[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]



 
       OUT AT HOME: WHY MOST NATS FANS CAN'T SEE THEIR TEAM ON TV

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                           GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                             APRIL 7, 2006

                               __________

                           Serial No. 109-152

                               __________

       Printed for the use of the Committee on Government Reform


  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
                               index.html
                      http://www.house.gov/reform

                     COMMITTEE ON GOVERNMENT REFORM

                     TOM DAVIS, Virginia, Chairman
CHRISTOPHER SHAYS, Connecticut       HENRY A. WAXMAN, California
DAN BURTON, Indiana                  TOM LANTOS, California
ILEANA ROS-LEHTINEN, Florida         MAJOR R. OWENS, New York
JOHN M. McHUGH, New York             EDOLPHUS TOWNS, New York
JOHN L. MICA, Florida                PAUL E. KANJORSKI, Pennsylvania
GIL GUTKNECHT, Minnesota             CAROLYN B. MALONEY, New York
MARK E. SOUDER, Indiana              ELIJAH E. CUMMINGS, Maryland
STEVEN C. LaTOURETTE, Ohio           DENNIS J. KUCINICH, Ohio
TODD RUSSELL PLATTS, Pennsylvania    DANNY K. DAVIS, Illinois
CHRIS CANNON, Utah                   WM. LACY CLAY, Missouri
JOHN J. DUNCAN, Jr., Tennessee       DIANE E. WATSON, California
CANDICE S. MILLER, Michigan          STEPHEN F. LYNCH, Massachusetts
MICHAEL R. TURNER, Ohio              CHRIS VAN HOLLEN, Maryland
DARRELL E. ISSA, California          LINDA T. SANCHEZ, California
JON C. PORTER, Nevada                C.A. DUTCH RUPPERSBERGER, Maryland
KENNY MARCHANT, Texas                BRIAN HIGGINS, New York
LYNN A. WESTMORELAND, Georgia        ELEANOR HOLMES NORTON, District of 
PATRICK T. McHENRY, North Carolina       Columbia
CHARLES W. DENT, Pennsylvania                    ------
VIRGINIA FOXX, North Carolina        BERNARD SANDERS, Vermont 
JEAN SCHMIDT, Ohio                       (Independent)
------ ------

                      David Marin, Staff Director
                Lawrence Halloran, Deputy Staff Director
                       Teresa Austin, Chief Clerk
          Phil Barnett, Minority Chief of Staff/Chief Counsel


















                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on April 7, 2006....................................     1
Statement of:
    Dupuy, Robert A., president and chief operating officer, 
      Major League Baseball; Peter G. Angelos, chairman and chief 
      executive officer, Baltimore Orioles; David L. Cohen, 
      executive vice president, Comcast Corp.; and Gary McCollum, 
      vice president and regional manager, Cox Northern Virginia.    18
        Angelos, Peter G.........................................    42
        Cohen, David L...........................................    54
        Dupuy, Robert A..........................................    18
        McCollum, Gary...........................................   176
    Franchot, Peter V.R., Delegate, Maryland House of Delegates; 
      Anthony Williams, Mayor, District of Columbia; Sean T. 
      Connaughton, chairman, Prince William County Board of 
      Supervisors; Doug Duncan, Montgomery County executive; and 
      Ian Koski, editor, Nationalspride.com......................   209
        Connaughton, Sean T......................................   216
        Duncan, Doug.............................................   220
        Franchot, Peter V.R......................................   209
        Koski, Ian...............................................   225
        Williams, Anthony........................................   214
Letters, statements, etc., submitted for the record by:
    Angelos, Peter G., chairman and chief executive officer, 
      Baltimore Orioles, prepared statement of...................    44
    Burton, Hon. Dan, a Representative in Congress from the State 
      of Indiana, prepared statement of..........................    10
    Cohen, David L., executive vice president, Comcast Corp., 
      prepared statement of......................................    57
    Connaughton, Sean T., chairman, Prince William County Board 
      of Supervisors, prepared statement of......................   218
    Davis, Chairman Tom, a Representative in Congress from the 
      State of Virginia, prepared statement of...................     4
    Duncan, Doug, Montgomery County executive, prepared statement 
      of.........................................................   222
    Dupuy, Robert A., president and chief operating officer, 
      Major League Baseball:
        Washington Post article..................................    20
        Prepared statement of....................................    23
    Franchot, Peter V.R., Delegate, Maryland House of Delegates, 
      prepared statement of......................................   211
    Issa, Hon. Darrell E., a Representative in Congress from the 
      State of California, prepared statement of.................    17
    Koski, Ian, editor, Nationalspride.com, prepared statement of   228
    McCollum, Gary, vice president and regional manager, Cox 
      Northern Virginia, prepared statement of...................   178



















       OUT AT HOME: WHY MOST NATS FANS CAN'T SEE THEIR TEAM ON TV

                              ----------                              


                         FRIDAY, APRIL 7, 2006

                          House of Representatives,
                            Committee on Government Reform,
                                                    Washington, DC.
    The committee met, pursuant to notice, in room 2154, 
Rayburn House Office Building, Hon. Tom Davis (chairman of the 
committee) presiding.
    Present: Representatives Tom Davis, Burton, Issa, Cummings, 
Van Hollen, Ruppersberger, and Norton.
    Also present: Representative Moran.
    Staff present: David Marin, staff director; Keith Ausbrook, 
chief counsel; Jennifer Safavian, chief counsel for oversight 
and investigations; Howie Denis, John Hunter, and Steve Castor, 
counsels; Rob White, communications director; Andrea LeBlanc, 
deputy director of communications; Teresa Austin, chief clerk; 
Sarah D'Orsie, deputy clerk; Leneal Scott, computer systems 
manager; Brian Cohen, minority senior investigator and policy 
advisor; Kim Trinca, minority counsel; Earley Green, minority 
chief clerk; and Jean Gosa, minority assistant clerk.
    Chairman Tom Davis. Good afternoon. Welcome, and a quorum 
being present, the Committee on Government Reform will come to 
order. I want to welcome everybody to today's hearing. Today, 
the committee will examine the dispute that is preventing the 
Washington Nationals games from being widely available on cable 
television. Nationals fans deserve to understand why they can't 
watch 75 percent of their team's games on the region's dominant 
cable provider--Comcast, with its 1.3 million subscribers.
    Being able to watch the Nats on TV has been a problem ever 
since the team came to Washington. Last season, before an 
agreement was reached with DirecTV, the lack of access to 
Nationals games was so bad that play-by-play man Mel Proctor 
actually gave out his cell phone number and asked anyone 
watching the game to call him. He got one call--from a 
technician in the production truck outside.
    As any fan knows, part of following your home team is 
watching the games on TV. For some, this means trying to watch 
every game. For others, it means flipping the ball game on at 
night to check the score. This past Wednesday night, if you 
flipped the game on in the ninth, you would have found the Nats 
down by one. Next thing you know, Ryan Zimmerman homers off 
Bill Wagner to tie the score, and then they go on to win the 
game in extra innings. Having all the games on TV means you can 
tune in when the Nats are in the midst of a winning streak, 
when a superstar opponent is in town, or when you find out that 
a no-hitter is in progress. I can't imagine how frustrated I 
would be if I found out Livan Hernandez had a no-hitter going 
in the seventh and I couldn't flip on the TV set to see it. 
Having all the games on TV allows folks to jump on the 
Nationals bandwagon, to have those water cooler conversations, 
and to make the Nationals part of the fabric of the community. 
If you air it, they will come.
    I am disappointed that the sophisticated businessmen 
involved in this dispute have failed to strike a deal. There 
should be enough money and good sense to make a deal work for 
everyone. The only people hurt by this dispute are the fans.
    I should also note at the outset that I'm not personally 
affected by this. As a Cox customer, my house will be receiving 
just about all the Nationals games, and, Gary McCollum, thank 
you very much. I intend to watch as many as I can, that is, 
when I can't be at RFK myself. Nothing against sports bars, but 
I prefer my own sofa.
    For more than 30 years, area fans waited for the national 
pastime to return to the Nation's Capital. Despite the 
favorable demographics of the Washington, DC, market, baseball 
was reluctant to move a team to Washington because of the close 
proximity of the Baltimore Orioles.
    As part of the deal to bring baseball back to the district, 
MLB--Major League Baseball--made a series of valuable 
concessions to the Orioles ball club; one granted the Orioles 
television rights to the Washington team. Armed with the TV 
rights to the Nationals, the Orioles formed a regional sports 
network called Mid-Atlantic Sports Network [MASN]. If viable, 
MASN will compete directly with Comcast SportsNet for the right 
to carry the Wizards, capitals, and other live sports events.
    By any measure, baseball's return to Washington last season 
was a huge success. Besting 19 other teams, the Nationals had 
the 11th highest attendance in baseball, averaging almost 
34,000 a game. In all, 2.7 million people went to Nationals 
home last year. RFK was rocking once again.
    Part of the Nationals' success has to do with the serious 
effort made by the Government of the District of Columbia and 
Mayor Anthony Williams. The District of Columbia has made a 
substantial financial commitment to the Nationals. A $600 
million publicly financed stadium is set to break ground. 
Expected to open for the 2008 season, it will be the keystone 
of the economic redevelopment of the Anacostia Waterfront 
section of the District. The presence of the stadium along with 
residential, office, and retail space in the surrounding area 
is projected to create a cumulative 30-year tax benefit of $2.5 
billion.
    This committee, with its oversight responsibility of the 
District, believes that the Nationals and the District need and 
deserve every chance to succeed. Ensuring that the games are 
widely available on television is an important component of 
that.
    With its 1.3 million subscribers, Comcast dominates the 
cable market in Washington. Other video programming suppliers 
in the area include Cox, RCN Cable, DirecTV, Dish Network, 
Charter Cable, Verizon, and Adelphia.
    MASN has reached an agreement to have their network and the 
Nationals games carried with five of those suppliers. MASN has 
demonstrated an ability to make a deal happen. Not so, however, 
when it comes to a deal with Comcast. This committee--and 
Nationals fans across the region--want to understand why. Is 
MASN asking for too much money or imposing unreasonable 
conditions? Is Comcast trying to prevent a competitor from 
getting its legs? Or is it some combination of factors?
    Today, the committee will try to get some answers. We look 
forward to hearing from officials of Comcast, Cox, Major League 
Baseball, the Orioles, and MASN. In addition, we will hear from 
local officials in the Washington area, whose constituents are 
adversely affected by the standoff between Comcast and MASN.
    [The prepared statement of Chairman Tom Davis follows:



    
    Chairman Tom Davis. I would now recognize Mr. Cummings from 
Baltimore for his opening statement, and I would ask unanimous 
consent that my colleague from Virginia, Mr. Moran, and the 
gentleman from Maryland, Mr. Wynn, be able to participate in 
the hearing today. Without objection, so ordered.
    Mr. Cummings. Mr. Chairman, thank you for calling this very 
important hearing to examine why 75 percent of the Washington 
Nationals games this season will be unavailable for viewing to 
over 1 million households who reside in the Washington area.
    After a three-decade-long absence, Major League Baseball 
returned to the Nation's Capital in 2005 with the Montreal 
Expos becoming the Washington Nationals. Despite the success of 
the Nationals' debut 2005 season in which they attracted 2.7 
million people to their home stadium, secured over half a 
billion dollars in funding for a new stadium, and made a 
competitive playoff bid, Nats fans continue to endure limited 
television access to a considerable portion of their games.
    During the 2005 season, free over-the-air television 
broadcast 80 of the Nationals' games. The Mid-Atlantic Sports 
Network, which is owned by the Baltimore Orioles owner, Peter 
Angelos, televised the outstanding 120 games on cable. 
Unfortunately for the Nat fans, only a handful of cable 
providers carried the Mid-Atlantic Sports Network at the time. 
This in turn left many in the region unable to watch on 
television a majority of the Nats' 2005 season.
    Last Monday marked the beginning of the Nationals' second 
season. While the number of games scheduled to be broadcast on 
over-the-air television dropped from 80 to 40 games, cable 
providers representing 60 percent of Washington households have 
agreed to carry MASN. Specifically, the Mid-Atlantic Sports 
Network is now under contract with Cox Cable, Charter Cable, 
DirecTV, RCN Cable, and VerizonFIOS. Fortunately, these 
contractual obligations between MASN and cable providers will 
permit the 120 remaining games that are not available on free 
television to be aired on cable. Comcast, however, the cable 
operator representing the remaining 40 percent of the region's 
households, has refused to carry the Mid-Atlantic Sports 
Network. Consequently, the 1.3 million Comcast subscribers in 
the region are due once again to not have the option of viewing 
120 games slated for cable.
    An enduring dispute between the Mid-Atlantic Sports Network 
and Comcast continues to deny over a million Comcast cable 
subscribers the ability to watch a majority of the Nationals 
season. Mr. Chairman, regardless of who is at fault for this 
impasse, we would do well by the fans of the Washington region 
if we recognized that no one wins if this needless situation 
continues. Fans in my district from Howard County to Baltimore 
City continue to contact me, interested not in assigning fault 
but achieving a reasonable resolution that ensures a majority 
of the season's games are available for Comcast subscribers.
    We should ask why five out of six cable providers in the 
Washington region have been able to reach a contractual 
agreement with the Mid-Atlantic Sports Network but Comcast has 
refused. What impact has Major League Baseball's antitrust 
exemption had in creating this situation? Finally, as a 
baseball fan all my life, no fan of a team, be it my beloved 
Orioles or the Washington Nationals, should be denied the 
opportunity to watch the game they love, our national pastime.
    And with that, Mr. Chairman, I yield back.
    Chairman Tom Davis. The gentleman from Indiana, Mr. Burton.
    Mr. Burton. You will have to forgive me, Mr. Chairman. I 
thought we were here to talk about the Indianapolis Indians 
being on.
    Chairman Tom Davis. We can throw that in at the next 
hearing.
    Mr. Burton. The Indianapolis Indians is a minor league team 
from my city of Indianapolis, so I apologize for the 
misinformation.
    That is supposed to be joke, folks. I thought it would 
lighten the thing up a little bit. [Laughter.]
    I am here not as an advocate on either side, but what I 
wanted to do is I wanted to make sure that the facts, as both 
sides see them, are well represented. I know there is a 
gentleman here from Comcast, and I have been given some 
information from Comcast that I think needs to be read into the 
record, so I am going to do that. This situation is currently 
under litigation. It has gone from the primary court--it is 
under appeal right now, which I understand is going to be heard 
sometime in June, and hopefully this thing will be resolved. I 
understand also that Comcast has put an offer on the table as a 
compromise, and maybe this hearing can serve as a catalyst to 
get everybody together to try to work out their differences so 
that the court doesn't have to pursue this through the 
appellate process and maybe even beyond.
    Let me read to you the facts as I have received them from 
Comcast and at least the record will reflect that. And once 
again, I would like to say I hope this thing can be worked out 
before it goes further in the courts.
    Peter Angelos opposed the return of baseball to the 
Washington area because he feared that a Washington team would 
divert his fan base and deprive him of revenue. When Major 
League Baseball relocated the Montreal Expos to Washington, DC, 
Angelos was the only owner to oppose that move.
    To appease Angelos, Major League Baseball gave him a 
sweetheart deal, according to my sources. It sold the Nationals 
television rights to Angelos for $21 million, which is a 
bargain basement price given that television revenue of 
baseball teams in smaller markets is $30 million or more. 
Published reports have valued the Nats TV rights at an 
estimated $750 million, and if that is true, getting $750 
million for $21 is a pretty good deal.
    Angelos intends to use the Nationals television rights to 
create a second regional sports network, the Mid-Atlantic 
Sports Network, which a majority of is owned by Angelos, and 
Major League Baseball owns one-third of Mid-Atlantic Sports 
Network, which is likely to be conferred to the new owners of 
the Nationals when the team is sold. But because such regional 
sports networks are typically unlikely to survive with the 
television rights to only one major league team, Mr. Angelos 
intends to package these Nationals rights with the Orioles 
television rights. The only problem is that the Orioles 
television rights have been contracted to Comcast Sports 
Network through the 2006 season. Comcast Sports Network also 
has the rights of first refusal thereafter, the rights to match 
any offer after the 2006 from a third party.
    The suit centers on the definition of a third party. 
Comcast SportsNet sued the Baltimore Orioles for breaching the 
contract with respect to the third-party match provision. 
Because Mid-Atlantic Sports Network is jointly owned by both 
the Orioles and Major League Baseball, Mid-Atlantic Sports 
Network is clearly a third party subject to the third-party 
match provisions of the contract.
    In 1996, Comcast Sports Network, then Home Team Sports, 
paid a premium in increased license fees for this provision in 
the contract. Comcast believes that Mr. Angelos triggered the 
third-party provision in partnering with Major League Baseball 
to form Mid-Atlantic Sports Network.
    In late 2005, a Maryland trial court granted the 
defendant's motions to dismiss the case. Comcast, as I said 
earlier, has appealed this decision, and that appeal is now 
pending in the Maryland intermediate appellate court. The 
Orioles have moved to bypass the intermediate appeal, 
petitioning the Maryland Supreme Court to accept the case 
directly to expedite its resolution. That petition is also 
pending. The schedule in the Maryland intermediate appellate 
court provides for a hearing on Comcast's appeal in June 2006.
    The Orioles have, among other things, complained to the 
Federal Communications Commission that Comcast's refusal to 
carry Mid-Atlantic Sports Network is a violation of program 
carriage rules. While program carriage rules forbid 
discrimination based on the fact that the programmer is 
unaffiliated, Comcast has refused to carry Mid-Atlantic Sports 
Network because it is utilizing what Comcast regards as illegal 
content.
    Comcast has made it clear that it will not air Mid-Atlantic 
Sports Network because the network was created through a breach 
of contract, in their opinion, with Comcast. No cable carrier 
has ever been asked to reward a party that breaches a contract 
with it by carrying its content. And so I would just like to 
say I hope this thing is resolved very clearly, very quickly, 
and it appears to me that all parties would be best served if 
they could sit down at a negotiating table and work this thing 
out without it going further in the courts.
    Nevertheless, I was asked to read this into the record, Mr. 
Chairman, and I have done so, and I wish you well with the rest 
of the hearing.
    [The prepared statement of Hon. Dan Burton follows:]


