Longform

America's pastime is being subsidized by the American people

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That's why Fox can double its payments to carry the World Series. Though only 10 percent of America will watch, the remaining 90 percent will cover the freight.

Consumers have clearly tired of picking up someone else's check. During a single quarter in 2012, Comcast lost 117,000 subscribers. While such figures are cyclical, cable and satellite have lost customers nine years running.

What's worse for baseball, the largest exodus involves the young, who increasingly turn to cheaper fare like Netflix and Hulu. They're not just turning away from the game; they don't even want access.

But neither television nor baseball seems to notice these darkening skies. Take the country's most obsessive television market, Los Angeles, where a school of piranhas has attacked the city's cable bill.

Not long ago, L.A. hosted just two regional sports channels. Soon there will be seven. The Lakers charge $4 a month. Fox bills $5.40 for its two channels. The Dodgers are expected to add another $5. And Bevilacqua just negotiated a stunning 500 percent increase for the Pac-12's media rights.

"There are no new pro or college games being created," says DirecTV's Dan York. "But what used to be delivered via two regional sports networks now seeks to be re-sliced into [multiple channels and] more costs for consumers. That's not a sustainable model."

Yes, the die-hard Dodger fan will readily fire up his debit card to cover the impending $200 tab. But the team's broadcasts average just 100,000 viewers. That means the remaining 5.6 million L.A. households with cable must be convinced to pay the same to catch such searing drama as Vanderpump Rules and Confessions: Animal Hoarding.

One needn't be an economist to know this won't turn out well.

Baseball's Introduced to Reality

Baseball may be sick, but the prognosis isn't terminal. Average per-game attendance was 31,000 last year, not far below pre-recession days. Better still, polling shows that Latinos, who make up the country's fastest-growing demographic, are also the game's biggest fans.

Posnanski notes that teams have agreed to share Internet revenues, meaning there may come a day when the Pirates and the Royals won't have reserved seats at the kids' table come playoff time.

Yet it's more likely that consumers and the cable industry will force baseball to confront its decaying foundation. And if they're successful, the cost to true fans will rocket.

Companies like Time Warner Cable have begun to use their own market power to fight back, offering cheaper, mostly sports-free deals for those tired of paying for games they don't watch. Time Warner's TV Essentials package comes in at less than $50, says spokeswoman Maureen Huff, and is "designed for people who are just kind of feeling the economy." Most telling: It doesn't include ESPN or other sports channels.

Cablevision is the biggest threat looming off baseball's stern. Earlier this month, the New York provider filed a federal anti-trust suit against Viacom, claiming that in order to carry Comedy Central and VH1, it was forced to buy channels like Logo and Palladia as well. According to the suit, Cablevision could always reject these demands. But Viacom wanted a $1 billion penalty in exchange for any exercise in free will.

If the court rules against Viacom, cable and satellite may be able to offer packages to suit any price or taste. Baseball's welfare payments from non-fans will corrode. And with an audience in decline, remaining subscribers will be forced to spend that much more to compensate. Suddenly, that $200 bill may look like a going-out-of-business sale.

A dying game will be introduced to Economics 101. It won't be a pleasant encounter.

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Pete Kotz
Contact: Pete Kotz