Cuban Story, Sports on TV

[MavsFanFinley]

I just saw this over on the yahoo entertainment page, thought I'd post it here.

Cuban Sees Future of Sports on TV
Sat Jul 20, 9:09 PM ET
By ALAN ROBINSON, AP Sports Writer

Mark Cuban, the Dallas Mavericks owner and technology billionaire, doesn't peer into a crystal ball, consult a schematic or flip through a voluminous business plan when he's asked to envision the future of sports on television.

He needs only to flick on one of the many TV sets in his mansion or his arena luxury box.

There, on a screen large enough to make even smallish point guard John Stockton look as big as the Mavs' 7-foot-6 Shawn Bradley, is a high-definition picture so lifelike, so full of detail and so realistic, it is almost as if television is reinventing itself. Which, more or less, is exactly what Cuban is trying to do.

He is best known as the most outspoken, most outrageous_ and most-fined — owner in pro sports but, in the TV industry, he is no longer seen as a curiosity pushing a technology doomed to always being a rich man's toy. He may be only one of 120 team owners in the NBA, NHL, NFL or major league baseball but, when it comes to sports on high-definition television, he is essentially the only full-time game in town.

Cuban is the chairman and co-founder of the only high-definition network, HDNet, devoted largely to sports programming, showing 80 major league baseball games, 65 NHL games, the Winter Olympics ( news - web sites) and a smorgasbord of other sports ranging from Arena Football, gymnastics, auto racing and lacrosse to the Mavericks' cheerleader tryouts.

Despite being on the air less than a year, and having a viewership currently pegged at a minuscule 150,000 via DirecTV, Cuban already has amassed far more major live sports programming than ESPN did in its first 10 years of operation.

"And they didn't do so badly," Cuban said.

Now, with high-definition TV about to explode as early as next year as the 10 largest U.S. cable companies start offering as many as five high-definition channels in the nation's top 100 markets, Cuban is starting to feel like Triple Crown winner Secretariat in the 1973 Belmont Stakes — so far out in front, he can't see who's in second place.

Right now, about the only other player in the high-definition sports game is CBS, which shows the Masters, the Final Four ( news - web sites) and a weekly SEC college football game in high-definition.

"I've already been through this multiple times before with PCs, local area networks, the Internet," said Cuban, who made his first million selling computer networks and his first billion by streaming audio on the Internet on Broadcast.com. "HDTV is the easiest sell of them all. ... The more people taste it, the more they want it."

Nate Morgan, the assistant manager of the Sony outlet store in Grove City, Pa., agrees. His store shows HDNet continuously on 65- and 61-inch sets, and the reaction by consumers, especially to sports, is "jaw dropping," he said.

"It really gets their attention," Morgan said. "They can't believe the difference in the picture. It really stops them in their tracks."

Until now, what prevented most American consumers from discarding their faithful, easily affordable analog sets — the same technology their fathers and grandfathers watched — and buying high-definition sets with a picture quality is up to four times superior were the three Cs: content, cost and confusion.

Namely, the sets were too expensive, with too little programming and way too much intimidating technology to learn. And, oh, the confusing terminology; high-definition TV is digital; but the digital satellite services Dish Network, DirecTV and digital cable aren't necessarily high-definition.

For example, viewers wanting to watch the Pirates-Astros game Monday night on HDNet, followed by the HDTV version of "The Tonight Show with Jay Leno ( news - Y! TV)" on NBC and a late movie on HBO needed an HDTV-ready set, an HDTV-capable DirecTV receiver and a straight-out-of-the-'50s TV antenna for picking up their local NBC affiliate's digital signal — if there was one. Then, they had to seamlessly integrate all the above, a far more challenging task than screwing a cable wire onto the back of a set.

Also slowing the shift to HDTV is the glacial-pace conversion of the nation's TV stations to digital, which was initially projected to be completed by 2006. Currently, 453 digital stations are on the air — less than one-third of all U.S. stations. And not all of them broadcast in high-definition; most Fox stations, for example, transmit in a format called SDTV that provides a clearer, sharper image than regular analog TV, but one that can't compare to high-definition.

However, Michael Goodman, a senior analyst with the Yankee Group consulting service in Boston, sees the resistance to HDTV ending in the next few years as sets become affordable and cable companies begin carrying HDTV signals.

Prices for 57-inch projection sets have dropped from $5,000 in early 2000 to less than $2,000, with many sets with smaller pictures priced in the $1,000 to $1,500 range. And, in a price breakthrough once seen as years away, Samsung is poised to introduce a 27-inch high-definition set for $799 in the next few weeks.

"Prices are clearly coming down; if prices keep dropping 50 percent every two years, you'll see $400 high-definition sets by 2004," Goodman said.

Cuban hopes to keep his status as the HDTV front-runner by converting HDNet into separate sports, movie and entertainment channels within a year. Besides sports, HDNet shows concerts ( Peter Frampton and Ringo Starr were recent offerings), travel shows, documentaries featuring former CNN newsman Peter Arnett, and old TV fare such as "Hogan's Heroes" and "Mission: Impossible."

However, the more popular HDTV becomes, the more competition Cuban will face.

Comcast plans to show up to 100 Orioles, Capitals and Bullets games in high definition next year in the Baltimore area, and occasional Yankees and Mets games already are shown in New York in HDTV. NBA commissioner David Stern recently revealed the league is working on a high-definition channel. And many in the TV industry are waiting to see which network is the first to regularly show the NFL in HDTV; ABC carried "Monday Night Football" in high-def in 1999 but did not the last two seasons.

With Cuban's network already up and running, Goodman estimates HDNet's chances of succeeding at 70 percent to 80 percent — a lot higher percentage than many analysts would have given ESPN 20 years ago.

"He's got good programming there, and that's important because cable operators need content to seed the market," Goodman said. "The key here is with cable operators promising only up to five (HDTV) channels in the early stages, there's a land grab going on. There's not an infinite amount of channel capacity."

HBO, Showtime and the Discovery Channel are on the air with high-definition channels, and some cable operators may opt to carry only their local network affiliates' digital stations.

"But he's ahead — and if he's ahead, he will gain carriage, and that's very important. ... I don't see if happening for 10-15 years, but there will reach a point when people won't want to watch analog, it will be a stepchild, and consumers will demand a full high-definition lineup," Goodman said.

Cuban thinks it may occur faster than that. "HD customers are high-end paying customers that buy more digital services and pay their bills. Both DBS (satellite) and cable will compete for those customers, and five HD networks won't be nearly enough," he said.

That's why Cuban is glad to be working out the kinks in his broadcasts now, in front of an audience too small for Nielsen to measure.

"It keeps the competition out because there aren't enough households, and it allows me to make my mistakes when just a few people are watching," Cuban said. "Networks that jump in when there are tens of millions of viewers will have to go through a learning curve. They will have to spend more on technology and the integration of technology ... and that's a great thing for me."