Altitude TV Update: Don't Get Used to Seeing the Nuggets on Free TV

The battle between Altitude TV and distributors Comcast, DISH and DIRECTV that's resulted in the platforms disallowing access to the network home of the Denver Nuggets and Colorado Avalanche since late August continues to rage. But at 7 p.m. tonight, October 25, Nuggets fans will be able to watch the promising squad's home opener for the 2019-2020 NBA season against the Phoenix Suns on KTVD/Channel 20.

The contest is believed to be the first Nuggets game to be broadcast locally on an over-the-air network in 32 years, and Darrin Duber-Smith, a marketing professor and senior lecturer at Metropolitan State University of Denver, applauds the move. Earlier this month, Duber-Smith said that, in his view, the regional sports-TV model is broken, making networks such as Altitude TV increasingly untenable. He suggested that the Nuggets and Avs might be able to triple their viewership by contracting with outlets such as Channel 20 rather than continuing to work with providers of cable and satellite services desperate to slash costs as more and more customers cut the cord and sign up for streaming services.

Matt Hutchings, the president of Altitude Sports, as well as the chief operating officer and executive vice president for Kroenke Sports & Entertainment, which runs Altitude TV for KSE namesake Stan Kroenke, doesn't buy that for a minute. He portrays tonight's Channel 20 broadcast as a gift to Nuggets followers that's unlikely to be repeated; he hopes to announce something similar related to the Avalanche soon. He still sees the concept behind Altitude TV as extremely viable in the current media landscape even as he contends that he's uncertain why Comcast, DISH and DIRECTV are putting the screws to the network and, by association, anyone with a television who loves the Nuggets and the Avs.

"I can't answer for them," Hutchings says of the distributors, "but we sit around and wonder why they're doing what they're doing. Every other regional sports network operates this way. We asked for a very fair and very equitable extension by terms and conditions, and we've come back multiple times trying to get a deal done. But they just won't accept it."

He adds that "continuing to put games on over-the-air networks isn't economically viable. So we're hoping to find creative ways to continue serving our fans until we can hopefully get deals done with the big three carriers."

Comcast, DISH and DIRECTV don't seem ready to budge. Indicative of their stances is this take from Suzanne Trantow, Rocky Mountain region lead public relations manager for AT&T, which owns DIRECTV. In response to an inquiry from Westword, she wrote via email, "Unfortunately, Altitude forced AT&T to remove its channel from our customers’ lineups.
... AT&T made a fair offer to keep the channel available, but Altitude rejected it."

Hutchings's version of events is very different, and while he steers clear of the term "collusion," his chronology portrays the relationships with Comcast, DISH and DIRECTV as traveling on parallel tracks.

"We've had a fifteen-year partnership with our cable and satellite-carrier partners," he says. "We've been good partners and they've been good partners. It's been a great run. And we've tried to work out long-term agreements with them. We initially did a ten-year deal, and then we did a five-year extension. We were looking to do more, but all of them stuck with five years. We went back at various times since then to try to do short-term extensions with all three at one point or another, but unfortunately, we weren't able to get any deals on that."

This failure wasn't because of unrealistic demands, he stresses. "We didn't ask for incredible rate increases, contrary to some of the things that have been put into the market. We know what broadcast-industry standards are in our business, and it was a very fair ask. And they came back to us with very similar responses that were 50 to 70 percent reductions in what we had been paying, and which we know just weren't economically viable to sustain a business." Moreover, he points out, "Comcast and AT&T both own and operate their own regional sports networks, and they're not requiring their own networks to operate on the same terms they came back to us with."

The Colorado Rockies, whose games are on AT&T SportsNet's Rocky Mountain arm, "just got their rights renewal, and we're very happy for them," Hutchings maintains. "But what we've been offered is very different. We keep saying, 'You're not asking your own networks to do this. Why are you picking on the fans of the Denver Nuggets and the Colorado Avalanche? We're a small independent.'"

Not everyone will agree with this description. Granted, many regional sports networks are based in areas with far larger population bases than the one served by Altitude TV. But the network traditionally covers a ten-state region that encompasses all or parts of Colorado, Idaho, Kansas, Montana, Nebraska, New Mexico, Nevada, South Dakota, Wyoming and Utah. Kroenke, meanwhile, is currently listed at number 49 on Forbes magazine's list of the 400 richest Americans, with a net worth estimated at $9.7 billion as of October 24.