    
    Chairman Tom Davis. Thank you very much, Mr. Burton.
    Mr. Van Hollen.
    Mr. Van Hollen. Well, thank you, Mr. Chairman. Thank you 
for holding this hearing, and welcome to all the witnesses here 
today. And as you said, Mr. Chairman, at the outset, the 
purpose of this hearing is to try and make sure that the fans 
are not the losers in this upcoming season or seasons beyond. 
And we thought it important to get the major players together 
to ask and shine the light on the facts in the open in the 
hopes that would help bring a reconciliation to this issue. And 
I am pleased that we have representatives from all the major 
parties involved in this, and I am sure you will be able to 
very ably speak for yourselves in this hearing, and we welcome 
all of you to do that.
    Let me just say that, as Mr. Davis has said, we are very 
excited in the Washington region to have the Nationals back, 
and this is a region that can accommodate two teams, obviously. 
We had a lot of Oriole fans before and continue to have Oriole 
fans. Our family continues to enjoy going to Orioles games. We 
have now a National League team and an American League team in 
the same region, and I think there is definitely room for both, 
and I believe everybody here testifying today believes that 
there is room for both.
    But as we have heard, while tonight we are going to be able 
to watch the Orioles game on Sports Net, we are going to only 
be able to see the Nationals game viewing over the air on UPN 
20. But for the rest of the season, we are not going to have 
the opportunity to watch many Nationals games in this region. 
And the fans are the big losers.
    I have three children, all baseball fans. My boys asked me 
just yesterday, as we talked about this hearing, they want to 
know about how Alfonzo Soriano is going to perform this year. 
They want to see how the starter John Patterson and the great 
closer Chad Cordero are going to do, rookie Ryan Zimmerman--the 
whole team. I mean, they are excited about how the whole team 
is going to perform under the legendary manager Frank Robinson. 
And they want to be able to both go to the ball park but also 
watch it on television.
    And so the purpose of today's hearing is pretty simple. We 
would like to see as expeditious a resolution of this issue as 
possible so the fans can watch their team and continue to enjoy 
the Orioles at the same time they enjoy the new team here in 
Washington, the Nationals. And I hope that out of today's 
hearing will come some progress in that effort.
    Thank you, Mr. Chairman.
    Chairman Tom Davis. Thank you very much.
    Mr. Ruppersberger.
    Mr. Ruppersberger. Thank you, Mr. Chairman.
    There is no question we have a problem. Many people here in 
Maryland, Virginia, and the District of Columbia cannot see the 
Nationals, their hometown team, on TV. I have been a Baltimore 
Orioles fan all my life. I love going to Camden Yards to watch 
the games, and when I cannot see them, I enjoy watching them on 
TV.
    As we know now, many Nat fans cannot do that right now. And 
if you are a baseball fan, that is just not right.
    I am not sure what Congress can do about this problem, but 
I applaud Chairman Davis for having this hearing. Now, you have 
to understand this. Chairman Davis is an avid baseball fan. He 
used to be a Baltimore Oriole fan, and now he is a big-time 
Nationals fan.
    Chairman Tom Davis. I still like the Orioles.
    Mr. Ruppersberger. Well, that is good to know. But let me 
say this, and I am going to stop for a second. I have three 
Nationals hats up here. Mr. Angelos, do you have a Baltimore 
Orioles hat that I can use?
    Mr. Angelos. It is close.
    Mr. Ruppersberger. OK. Now, I now have both sides involved 
in this dispute. As a former Baltimore County executive, I work 
closely with Comcast, and probably Comcast more than any other 
company that I know has done more to put in Baltimore County 
when I was executive. They wired all of our schools for 
Internet. Their employees volunteer hours of time in community 
service. And Comcast sponsors all sorts of community projects. 
And when you call on Comcast to sponsor a community event, they 
never said no. They were always there for you, for their 
community.
    I have also known Peter Angelos ever since I was a 
prosecutor before I got into public office. That was about 30 
years ago. We have aged a little bit, Peter.
    Peter Angelos is all about Baltimore. He grew up in 
Baltimore. He went to school in Baltimore. He loves Baltimore. 
He is a very successful, self-made attorney and businessman. He 
bought the Orioles because he wanted the team to be owned 
locally. And he is a good friend, a good lawyer, and one of the 
toughest negotiators that you will ever face. But deep, deep 
down, he does have a really good heart. And like Comcast, he 
and the Baltimore Orioles give back to the community.
    Now, with all this being said, Nats fans don't care who is 
right, who is wrong, and who has paid for what. They want to 
see their team on TV. And I hope we can find out in this 
hearing some issues, for instance, if the fee that Mid-Atlantic 
Sports Network is charging is reasonable in the region and on a 
national basis. Almost everything comes down to money, and that 
is what this is all about. But this issue must be resolved. The 
two sides must come together to work it out.
    Now, the Baltimore Orioles, of which I am an Oriole fan, 
the contract with Comcast is up in 2007. And I don't want the 
same thing to happen to the Baltimore Oriole fans that has 
happened to the Nationals fans right now. As an avid Orioles 
fan, believe me, I always want to see my team on TV. And I 
would hate a year from now to have another hearing about the 
Orioles not being on TV in Baltimore.
    Now, hopefully this hearing will bring the two sides 
together so we can get this worked out. We want the Nats fans 
to be able to see their team on TV this season, and we do not 
want to have the same problem with the Baltimore Orioles a year 
from now.
    Now let the games begin.
    Chairman Tom Davis. Thank you very much.
    Mr. Moran.
    Mr. Moran. Thank you very much, Mr. Chairman. If Ms. Norton 
would like to speak first--I do have an opening statement, but 
if you want to go first, Eleanor, it is fine.
    [No response.]
    Mr. Moran. The public may ask, What business is it of the 
Congress' to get involved in this? But last night, ESPN 
announced that it was going to show the Nationals game, 
beginning of the season, a whole lot of fans wanted to tune in, 
turn on, and the game comes on, it is blacked out for the vast 
majority of television sets in my district. Tom's district is a 
little more fortunate. They have Cox, and Cox has decided to 
show them.
    The cable providers have a symbiotic relationship, if you 
will, with the local community. The local community has a 
certain amount of leverage, as does the cable provider have a 
lot of influence upon the ability of households to enjoy 
themselves and to take advantage of technology. So we have a 
disconnect.
    And there is something unique about sports. It is a 
unifying element that is, in fact, important to our community. 
Tom and I were just in a parade out in Fairfax City. I cannot 
believe we made it back in time, but, of course, Tom had 
arranged for one of Fairfax City's finest to drive us back, and 
we got back just in time. But, boy, I am glad we made the 
parade. Those George Mason basketball players and the 
community, even more importantly, wanted an opportunity to say 
thanks--thanks for all that entertainment, thanks for making us 
feel good. The Redskins achieve that and the Nationals will as 
well.
    Now, I have a lot of misgivings over a situation where the 
owner of a competitive team controls the broadcast rights for 
Washington's team. I understand that a quarter of a century 
ago, 25 years ago, there was a deal, and the country was carved 
up and the Washington-Baltimore area was assigned to Mr. 
Angelos. Although Washington had had a team, I don't think they 
objected when the Baltimore Orioles were established and the 
Washington Senators were still here.
    But that is a big problem, and I don't think it is fair to 
the owners when broadcast revenue is as important as real 
estate, both of which are a more important source of revenue 
than actual ticket sales. So it is an issue that our 
constituents are very much concerned about.
    On the other hand, Cox has reached a deal. They will tell 
us about their perspective and whether it is a fair deal or 
not, and they are providing these games in the only way that 
they can be provided to Fairfax County. Comcast has chosen not 
to. I assume it is all about the bottom line, but it could also 
be about principle, about feeling as though they did not get a 
fair shake from Major League Baseball, and that is why Major 
League Baseball is here.
    But something has to give. This is too important to our 
community and the Washington metropolitan area. And if the 
Nationals are going to succeed--and it is important to use that 
they succeed--the owner not only has to have enough revenue 
that they can buy competitive players, but they have to be able 
to sustain that fan base, and to do so they have to be able to 
show the games on television.
    So that is the objective of this hearing, and I know that 
Chairman Davis' objective is that the four of you who can make 
it work--the three of you, really, because Mr. McCollum is 
making it work in Fairfax County. The three of you have to 
figure out a way how it can work for the benefit of fans 
because that ought to be the bottom line, not the dollars and 
cents, the ability of the Nationals fans to enjoy themselves 
and make this America's pastime within the Washington area.
    So thanks for having the hearing, Mr. Chairman.
    Chairman Tom Davis. Ms. Norton.
    Ms. Norton. Thank you, Mr. Chairman. Thank you for your 
important leadership on yet another important issue.
    Mr. Chairman, you are known as a baseball maniac who 
memorizes baseball statistics. But I can attest to the fact 
that when you have focused on baseball in our committee, as 
with our hearings on cheating in baseball by the use of 
steroids and other drugs, you have always focused us on a very 
serious concern. That is what you are doing this afternoon.
    There is joy in the city at the return of baseball after 35 
years, especially among Washingtonians like me. We remember 
life in Washington as kids when the city had almost 800,000 
people and the suburbs were the hinterland. We remember 
Griffith Stadium and the Washington Senators, whose ineptness 
at the game was matched by the team's inapt name in a city that 
did not have a mayor or a city council, much less Members of 
the House and Senate.
    Nevertheless, even in segregated Washington, the Senators 
gave the city an identity distinct from official Washington, an 
identity to which all could relate.
    As D.C.'s Congresswoman, I particularly welcomed baseball's 
return to Washington because when baseball left, it took 
something away from the District's place among great American 
cities. D.C. could not retain its place among the Nation's big 
cities that mattered without reclaiming the sport identified 
with the Nation itself. Although most major sports teams had 
long understood that Washington is a mandatory location, 
baseball was a very slow learned in coming to grips with this 
reality.
    Sad to say the return of baseball is something of a 
counterfeit slogan, with 75 percent of the games blacked out by 
a lose-lose dispute that turns its back on the region that has 
already demonstrated its allegiance to the team and lined the 
pockets of baseball. Baseball and much of the region gave the 
Bronx cheer to the city council, which is footing the bill for 
the big party, because the council did not simply fall in line 
and pay whatever it took. However, the council proceedings were 
typical of elected officials and expected of the democratic 
process, especially one involving the city's resources.
    However, what are we to think of baseball and Comcast, who 
are caught in a deadlock more typical of the public's view of 
silly politicians? When business interests see that each is 
losing money or not maximizing profits, we are told they focus 
on the bottom line. Nationally, local and regional TV and radio 
contribute about half of all its broadcast revenue to baseball, 
far more than other sports. The A list team of baseball--New 
York, Los Angeles, and Chicago--are all located in major media 
markets where the teams have used TV to grow their fan bases, 
and with them their own revenue.
    So why are baseball, which finally got the sense to move a 
long-suffering team from Montreal to a platinum major market, 
and Comcast, this region's regional network provider, leaving 
money on the table and the fans with dark screens? Is MASN, the 
startup fledgling network, even talking with Comcast? The 
public is clamoring for answers and deserves better than the 
silent treatment and dark screens.
    That is why this hearing is particularly important. Today's 
hearing may be the first time all the relevant actors have been 
in the same room or have sat at the same table. If they are as 
good at business as their putative reputations, perhaps 
somebody will strike up a conversation that leads to striking a 
deal.
    Thank you, Mr. Chairman.
    Chairman Tom Davis. Well, thank you very much.
    [The prepared statement of Hon. Darrell E. Issa follows:]


    
    
    Chairman Tom Davis. We are now going to get to the panel. 
Let me just note for the record everybody is appearing here 
voluntarily. We appreciate it. Mr. Cohen, I know you have an 
engagement out of the area later in the day, and hopefully our 
schedule will let you get out at a reasonable time. In this 
committee, we always swear everyone in before you testify, so 
if you would just rise and raise your right hands.
    [Witnesses sworn.]
    Chairman Tom Davis. We have Mr. Bob Dupuy, the president 
and chief operating officer for Major League Baseball; Mr. 
Peter Angelos, the president of the Baltimore Orioles, which is 
the general partner of the entity known as the Mid-Atlantic 
Sports Network; Mr. David Cohen, the executive vice president 
of Comcast Corp.; and Garry McCollum, the vice president and 
regional manager for Cox northern Virginia.
    Mr. Dupuy, we will start with you give you as much time as 
you need. Your entire statement is in the record, but take what 
you need to make your points, and then as soon as you are 
through, we will get to questions. Thank you for being with us. 
You need to push your button there.

 STATEMENTS OF ROBERT A. DUPUY, PRESIDENT AND CHIEF OPERATING 
OFFICER, MAJOR LEAGUE BASEBALL; PETER G. ANGELOS, CHAIRMAN AND 
  CHIEF EXECUTIVE OFFICER, BALTIMORE ORIOLES; DAVID L. COHEN, 
  EXECUTIVE VICE PRESIDENT, COMCAST CORP.; AND GARY McCOLLUM, 
   VICE PRESIDENT AND REGIONAL MANAGER, COX NORTHERN VIRGINIA

                  STATEMENT OF ROBERT A. DUPUY

    Mr. Dupuy. Thank you, Mr. Chairman. Good afternoon. My name 
is Bob Dupuy. I am the president and chief operating officer of 
Major League Baseball, and I appreciate the opportunity to 
appear before you and the committee this afternoon.
    Major League Baseball understands the concerns of this 
committee over the lack of full telecast distribution of 
Washington Nationals games because we share that concern. One 
of the primary responsibilities of baseball's central offices 
is to maintain and increase the high level of interest and 
enthusiasm in our sport. One way we have done that for over 
half a century is to make large numbers of game telecasts 
available to our fans, both nationally and locally. Today we 
are very proud of how well we serve the television viewing 
public through a combination of national telecasts, regional 
telecasts, out-of-market telecasts for displaced fans, and 
games and highlights streamed on the Internet. Virtually all of 
our 2,400 games are available in the local markets through a 
combination of over-the-air, cable, and satellite distribution, 
and increasingly, games and highlights are being distributed 
through new technology platforms such as cell phones, PDAs, and 
other wireless devices.
    We, too, are delighted at the return of baseball to our 
Nation's Capital and also delighted that we finally have a 
lease and MOU in place after a year of negotiation. We would 
like to see the Nationals' telecasts made available to all of 
their fans, and that was our expectation a year ago when we 
entered into the television arrangements involving MASN. The 
MASN agreement resulted from a long and difficult process 
intended to find the best new home for the Montreal Expos. That 
team had almost completely lost its local following in Montreal 
where none or only a handful of games were broadcast. After a 
long and competitive process, the commissioner and owners 
settled on the District of Columbia as the new home for the 
Expos. However, Major League Baseball's responsibility to grow 
fan interest applies to all 30 of our teams, and the 
commissioner felt strongly that any relocation of the Expos had 
to be done in a manner that was consistent with the goal of 
maximizing the viability and popularity of all our teams, 
including the Baltimore Orioles.
    After baseball decided upon Washington as the Expos' new 
home, Mr. Angelos and I entered into lengthy discussions and 
negotiations over the best and fairest way to move the team 
here, less than 50 miles from Camden Yards. Many of our 
discussions focused on the Nationals' local telecast rights, 
and we entered into a deal that we believe was fair for all 
parties. That deal has been frequently misunderstood and 
misreported, although I would like to indicate that there was a 
fair and balanced report of the deal written by Mayor Anthony 
Williams and Councilmember Jack Evans that appeared in the 
Washington Post on April 14, 2005, and I would respectfully 
request that the Chair allow me to make this part of the 
record.
    Chairman Tom Davis. Without objection, that will be part of 
the record. Thank you.
    Mr. Dupuy. Thank you, sir.
    [The information referred to follows:]


    
    
    Mr. Dupuy. What the deal does do is provide for a 
guaranteed market rate annual revenue stream to the Nationals 
for their telecast rights, which should obviate the concerns of 
Congressman Burton that somehow this was a sweetheart deal for 
the Orioles. In addition, the number that the Congressman 
quoted, I would note for the record, of $750 million is a 
multiple of more than 10 higher than any team in Major League 
Baseball receives for their local rights. So where the number 
of $750 million came from is, frankly, beyond me.
    It was also intended to provide broad distribution of both 
Nationals' and Orioles' telecasts. For example, rather than 
carve up the two teams' territories--as could have been done--
we chose to distribute both teams across the entire territory, 
allowing existing Orioles fans to retain their allegiance and 
allowing new National League and Nationals fans to emerge from 
the entire geographical reach.
    As you know, as technology and distribution platforms have 
developed and evolved, a number of our teams have recently 
created their own regional sports networks, as has been done 
here. And full distribution of those networks has typically 
taken some time, as it has here. Mr. Angelos' testimony will 
cover the details of MASN's attempt to reach a distribution 
deal with Comcast. Let me say that baseball is disappointed 
that there has been litigation over this matter. We share the 
frustration of Nationals fans and the feeling that a business 
deal here should replace a court or administrative fight.
    While we have not been involved directly in the MASN 
negotiations with Comcast, our office has been in contact with 
both parties to urge them to resolve their differences. We 
would also note, as members of the committee have, that MASN 
does have deals in place for Nationals games with Charter, Cox, 
DirecTV, Verizon, and RCN.
    For the benefit of Nationals fans who are Comcast 
subscribers, we urge that an agreement quickly be reached for 
the carriage of Nationals' telecasts.
    Thank you.
    [The prepared statement of Mr. Dupuy follows:]


    
    
    Chairman Tom Davis. Thank you very much.
    Mr. Angelos, thank you for being with us.

