Will 'Linsanity' Cure the Insanity of the Time Warner-MSG Spat?

Jeremy Lin
Could Jeremy Lin force a deal between Time Warner Cable and MSG?

Is Linsanity the cure to the month-and-a-half-long bickering that has left 2.8 million New York Knicks fans without access to see Knicks phenom Jeremy Lin play?

Lin, a Harvard graduate cut by two NBA teams before latching on with the Knicks, captivated the national audience that tuned into his show last Friday on ESPN. Linsanity was on full display. Lin, Knicks point guard making waves over the last five games, scored 38 points, outdueling Los Angeles Lakers star Kobe Bryant and sparking buzz in New York and around the country.

That game was on ESPN. Good luck seeing any of Lin's other performances.

Since Jan. 1, the dispute between Time Warner Cable and Madison Square Garden Co. over the carriage of MSG Network has left those subscribers unable to see regional broadcasts of the Knicks, along with the NHL's New York Rangers, New Jersey Devils and Buffalo Sabres.

I'm not saying that Jeremy Lin is going to solve the dispute between Time Warner and Madison Square Garden, said Michael Neuman, the managing partner at Scout Sports and Entertainment, a division of Horizon Media. But if there is a spark of hope that these two organizations will come to their senses or at least table this until the end of the season, this is that opportunity.

The dispute wasn't as much of a problem when the disgruntled fans were locked out of watching a sub-par team. Then came Lin, the first Asian-American player in the NBA, and the resulting Linsanity.

In the three days leading up to last Friday's Knicks win over the Lakers, ticket prices jumped 23 percent on the secondary market. MSG Network's ratings have leaped 70 percent since Lin's arrival. The Knicks organization rushed to pump out Jeremy Lin merchandise for sale.

Since Lin entered the starting lineup, MSG shares have jumped from $29.49 on Feb. 5 to $32.03 at the Tuesday's close. 

Out of nowhere, you have one of the best sports stories of the year, Neuman said. You have Jeremy Lin.

With 20-plus points, six-plus assists and 50 percent-plus shooting in each of the last four games, Lin has put himself among elite company in a list of names that includes Michael Jordan, Larry Bird, Magic Johnson and LeBron James.

It's clear that Time Warner subscribers are missing something special, something Lin looks to continue Tuesday night when the Knicks travel to Toronto to face the Raptors. The longer the dispute ensues, the more potential for consequences for both MSG Network and Time Warner.

For the James Dolan family-owned MSG, which also owns Time Warner rival Cablevision Systems Corp., those consequences could come in both tangible and intangible forms. Tangibly, a heavy loss of advertising revenue. Intangibly, an increasingly frustrated fan base that may run out of patience.

MSG said its ratings are up 71 percent this season -- 70 percent since Lin entered the starting lineup on Feb. 6. But that number is misleading, Neuman said, because it eliminates the subscriber base that can't see the games because of the dispute. To advertisers, those 2.8 million missing subscribers could overshadow the positive ratings boost, Neuman said.

And Time Warner will face the possibility of a chunk of its passionate subscriber base looking elsewhere to watch their favorite team -- thousands -- and not coming back. They could seek the services from companies like RCN Corp., Dish Network Corp., DirecTV or Verizon Communication Inc.'s FiOS service.  

And negotiations don't look promising. Time Warner spokeswoman Maureen Huff didn't address whether the company feels any pressure to resolve the dispute with Lin's quick ascent to national prominence, but she did provide a company statement that pins blame on MSG.

Huff said MSG is demanding a 53 percent price increase for carriage, dramatically up from a 6.5 percent increase before December negotiations. Time Warner said it requested an extension in December but was denied, preventing our customers from viewing games on MSG.

But MSG Media President Michael Bair told investors last week that the dispute could last until April, when the Knicks could be in the final stages of fighting for a playoff spot. That's to say nothing of the Rangers, who are currently in first place in the NHL's Eastern Conference.

All we've asked of Time Warner Cable is to recognize the fair market value of the services that we provide, Bair told investors last week.

Three of the Knicks next seven games will be accessible to the affected Time Warner subscribers, including premier games against the Dallas Mavericks and Miami Heat. But in the big picture, the longer Linsanity lasts, the greater the incentive for both sides to work out a deal.

It'll be interesting to see who comes to the table and does the right things for the fans,Neuman said. If neither party comes forward and does the right things for the fans, it's a travesty that neither organization cares much about the fans to do that. It would be a really bad situation.

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