Of course, Kroenke didn't reach this fiscally elevated status by throwing good money after bad. That's one reason why Hutchings rejects many of Duber-Smith's ideas about where Altitude TV should go from here. For instance, he emphasizes that "I don't think the regional-sports model is broken, and I don't think most people in the industry think it's broken. Some of the biggest media companies in the world own and operate them, and I've been part of multiple launches of sports networks, the majority of which were regional, for the past 36 years." Companies such as Comcast, DISH and DIRECTV "have built and developed their businesses in large part due to regional sports networks," and nets in this category benefit consumers in a wide variety of ways, he contends: "Remember that when we started, not all games were broadcast — but today, every game is broadcast in some form or fashion on linear TV."

He acknowledges that in today's post-streaming landscape, "things are changing, and the way viewers consume programming is changing. We're in a world of convergence. But we know that sports has always been and always will be an important product to consumers and fans on TV, in particular. I've said for a long time that sports is really the original reality program. It's a new script every night. It's the thrills and the passion and the ups and the downs that people love and what they want to watch. Twenty or thirty years ago, [former Viacom chairman] Sumner Redstone made the statement that 'content is king,' and what's the best content? Your teams. And we've got two teams in particular, the Nuggets and the Avs, that are two of the most highly anticipated teams in the country in their respective leagues. So, with all due respect to Mr. Duber-Smith, regional sports networks are changing and evolving, but they're still an important component of any channel lineup."

He's similarly unenthusiastic about Duber-Smith's notion that broadcasting might function as a loss leader because it boosts the teams' bottom lines in other areas. "When I read that, I just shook my head, because it makes no sense. Sports is an expensive proposition. We have to look at not only the cost of the players and of the operations, but of creating the broadcast and a lot more. We have nearly 5,000 employees that support events and games and concerts and everything else that goes on at the Pepsi Center, Dick's Sport Goods Park and the Paramount Theatre in Denver alone. Our ownership has invested mightily into the market and into these facilities to make them great entertainment experiences, and that costs money."

In the meantime, Altitude TV offers what he sees as "a broader-based distribution to all of the fans. The Pepsi Center contains a finite amount of people every night. So we're able to expand our fan base to a larger territory. And the other issue is that most over-the-air networks have affiliate deals that could not allow them to give up two- to three-hour blocks during their prime-time programming every time there's a game. We have a great relationship with all the broadcast networks here, but we've had a long-term relationship with Channel 9 over the years, and when we reached out to them about the home opener, we were able to arrange a deal. But that isn't something that would work for every game."

As for the contention that most viewers of Altitude TV only watch the live games and ignore the shows that fill up the rest of the schedule, Hutchings argues that "there's an audience base for all the programming that goes on the network. When we do a high school game of the week, or a girls volleyball tournament, you're obviously going to have a niche interest. But our shoulder programming is also created to give fans inside access to their favorite players and teams — not just the Nuggets and the Avalanche, but also the Colorado Rapids and the Colorado Mammoth. We use all local talent who know and live with these guys. So you can debate the value of shoulder programming in terms of viewership, but we know that people like it, and it ebbs and flows with the success of the teams."

If that's the case, Altitude TV should have been well-positioned for a banner year. Right now, the Avs have one of the best records in the NHL, and the Nuggets kicked off their latest campaign with an impressive road victory on Wednesday, October 23, over the Portland Trail Blazers, the franchise that knocked them out of the playoffs in May.

Instead, the network is essentially paralyzed, and plenty of observers suspect the situation could last the entire season — a prospect Hutchings hates even considering.

"We don't want to think this isn't going to get done," he says. "But obviously we're only one side of the negotiations. We've been very proactive in our communications: phone calls, emails, face-to-face meetings. We'll meet anytime, anywhere, and we'll talk anytime they want to talk. But we want to have good-faith conversations, and we haven't seen them do that in return. There's been no reciprocity so far. But these carriers have the power to put the games back on, and we continue to hope we'll be able to make a deal."

Until then, at least there's tonight.