                 STATEMENT OF PETER G. ANGELOS

    Mr. Angelos. Thank you, Mr. Chairman, members of the panel. 
Thank you for inviting us here today to discuss the issue which 
you have alerted us to and which we are obviously thoroughly 
conversant with.
    I have listened to what was said a moment ago or a few 
minutes ago by Congressman Burton, but I shall not address 
those items that he talked about; but, rather, I am here to ask 
you to do all that you can to facilitate the distribution of 
Washington National games over paid television systems.
    This may seem paradoxical to you that the owner of the 
Orioles--that is, the majority owner. I should remark that we 
have 18 other investors who contributed to the purchase of the 
Orioles out of bankruptcy in 1993. I am committed to promoting 
the distribution of Nationals games because, obviously, we have 
a vested interest in seeing to it that effort will be 
successful.
    As has been commented, we now have under contract five 
distributors, very sophisticated and very long in the business 
of distributing programming. And the games are now available to 
2 million subscribers of these companies.
    Now, we made, we believe, an agreement with Major League 
Baseball that Mr. Dupuy just touched on which was one that 
would benefit both clubs. The idea was that by establishing a 
regional sports network, essentially composed of the two 
baseball teams and offering those games throughout the entire 
Orioles home television territory, which runs from Lancaster, 
PA, down through central Pennsylvania, all of Maryland, all of 
Delaware, all of the District of Columbia, all of Virginia, 13 
counties in West Virginia, and half of the State of North 
Carolina. We now share that territory, Mr. Chairman, with the 
Nationals, and we are promoting the inclusion of the Nationals 
games right through that entire territory along with the 
Orioles, who are now being projected through that territory by 
Comcast in the final year of a contract that they have held 
with the Orioles for 10 long years.
    I might say at this point that the highest rights fee that 
we have ever received in those 10 years from Comcast for that 
entire territory, Mr. Chairman, is in this particular last 
season that Comcast will have the Oriole rights to use on their 
distribution system. The highest they have ever paid is 
$18,450,000 for the entire territory. So our commitment to the 
Nationals at $20 million, which next year goes to $25 million, 
we believe was a much more generous and sensible kind of 
arrangement that was made with Major League Baseball, and 
obviously, I believe that will ultimately be the arrangement 
that the Nationals will have once the new owner has been 
selected.
    So we are able to say that in addition to the $20 million 
that we paid in the year 2005, $20 million in the year 2006, 
and $25 million in 2007, and thereafter even higher fees will 
be paid to the Nationals, and the Orioles, for that matter, we 
believe that along with that, a special arrangement has been 
made with the Nationals in that they initially start with 
owning 10 percent of the RSN and over a period of years will 
ultimately own 33 percent of the RSN.
    Now, there have been comments about our opposition or 
specifically my opposition to the location of the Nationals in 
Washington, DC. When we learned that was going to be 
accomplished, we obviously were concerned--concerned, one, that 
the inclusion of a team not 50 miles away, as Mr. Dupuy has 
mentioned, but actually some 35 miles away if you measure from 
border to border, but actually the establishment of the 
Nationals at the proposed new baseball stadium in probably 
2008, or while they are at RFK, brings another team roughly 8 
miles away from one of the counties that is part of our 
franchise, that is, Howard County or Anne Arundel County and so 
on. Formerly, we enjoyed all of that territory. But the 
decision was made, and we made a decision to live with that 
arrangement. And concurrently, as Mr. Dupuy has said, we 
arranged to work things out with Major League Baseball to share 
our territory with the Nationals, to establish the RSN that has 
been talked about, and thereby to create an opportunity for 
both teams to benefit and, moreover, to allow the Orioles to 
gain extra revenue to make up for what is expected to be at 
least a 25-percent reduction in attendance as well as other 
potential diminution in income that the club has been 
accustomed to for some 30 years.
    I might say that the territory that I described has been 
the Oriole home television territory for more than 30 years. 
Nonetheless, it is now the territory, through the efforts of 
Mr. Dupuy and the commissioner, of both teams, and both teams 
can produce and present their games within that territory.
    Now, the purpose, therefore, of asking that this 
arrangement be made was, as I said, to make up for the expected 
losses that our team will suffer. Now, the comment that we 
control the games I think is absolutely incorrect, especially 
because we don't control the games. We can present the games. 
But the ultimate control as to what is going to be paid for the 
rights from period to period is in the hands of Major League 
Baseball and will remain there. If at any time the Nationals 
would be dissatisfied with the fee structure, the rights fee 
structure, they have a right to complain to Major League 
Baseball and demand that a survey be made to guarantee that 
fair market value payments are being made for the rights fees 
for the rights to their games. So I think that is important to 
understand, that we do not exercise any authority over the 
team. We cannot set the rights fees without the approval of 
Major League Baseball.
    As to the quality of the presentation, Major League 
Baseball controls that also. If we do not perform up to a 
quality level and the Nationals are not satisfied with the 
presentation of the games by MASN, they have every right to 
petition Major League Baseball to compel us to correct the 
situation.
    So the issue here really is not the litigation that ensued 
that was referred to previously or litigation that might ensue 
in the future. The issue here is why doesn't Comcast put the 
National games on their distribution system. As has been said 
repeatedly, five other companies have done so. Five other 
companies have accepted the rate schedule that was recommended 
to them, and the games are being seen by 2 million people 
within the territory that I described.
    We think that Comcast does not want to do that because they 
want to protect what they already have. They have had their way 
for so many years, they feel that no one should interrupt their 
monopolistic arrangement where they do not have any competition 
and where they simply deal with sports teams essentially on the 
basis of what they think is appropriate, since essentially 
there is no competition within the broad territory that I 
described. There are other distributors, but Comcast is not 
just a distributor. Comcast is a program generator. And, 
obviously, it prefers to hold onto what it has and does not 
appreciate the competition that MASN is providing. One might 
say that is an understandable business attitude, that what a 
business has it wants to keep. But, unfortunately, it should 
not be allowed to keep what it has had at the expense of the 
fans of the Nationals or, for that matter, the Orioles or, for 
that matter, any sports team.
    I think they have an obligation to show the games, to 
present the games of the Nationals. We have approached them 
more than five times, and they have refused not a particular 
approach that we have talked about. Why, they will not even 
talk to us about it. They do not want to have any discussion 
about whether or not we can get together.
    Now, we are ready. We have been ready for over a year. And 
I am sitting here next to Mr. Cohen, and I am prepared to sit 
down and shake his hand and make a deal with him now and let 
all of the differences and all of the acrimony that has ensued 
in the past disappear. But that is up to them. The price--our 
rates, we carefully made sure, are just about what Comcast 
charges, and maybe a tad less and maybe--well, I say a tad 
less. And when we have the Orioles in 2007 along with the 
Nationals, actually our rate will be less than what the Comcast 
level is presently.
    So just as I urge you, Mr. Chairman and other members of 
the committee, do not be deceived by the arguments that are 
being advanced by Comcast. Just like their lawsuit, give those 
comments and those positions no credence. The lawsuit that 
Congressman Burton talked about or referred to was tossed out 
of court peremptorily by the judge, who said on two different 
occasions because they filed it two times, ``Your case, 
gentlemen, is dismissed because you have failed to state a 
cause of action.'' And I would apply that same argument to 
their position now, that somehow or other putting the games on 
is going to cause the Comcast company some kind of negative 
consequences. What will happen is they will then have the games 
of the Orioles and the Nationals, and they will make their fans 
happy, and the fans will see the Nationals and the Oriole games 
and be certainly grateful to you, gentlemen and ladies, for all 
that you have done to make that come about.
    I urge you to put the pressure on them. They should put 
those games on now. Thank you.
    [The prepared statement of Mr. Angelos follows:]


    
    
    Chairman Tom Davis. Thank you very much, Mr. Angelos.
    Mr. Cohen, thank you for being with us.

                  STATEMENT OF DAVID L. COHEN

    Mr. Cohen. Thank you very much, Mr. Chairman, and thank you 
for providing us the opportunity to testify here today. Let me 
start by making a clear and unmistakable point. We at Comcast 
are fans of the Washington Nationals, we want to carry as many 
of the teams' games as possible, and we are absolutely 
committed to solving the current dilemma.
    It is also important to note that Comcast has always 
supported the return of Major League Baseball to the 
Washington, DC, area. This position distinguished us from the 
Baltimore Orioles, which apparently believed that a Washington 
baseball team would result in a loss of fans and television 
revenue and, therefore, would reduce the value of that team. It 
is certainly Mr. Angelos' right to advocate on behalf of the 
economic interests of the Orioles, and that is properly a 
matter that should have been resolved between MLB and the 
Orioles.
    The problem that confronts us today began when MLB came up 
with its very odd solution to this problem. It is what I refer 
to as ``the original sin'' in this entire episode. You see, MLB 
chose to compensate the Orioles by giving the team control of 
the Nationals' local television rights. This was the first time 
in history of which we are aware that a team's rights have been 
handed over to a rival franchise.
    Now, Comcast is agnostic as to whether or not MLB owes the 
Orioles compensation as a result of the relocation of the 
Nationals. But we do object to how MLB has chosen to compensate 
the Orioles--by assigning the television rights of the 
Nationals to that competing franchise. By doing this, MLB has 
tried to foist onto D.C. cable customers, your constituents, 
Mr. Chairman, their obligation to compensate the Orioles. That 
is unfair to our customers, and it is just plain wrong. Let me 
explain.
    The Orioles and MLB have created a new regional sports 
network, MASN, which is trying to charge satellite and cable 
providers more than $2 a month per subscriber once MASN is 
carrying Nationals and Orioles games. This charge is for a 
channel that has no programming right now other than the 
Nationals games. Even today, 1 year after its launch, MASN 
offers no sports newscasts, no college games, and no other 
sports contests. In fact, for nearly 8,000 hours a year, MASN 
offers nothing but a dark screen. It is no wonder that 
Communications Daily reported last week that independent 
analysts believe that MASN is asking too much for carrying the 
network.
    What does this mean for Washington area consumers? Only 
this: Over the next decade, assuming that cable and satellite 
companies pass along these increased programming costs to their 
customers, as Cox has pointed out it will have no choice but to 
do, this arrangement will transfer more than $600 million from 
Comcast customers and your constituents and more than $1.3 
billion from all D.C. area cable customers to a business that 
is controlled and majority-owned by the Orioles.
    Of course, at the same time that this assignment of the 
television rights to the Orioles hurts our customers, we 
believe that it also hurts the Nationals. According to MASN's 
own Web site, and as Mr. Angelos confirmed today, the network 
paid only $20 million to the Nationals last year, and I gather 
this year. This is well below what we believe the market rate 
is. And we know this because we offered to pay more for those 
rights. And I would suggest to you that the only way you can 
set a market rate is to have those rights being made available 
on the market and to see what people would agree to pay for 
them. A mechanism by which the Nationals can appeal to Major 
League Baseball if they do not like the rights fees they are 
getting is not a market rate adjustment and does not guarantee 
the Nationals a market rights fee over the life of the 
franchise.
    Even more unbelievable, though, is that the rights deal 
states that, at least until 2011, the Orioles will not get less 
for its TV rights than the Nationals, contractually eliminating 
the real differences in the value of the Washington market, 
which is the 8th ranked DMA in the country, from the Baltimore 
market, which is the 24th ranked DMA in the country.
    Moreover, we believe that this deal creates a real and 
substantial conflict of interest. Last year, by way of example, 
the Orioles negotiated over-the-air broadcast deals that did 
not provide the Nationals with carriage in many D.C. suburbs 
and in certain Baltimore markets, while negotiating deals for 
the Orioles that included all homes in the D.C. and Baltimore 
markets. And this year, it was the Orioles, not Comcast, that 
decided to slash the number of Nationals games on over-the-air 
broadcast television from 81 to 39 games. That is how we find 
ourselves here today. But we are not here to assign blame. We 
are here to help find a solution.
    We have suggested that Major League Baseball and Mr. 
Angelos do what is right for the Nationals, for their fans, for 
our customers, and for your constituents. They should return 
control of the Nationals television rights to the Nationals, 
their rightful owner. Let the team engage in a process for the 
sale of its local television rights in which all legitimate 
telecast partners are invited to make proposals. MASN can 
participate in this process, as can Comcast SportsNet and any 
other regional sports net that might want to do business in 
this market. If MLB's owners believe that their colleague 
deserves compensation, let them pay him directly rather than 
shifting this burden to cable and satellite customers and to 
your constituents.
    If the parties will agree to this solution, Comcast will 
immediately begin televising all Nationals games that are 
available for local cable broadcast. We have also offered the 
Nationals an additional rights fee equal to what MASN is paying 
the team, I learned today $20 million this year, for the non-
exclusive rights along with MASN to televise these games this 
year while this gets worked out. The fans will benefit because 
all of the games will be on television, and the Nationals will 
prosper through a doubling of their rights fee as they deserve 
to. We have to find a solution that is in the best interest of 
all the parties to this situation. In our view, that requires 
undoing the original sin of the disinheritance of the Nationals 
of their TV rights. Our proposal will get the Nationals games 
on the air fast. It will give the Nationals fair market value 
for the team's local cable rights. And it will allow Major 
League Baseball and the Orioles to work out their issues in a 
way that does not pick the pockets of our customers. That, Mr. 
Chairman, to borrow a baseball analogy, would be a grand slam.
    Thank you very much.
    [The prepared statement of Mr. Cohen follows:]


    
    
    Chairman Tom Davis. Thank you very much.
    Mr. McCollum, thank you very much for being with us today, 
and thanks for bringing the Nats to Fairfax.

                   STATEMENT OF GARY McCOLLUM

    Mr. McCollum. Thank you, Mr. Chairman and distinguished 
members of the House Government Reform Committee. I am Gary 
McCollum. I am the vice president and regional manager of Cox 
Communications, and I am responsible for all local operations.
    Cox is a major contributor the local economy. We employ 900 
local citizens in the Fairfax area. We contributed $13 million 
in cash and in-kind donations to the local community last year. 
Since 1996, Cox has invested more than $640 million in northern 
Virginia to upgrade our technology to provide more bandwidth, 
not only for digital cable, including high-definition 
television, but also for high-speed data and telephone service.
    Again, thank you for the opportunity to testify about 
sports programming and the Mid-Atlantic Sports Network. There 
is no question that sports are deeply imbedded in our social 
fabric.
    Likewise, America's love affair with television is a way of 
life. The vibrant cable TV industry has done a lot for sports. 
First and foremost, we extend its reach by creating front row 
seats for every game in the living rooms of millions of 
Americans. And we create excitement about the teams and their 
players. Sports wouldn't be the mega-business it is today 
without cable television.
    It is important to understand that Cox is a retail 
distributor of a wholesale product--cable programming--
including channels like Fox News, Nickelodeon, and ESPN. As you 
know, any business that retails a wholesale product is subject 
to market forces. Gas prices rise at the pump when the cost of 
a barrel of oil rises. Likewise, cable prices increase when 
programming costs escalate. This year our programming costs are 
projected to increase 13 percent, and with the addition of 
MASN, that increase will grow to nearly 18 percent.
    The sports leagues and team owners are able to pass their 
uncontrolled costs through the cable operators, insulating them 
from consumer backlash. Since these costs are passed through to 
the consumer without consequence to the owners, the owners are 
uninhibited about controlling such costs.
    Cox is no longer willing to be the scapegoat for the real 
culprits. Now more than ever we are telling our customers why 
their bills are rising and how sports programmers are holding 
the fans hostage.
    We know our customers want to watch the Nationals, and with 
those customers squarely in mind, we attempted to negotiate a 
long-term deal to show the games. On March 8th, we announced an 
agreement to make available MASN's telecasts of Nationals games 
on our Expanded Basic service to nearly 260,000 customers in 
northern Virginia. While the terms of that agreement are 
confidential, I can assure you that this programming did not 
come cheaply and will affect cable prices.
    Clearly, the added cost of this programming is not a good 
thing for our customers. But our baseball-starved community is 
hungry for televised games. Are fans willing to pay this 
unreasonably high cost for sports programming? Well, they may 
not see the connection, but the high rates for which customers 
express concern are, in fact, driven largely by these out-of-
control sports costs. So, on the one hand, our customers want 
the games. And, on the other hand, they criticize our rates 
increasing directly because of the games. This is a no-win 
situation to cable operators.
    So let me be clear. While the agreement contains costs and 
channel space requirements that remain very onerous to Cox, it 
simply reflects the realities of our customers' desire for 
Nationals games and our relative inability to negotiate better 
terms and conditions.
    For the sake of all cable customers in this market, Cox had 
hoped that MASN would realize the efficiency of joining with 
Comcast SportsNet to occupy one channel on everybody's lineup. 
That would have allowed us to better manage network capacity 
and programming costs that drive up cable rates.
    We entered into a deal with MASN because we had little or 
no negotiating leverage as a small player in the very large 
Washington metro market. Remember, a reasonable deal eluded Cox 
and our customers for an entire season. This year, in spite of 
the outrageous costs, it was time for us to deliver the games 
of our local major league team to our hungry customers. We 
broke down and concluded an agreement with the fervent hope 
that if anybody can change or improve the deal, it is the metro 
area's biggest player--Comcast.
    But, Mr. Chairman, I must put this urgent question before 
the committee. The owners of Major League Baseball and 
Commissioner Selig have granted to the owner of the Baltimore 
club what appears to be a sweetheart deal. TV revenues from the 
broadcast of the Washington Nationals baseball games are 
transferred from the pockets of the new entrant Washington 
Nationals to the pockets of their neighboring Baltimore team 
through its interest in MASN. So if monopoly rates are paid to 
MASN, Mr. Angelos wins. And if there is no agreement to pay 
these monopoly rates and the fans of the Washington Nationals 
are cheated of the opportunity to see their team, the 
neighboring Baltimore team wins as well. So what is MASN's 
incentive to moderate its behavior? None.
    Mr. Chairman, sooner or later, the underlying problem of 
escalating sports entertainment costs must be addressed. It is 
a very serious problem for all of us, including Comcast, in the 
business of trying to provide such entertainment to the 
American consumer at a reasonable price.
    Cox's mantra is that we are ``Your friend in the digital 
age.'' Our relationship with our customer is our primary 
advantage. Our customers trust us. They depend on us, and I am 
directly accountable to these customers. And for their sake, I 
implore all of those involved in the sports supply chain to 
rein in prices and stop holding the fans hostage.
    Thank you very much for allowing me to address you today.
    [The prepared statement of Mr. McCollum follows:]


    
    
