- The Washington Times - Thursday, December 12, 2002

The NFL yesterday signed a five-year, $2billion contract extension with DirecTV to keep NFL Sunday Ticket, the league's popular out-of-market package of games, exclusively on the satellite TV provider.

The new deal, set to take effect next year, more than triples the annual value of the current accord. It also calls for creation of a 24-hour NFL Channel as early as next year.

NFL Sunday Ticket has surged in popularity since its debut on DirecTV in 1995 as fans continue to grow less enchanted with the limitations of the networks' locally focused broadcast schedules. Sunday Ticket, sold on an annual subscription basis, allows fans to see every regular-season game. An estimated 70 percent of NFL fans also root for a team other than the one nearest their homes.

The league had considered moving part or all of the package to digital cable, which boasts more than 17million total subscribers compared to DirecTV's 11million. But NFL executives ultimately found DirecTV's offer better in terms of both money to the NFL and level of service to fans.

"This agreement is the result of a very thorough analysis from our perspective of our choices and the future directions of television," NFL commissioner Paul Tagliabue said.

The extension grants DirecTV full satellite exclusivity for the out-of-market games for the life of the contract and complete multi-channel exclusivity through 2005, meaning a digital cable provider could get part of the service after then. Also in 2005, the league's contracts with ABC, ESPN, Fox and CBS expire, and further blending and balancing the out-of-market games with the NFL's traditional broadcast model will become a major undertaking.

"The NFL has always been sensitive to oversaturation," Tagliabue said. "We don't want to move precipitously into multi-channel, subscriber-supported mediums at the expense of our ability to continue serving the broadest universe of fans on broadcast television, so there has to be a balance."

The new deal also calls for an extensive rollout of additional services to Sunday Ticket subscribers, such as games shown in high-definition television and viewer-selected replays. The high-definition option will result in some cost increase for the service, now $139 to $199 per year, but new prices have not been determined.

"We are getting into some very affordable territory for high-def television receivers, high-def television sets," said Eddy Hartenstein, DirecTV chairman and chief executive. "That's an integral part of our future view of entertainment in general, and there's no category than sports to exploit the advantages."

For DirecTV itself, the extension also represents something of a coup. Despite being owned by General Motors, California-based DirecTV is still a relative upstart in the TV industry, and some of the cable companies the NFL negotiated with are far older, larger and more connected.

"Over the years, there have been significant programming additions to DirecTV, but none more constant or significant than our mainstay of our sports and entertainment package, which is NFL Sunday Ticket," Hartenstein said.

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