose other conditions or give DirecTV special consideration in the future.


“They win either way,” said Jimmy Schaeffler, chairman and senior research analyst for The Carmel Group, a cable consultancy based in Northern California. “Like so many dealings in the regulatory world, if they lose this one, they gain a mark the next time.”


John Mansell, senior analyst for the consultancy Kagan Research LLC, rated DirecTV chances of getting conditions imposed on the Adelphia deal at 50-50.


There is also irony in the move. At the urging of the cable industry, when News Corp. acquired a controlling interest in DirecTV in 2003, the FCC prevented it from forming exclusive broadcast agreements with sports leagues and teams that barred cable systems from carrying the games.


“(DirecTV) could argue that turnabout is fair play,” Mansell said.


DirecTV spokesman Bob Marsocci said the company’s petition with the FCC isn’t about sending a message or trying to win concessions from regulators in the future. “At the end of the day, we truly believe that there needs to be competition with these regional sports networks,” he said.



Out of Style?


Has Styles Media Group LLC bitten off more than it can chew? The small Florida-based broadcaster turned heads in L.A. radio circles last August by announcing that it was paying $120 million for a Spanish-language station in Los Angeles and its simulcast partner in the Inland Empire and then converting both to a mix of hip-hip aimed at listeners in their 20s and 30s.


In its first foray into a major market, Styles Media Group revived the KDAY call letters for its new property harking back to the 1980s when KDAY was the first around-the-clock rap station in the United States.


Although Styles Media has been operating KDAY, it still has not closed the purchase from the station’s owner, Spanish Broadcasting System Inc. The deal suffered another setback when Styles acknowledged that a group of investors had backed out of a plan to help finance the deal.


Styles Media and Spanish Broadcasting now say that the purchase won’t close until Jan. 31, 2006, nearly a year after the planned transaction date if at all.


Russ Oasis, a Miami-based radio entrepreneur, said he and other investors backed out of the partnership with Styles because the company insisted on continuing to operate KDAY. Oasis said he had no plans to change the station’s format but wanted operational control. “We don’t finance anything that I don’t run,” Oasis said.


Styles executives continued to express optimism that they would be able to close the deal. “The devil is in the details,” said Styles Media CEO Don McCoy.


Spanish Broadcasting System declined to speculate on the fate of the station as Styles struggles to come up with the cash. If the deal falls through, Spanish Broadcasting could take back day-to-day control of KDAY and operate it in any format.



Beat Goes On


The Battle of Flint Peak has ended not with a bang, but with the Spanish-tinged rhythms of reggaeton playing on.


Flint Peak became the site of a skirmish this summer between Emmis Communications Corp., which owns a broadcasting tower on the Glendale-area mountain, and one of the antenna’s tenants, Spanish Broadcasting System Inc.


Indianapolis-based Emmis broadcasts KPWR-FM (105.9), L.A.’s leading hip-hop station, while Spanish Broadcasting System was broadcasting KXOL-FM (96.3), a Spanish contemporary music station.


The relationship soured in late May when Spanish Broadcasting System tweaked KXOL’s format to include English-language rap and hip-hop music and reggaeton, a youth-oriented form of Caribbean dance music. With the change, KXOL now vied for a portion of KPWR’s youthful and largely Latino audience.


Emmis sued Spanish Broadcasting System, accusing it of making the change in violation of a non-compete clause in the lease. Spanish Broadcasting fired back with a letter to the Federal Communications Commission charging Emmis with attempting to stifle competition.


Both sides recently withdrew their complaints, and now without fanfare, KXOL has begun transmitting from a site owned by Viacom Inc.’s Infinity Broadcasting division in the Verdugo Hills.


David Haymore, the Spanish Broadcasting System executive in charge of the L.A. market, said he’s relieved to have the dispute settled amicably. Emmis declined to comment beyond acknowledging that both sides had settled the conflict.



Taking a Spin


After months of drifting without a permanent leader, the L.A. office of the public relations giant Burson-Marsteller now has a new boss.


He’s Fred Muir, who spent a long career in journalism at the Los Angeles Times and the L.A. bureau of the Wall Street Journal before joining the L.A. office of Fleishman-Hillard, which became embroiled in scandal over inflated bills to the city’s Department of Water and Power.


In a bit of in-house spin-doctoring, the official Burson-Marsteller bio on Muir notes that he worked for a “major international communications consulting firm” without mentioning that the firm was Fleishman-Hillard.


At Burson-Marsteller, Muir replaces Alan Arkatov, who left the firm in January for the L.A. office of the PR firm Rogers & Associates. After leaving Fleishman-Hillard in 2003, Muir ran his own small agency.


Muir said he has big plans for the L.A. office of Burson-Marsteller, which some insiders say has languished amid a lack of local leadership and an East Coast-centric corporate philosophy.



*Staff reporter James Nash can be reached by phone at (323) 549-5225, ext. 230, or by e-mail at

jnash@labusinessjournal

.com.

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