    Chairman Tom Davis. Thank you very much.
    Well, we certainly heard four different perspectives on the 
issue, and I think the question for us today is can we work 
toward a resolution of this in a timely manner.
    I am going to start with Major League Baseball, Mr. Dupuy. 
Let me first start, before I get here, and just say I don't 
know if this would add to it. Are we any closer to naming an 
ownership entity for the Nationals? Because I think that would 
help.
    Mr. Dupuy. We are certainly closer. I mean, every day we 
get closer. But, yes, now that we have, as I mentioned, thanks 
to the hard work----
    Chairman Tom Davis. Everything is done----
    Mr. Dupuy [continuing]. Of Mayor Williams, Chairman Cropp, 
and other members of the council, we have a signed lease, we 
have a signed MOU. I have met with four of the groups over the 
last week and a half. I have had extensive discussions with the 
commissioner, and I would expect it to happen within the next 
couple of weeks.
    Chairman Tom Davis. I just feel that a lot of these 
problems could get resolved if we could get ownership on the 
table or, you know, and I think enough said. And I think the 
mayor has expressed that, and all of us have.
    Mr. Dupuy. We are all anxious to have that happen, Mr. 
Chairman.
    Chairman Tom Davis. Mr. McCollum, let me start. Is MASN 
more expensive than Comcast cable, Comcast SportsNet? Do you 
know offhand, are you paying more for the games on a per-game 
basis than you would under--because you carry them, but you 
carry them both.
    Mr. McCollum. I carry them both, but, again, those----
    Chairman Tom Davis. You don't want to get into the 
confidentiality agreement?
    Mr. McCollum [continuing]. Agreements are confidential. I 
can honestly say, Mr. Chairman, that the deal was a very 
onerous deal and the price was very costly.
    Chairman Tom Davis. Is Comcast Cable also an onerous deal?
    Mr. McCollum. I would say it is apples and oranges 
because--and Mr. Cohen alluded to this--what is on Comcast 
SportsNet in terms of content is clearly different than what 
you see on MASN. MASN for the most--when there is not a game 
shown, there is nothing on the screen.
    Chairman Tom Davis. Our biggest frustration is everybody 
has come at this from such different directions. I mean, one 
group is talking here, another group is talking over here, and 
there is no way that we are going to intersect these lines. I 
am trying to figure a way that we could get closer on this. For 
example, pay-per-view, is that an option?
    Mr. Cohen. Let me take a first shot at that. I think--are 
you talking about pay-per-view or literally on a per-game 
basis, or----
    Chairman Tom Davis. Either on a per-game basis or a 
different tier or level, or whatever.
    Mr. Cohen. A la carte or per tier basis. Well, I think, Mr. 
Chairman, you have heard the cable industry's view on a la 
carte programming. You have probably heard me express this 
view. I think for a long-run----
    Chairman Tom Davis. Right. Just from a fan's perspective.
    Mr. Cohen. I understand.
    Chairman Tom Davis. Everybody is a businessman here, but 
the fans are kind of getting left out. Go ahead.
    Mr. Cohen. From a long-run public policy perspective, I 
believe and the industry believes that an a la carte approach 
to programming will result in less choice for the consumer at 
greater expense. As a short-term bridge, while other issues are 
worked out, you know, if somebody wants to talk to us about 
offering Nationals games on a more limited basis, it is 
certainly something that we would be willing to talk about. Our 
primary interest--and I am going to reiterate this--is to make 
sure that the Nationals, their fans, our customers, and your 
constituents are treated properly and are successful. And so we 
are open to any discussion, any idea that would permit those 
objectives to be achieved.
    Chairman Tom Davis. But you have not been talking to Mr. 
Angelos. Is there any way we can get together and put some of 
these on the table and go back and forth? Maybe Major League 
Baseball could be the adult here in trying to oversee this.
    Mr. Cohen. I am happy to have Major League Baseball be 
another adult in the process. I think Mr. Angelos and his 
representatives and Comcast and our representatives have been 
adult as well. I think----
    Chairman Tom Davis. But you are not talking.
    Mr. Cohen [continuing]. I would quibble a little bit with 
Mr. Angelos' characterization that there have been no 
discussions. There have been discussions. This week, when we 
received our latest offer from MASN--and let me be clear. Our 
offer from MASN is the same offer that MASN has always given 
us. They have never given us anything other than their original 
offer. But a meeting has been scheduled between representatives 
of MASN and representatives of Comcast in response to that.
    Chairman Tom Davis. Well, let me ask this: Is the offer to 
Comcast any different than the offer to Cox, Mr. Angelos?
    Mr. Angelos. No, it is not, and the communication that Mr. 
Cohen refers to occurred 2 or 3 days ago. We finally got a 
response 2 or 3 days ago, clearly in anticipation of this 
meeting. And I notice that Mr. McCollum does not want to answer 
the question. Are our rates any different than Comcast? And I 
will answer it. The answer is no, they are not different. They 
are actually just the same. And they are that way purposely 
because we were careful to make sure that we did not charge any 
more than the going rate so we would be fair and concerned 
about the subscribers.
    Chairman Tom Davis. But, Mr. Angelos, Comcast is 24/7. 
SportsNet is 24/7.
    Mr. Angelos. I can answer that. You are going to have 
only----
    Chairman Tom Davis. No, I am just trying to get--I am not 
trying to take sides. I really---go ahead.
    Mr. Angelos. I would like to respond. We have under 
construction presently a full facility for the purpose of 
presenting 24/7 of the kind that Mr. Cohen refers to, and he is 
correct that at this moment that is not in place, but we have 
only been at it for a year, Mr. Chairman. And despite the 
absence of cooperation from our monopolists here, we have not--
we have been pretty busy. We have been sued. We have been 
castigated. We have been vilified. We have been everything that 
one can imagine has been done. We have had lawsuits filed 
against us totally without merit, and we have constant 
indications publicly that somehow or other we are about--or 
involved in an inappropriate business or being unfair and so 
on.
    Chairman Tom Davis. Well, let me ask you this. Let me fast 
forward this a year. As I understand, next year at this time 
MASN will have the Orioles rights as well as the Nationals 
rights. Is that correct?
    Mr. Angelos. Yes, Mr. Chairman, and I did not answer your 
question properly. We will have 24/7 as of July 15th of this 
year.
    Chairman Tom Davis. OK. That is fine. But I am just fast 
forwarding this a year. As we go a year from now, MASN will 
have both the Orioles and the Nationals rights. If Comcast 
still refuses to carry it at that point because it is not on 
Comcast SportsNet, fans will be deprived of the Orioles and the 
Nationals. Is that correct?
    Mr. Angelos. Our system will have both the Orioles and the 
Nationals, and they will be shown. Both teams will be presented 
throughout that entire territory. If you are in Washington----
    Chairman Tom Davis. You present it, but if the local cable 
affiliate does not carry it----
    Mr. Angelos. I am sorry?
    Chairman Tom Davis. If the local cable affiliate, whether 
it is Comcast or whoever, does not carry it, then people that 
are receiving it on Comcast SportsNet this year would have to 
receive it under MASN next year, right? The Orioles.
    Mr. Angelos. Yes, or any distributor that is carrying MASN.
    Chairman Tom Davis. Exactly. But I guess my point is, if we 
do not breach this, this could widen next year where fans won't 
even be able to get Orioles games on Comcast. Do you want to 
comment on that, Mr. Cohen?
    Mr. Cohen. Obviously, I have a different view about what 
will happen next year.
    Chairman Tom Davis. Well, I will be happy to hear it.
    Mr. Cohen. Our belief is that we have clear contractual--
that Comcast SportsNet has clear contractual rights to continue 
to carry the Orioles games. Although Mr. Angelos has accurately 
characterized what happened in the courts below, we believe 
that the lower court was mistaken. That is why we appealed. And 
we believe that we will be in a position to vindicate our 
rights.
    Chairman Tom Davis. And if you aren't?
    Mr. Cohen. And if we aren't, then the situation you 
describe is accurate unless we are able to reach an agreement 
with MASN before the beginning----
    Chairman Tom Davis. Would reaching an agreement this year 
while the case is pending prejudice the court case, in your 
opinion?
    Mr. Cohen. I think the answer--to be fair, I think the 
answer to that is probably not. I think the relevance of the 
court case to us is that we believe that MASN is in part 
spawned by a breach of our contractual rights, and we are not 
eager to do business or continue business with an entity that 
would flout those rights. I don't think I can point to a 
prejudice of the court case from entering into a deal.
    Chairman Tom Davis. And even if it were, you could enter 
into an agreement, the two of you, that it would go ahead 
without prejudice, correct?
    Mr. Cohen. We would not assert the existence of the 
litigation or the merits of the litigation or effect on the 
merits of the litigation as a reason why we are not carrying 
MASN.
    Chairman Tom Davis. But you don't like MASN and what they 
have done and the way the deal has been set up, correct?
    Mr. Cohen. Again, with--and it is funny. I said----
    Chairman Tom Davis. I don't mean personally. I just----
    Mr. Cohen [continuing]. Before the hearing. It isn't 
personal, and we respect the rights of MASN to exist in the 
marketplace. We respect the competitive element that they bring 
to the marketplace. I think we, as anyone would, resent being 
called a monopolist. I think that when you have a network that, 
according to the structure of the agreement between Major 
League Baseball and the Orioles has the rights in perpetuity 
for two teams--the Baltimore Orioles, because they are owned by 
the majority owner of the network, and the Washington 
Nationals, because those have been granted--where neither of 
those rights ever has to go out in a process where anyone else 
in the market has an opportunity to be able to carry those 
rights, I think--I mean, I hate to say this, but I think MASN 
is sitting in the unfair competitive advantage and not Comcast 
SportsNet.
    Chairman Tom Davis. Well, I think you could make an 
argument we are dealing with two monopolists, Major League 
Baseball, which is granted a monopoly under antitrust 
exemption, and your cable franchise, which basically has a 
monopoly, and part of that is before Congress now, depending 
what the openness is going to be. But not----
    Mr. Cohen. I do not think--let me say this, because let me 
give the numbers to be fair. I don't think Mr. Angelos was 
saying that our cable system is a monopolist, although maybe he 
was. I think he was referring to Comcast SportsNet as a 
monopoly regional sports net.
    If you look at this whole market that Major League Baseball 
has defined--and let's understand this. This is not a natural 
market.
    Chairman Tom Davis. Right. Correct.
    Mr. Cohen. This is a Major League Baseball defined market.
    Chairman Tom Davis. There are local cable franchises that--
--
    Mr. Cohen. But we are--and in that entire market, there are 
6.9 million television households----
    Chairman Tom Davis. But if you are in Prince William County 
or you are in Montgomery County----
    Mr. Cohen. If you want to go on a county-by-county basis, 
you might reach a different conclusion. But we control less 
than a third of the households in that entire----
    Chairman Tom Davis. Well, I agree, but a lot of these other 
companies have been able to reach agreements, and they are 
smaller than you. They don't have pending lawsuits.
    Mr. Cohen. I think you heard from Mr. McCollum----
    Chairman Tom Davis. I am not saying it is cheap. I am not 
saying it is cheap.
    Mr. Cohen. And I think--and I am going to say this again. 
For the benefit of everyone in the market, for the benefit of 
the customers in the market, for the benefit of the Nationals 
and their fans, and with all due respect, for the benefit of 
your constituents, somebody has to stand up and say no, enough 
is enough, and it is time to protect the customers' rights. And 
it is not fair, it is not appropriate--it may be convenient--to 
characterize this as a dispute between a corporate giant and a 
business leader in the Baltimore market. I think it is unfair. 
I think that this is a situation that has been created by the 
third party at this table, by Major League Baseball in the way 
in which they have structured this. And I think that it is 
totally appropriate for us, as Mr. McCollum said, the company 
that does have an ability to stand up and say we are going to 
try and protect the rights and the positions of our customers 
and of your constituents.
    And, by the way, my bet is, although I don't know, my bet 
is that Mr. McCollum has a most-favored-nations clause, what is 
called an MFN, in his agreement and he may well get the benefit 
of whatever it is we are able to----
    Chairman Tom Davis. I think that is accurate. I don't think 
there is any dispute on that.
    Mr. Cohen. And so even though everyone may have reached 
agreements, if----
    Chairman Tom Davis. If you can drive a better agreement, 
they benefit.
    Mr. Cohen. Everyone is being honest about it----
    Chairman Tom Davis. OK.
    Mr. Cohen [continuing]. They are all hoping that we are 
going to take care of this problem.
    Chairman Tom Davis. My time is up. I am going to yield to 
Mr. Van Hollen, but let me just say, Mr. Dupuy, this would 
really be helpful for Major League Baseball, who is the owners 
of the Nats at this point, to step in here and try to look 
after the fans. We have waited in this region for over 30 years 
for a Major League Baseball team, and to get fewer games this 
year over the air than we got last year, it is a slap in the 
face. It is like giving us half a team. Major League Baseball 
can step in here and try to get these parties together, if only 
for a 1-year agreement, holding harmless everything else, so 
that our fans can see the games.
    Mr. Dupuy. We would be delighted to help in any way 
possible, as long as that help does not assume breaching 
contractual obligations.
    Chairman Tom Davis. I am not asking anybody to do that. We 
are going to have to be outside the box on some of this stuff, 
I think, if we are going to get this done, because you are 
coming at this from such different perspectives. I do not need 
to remind Comcast and I think the cable industry has a lot of 
issues pending up here. You know, this is not helpful to 
anybody over the long term, not being able to reach this 
agreement.
    OK, Mr. Van Hollen.
    Mr. Van Hollen. Well, thank you, Mr. Chairman. I want to 
thank all of you for your testimony. I do think it is helpful 
both for us and for the public to get the facts on the table in 
this way.
    Now, Mr. Burton in that opening statement he read made a 
comment that related actually to the question that the chairman 
just asked of Mr. Cohen regarding the effect of the ongoing 
litigation on Comcast's willingness to try and sit down and 
work out a solution right now as opposed to waiting until that 
litigation is resolved.
    As I understood the statement that Mr. Burton had read that 
was a Comcast statement, he said that Comcast was not willing 
to enter into those kinds of discussions because they believe 
that the MASN network was the result of a breach of contract.
    Putting aside your legal position on that, is your position 
today that you are willing to go forward now to try and work 
out an agreement to air the----
    Mr. Cohen. Congressman, I think I tried to at least touch 
on that answer in response to the chairman's question. There 
are a whole host of reasons and a whole host of problems that 
we have with negotiating a deal with MASN. And certainly the 
pendency of the lawsuit but, more importantly, the breach of 
our contractual rights is one of those reasons. Standing up for 
our customers is another reason. The price is a third reason. 
The programming that is available is a fourth reason. And our 
willingness and our ability to do what is right for the 
Nationals, for their fans, and for our customers and your 
constituents, and make sure that we end up--that all of us end 
up--we are big citizen of Washington, DC. That is why we were a 
big fan of bringing the Washington Nationals to Washington. I 
want to say this. If we go and we sign a deal with MASN, we are 
the last thing standing in between a protection of the 
Nationals' long-term rights and the status quo for them. And if 
we sign that deal, 5 years from now, 10 years from now, mark my 
word: Washington, DC, and the Nationals is going to have a 
second-class franchise in a first-class city, and somebody is 
going to be standing around screaming: How did this happen? Who 
let this happen?
    I am willing to say, in addition to all the other reasons 
that I have noted, that we are willing to stand up and try and 
create the incentive for the right thing to happen.
    Let me ask this question. If we had signed a deal with 
MASN--all right? And, by the way, I heard all the opening 
statements. A lot of people properly said we have questions 
about this deal with Major League Baseball. We have questions 
about what this means to the Nationals, the future of the team, 
questions about the public investment that Mayor Williams so 
artfully guided through City Council. I heard all of that. If 
we had signed a deal with MASN last summer, the end of the 
baseball season, before this season, would this hearing be 
taking place? Of course not.
    Our unwillingness to sign a deal is keeping a spotlight on 
the original sin here, and that is this extremely unusual 
structure that has been created, and resolution of that problem 
will solve this faster than anything else.
    Mr. Van Hollen. Well, let me just--I was not--I understood 
your answer to the chairman's question to be different than the 
way Mr. Burton had characterized Comcast's position, which is 
why I was asking you the question. Taking everything you just 
said, are you willing to sit down with Mr. Angelos or is 
Comcast willing to sit down with the Orioles and taking all 
those variables you mentioned into consideration, tomorrow sit 
down and try and--or at least talk?
    Mr. Cohen. As I also mentioned, we are willing to sit down 
with anyone. Our only given is that we would like to get a deal 
done, and as I mentioned, there is a meeting scheduled between 
representatives of MASN and representatives of Comcast. But I 
have tried to put on the table here the whole host of concerns 
that we have, some of which are resolvable in discussions with 
MASN, but some of which are not resolvable in discussions only 
with MASN. Major League Baseball needs to have a seat at that 
table and needs to be involved in that process.
    Mr. Van Hollen. I understood Mr. Dupuy to say he would be 
willing to sit down in that process. But I also understand your 
position to be unless Major League Baseball sort of undoes what 
you have termed the original sin, you are not willing to 
reach----
    Mr. Cohen. I think we are asking for Major League Baseball 
and the Baltimore Orioles to do what is right for the Nationals 
and their fans.
    Mr. Van Hollen. OK. Let me get to this price issue because 
I think there is the apples and oranges issue, and we do hear 
that. Mr. McCollum, you mentioned--as I understand the 
testimony so far, the rate amount that you are being charged by 
Comcast, just the rate--put aside the apples to oranges--is 
comparable to what you are paying MASN. Is that correct?
    Mr. McCollum. Again, Congressman, I cannot comment on the 
specific rates. I think the point is that the deal that we have 
with MASN is a very onerous deal and does put significant 
pressure on our rates.
    The other thing I would say is that it is not an apples-to-
apples comparison when you look at what they are offering in 
terms of the content. Again, at home last night, looking at 
this network, there is nothing--it is not a black screen. It is 
a blue screen with a computer-generated message saying ``This 
is MASN.''
    Mr. Van Hollen. I want to get to that, but let me just ask 
you this. I mean, your customers also pay more, do they not, 
because of the fact that you carry Comcast SportsNet?
    Mr. McCollum. That programming----
    Mr. Van Hollen. OK. I mean, they pay more----
    Mr. McCollum. All of our programming costs impact----
    Mr. Van Hollen. Look, I am just trying to figure out what 
the impact on our consumers, our constituents is going to be. 
So they pay more because you have Comcast SportsNet, and now 
you are saying they are going to pay more if they carry MASN. 
Let's get to the apples-and-oranges issue here. As I understand 
what Mr. Angelos just said, they have a plan in the works to 
have 24/7 programming. I have two questions here. One, won't 
that make a difference? Will that then make it apples to 
apples? And, second, they are a startup, as I understand it, 
and I guess my question to Mr. Cohen would be, Comcast, when it 
started up some of its sports nets in different cities around 
the country, have you never had a cable channel that just 
showed games, or has it always been--in every case, has it been 
24/7 programming?
    Mr. Cohen. My history in the cable industry does not go 
back far enough to answer that question with 100 percent 
certainty, but I can tell you that in the last 18 months we 
have launched two regional sports nets--one in Chicago, a four-
team regional sports net, by the way, and one in New York, a 
one-team regional sports net. In both cases, immediately upon 
launch, both networks were 24/7 networks.
    Mr. Van Hollen. OK.
    Mr. Cohen. We don't go out to the market and try and 
collect the types of pricing that regional sports nets command 
without 24/7 programming.
    Mr. Van Hollen. If it turns out MASN is going 24/7, would 
that make it apples to apples?
    Mr. McCollum. Well, I think the difficulty, Congressman, 
will be--and, again, I would love to see the Nationals playing 
in October. The fact of the matter is baseball is a summer 
sport. 24/7 assumes 365--it assumes a year-round network. And 
Comcast SportsNet clearly has Caps, it has Wizards, and it has 
Orioles today. So I think when you really look at--I am 
encouraged by what Mr. Angelos said today about what is going 
to happen on July 1st, but I am more interested in what is 
going to happen on December 1st.
    Mr. Van Hollen. All right. Let me also, if I may, Mr. 
Chairman, just on this price issue, Mr. Cohen, as I understand 
it, you said that Comcast proposed to pay more for the rights. 
Is that right?
    Mr. Cohen. Correct.
    Mr. Van Hollen. Now, as a result of that, won't my 
constituents be paying more to Comcast?
    Mr. Cohen. The answer--it is a very good question, a very 
important question. I think the experience around the country 
has been that in markets with duplicate regional sports 
networks, the customers end up paying more as a result, more 
for regional sports net programming than they would pay in 
single regional sports net markets. So although your 
constituents might have paid more--and, by the way, a lot of 
this has to do with channel capacity as well as Mr. McCollum 
referred--and, understand, I do not want to--Mr. McCollum and I 
have met once before. We did not talk at all before his 
testimony. I had no idea what he was going to say. But notice 
that he pointed out from an independent cable provider that has 
no regional sports net interests in this market--and I don't 
know that Cox has anywhere--that he said that he was hoping 
that there would be a single regional sports net in this market 
because it would be most efficient to him and to his customers. 
And that has been the national experience.
    I would note, by the way--and I am not--we are a little 
constrained here, and I think we all understand the awkwardness 
of it, not to get into the confidentiality of pricing. But I 
will tell you and I will represent to you--and I hope all of 
you know me well enough that I would not make this up--that we 
are in Comcast of 10 two-team regional sports nets in the 
country. And looking at the pricing that MASN is proposing for 
next year, starting when it would be a two-team regional sports 
net, it would have the highest pricing of any of those 10 
regional sports nets anywhere else in the country.
    Mr. Angelos. I am reluctant to say it, but I will. Mr. 
Cohen's most recent statement is an absolute untruth. Moreover, 
his contention that more than one regional sports network in a 
given area just is simply not the right thing to have, and he 
says that under oath when his company is involved in a number 
of places in which they have a regional sports network and 
there is an additional one or additional three or even four. 
But he sanctimoniously sits here under oath and tells you that 
what is really wrong here is that there will be two regional 
sports networks in this area and somehow that is going to be 
catastrophic for the consumer.
    And let me address Mr. McCollum's position. The only reason 
that they finally came to the table to put the Nationals on is 
because Verizon has brought the competition that this 
industry--their industry--has needed for maybe further back 
than Mr. Cohen was talking about, which he won't have too much 
information on.
    The competition has come to Fairfax County, and that 
brought Mr. McCollum--Mr. Wilson to the table to make the 
arrangements with MASN to put the National games on. No 
Verizon, there would not be any deal with Cox. It is that 
simple. And that is what Mr. Cohen's people need, and that is 
what Mr. McCollum's people have to have, and all of these cable 
companies need to have--competition. And that is why they do 
not like us. That is why we have been castigated and vilified 
and so on, because we also present competition.
    Mr. Congressman, we are not gouging anybody, and we are not 
reluctant to show you numbers. I will be delighted to show you 
numbers. Maybe not here, that is, openly. There may be some 
concern on the part of these gentlemen that should not be an 
open matter. But I would be delighted to sit with the chairman 
and members of the committee and show you exactly where we are 
coming from them. But I will also show you what their numbers 
are. We have nothing to hide, and we do not deal in statements 
that simply are untrue, inaccurate, and deceptive.
    Mr. Cohen's position, while well articulated, is a false 
one, just like his litigation is a false one.
    Chairman Tom Davis. Thank you. It looks like when we have 
that meeting, Mr. Angelos, with you and Mr. Cohen, we are going 
to need Major League Baseball there. [Laughter.]
    Mr. Ruppersberger.
    Mr. Ruppersberger. First, I do think this hearing has been 
helpful because we are getting a lot of the facts out on the 
table. I know that we cannot agree with the other person's 
positions, but maybe we can find a way to move forward somehow. 
I think from what I am hearing now, we need a short-term 
solution and long-term solution.
    The first thing, Mr. Cohen, I would like to address your 
argument about Major League Baseball and a bad deal for the 
Nats, and I might agree with you. But on the other side is that 
the Baltimore Orioles gave up a lot. They gave up 25 percent of 
their market, and that is going to be a financial loss. When 
Mr. Angelos or any owner buys a team, they are going to buy the 
team, and they enter into a contract, and they have a certain 
market, and that is something of value. And there is no good 
businessman who has the money to buy any team, I am sure, that 
is going to try to go in and have a losing proposition.
    I would agree with you, though, that I think if anybody is 
going to help move this on, it might be Major League Baseball. 
Whatever Major League Baseball and Mr. Angelos did, Mr. 
Angelos, I am sure, has a contract or understanding, and he is 
not going to give that up because he needs to generate money to 
compete with the Yankees and to compete with Boston and those 
other teams.
    Now, Major League Baseball also has an obligation to the 
Nationals, too, and they don't want the Nationals to fail. And 
neither do the gentlemen sitting to my right or left want the 
Nationals to fail either. So it is up to Major League Baseball 
on a long-term solution to look and analyze.
    But I can guarantee you, knowing Mr. Angelos' ability to be 
a good negotiator, he is not going to give up what he already 
has in his pocket to help his team.
    So I think that argument, even though it might be a good 
argument, I don't think that argument is going to go anywhere. 
So where do we go from here?
    The first thing, Comcast, as I said in my opening 
statement, is a very good corporate entity within at least the 
jurisdiction that I represent, and I think a lot of your 
reputation is because you have put back in. And most of those 
corporations that do well put back into the community. And I 
think you really have to look long term whether or not, you 
know, this position that you are taking, that you are saying to 
save the Nats or whatever, is going to affect you and also your 
reputation. How much is that worth?
    But, on the other hand, as a good businessman, you have to 
look at the margins. You have to look at the long term.
    Now, you know, we are talking about where to go on the long 
term or whatever. I would think right now, my recommendation is 
that somehow you move forward and try to resolve a short-term 
situation. Now, I know long term you have to wait for the 
lawsuits and see where they are going to go. That might make a 
decision where a lawsuit goes. I know there are other issues 
about what is MASN and where we are, and I am sure it is an 
issue with you. What is going to happen when the Orioles 
contract expires? And I hope as an Oriole fan you work it out 
before we get to that level again.
    But I do think--and I think that Major League Baseball has 
to step up a lot more, maybe, about where we are going, but 
they are not going to be able to do that until you have an 
owner. And I think once you have an owner, you have an 
advocate, and a lot of the things might be able to move 
forward. But, you know, how much you pay for advertising, how 
much you pay for public relations, all that could go away if 
you irritate the average person, who really does not care about 
anything we are talking about here today other than having 
their team on TV. That is bottom line.
    Now, let me ask you, Mr. Dupuy, as far as where you think--
you have heard what I just said. Where do you think you can be 
to move this or do you have recommendations on what to do from 
a short-term perspective and then from a long-term perspective? 
Because if the Nats cannot generate revenue enough to be 
competitive, that does not help you either. And, again, if that 
is the case, I mean everything has a price. Maybe you have to 
look at how you can compensate Mr. Angelos, and I want him to 
be compensated because I want the Orioles to be competitive.
    Mr. Dupuy. Congressman, addressing several of your comments 
in a single answer, despite the disclaimer that there was no 
attempt to ascribe blame today, I keep hearing the phrase, you 
know, ``original sin,'' that we committed the original sin. 
Well, we don't think we committed a sin, and what we did 
certainly wasn't original, because there are lot of models for 
it around the country, including several that Comcast is 
involved in individually.
    I think the short-term solution is there needs to be a 
commercial resolution. This is a commercial dispute. There 
needs to be a commercial resolution between MASN and Comcast as 
to what a fair rate is for this year's coverage with regard to 
the coverage of the team. MASN has been able to reach that 
resolution with at least five other carriers. They ought to be 
able to reach a resolution with Comcast over the broadcast of 
the games this year until, as you mentioned, the various claims 
and litigations are either compromised or are determined.
    In terms of a long-term solution, that is what we believe 
we did, and what we believe we did is something that is both 
pro-fan and pro-competition. In the sense of being pro-fan, we 
expanded the territory. We allowed all of the fans in the 
entire territory to be fans of both the Orioles and the 
Nationals. We allowed fans to choose based on the performance 
of the teams on the field, based on stars, based on 
allegiances, based on presentation of the product on the field. 
We did not split it up. We said fans could be fans of the 
entire area. We tried to deal with the compensation of the 
Orioles for the losses----
    Mr. Ruppersberger. But how do you deal with Mr. Cohen's 
argument that you have as a result of this arrangement you have 
with the Orioles, that it is not a monopoly? How do you deal 
with the issue of a fair competitive price? Because you are 
part owner of MASN, too.
    Mr. Dupuy. The Nationals are part owners of MASN, just as 
the Cubs and the White Sox and Comcast are part owners of the 
joint venture in Chicago that we modeled this after. This is a 
joint venture. It is a joint business venture.
    Mr. Ruppersberger. We know that Comcast has the Flyers and 
the 1976ers, and they don't allow anybody to come in on their 
side. So it is a different story here. But I do not really--I 
am not concerned about their rights and the fact that they need 
to be a competitive company. It is just about what is fair and 
reasonable.
    You know, whether we like it or not, electricity, 
telephone, and sports, believe it or not, seem to be quasi-
governmental, even though they are not. And we know you have to 
make a profit. But when it comes to this type of thing, people 
are not--this is not going to go away. And I think you have to 
step up more than anybody and get these games on in the short 
term and then start working it through when you get another 
owner. That is the only----
    Mr. Dupuy. Again, we are happy to do whatever we can----
    Mr. Ruppersberger. I see my red light is on. It goes so 
quickly. I do want to say this, though. I think everybody at 
the table needs to understand this. The airwaves are not 
privately owned, and they belong to the public. And we need to 
understand that. These airwaves are making a lot of people a 
lot of money, but they do belong to the public. And we do not 
want Congress or the FCC to have to get in, which could hurt 
everybody. I believe that we need free enterprise to move 
forward, let the market share move where it is, negotiate based 
on the market share. But if it goes too far and you irritate 
fans and it looks like people feel, even though it might be the 
case, that you are being gouged or whatever, then that is when 
we step in because we represent the people.
    So let's get it together because we do not want to get to 
that next level.
    Chairman Tom Davis. Mr. Moran.
    Mr. Moran. Thank you, Chairman Davis, and just a segue from 
what Dutch says, you know, it does fall on us to represent the 
fans, because it is the fans that are really getting the short 
end of the stick here.
    Let me first ask Mr. Dupuy with regard to Major League 
Baseball's role. You make a deal that gives 90 percent of the 
broadcasting rights to the owner of a competitive team, the 
Orioles.
    Mr. Dupuy. No, sir. We gave 90 percent, beginning 90 
percent of the control of the corporation, 90 percent of the 
profits of the corporation, not 90 percent of the rights. The 
rights were given to a joint venture.
    Mr. Moran. All right.
    Mr. Dupuy. This is a joint venture.
    Mr. Moran. All right. Then let me rephrase it. You give 90 
percent of the profits for broadcasting rights from the 
Nationals to the owner of a competitive team.
    Mr. Dupuy. Only after first ensuring that the Nationals 
would receive, unlike any other team in baseball--there is no 
other team in baseball that has a guarantee that they will get 
a market right fee for their product.
    Mr. Moran. But, Mr. Dupuy, isn't it correct that the two 
principal sources of revenue for a baseball team are the real 
estate that it owns and the revenue generated from that and the 
broadcasting rights, that the broadcasting rights are essential 
to the revenue that a baseball team owner receives?
    Mr. Dupuy. Precisely so. Ticket sales and broadcast rights 
are the two economic drivers.
    Mr. Moran. And yet the deal that you make gives the new 
owners of the Nationals 10 percent of the revenue from 
television, which means that they are not going to be able to 
compete in terms of buying the best players, fielding a 
competitive team. Now----
    Mr. Dupuy. With all due respect, sir, quite the opposite. 
The Washington Nationals do not have the wherewithal, do not 
have the product to set up a competing RSN to Comcast. A single 
team in this market would have had difficulty setting up an 
RSN.
    What the Nationals have done is combined and formed with 
the Orioles, given the critical mass to be able to form a 
competing RSN. They are getting a full rights fee, but they are 
also getting a plus. They are getting 10 percent of an entity 
and eventually 33 percent of an entity they never would have 
had but for the negotiations.
    Mr. Moran. Baltimore is the 23rd market. Washington is the 
8th market. The income level in Washington is twice what it is 
in Baltimore, and there are twice as many TV sets in the 
Washington area, immediate Washington area, as in the Baltimore 
area. And yet it seems to us that you have set up a situation 
where the revenue that would normally go to the team owner, 
grant you at some point, is constricted, limited to only 10 
percent, 33 percent in the future, but Mr. Angelos has into 
perpetuity----
    Mr. Dupuy. No, I----
    Mr. Moran [continuing]. A control over the revenue that is 
coming from the network that he owns.
    Mr. Dupuy. Again, sir, I would disagree. Just as in Chicago 
the White Sox have a certain percentage, the Cubs have a 
certain percentage, the Bulls have a certain percentage, the 
Black Hawks have a certain percentage, Comcast has a certain 
percentage, so too here the Nationals have a certain percentage 
of an upside that was created by this joint venture. They are 
getting a full market rate for their rights, and we have 
created value rather than diminishing value in my opinion.
    Mr. Moran. I just cannot understand how you can say that, 
for the team owner--any team owner in their right mind who is a 
businessman is going to have to buy from Mr. Angelos the right 
to get more than 10 percent or even 33 percent of the revenue 
that is generated by this television market.
    Now, Mr. Angelos wants to say something, and you can 
address that, Mr. Angelos. But let me also ask you, because it 
seems to me there is another factor here in terms of the 
revenue that will offset the cost that Mr. McCollum and Mr. 
Cohen's network are going to have to bear, and that is 
advertising.
    Now, if you let them advertise and they get a fair share of 
the advertising revenue, then that covers, that could cover 
their costs. Certainly it covers part of their costs. But, on 
the other hand, if you say, well, you can get a share of the 
advertising revenue when we present the International Dog Show 
at midnight, but you cannot get the revenue from the baseball 
game, that is a different situation. And that is a factor that 
we need to understand because it seems to me there are ways 
that you can compensate, enable Cox and Comcast to get back 
their revenue--excuse me, get revenue to cover that extra 
expense that you are charging them per subscriber if you let 
them have a fair share of advertising revenue.
    Now, how have you structured that, Mr. Angelos, if you 
would not mind telling us?
    Mr. Angelos. The division of the advertising revenues 
between an RSN and a distributor such as Cox is on a 75/25 
percent break: 25 percent goes to the entity like Cox, and the 
rest goes to the RSN.
    Mr. Moran. Well, and that is of all the advertising?
    Mr. Angelos. What is that?
    Mr. Moran. They cannot distinguish between--in other words, 
all the advertising that is on the games, that is on the dog 
shows, that is on everything, you split it the same?
    Mr. Angelos. Congressman, we did not originate this 
approach, neither with respect to the rates nor the division of 
the advertising revenues. That is a standard arrangement in the 
particular business we are discussing, which is a regional 
sports network. We have not innovated anything. We have 
followed the system which has been developed over the years, 
and that is the arrangement.
    Mr. Moran. OK. If you were to buy the Nationals, would you 
not see it as essential in your interest to try to acquire the 
broadcasting rights for the Nationals so that revenue would be 
going to the benefit of the Nationals team and not primarily 
going to the benefit of the owner of the Orioles team?
    Mr. Angelos. Congressman, let me try to answer the other 
question as well as this one that you asked before. Let me 
point out that the territory that we are discussing, which I 
enumerated earlier, running from Lancaster all the way through 
central Pennsylvania, in Maryland, in D.C., in Virginia, and so 
on, that has been----
    Mr. Moran. Chairman Davis covered that.
    Mr. Angelos. That has been, sir, the Oriole home television 
and cable territory for 30 years, and every team in Major 
League Baseball has a territory like that, similar to that.
    Mr. Moran. No, no. There is not another situation where you 
have as large a metropolitan area as Washington that has been 
shut out from baseball for 30 years, and much of the reason 
they have been shut out is because you have worked with the 
other baseball club owners to shut them out.
    We have been at your mercy because you had a financial 
interest in Washington not having a team, Mr. Angelos.
    Mr. Angelos. May I respond? Let me say that in 1993, when 
we purchased the Oriole team out of bankruptcy, we paid $173 
million for that team--if you would let me finish, please--and 
we also assumed certain obligations that were outstanding. At 
that time, the Oriole home television territory was essentially 
as I have described it here today.
    The purchase of that team, along with that territory, the 
home territory of the Orioles, was one of the reasons we made 
that kind of an investment, and at that time what we paid was 
the highest number ever paid for a ball club in the history of 
Major League Baseball.
    Mr. Moran. I understand the history, but I also understand 
the history of the last 30 years. The last thing I want to say 
is I have to conclude, Mr. Cohen, that the fact that there is a 
lawsuit pending, which if it prevailed on your side would 
substantially weaken the leverage that MASN has, Mr. Davis 
suggested it, and you pooh-poohed it, but I have to believe 
that you have a substantial vested financial interest in not 
showing games until this lawsuit is concluded because you think 
that you are going to prevail, and if you are able to maintain 
that contract, then, of course, you are not going to have to 
pay anywhere near as much to MASN as you would have to today, 
and as Mr. McCollum has had to.
    So I do think that Comcast has culpability here, to be 
honest with you, and I think it is you that is going to have to 
yield.
    Chairman Tom Davis. Thank you.
    Ms. Norton.
    Ms. Norton. Thank you, Mr. Chairman. I am going to start 
with Mr. Dupuy. You have gotten off pretty easy here. But if 
you happen to represent the District of Columbia, when I look 
at you, sir, the first thing I think of is $611 million that 
this city paid for a stadium, the price of bringing baseball 
back to Washington. And, of course, this city is the core of 
the region and doing very well, but it pales beside the wealth 
of the rest of the region. And yet who put the $611 million on 
the table was the District of Columbia.
    I am sure you watched very carefully the council to see 
whether it would get through those proceedings, because for you 
that meant $450 million. We put $611 million. You immediately 
have a team that could go for--at least it is estimated as much 
as $450 million. We have not seen much of you in this dispute. 
You have not played any of the roles that one might expect 
Major League Baseball to play, largely because it is 
unarguable, it seems to me, that the present deal does take 
resources away from the Nationals in particular and will have a 
negative effect upon their ability to compete.
    But, you see, I know Mr. Angelos, and I understand that the 
delay in bringing baseball to Washington had to do with the 
fact--and he has laid it out very clearly. Here was coming a 
team very close to his team, so he was in a position to drive a 
very hard bargain, and of all the bargainers I know, you all 
aren't nearly as good as Mr. Angelos, even though everybody in 
the District gives you a lot of credit for the kind of bargain 
you drove against the taxpayers of the District of Columbia. We 
were not match for Mr. Angelos, and he came out with something 
that he believes will at least not prejudice him in the long 
run.
    Members here have raised all kinds of Federal interests 
that are on the table--airwaves interests, the monopoly and 
antitrust exemption that has favored you. One way, of course--
the thing that stands out, though, is that in this dispute 
there is nobody to speak for the Nationals. So, you know, 
obviously Mr. Angelos is going to speak for the Orioles. You, 
of course, have money on Mr. Angelos. I am not criticizing 
that. I understand business deals.
    Meanwhile, here are the Nationals, playing baseball every 
day, and not at the table during a dispute that means real 
dollars for them. In any fair dispute, at least they would be 
at the table. Maybe they are no match for Mr. Angelos, but he 
has a situation where he is bargaining with himself because you 
will not even bargain for him, and I can understand that. And 
when you were asked by the chairman when are you going to name 
an owner for the team, you came out with a month, a true insult 
given the nature of this dispute.
    Sir, I must ask you to detail where you are, what 
discussions have taken place, and to give us a date so that we 
can have somebody at this table. We have paid for this team. We 
deserve to have a voice and to have somebody who can speak for 
us. We are used to not having anybody who can speak for us on 
the floor of the House and Senate. I will be darned if when you 
give this kind of money to build a stadium you do not deserve 
more than vague notions anytime soon, maybe in a couple of 
weeks. I am asking you to be far more specific than that out of 
fairness to the people I represent.
    Mr. Dupuy. Thank you, Representative Norton. A couple of 
comments.
    First, I believe that the deal that was negotiated with the 
city, the City Council, the mayor, the sports commission, that 
because of the unique circumstances of D.C. government, was 
renegotiated four or five times during the course of a year and 
a half, is a fair deal.
    Ms. Norton. I bet you do.
    Mr. Dupuy. And with regard to the $611 million, over 70 
percent of that will be paid for by the team through rent 
payments, through ticket taxes that would not otherwise exist, 
and we believe will spur development of the entire Anacostia 
Basin to the benefit of all of the D.C. residents and the city 
of D.C. We are proud to be here. We think the deal was fair, 
and we believe that the team and the city were very well 
represented by the mayor, by the sports commission, and by----
    Ms. Norton. Now will you answer my question?
    Mr. Dupuy. And in response to your question, that decision 
will be made by the commissioner. Until last week, 
Representative Norton, we did not have an asset to sell. We did 
not have a lease. We did not have----
    Ms. Norton. What do you mean by that?
    Mr. Dupuy. We did not have a document. We did not have 
anything to give to a new owner. We had promises. We had, ``Oh, 
yes, we can do that.'' But last week, for the first time all 
the documents were signed.
    As you recall, because I did participate and watched the 
hearings, as you did, this has gone on for some time now. There 
have been protracted hearings. There have been protracted 
changes. There have been renegotiations. Major League Baseball 
itself for the first time ever is putting up $20 million. Now, 
$20 million may not be a lot of money, but $20 million is the 
first time we have ever contributed to a stadium----
    Ms. Norton. Now that a deal----
    Mr. Dupuy [continuing]. And we did that trying to bridge 
the gap.
    Ms. Norton. Now that you have a lease--and that is, of 
course--you are arguing you could not have named an owner 
without a lease. Now that you have a lease, now would you 
answer my question?
    Mr. Dupuy. Yes, and we have assembled all the documents in 
New York, all the new documents, the new lease, the MOU, the 
groups have come in this week. I believe we had five groups in 
New York this week. As I mentioned, I spent the last week, 
apart from getting prepared for this hearing, meeting with the 
various groups. And as I also indicated, this is the 
commissioner's decision. He has indicated he will make this 
decision within a couple of weeks. I tried to be as specific as 
I could.
    Ms. Norton. So within a couple of weeks you expect----
    Mr. Dupuy. That is what the commissioner has indicated, 
yes, ma'am.
    Ms. Norton. We cannot expect--I never expected Major League 
Baseball, given the incestuous relationship they have with this 
deal, given the fact that, frankly, Major League Baseball 
represents all of the teams, to be a legitimate third party to 
help resolve this matter. And I am trying to find how it is 
going to be resolved.
    Mr. Cohen, you know the respect I have for you because of 
your Philadelphia experience. Sir, are you a lawyer?
    Mr. Cohen. I am.
    Ms. Norton. In that case, I am truly astonished by what you 
had to say about how the matter should be resolved because--and 
here I am reading from your own testimony. The way you think it 
ought to be resolved, as I see it, is to nullify the agreement 
that has been made. This is an agreement which I agree is 
unfair, and I must tell you, I have to sit through a lot of 
unfairness in the House of Representatives that I can do 
nothing about. And unfair contracts, when you and I went to law 
school, we were taught as long as the parties were free and 21, 
is something in which the law cannot intervene. Wish it could. 
But there is a reason for that in a market system.
    You said that Mr. Angelos should return control of the 
Nationals television rights to the Nationals, their rightful 
owner. Then MASN can bid on those rights. You can bid on the 
rights. He deserves compensation. Let them pay directly, Major 
League Baseball.
    Now, it is hard for me to regard that as anything but a 
negotiating position. Do you agree that is what it is and that 
you would have to move from there if you were sitting down with 
any party in order to try to resolve this dispute?
    Mr. Cohen. Congresswoman, two things. First of all, I am a 
good enough lawyer to know that I was not asking for a court or 
this Congress or anyone independent----
    Ms. Norton. So if a court--you expect them to do it 
willfully?
    Mr. Cohen. That is exactly correct.
    Ms. Norton. Why? Why is it in their interest to----
    Mr. Cohen. Because--and let me be clear. Notwithstanding 
Mr. Angelos' comments, I have tried very hard not to castigate 
him because I don't think Mr. Angelos is taking an unreasonable 
position in seeking to make the best deal that he can on behalf 
of his team.
    Ms. Norton. You understand I looked at this--you know, I 
tried to take away my bias in favor of my own jurisdiction. I 
looked at what Mr. Angelos did when you all filed suit, and 
your original complaint, as I read it, said you deserve first 
rights, and you didn't get it.
    Mr. Cohen. That's on the Orioles, not the Nationals.
    Ms. Norton. And, you know, the clear answer is, yeah, I 
deserve first rights, but obviously somebody can do it himself 
if he has the rights. So one goes into court on that kind of 
theory, and one wonders why is this a legal dispute and does 
anyone expect the matter to be resolved in this way? And if 
not, then what is it that you--how do you expect a resolution 
to come by?
    Mr. Cohen. Congresswoman, this is a different issue.
    The legal dispute around the Orioles' rights relates 
precisely to whether Mr. Angelos and the Orioles in fact did do 
this themselves. You've heard, in response to Congressman 
Moran's question, Mr. Dupuy's testimony that in fact this was 
not the Orioles doing this themselves, this was a joint 
venture. It was a third party that gained control of these 
rights, different from the Orioles, and you can't have it both 
ways. Either it's fair to the Nationals or it's not fair to the 
Nationals.
    Ms. Norton. And the third party?
    Mr. Cohen. Is this new joint venture between Major League 
Baseball/Nationals and the Baltimore Orioles. But this is a 
matter of----
    Ms. Norton. That was done pursuant to a legal contract.
    Mr. Cohen. That is--well----
    Ms. Norton. Legal negotiations.
    Mr. Cohen. Well, an illegal legal contract in our view, OK?
    Ms. Norton. I really don't want to----
    Mr. Cohen. I think that's it. But let me answer. The 
question you asked is we are asking Major League Baseball and 
the Orioles to do the right thing for the Nationals and their 
fans, and to figure out a different way to compensate or to 
give the Orioles whatever compensation they're due, and not use 
as a mechanism to do that, the wallets of cable customers and 
your constituents. That's what our request is.
    Ms. Norton. I understand that is how anybody would begin 
negotiations. I don't understand that somebody like you in 
Philadelphia, who worked all kinds of deals in the public 
sector would regard that as the way to move----
    Mr. Cohen. And I----
    Ms. Norton. Maybe that isn't your job. Maybe your job is to 
put that on the table----
    Mr. Cohen. But I can say, Congressman, I've also sat here 
today, and I want to repeat, our--we are willing to talk and to 
discuss and to be flexible in this entire area. We have in 
front of us though the interest of the Nationals, their fans 
and our customers. That is really what we're trying to focus 
on.
    Ms. Norton. Let me continue if I just might, because I want 
to--precisely because I thought at least Mr. Cohen's reputation 
as being a problem solver, I want to see what can happen here. 
So I looked, I asked my staff to find out about your own 
behavior in your home jurisdiction, and as you know, that is 
Philadelphia. And I was really quite astonished to learn that 
in Philadelphia, for example--this is among other 
jurisdictions--where you own the rights to the Flyers, the 
Philadelphia Flyers and the Philadelphia 76ers, you have 
refused to allow other cable providers to televise the games.
    Mr. Cohen. That's not true.
    Ms. Norton. And that the opposite is here because we have 
kind of a turning-it-on-its-head situation here. That is not 
true now?
    Mr. Cohen. Congresswoman, that is not true. In 
Philadelphia--and Comcast SportsNet is a unique regional sports 
net in the country--but Comcast SportsNet is made available to 
all cable providers in the market, to all over-builders in the 
market, including RCN. The only entity that we do not make 
Comcast SportsNet available to are the DBS providers, DirecTV 
and EchoStar, and that is pursuant to terrestrial exemption in 
the Federal Telecommunications Act, which was designed to 
encourage investments in existing terrestrial networks, which 
is what Comcast SportsNet was when we purchased it, but it is a 
regional sports net that is available to all cable providers in 
the market, including competitive cable providers to Comcast.
    Ms. Norton. In your own testimony, when we got past what 
they ought to do, which is to tear up their contract, you said 
in your own testimony that independent analysts reported last 
week, believe that MASN is, ``asking too much for carrying the 
network.'' So basically what we are talking about is a 
necessity for some kind of negotiation over price. Is that not 
right, sir?
    Mr. Cohen. I think that is part of the issue, 
Congresswoman, but I've identified a whole series of issues 
that we have with this network, of which price is only one 
factor.
    Ms. Norton. What is the other one?
    Mr. Cohen. The other factors----
    Ms. Norton. You are in business here, what is the other 
one?
    Mr. Cohen. The other facts that I've identified is 
protection of our customers, and to make sure that we deliver 
the highest quality service to them at the best price. Price, 
quality, the extent of programming and the quality of 
programming, and the fact that his network, we believe, has 
fundamentally been spawned by a violation of our contractual 
rights. And last, our interest in standing up and protecting 
the interests of the Nationals and their fans, and keeping the 
spotlight focused on the structure of this deal. Those are the 
five items I've identified over the course of this hearing.
    Ms. Norton. Well, Thank you very much, Mr. Cohen, but 
unless I am hearing you wrong, it still all comes down to cost 
and price. Anyway, I understand how you are framing the issue. 
Allow us to frame it, given the amount of money we put on the 
table as we do.
    Mr. Angelos, you have already been beaten up a lot in the 
region, and I don't want to flog you any further. You know how 
I must feel about this. Let me ask you though about this new 
MASN, because you said that it was going to be 24/7 this year, 
so I would like you to elaborate on that. How are you going to 
maintain a profitable regional sports network and competition 
with another that has such a head start, going 24/7, and what 
conceivable programming, if you are going to do it as soon as 
July, do you have in mind?
    Mr. Angelos. We will have a full range of what is referred 
to in the industry as shoulder programming, which includes 
college football and college basketball, ESPN programming. 
Potentially we will also have Fox programming. We're interested 
in putting together 24/7 operation with the two baseball teams, 
which includes all of the kinds of sports programs, sports 
news, sports magazine, that fans want to watch on a regular 
basis. So basically, we're in the process of doing that. We've 
only been in operation for a little bit better than a year. We 
need another few months and we will have all of that put 
together, and we'll be glad to report that to you personally if 
you would like, as to our progress.
    Ms. Norton. Mr. Angelos, you, and perhaps Mr. Dupuy, could 
answer this question, if you could answer this for us. You've 
done your own network, I understand that. I understand the 
reasons. I understand the initiative. I understand the 
negotiating position it puts you in. All things being 
considered, if you could strike a deal with an already-
established network, that you think would satisfy your 
interests, as opposed to having your own startup network, would 
that not be preferable?
    Mr. Angelos. I think we----
    Ms. Norton. If you could get a deal now. I am not----
    Mr. Angelos. Congresswoman, with all due respect, I think 
we've made our decisions, we have joined in a contract with 
MLB, which eventually will be the contract of the Nationals 
directly, and we intend to see that contract is enforced.
    The proposal that has come from Comcast for purposes of 
preserving its monopoly, we absolutely find to be, one, if you 
want to speak of illegalities, grossly illegal and improper, 
because what the solution is that is being offered by Comcast 
is that Major League Baseball should breach its agreement with 
us, and we in turn would then have to breach our agreement with 
the five distributors that we have executed contacts with, 
including Cox, for periods of 7 years. They have signed for 7 
years to put the MASN games, the two baseball teams in 2007, 
and the full 24/7 that I described to you just a moment ago.
    So we offer, and we will deliver to the Nationals, not just 
a rights fee that is market rate and increasing almost 
annually, but we also will produce for them an ownership 
interest. They're going to own part of this RSN.
    Ms. Norton. Mr. Angelos, I don't know if you are telling me 
that you are in so deep that--we have just heard now that 
Comcast is willing to sit down, whatever that means. And then, 
of course, you have justified the position you have and you 
think it ultimately is a position that will be profitable. Does 
that eliminate the possibility of sitting down with Comcast?
    Mr. Angelos. Yes, ma'am. We would be delighted to sit down 
with Comcast at their earliest opportunity. We didn't hear from 
them for a year, but Mr. Cohen is correct, they called a couple 
of days ago and indicated that maybe they'll have a meeting 
with us. We're delighted to hear that. We're prepared to meet 
with them.
    Ms. Norton. That is progress, Mr. Angelos.
    Mr. Dupuy, I only have a couple more questions.
    Chairman Tom Davis. Ms. Norton, Mr. Cohen only has just a 
couple more minutes to check with his staff----
    Ms. Norton. I have no more questions for Mr. Cohen, but I 
do have two more questions. They are very short, Mr. Chairman.
    I have heard the whole region that didn't pay a dime for 
this team usurp all the time, and I got two more----
    Chairman Tom Davis. Well, why don't we get questions for 
Mr. Cohen so that he can make his train, which he had promised 
him.
    Mr. Angelos. May I finish my sentence, please?
    Ms. Norton. Yes, but then we will go to Mr. Cohen.
    Mr. Angelos. Let me say we're delighted to meet with 
Comcast at their convenience wherever they designated. We're 
prepared to put the games on Comcast for the same rate that Cox 
is paying and Verizon is paying and so on.
    Ms. Norton. OK. We have heard your negotiations issue.
    Mr. Angelos. No, wait. Well, let me finish----
    Ms. Norton. We have heard Mr. Cohen's----
    Mr. Angelos. May I finish? Please, Ms. Congresswoman. In 
addition, we're prepared to talk about a potential amalgamation 
of the two systems under the appropriate arrangements, and that 
may be a long and difficult negotiation, but I think we can get 
there, assuming there's good faith on the side of Comcast. We 
are interested in doing that. We are prepared to work at it 
diligently and come back and report to your committee our 
progress with the chairman, who obviously can disseminate the 
information to the members of the panel.
    We think that the two ought to be put together. We will 
work toward that, but let them put the games on now.
    Chairman Tom Davis. That was a good question, Ms. Norton.
    Let me just ask Mr. Cohen, could you respond? I mean when 
we talk about an amalgamation of the two systems and getting 
the games on, while you talk about, are we at least in the same 
room? You don't close the door on that?
    Mr. Cohen. I don't close the door on talking about 
anything. I think I've said that before, and I think I'll just 
stop there.
    Chairman Tom Davis. But an amalgamation of the two, I think 
that is as good as you are going to do under any circumstance 
at this point.
    Mr. Cohen. Look, I don't know whether that's true or not, 
but again, as Mr. Angelos said and as I've said, we have never 
said that we are not willing to talk about anything. We have 
always said that we are flexible and the door is open to talk.
    Chairman Tom Davis. Well, let me ask you this, if you don't 
have Orioles games--I don't know how these lawsuits turn out--
but worse case, if you don't have the Orioles next summer and 
you don't have the Nats next summer on your SportsNet, what are 
you going to show?
    Mr. Cohen. Well, I think, I mean again----
    Chairman Tom Davis. Australian football?
    Mr. Cohen. Well, it's a question of what we show in the 
summer. We'll obviously show the Capitals and the Wizards----
    Chairman Tom Davis. Until they come up for bid again as 
well. I mean----
    Mr. Cohen. Right. But, of course, it's interesting. They 
will come up and have to be bid upon in the market.
    Chairman Tom Davis. Right, exactly.
    Mr. Cohen. The way this is always done except for this one 
channel. And we're OK living under that world. I mean that's 
the way in which we live.
    Chairman Tom Davis. Sure.
    Mr. Cohen. But we will fill in our programming with other 
regional sports programming the same way in which we do in our 
other regional SportsNets around the country.
    Chairman Tom Davis. I mean, let me just say this. I think 
there are other market opportunities. I mean, George Mason 
basketball is hot right now. I mean Mr. Moran and I just came 
out, thousands of the people lined the streets there. Somebody 
can put that on while you have the Capitals and the Wizards. I 
am not sure that two regional sports networks couldn't make a 
bigger market that could be shared on this.
    I guess what I want to ask, and I want to be respectful of 
your time, Mr. Cohen--you have stayed, generously, far more 
than anticipated.
    Mr. Cohen. And I appreciate the courtesy.
    Chairman Tom Davis. Mr. Dupuy, would you try to oversee 
this in the next couple weeks as these parties get together? We 
will be happy to help any way we can. I don't want to--this is 
not a threat--but underscoring everything here is the fact that 
from a congressional perception, we are dealing with big giants 
here that enjoy a lot of benefits. We have a telecommunications 
bill going through. It is not a good reflection on the industry 
to have everybody fighting over dollars when nobody is losing 
money and the fans are suffering. And I wonder if everybody can 
give a little bit, and with Major League Baseball supervision 
in this, if we might be able, over the next couple weeks, to 
come back and give us a progress report.
    Mr. Angelos has indicated his willingness to do that. Mr. 
Dupuy has said they will be willing to oversee it. Will you be 
willing to participate and see--I am talking about in good 
faith, sit down. And if you cut a better deal than Mr. 
McCollum, he benefits and my rates in Fairfax will benefit, so 
that could be a win-win. But be willing to give that a try?
    Mr. Cohen. As I said, we have been a party that has always 
said we are wiling to talk. I don't want to walk away from any 
of the principles that I set forth before this committee 
because we firmly believe----
    Chairman Tom Davis. We understand. Look, we understand 
everybody's position.
    Mr. Cohen [continuing]. That they are important principles.
    Chairman Tom Davis. Mrs. Norton's been through it. We 
understand the principles.
    Any more questions for Mr. Cohen, because he has to leave? 
Yes, Mr.----
    Mr. Van Hollen. Thank you, Mr. Chairman.
    Let me just underscore the suggestion of the chairman with 
respect to getting together, and a progress report. That would 
be helpful.
    Look, we all want to make sure the fans can see the games, 
and as someone who represents a lot of viewers who watch 
Comcast and other providers in the region, I also want to make 
sure, as Mr. Cohen said, we want to make sure that we protect 
the wallets of able customers and our constituents.
    So my view is, we want to see the maximum number of games, 
and we want to make sure that our viewers pay the least cost 
necessary. There are lots of people who also watch Comcast who 
don't watch these games, and I want to make sure they don't see 
a price hike.
    Mr. Cohen, I have to understand. You say you are going to 
pay more, put it up for bid, and Comcast, I assume by what you 
are saying, Comcast is going to pay more for these rights. Can 
you tell me today, can you guarantee me today that my 
constituents, your consumers, are going to be paying less if 
you are successful in outbidding MASN or whoever it was if 
those--they are going to be paying less to watch these games 
than they are if they took the deal that MASN has on the table? 
Can you guarantee me that? And if so, why?
    Mr. Cohen. I will give you the same answer that I gave--I 
think that was the first question you asked me, which is, that 
the history and the practice around the country is that 
customers pay less for regional SportsNet programming I market 
where there are less than--where there is one regional 
SportsNet. That is what I can tell you.
    Mr. Van Hollen. If I could, Mr. Chairman, if you could 
provide the committee and everybody else who is represented 
here with any other--that is information that would be very 
helpful for me just in understanding the impact of this. So if 
you would be willing, and anybody else at the table, to present 
that information, I would appreciate it.
    Mr. Cohen. I'm not sure what information I can provide 
other than the--I mean, again, all these agreements are subject 
to strict confidentiality provisions. I think there may 
actually have been articles written about this, and so by 
economists, and so I will--we will look and we will see what we 
can provide to amplify that for the committee.
    Mr. Van Hollen. If I could, because this price is an issue. 
We have talked about when we met, and you mentioned, actually 
in your testimony, the recent deal you got with the New York 
Mets. And I assume that there are other providers like the ones 
we have mentioned at the table that also want to air those 
shows. Can you give me some sense of how the price you are 
charging those other providers for the rights to air the Mets 
games compared to the price that Mr. Angelos has on the table?
    Mr. Cohen. The answer is I don't even know the answer to 
that question. I don't know what it is that I can say. I've 
given--even though Mr. Angelos didn't agree with my testimony, 
I will tell you that--and this does not breach any of our 
confidentiality agreements--that the price that MASN is seeking 
to charge as a two-team regional sports network is a higher 
price than the price we are paying for the 10 other two-sport 
regional sport networks in the country. That is a fact.
    Chairman Tom Davis. Mr. Ruppersberger.
    Mr. Ruppersberger. Let me try to really conclude here what 
I think is happening. First, do we have a commitment here that 
parties will meet on this issue today?
    Mr. Cohen. A meeting was scheduled--first of all, the 
parties have met.
    Mr. Ruppersberger. All right. I am talking about----
    Mr. Cohen. And I have told you that a meeting was already 
scheduled.
    Mr. Ruppersberger. Will you commit to a meeting with Mr. 
Angelos and with Major League Baseball?
    Mr. Cohen. There's already a meeting scheduled.
    Mr. Ruppersberger. OK, that is fine.
    Mr. Angelos, you will commit to a meeting with Comcast and 
Major League Baseball?
    Mr. Angelos. I just offered to do that, and I've been 
offering it for a year, Congressman.
    Mr. Ruppersberger. And also, Mr. Dupuy.
    This is the way I see it. Second, I would ask, Mr. 
Chairman, that maybe Major League Baseball come back to us in 
maybe 2 or 3 weeks, and they have offered to do that, to report 
to us.
    I come back and hear everyone has a point of view, and I 
understand that. I understand what business is about and what 
margins are. I understand that you make short-term decisions 
and long-term decisions, especially, Mr. Cohen, your industry 
is becoming a lot more competitive, so you have to look at 
where you are 10 years from now, and what decisions that you do 
make. That is why I think it is very important--and I am asking 
Mr. Dupuy to be more of the arbiter if you can--I think it is 
important that you come up with a short-term solution to take 
care of the Nats right now, and I think that is extremely 
important, whatever can be done in that regard.
    Now, I am asking Comcast to give up their long-term legal 
issues, leverages they might have. That is why I think it is 
important for short term. But I would also ask that when you 
are sitting there--and if you start the negotiation--because I 
believe Major League Baseball has a responsibility. I believe 
Mr. Angelos has his rights to negotiate the best deal he did, 
and he did, and he has a contract in that regard. Now, I think 
it is extremely important though, that you, representing all of 
Major League Baseball, need to do what is right for baseball, 
and I would hope that if you can start and do something in the 
short term, that you look down the road with long term, 
including the Baltimore Orioles contact of 2007.
    Than you.
    Chairman Tom Davis. Mr. Moran, quickly.
    Mr. Moran. Thanks, Mr. Chairman. I want to tell you, Mr. 
Chairman, in addition to appreciating the hearing, I appreciate 
you having Mr. Angelos here, because that means I can afford to 
engage in an adversarial line of questioning without having to 
worry that I am going to hurt your feelings or anything. It is 
nice to have tough guys on the panel. And not to put you off 
to--well, whatever. I do think it should be said that it is 
clear there is nothing approaching illegality, nor could I see 
anything unethical in what has transpired here, and I say that 
quite honestly. I think Mr. Angelos has engaged in a business 
transaction, and if he didn't own the Orioles, I would love to 
see he or some Angelos clone buy the Nationals, because you 
have built a beautiful stadium, the Orioles are a terrific 
team, and we need an owner that is going to go to bat and going 
to generate as much revenue and field as good a team as 
possible, and you have done that. So there is no problem with 
that.
    I do have a concern over the development of MASN, and if it 
becomes, for example, a 24/7 station, you will have the ability 
to substantially increase rates, as I understand it, and I 
think that is a concern that we would have on behalf of our 
constituents. For example, if you do go 24/7 can't you 
substantially increase the rate, and don't you have 
substantially more leverage over both Cox and Comcast and any 
of these other providers given your exclusive broadcasting 
rights for both Orioles and Nationals games? Is that true, or 
is it a supposition that is unwarranted, Mr. Angelos?
    Mr. Angelos. I think the whole operation will continue to 
be under the jurisdiction of Major League Baseball. That is the 
way that Mr. Dupuy and MLB have fashioned it. We present the 
games. The ultimate control of our approach, the rights fees 
that we pay, the quality of the presentation, and the concern 
that you just expressed, Congressman, will be carefully taken 
care of and guarded by Major League Baseball. We know that. 
That has been explained to us, and we intend to abide by those 
requirements.
    Mr. Moran. I am going to conclude now because we have 
another panel, but I have to say we feel vulnerable because we 
don't have an owner. We don't have a tough guy representing the 
Nationals, our team, our woman, or whatever, so we are in a 
vulnerable position. Major League Baseball owns our club, but, 
you know, that is 31 other owners, and they have their own 
vested interests in the benefits of their club. So I think you 
can understand where we are coming from, and it is not meant to 
be adversarial or accusatory. It is just we want to get the 
best deal for----
    Mr. Angelos. Sure.
    Mr. Moran [continuing]. Our fan base, our constituents.
    I appreciate Mr. McCollum doing that with Cox. I hope it 
works out, and I really hope, Mr. Cohen, that you can look at 
the fans first when you make these subsequent decisions over 
the next couple of months.
    Dutch.
    Mr. Ruppersberger. This is not relevant, but chairman made 
a comment about how George Mason is a very hot team. I just 
want to acknowledge that the University of Maryland Lady Terps 
are a very hot team now also. Thank you. [Laughter.]
    Chairman Tom Davis. I would have said that, Dutch, but I 
wanted you to be able to make that comment.
    Mr. Cohen, you are free to go. I think Ms. Norton has just 
one more question for the panel.
    Mr. Cohen. I'm happy--I mean I'm fine.
    Chairman Tom Davis. You missed the train now, so you can 
take the next one.
    Ms. Norton will sum up, and then we will go to our next 
panel, which is also I think going to be a good panel.
    Ms. Norton.
    Ms. Norton. One last question. It really goes to 
resolution, trying to take into account the positions, both of 
which I regard as legal positions, as positions you might 
expect in hard bargaining, so I am not affronted by the 
positions as a legal or negotiation matter. I must tell you, I 
have to step back from my role as a third-generation 
Washingtonian to be objective about this, but I am trying my 
best because I would like a resolution.
    I note though that this kind of dispute may be somewhat 
chronic in Major League Baseball, because, to quote one of 
baseball's most famous philosopher, kind of deja vu all over 
again here, or if I understand the dispute, the New York 
dispute when the Yankees created their own network.
    I would like to ask Mr. Dupuy, because it sounds literally 
as though it was the same thing, and you would think that 
baseball would never want that to happen again. How was that 
dispute resolved?
    Mr. Dupuy. It was resolved through ultimately a commercial 
resolution between the YES Network and Cablevision, just as 
here we have MASN and Comcast. Ultimately, the fans were 
unhappy enough that they sought alternative methods of 
distribution. The YES Network didn't get the carriage that it 
wanted, and ultimately, after a full year of no games, the 
parties----
    Ms. Norton. Just like this.
    Mr. Dupuy. Although last year there were about 70 games 
over the year that got carried by Comcast, and this year 
there's 32, but there were no games on Cablevision. Ultimately, 
the two sides decided it was in their interest to reach a----
    Ms. Norton. Well, they decided with the help of a third 
party; is that not true? They just sat down themselves and 
figured it all out?
    Mr. Dupuy. Lots of third parties attempted to intervene, 
and those third parties were told it was a commercial dispute, 
and ultimately, they resolved it one-on-one as a commercial 
matter.
    Chairman Tom Davis. Will the gentlelady yield on that?
    I just want to--was compulsory arbitration something 
everybody would submit to on this in the fans' interest?
    Mr. Dupuy. I mean----
    Mr. Cohen. Compulsory arbitration is not something that we 
would be interested in. I mean we have to run our business and 
we can't hand that over to third parties, no more than I would 
ask----
    Chairman Tom Davis. I am just thinking of the fans.
    Mr. Cohen. No more than I would ask you, for example, to 
engage in compulsory arbitration in working out an immigration 
bill. I mean this is something----
    Chairman Tom Davis. That probably would be better than what 
we are doing, but that is a different issue. [Laughter.]
    Mr. Cohen. I think we have to run our business, and we 
really can't turn it over to a third party.
    Chairman Tom Davis. Well, if we can just count on everybody 
to bargain in good faith.
    Ms. Norton. The chairman is borrowing--yes?
    Mr. Dupuy. Representative Norton, I have been corrected. 
I'm told--again, it was a few years ago--that the New York 
Attorney General did get involved and banged a few heads 
around, and that's ultimately what resulted in the----
    Ms. Norton. Thank you for correcting that.
    The chairman was only borrowing a word from baseball. I 
wouldn't use such a word because I'm not as familiar with 
baseball as the chairman is, and because I don't think it's 
appropriate here. The reasons I asked about third party 
intervention, and was so interested in the fact that the YES 
dispute was solved that way, is that one of the subjects I 
taught when I was a full-time law professor at Georgetown was 
negotiations, though it was not my----
    Chairman Tom Davis. There was an arbitration.
    Ms. Norton. Yes. He is saying there was an arbitration 
panel.
    Mr. Cohen. The YES thing, it was a three-judge arbitration 
panel.
    Ms. Norton. The chairman has just handed me New York Daily 
News report. The decision by a three-man arbitration panel, 
making YES available to cable subscribers on expanded basis, 
cost of $1.93 per subscriber per month.
    Mr. Cohen. I think--and Mr. Dupuy can correct me if I'm 
wrong--but I believe what happened was that Cablevision and YES 
reached an agreement for carriage. There was one outstanding 
issue which was whether or not Cablevision would be permitted 
to carry this on a tier or on expanded basic, and if so, at 
what rate? And that issue was submitted to arbitration. So that 
is the--I mean that may be the combination of those two, and 
you may be looking at the article that reported on the results 
of the arbitration which came out many months, maybe even more 
than a year, after the carriage agreement was reached between 
Cablevision and----
    Ms. Norton. Thank you, Mr. Cohen, but I really don't think 
it--since I wasn't calling for any kind of compulsory--it 
doesn't detract from what I'm trying to find out. As I indicate 
though, though negotiations wasn't my black letter law subject, 
I can't say that I enjoyed anything more than teaching law 
students that adversarial relationship costs money to your 
client, and that he ought to pay you a whole lot more for 
helping to resolve suits without going to court, if you put a 
complaint in, you ought to sit down right then--and that's one 
of the reasons, by the way, that major businesses now very 
often hire the same lawyers that would have gone into big law 
firms as their own counsel in Fortune 500 companies, because 
they have learned that having a very good lawyer on the inside, 
rather than farming it out, may be the way to get around 
litigation costs.
    Let me just say what I think has been accomplished here, 
because for me, this wasn't an interesting exercise. Without a 
team, with a stalemate, and an issue that means hugely much to 
the District of Columbia in the way that counts the most for 
the people sitting at the table, dollars and cents, just let me 
say what I think has been accomplished.
    At least according to the newspapers and the way the 
parties described themselves before they came here, Mr. Angelos 
said that there had been multiple offers on the table for a 
year--even repeated that here--with no response. Mr. Cohen 
says, well, he has always been willing to talk.
    Well, at least we have I think gotten on the record an 
agreement that both parties are willing to engage in talks. You 
don't have to call them negotiations. You can call them 
anything you want to, but it means representatives face to 
face. It doesn't mean these two head guys in charge. It means 
whatever you mean, but it certainly means that is on the 
record.
    Second, in answer to my question to Mr. Angelos about 
whether he really would prefer a startup network--after all, he 
has a right to say, look, let me get in this business now, let 
me compete, I am willing to do the venture capital myself. An 
answer to that question is that your preferred course, my 
understanding--and remember, there has been somebody taking 
notes here--is that Mr. Angelos is willing to go forward on 
either of two bases, on the present basis at his own risk, or 
talking some kind of merger or--and that is perhaps the wrong 
word--but some kind of deal in which both of them, both of the 
parties, MASN and Comcast themselves, have decided jointly on 
how to proceed.
    Given the polarization of the parties as your articulated 
positions have been here, you know, both negotiating positions, 
obviously, that, on the part of Mr. Cohen, turn up the contract 
and we can start all over again. Mr. Angelos, willing to take 
his chances with MASN, no matter where it goes. Could I ask 
this question. If all else fails, would you be willing to let 
somebody else talk with either of you and ultimately both of 
you, to see if a decision could be raised? That would have to 
be on agreement. Often such efforts fail. But if all else 
fails, rather than continue as we have, would that at least be 
a possible course? You might do it and say, well, you all don't 
do it any better than we do, or goodbye, but would that be 
something you would at least be willing to entertain? Yes, sir?
    Mr. Angelos. Congresswoman, as I expressed before, I am 
willing, we are willing to go anywhere, meet with the Comcast 
people at any time and place that is convenient to them. And so 
the answer to your question is an affirmative and strong yes. 
But I would say once again, let's get the situation calmed 
down, and as all of you have said, let's get the games out 
there for the Nationals fans in the interim. If they are 
willing, truthfully, to try to come to a resolution, they 
should be willing to join in that process on the same basis 
that I just indicated, and in the meantime, put the games on. 
And then all of us can do this in a calm, sensible, and 
ultimately fair and equitable basis.
    Ms. Norton. Mr. Angelos, I heard you say yes if all----
    Mr. Angelos. Right.
    Ms. Norton. That maybe somebody could at least talk to you 
both, and I also heard your negotiating positions.
    Finally, Mr. Cohen?
    Mr. Cohen. I must say I'm not sure I understand the 
question.
    Ms. Norton. I don't think it is a very obscure question, 
sir. I said----
    Mr. Cohen. I don't think a third party is going to be at 
all helpful in this process, if that's the----
    Chairman Tom Davis. What about Major League Baseball 
sitting in?
    Mr. Cohen. I think Major League Baseball has to be involved 
in this process.
    Chairman Tom Davis. Could we just ask, Mr. Dupuy, you all 
sit down and report, let's say, by the end of the month give us 
a status report if we don't have something worked out?
    Mr. Dupuy. Yes, sir.
    Chairman Tom Davis. And let's try to do the best we can. I 
think that is what we are all after. I think all of the members 
here feel not just strongly for their constituents, but after 
hearing everything that has gone on, can't understand--nobody 
is losing money here--why we can't put the fans first. We have 
some major issues pending before us that affect some of the 
industries here. This shouldn't be a part of it. We should be 
able to work something out there. And if there is anything we 
can do to help along those lines, call on us, but we will look 
forward to a report by the end of the month.
    Mr. Angelos. Mr. Chairman, just one more thing.
    Chairman Tom Davis. Sure.
    Mr. Angelos. I would appreciate it very much if the Chair 
would ask Mr. Cohen whether or not he will agree to put the 
games on so that the fans can be satisfied while this process 
is ongoing?
    Chairman Tom Davis. I think he has already answered that. 
But I will ask you. Will you put the games on----
    Mr. Cohen. Our offer is to put the games on immediately, as 
soon as Major League Baseball and the Orioles do what is right 
for the Nationals and for the fans, and return the rights to 
the fans.
    Chairman Tom Davis. I just think, look, let's just sit down 
in a room and see if we can get these games on quickly while we 
are putting other issues aside. It looks like, unfortunately, 
this is going to take some time. We will do anything we can, 
and if you would report back to us in 3 weeks, Mr. Dupuy, on 
how these discussions are going, we will do anything we can to 
bring----
    Mr. Cohen. Mr. Chairman, one other thought. The 
Congresswoman raises an interesting issue. There is another 
party that we happen to believe would be very helpful to be at 
the table, and that is the owner of the Nationals.
    Chairman Tom Davis. Well, have to wait a couple weeks for 
that, but we will start the conversations. Let me just also 
say, Mr. Cohen--you have to go--but I hope that folks can 
monitor this next panel coming up because we have the local 
officials where you have cable franchises, are going to talk 
about what they need to do. They also have some things that 
they can do along this thing if we can't get this resolved.
    Mr. McCollum, I just want to thank you for putting the Nats 
games on in Fairfax, and staying here through this today. You 
set a good example.
    Mr. McCollum. Quite welcome, Mr. Chairman.
    Chairman Tom Davis. Thank you.
    We are going to take a 3-minute recess while we bring the 
next panel.
    [Recess.]
    Chairman Tom Davis. Thank you all for your patience through 
the first panel.
    We have a very important and distinguished second panel as 
well. We have the Hon. Anthony Williams, the Mayor of the 
District of Columbia; the Hon. Sean Connaughton, the chairman 
of the Prince William County Board of Supervisors. We have the 
Hon. Doug Duncan, the Montgomery County executive. We have the 
Hon. Peter Franchot, who is a Delegate in the Maryland House of 
Delegates, and Mr. Ian Koski, NationalsPride.com, head of the 
fan club there.
    Would you just rise and raise your right hands and let me 
swear you in before you testify?
    [Witnesses sworn.]
    Chairman Tom Davis. Thank you. We are going to start with 
the Mayor and move down. I know everybody has time constraints. 
Mr. Franchot, you need to get back to Annapolis. We will get 
your time to 5, your speech, and get a question maybe. Mr. 
Franchot, the Mayor had allowed you to go first. Thank you very 
much for also being here.

STATEMENTS OF PETER V.R. FRANCHOT, DELEGATE, MARYLAND HOUSE OF 
DELEGATES; ANTHONY WILLIAMS, MAYOR, DISTRICT OF COLUMBIA; SEAN 
   T. CONNAUGHTON, CHAIRMAN, PRINCE WILLIAM COUNTY BOARD OF 
SUPERVISORS; DOUG DUNCAN, MONTGOMERY COUNTY EXECUTIVE; AND IAN 
   KOSKI, EDITOR, NATIONALSPRIDE.COM STATEMENT OF PETER V.R. 
                            FRANCHOT

    Mr. Franchot. In deference to the Mayor and others who want 
to speak, I will not read my testimony. It's beautifully 
written, however, if anyone wants to take a quick look at it.
    Chairman Tom Davis. It is in the record.
    Mr. Franchot. Thank you very much. I will just thank you, 
Mr. Chairman. As you know, 12 days ago we tried to have a small 
press conference on this subject to bring some attention to the 
matter. Congressman Moran was kind enough to join me, and we 
passed the lath test with him. But then when I saw you coming 
to join us at the press conference, I was tremendously 
emboldened because we had been told at the local level that we 
had neither the political clout, nor, frankly, the regulatory 
clout over Comcast, and certainly not over Major League 
Baseball or Mr. Angelos, to get a result for this. So I'm 
delighted to see Congressman Cummings and Congressman Van 
Hollen, and Congressman Ruppersberger, who was here earlier, 
Congresswoman Norton.
    I will just say briefly, my two points are that having 
listened to the testimony, it is completely unacceptable for 
our constituents to be told that we are going to have to wait 
2, 3, 4 or more weeks to get the Nationals games on TV. Last 
night there was a very exciting game played up in New York. 
Anybody able to see it? Well, yes, maybe with the DirecTV or 
something, Cox. We couldn't see it. None of us could see it. 
None of our kids could see it.
    Congresswoman Norton, in your absence I was praising your 
advocacy on this, and Congressman Moran, I really wanted to 
thank you personally for joining with us very early on this 
issue.
    Mr. Moran. Well, it was your idea, Peter, thanks. 
[Laughter.]
    Good issue.
    Mr. Franchot. You know, we've come a long way in 12 days, 
and I detected a little note of pessimism or frustration in 
talking to the major parties, because we're dealing with 
large--I don't want to say elephants--but three very large 
entities are locked in combat before us. And as everyone has so 
aptly noted from the podium and from the dais, the fans are 
getting stepped on underneath as these large corporate entities 
are maneuvering for different advantages. And I would urge this 
committee not to be pessimistic at all from the responses that 
were received today, because we have come so much farther than 
we were 12 days ago.
    I believe that is you keep the pressure on, and hold 
Comcast, particularly, feet to the fire, I think we will get an 
interim solution of having these games up on TV, while, as 
everyone was saying, the larger legal issues can be negotiated. 
And I would hope that the committee would exercise whatever 
prerogatives it has not to put this off 2, 3, 4 weeks down the 
road because we need this resolved now.
    Obviously, Comcast has to swallow a bitter pill. They are a 
good corporate citizen in Maryland. They make a lot of time 
contributions. Their reputation in Maryland is excellent. It is 
going to be damaged by this controversy. It's only going to get 
worse as the season progresses, and I would urge this committee 
to really hold their feet to the fire and say, ``For the sake 
of the public interest, you're going to have to, frankly, sign 
a deal that's going to, if not make you as much money, but 
you're going to have to deal that to make a sacrifice.''
    The second issue which was noted by you, Mr. Chairman, and 
I missed it because I was a little bit late, is that this issue 
of ownership has to be resolved. I mean there is no way this 
team cannot have a strong advocate in these negotiations, 
Congresswoman, and basically in promoting the success of the 
Nationals. As everyone said before, I happen to be an Orioles 
fan. I love baseball. I love the idea of a regional rivalry 
between the Orioles and Nationals. We're never going to get it 
if we keep this dilatory practice of a couple of weeks here, 
couple of weeks there, and not having a new owner, and 
particularly, not being able to get this team up on TV.
    What I heard today was just more the same. This idea that 
we're going to come back in 3 weeks and tell you how the 
negotiations are going, I don't give a hoot how the 
negotiations are going. Our people don't care how they are. 
They want to see the games on TV. Have Major League Baseball 
come and say, ``We're going to get back to you in a couple of 
weeks about a new owner,'' hello? 52 weeks ago, 52 weeks ago 
that was the message.
    So I hope this committee, because we don't have the power 
at the local level that I thought we had over Comcast, and 
frankly, we have no power, as I said, over Major League 
baseball. You do. And if we can shortcut some of this, I 
promise you, Comcast is going to yield if you keep their feet 
to the fire, and it may only be an interim solution, but it 
will be a solution in the public interest, i.e., the games will 
be up.
    Thank you very much. I apologize for having to get back to 
Annapolis. We're going to be in a voting session starting 
shortly.
    And I just want to give my compliments to Mayor Williams. 
Nobody was more excited than baseball fans and even Orioles 
fans, when he announced in 2004 that the team was coming to 
Washington, and we salute him for his leadership.
    And whatever we can, Congresswoman Norton, collectively as 
a region, to help this team grow and help this team be a 
success, we want to do that. Thank you for your advocacy and 
leadership on this. It is a tremendous asset to our region.
    Mr. Chairman, once again, personally my thanks to you.
    [The prepared statement of Mr. Franchot follows:]


    
    
    Chairman Tom Davis. Mr. Van Hollen, did you want to say 
something?
    Mr. Van Hollen. Yes, Mr. Chairman. I was out of the room 
when Mr. Franchot was introduced, and I understand he has to 
run, but I want to thank Delegate Franchot for his leadership 
on this issue and getting it out in front.
    Mr. Franchot. Thank you.
    Mr. Van Hollen. Do your best in Annapolis in these last 
busy days.
    Mr. Franchot. Thank you.
    Chairman Tom Davis. Now, we are going to hear from the man 
who caused all this by bringing the team to Washington. Tony?
    Mr. Ruppersberger. Can I say something to Mr. Franchot?
    Chairman Tom Davis. Yes.
    Mr. Ruppersberger. Thank you for being here today. I know 
this is a very difficult issue, but that energy issue that you 
are dealing with is very difficult also, so do your job in 
Annapolis. Thank you.
    Chairman Tom Davis. Thank you.
    Mr. Franchot. Well, we'll solve that issue. You solve this 
one up here, and we'll come together.
    Mr. Ruppersberger. That is a deal.
    Chairman Tom Davis. Mayor Williams, thank you very much for 
your patience today, and thank you for bringing the team here, 
and it has been a tough road. I don't know that anybody could 
have done it, and you made a huge difference, and I just thank 
you for it.

              STATEMENT OF MAYOR ANTHONY WILLIAMS

    Mayor Williams. Thank you, Mr. Chairman, members of the 
committee. It has been tough, but it's been great for our city 
and it's been great for our region. This really is a regional 
partnership. I just mention that 77 percent of the fan base is 
a regional fan base, coming from outside the city, so it really 
is a shared enterprise in that respect, and I'm proud of it.
    It is my pleasure to testify before you today regarding, I 
think, a need all of us feel to widely broadcast Nationals 
baseball games. I want to thank you and the committee for 
convening this hearing as a way to leverage and try to resolve 
this matter quickly of broadcast rights for the Nationals. You 
know how hard I worked, the Council worked, the leaders of our 
city worked, people all over the area worked to bring baseball 
back to our city and to our region. And now that the team is 
here, what I want to do, and I want to speak to here, Mr. 
Chairman, is maximizing the number of people who catch the 
fever and the spirit of the Nats.
    In your letter inviting me to speak at this hearing, you 
asked about the potential impact of the team on the District of 
Columbia. The Washington Nationals and the team's new ballpark, 
I believe, will produce new jobs for our city's residents. The 
ballpark will be a catalyst for, I believe $2 to $3 billion in 
development, and $50 to $75 million in annual sales and 
property taxes.
    On top of this, based on the anticipated economic 
development around the stadium, we anticipate generating 
another $450 million for a community benefit fund, which will 
support our schools and after-school programs. All these 
estimates are, of course--and I emphasize this--predicated on 
the Nationals being widely publicized and the fan base 
continually growing.
    I want to also talk about the impact on our residents, both 
in the District and in the region. Having baseball back means 
we can now satisfy our young baseball fans who have just been 
waiting for their chance to root for a home team.
    Furthermore, the new ballpark is truly about something very 
special to us in this city, and that is the rebirth of the 
Anacostia waterfront. And what does this mean? It means 
creating thousands of jobs and new economic development, 
particularly for local, small disadvantaged businesses. It is 
about visitors from Maryland, from Virginia, from around the 
country and around the world, all coming to the District and 
enjoying America's pastime.
    The ballpark on the Anacostia River will be the anchor for 
developing hundreds of acres of vacant and under-utilized land, 
creating new opportunities for local small businesses and local 
ventures. The location of the ballpark where we enforce the 
connection of neighborhoods on both sides of the river, and in 
so doing, reinforce the connection of people on both sides of 
the river and our city.
    And in so doing, finally, it will link an under-utilized 
segment of the river back to the capital. It is hard to believe 
that only four blocks from here is one of the most under used, 
under utilized and neglected spots in our entire city, four 
blocks from the literal center of the city of Washington, DC.
    So the bottom line is that the ballpark and the team will 
not be islands until themselves. The bottom line is that 
intertwined and in partnership will be part of, I think, a 
very, very powerful economic engine, churning out new 
development, new jobs and new opportunities for our Nation's 
Capital. And as an advocate, as Mayor of our city, for 
Washington Nationals fans everywhere, I urge all of the folks 
here to come together. We've got a number of legal issues, but 
we have to come together.
    You know, a lot of the legal issues I heard here were 
similar to the legal issues we had in bringing the team to 
Washington to begin with. We got the original issues with the 
baseball stadium agreement. We got the original--we got the 
issues with the lease and the issues with the construction 
contract, and the issues with this and the issues with that. 
And what we heard consistently from the fans is, you know, 
``That's your problem, that's not my problem. Get it done. Get 
the team here.'' What I'm hearing from citizens is, ``We 
understand the issues of compensating the Orioles. We 
understand the issues with the regional sports network. We 
understand the issues with Comcast. But that's not our problem. 
That's your problem. Get it done.''
    So I can't do anything but wholeheartedly agree with the 
committee on the need for baseball to step in while we are, as 
quickly as possible, getting an owner, bringing the parties 
together. And while they're resolving these disputes, get the 
game on the air.
    Thank you.
    Chairman Tom Davis. Thank you very much.
    Sean, welcome.

                STATEMENT OF SEAN T. CONNAUGHTON

    Mr. Connaughton. Congressman Davis, Mr. Chairman, thank you 
very much, members of the committee. I am Sean Connaughton. I'm 
the chairman of the Board of Supervisors in Prince William 
County, and I would first of all like to thank you for having 
me here, and also commend you for raising this issue.
    It's been surprising to me the number of constituent 
contacts I've gotten on this issue, particularly, given it is a 
team that's only existed for about a year, and the number of 
people that really in my community have already adopted the 
Nationals, and are very, very big supporters.
    For those of you who don't maybe know about Prince William, 
we are approximately 30 miles south of Washington, DC, to the 
south and to the west, growing very rapidly. We have around 
370,000 people today. Our estimates put us in about a little 
over a decade, we'll be actually larger in population than the 
District of Columbia.
    Because of that growth, obviously, we have people that are 
very much tied to the Washington region when you look at where 
they are going for work. Many people are like myself, who come 
up to Washington pretty much every day to work. This is our 
city. We very much are here working, paying taxes, and being 
involved in some of the things that are happening up here.
    But it is very difficult for many of my constituents, due 
to all the transportation problems we're having, to get up here 
for ball games, to enjoy all of the things that are in this 
great city. That is why being able to become a fan and being 
able to watch the Nationals, being able to make sure that they 
can enjoy, when they can, the Nationals on TV, but also when 
they can, to get up here to build that fan base by using and 
looking to the cable franchises such as Comcast.
    Comcast is our cable provider, although we do have a couple 
smaller ones, and we will be actually voting next month or so 
on having a franchise for Verizon as well. But about 75,000 
homes are served by Comcast in Prince William County. They've 
been a very good provider. We've had a very good relationship 
with them. They've been very much involved in our community, 
and also have a fairly large call center in our county, and so 
we've enjoyed that relationship.
    And we really are just trying to urge whatever can happen 
to make sure that this negotiation goes in such a way that our 
citizens can enjoy the Nationals.
    I will mention that one of the things that we're looking to 
is not only to help this regional economy, to help support this 
team, we also are the location of a minor league affiliate of 
the Nationals, the Potomac Nationals. And we recognize that as 
we're moving forward on building a new stadium for that 
franchise, which will not be reaching some of the proportions 
of some of the issues that Mayor Williams' faces in building 
his stadium. But I will tell you, we have faced some of the 
same cost issues, we are facing some of the same land 
acquisition issues, but obviously, on a much smaller scale, but 
we recognize that if we are going to put that type of 
expenditure out, we need to make sure we have a fan base 
locally for the Nationals and our local Nationals affiliate, 
and that will help the big league Nationals.
    So anything that can be done to move this issue forward is 
something that we will be there, whether to discuss this with 
Comcast, to work with you all, work with the Mayor, we just 
want to see this issue resolved.
    Thank you very much.
    [The prepared statement of Mr. Connaughton follows:]


    
    
    Chairman Tom Davis. Thank you.
    Mr. Duncan, thanks for being with us.

                    STATEMENT OF DOUG DUNCAN

    Mr. Duncan. Mr. Chairman and members of the panel, Thank 
you very much.
    I sat here since 12:30 listening to the testimony, 
listening to the comments, and all I could do was think about 
how wrong Tom Hanks was. In the movie ``League of Their Own,'' 
he kept saying, ``There's no crying in baseball. There's no 
crying in baseball.'' Well, you know what? There are thousands 
of fans who are crying because they can't see their team on TV. 
A great game last night. If you're fortunate enough to live in 
Fairfax County with Cox, you could have seen it. If you're in 
Montgomery County with Comcast, it wasn't available, thanks to 
Major League Baseball, thanks to Peter Angelos.
    We do have a unique situation here. The plan devised by 
their agreement led to the formation and the development of the 
Mid-Atlantic Sports Network, which is a media outlet designed 
to enable fans throughout our State to view sports 
entertainment from both teams. I think that agreement is going 
to lead stronger franchises, dual sports loyalties, more 
exciting rivalries, which is great for all Marylanders.
    There's one impediment to that though, and that, 
unfortunately is the power of our cable companies to restrict 
the content. Comcast is an effective monopoly in a number of 
local jurisdictions in Maryland. It's a legal right granted by 
you all, granted by the counties, granted by the States, in 
order to achieve universal cable coverage. But it wasn't a 
monopoly granted to allow them to make unilateral decisions 
about the programming available to the customers.
    We're all frustrated that we can only see 40 games this 
year that are going to be on UPN 20. If you're not in a part of 
the State that can't get UPN 20, you don't see any of those, 
and it leaves everyone out of the other 120 games, 122 games in 
which sports fans get shut out by Comcast.
    I grew up as a Senators fan. When they left, I became an 
Orioles fan. I'm a long-time Orioles fan. I could not have been 
more pleased when Mayor Williams brokered the deal to bring the 
Expos to D.C. to give us the Nationals. Competition in sports 
is good. Competition in the marketplace is good, but right now 
that competition is being hampered because fans are being 
denied the right to watch the team of their choice on 
television. That's an unfortunate case of self-interest and 
shortsightedness.
    The time to resolve this matter was not now when the season 
started, it was during the off season. But we saw Comcast make 
a choice that they were going to litigate instead of negotiate, 
and that's a shame for all of us.
    One way to solve this is to get competition in the 
marketplace. You've got it in certain areas. You're talking 
about Verizon coming. We're in negotiations with Verizon as 
well. I think once you get that competition in there, that's 
going to free up and lead to demand for this. However, we can't 
wait years for that to happen. I sort of agree that Comcast can 
show the games now, while the court case is going on, while 
negotiations, discussions are going on, they can show the games 
now. They owe it to their customer base. They owe it to this 
region, and that's what we're asking them to do, and I'm just 
very thankful that you all are involved with this and trying to 
push them and urge them to do the right thing here.
    Thank you very much.
    [The prepared statement of Mr. Duncan follows:]


    
    
    Chairman Tom Davis. Thank you very much.
    Mr. Koski, thanks for being here and thanks for your 
patience.

                     STATEMENT OF IAN KOSKI

    Mr. Koski. You bet. Thank you very much.
    Chairman Tom Davis. Thanks for spearheading this.
    Mr. Koski. Thank you all very much for the honor of 
actually being invited to speak here today on behalf of all 
Washington Nationals fans, at least the ones who don't hold a 
seat in Congress.
    My name is Ian Koski. I'm the editor of a Web site, 
NationalsPride.com. We're essentially a daily newsstand for all 
things Nationals, features, news, whatever. And I have 
absolutely no connection to MASN, to the Orioles, to the 
Nationals, Comcast, I mean except for the money I pay out for 
my tickets and my Comcast bill, I'm independent.
    Before I start, I did want to thank Mayor Williams. I 
thanked him privately. But getting the Nationals was a big deal 
for us, and we really appreciate the work you've done to bring 
us this team.
    I know what it means to be at the last seat of the last 
panel, so I will try to be brief.
    First of all, I want to thank you for actually holding the 
hearing. In the broader scheme of things, this isn't, you know, 
a terribly important issue in the Congress, but you're doing 
the right thing here. There obviously are national concerns 
when a company as large as Comcast flagrantly disregards the 
interests of its customers, your constituents, but ultimately, 
this issue should never have reached this body. It should have 
been resolved by the parties who sat at this table before us, 
long, long ago.
    If the Nationals had an ownership group, this wouldn't have 
been an issue, they would have been able to deal with this, and 
they would have been able to fight for it.
    In lieu of that, I'm glad that our elected leaders have 
stepped up. Congressman Davis, Congressman Moran, I really, 
really appreciate, as a Virginia resident, your participation 
in the press conference last weekend, your leadership since 
then in making this a real issue.
    The fact is, the deal that Major League Baseball made with 
Mr. Angelos was terrible for Washington. It may have made sense 
that Mr. Angelos would feel he needed to be compensated for the 
hit he was going to take when the Nationals came here, but 
baseball went way too far, giving away our broadcast rights, 
which is what they did. It is absurd that our closest 
competitor, led by a man who has fought tooth and nail for 15 
years to keep baseball out of D.C., it's absurd that he has our 
broadcast rights. The rights should have been held for the new 
owners, frankly, they just should have been held. A deal could 
have been reached for 1 year to get the Nationals on last 
season. Of course, we were supposed to have an owner a long 
time ago, but that's another issue.
    It's just awful that Comcast is refusing to carry MASN, and 
I note how the reason keeps changing. One day it's about how 
Comcast SportsNet was supposed to have this right of first 
refusal, the next day it's about the per-subscriber fee, that 
it's too high, the following week it's because they think that 
D.C. and Baltimore, two top-25 markets, can't handle two 
regional sports networks. Then of course, there's the argument 
they made yesterday, that the whole situation should have been 
avoided in the first place by putting Nationals rights out to 
competitive bid.
    The story keeps changing until now they haven't found a 
message that insulates them from our outrage. And I say until 
now because, well, the proposal they put out yesterday, it's 
probably right. You know, it's what should have been done day 
one, you know. At this point though it's almost naive to think 
that's going to happen. It was clearly proposed for the sake of 
this hearing. When I actually read the document, the letter 
written to Bud Selig, I actually laughed out loud, because it's 
clearly not going to happen.
    Major League Baseball's deal with Mr. Angelos is definitely 
a bad one, and it frustrates Nats fans like me to no end, that 
our interests have been forcibly tied to his. I don't see that 
deal going away though. I would be floored if Mr. Angelos 
voluntarily surrendered the sweetheart deal he's got going now.
    It's up to Comcast, it really is. The lawsuits aren't going 
to pan out for them. That's pretty clear at this point. All the 
other cable companies are paying the board subscriber fee. I 
mean, the YES Network, which charges about the same thing, is 
not MASN, as we've identified here. And, of course, the region 
can handle two sports networks. We need Comcast to take the 
high road, and, frankly, I'm disappointed they've all left, 
because I was hoping to directly ask them to take the high 
road.
    It's time for Comcast to move on and start showing 
Nationals games. It's the fans here in Washington, us, who are 
paying the price here, and it's a legal feud--you know, they 
may try to deny it, but this is a legal feud between a 
corporation in Philadelphia, a business owner in Baltimore and 
Major League Baseball in New York. It's got nothing to do with 
us, and we're the ones paying the price.
    Major League Baseball should be more involved in this. 
They're kind of burying their heads in the sand here by saying, 
well, you know, we're meeting with them, we're gently 
encouraging them. The fact of the matter is they created this 
situation and it's very much their responsibility to end this 
situation.
    Now, NationalsPride.com has offered fans an online petition 
to sign since mid last summer, when it became clear that this 
issue was going nowhere for a variety of reasons, including 
lack of a budget--I mean funding it out of my savings account--
and declining fan interest in the team as they're on their on-
the-field play declined last season. The petition really didn't 
gain traction. And at the end of the season we only had about 
200 signatures.
    About 3 weeks ago, that changed. People realized that we're 
going to have another season without games on Comcast, and the 
signatures picked up, and in just 3 weeks we've had another 350 
signatures, which isn't bad considering the budget we're 
working with, and 100 have come just from the last 2 days.
    So today, our petition is 565 names strong, and that's 
going to grow, and that will continue to grow every day this 
situation drags on.
    Chairman Davis, Congressman Moran, I appreciate your 
signatures on this petition, and I hope it to be joined soon by 
other Members of Congress from this area. On behalf of the 
signatories of this petition, we urge Comcast to move on and 
start carrying MASN. And we thank Congress for getting 
involved.
    Not all of us can get out to RFK Stadium. A gentleman named 
Neil Owens, his father can't. He sent me an e-mail. He's from 
Kensington, MD. He sent me an e-mail this week about how happy 
he and his father were when the Nats started playing here, 
because the two went to games, father and son do, just like 
they did when the Senators were in town when this gentleman was 
a youngster. Unfortunately, since then his father's health has 
declined. His hip prevents him from actually going up and down, 
and they just can't go to games at RFK. And he's a municipal 
employee, and, frankly, doesn't think he can afford DirecTV, 
and frankly, not all of us can even get DirecTV. I live in a 
condo and the landlord simply won't allow a dish on his 
balcony. I used to live in a high-rise where dishes were 
absolutely prohibited, and that's the case in many, many 
buildings throughout the D.C. region. It's not as simple as 
switching.
    So for people like Neil and people like me, there is not 
that clear option, and something needs to be done. Baseball's 
been so good for Washington since it came here last year. I 
mean it's really renewed the sense of community and created a 
shared sense of excitement. I mean it's just--it's great to 
walk around and see people different colors, ages, incomes, 
walking around in all the same red Nats hats, and it's just 
such a disappointment that enthusiasm has to end when you enter 
your house, when you enter your apartment, and you can't watch 
your team on TV. No other city has such a terrible situation 
with their baseball team, so let me conclude with just a clear 
statement.
    It's time for Washington fans to stop being punished by 
Comcast because it's got a problem with the Orioles. It's just 
not right. Both of them are the problem here. Both of them are 
to blame, and unfortunately, at this point, I genuinely think 
only Comcast will provide the solution.
    So with that, thank you very, very much for your time.
    [The prepared statement of Mr. Koski follows:]


    
    
    Chairman Tom Davis. Thank you. Let me ask each of the local 
leaders where you have Comcast Cable, is there anything you can 
do because you have given them an exclusive franchise for your 
areas, any pressure you can put on them to carry out? I know 
years ago in Fairfax we had an issue with WGN and carrying the 
Cubs games, and we were able to prevail on them. Of course, 
since that time, Congress has eroded some of the power of 
localities to oversee. Is there anything you can do from your 
perspective? Have you sat down with Comcast, Doug?
    Mr. Duncan. We have no control over what they show on the 
airwaves. You all preempted that, so there's no local control 
over any of that.
    Chairman Tom Davis. You can't control the airwaves. What 
controls do you have over Comcast? You can allow other 
franchises to come into the county, can't you?
    Mr. Duncan. Yes, and we've got Star Power and we are in 
negotiations with Verizon. We need competition in the 
marketplace, the best thing that could happen, but I don't want 
to wait 2 or 3 years for that to happen. We need to see the 
games now.
    Chairman Tom Davis. Right.
    Mr. Connaughton. I believe, Mr. Chairman, that I'll go 
along with Mr. Duncan. I mean, we've contacted them on this 
issue. We only recently renegotiated the franchise agreement 
with Comcast, which obviously if this came up before that, we 
could have had a little bit more leverage on them, but, 
obviously, due to the law, we can't either deal with the 
channels or the rates that they end up charging, but we do have 
Verizon coming down the pike, and that will take some time for 
them to get the infrastructure in place to actually offer 
service throughout the county.
    Mayor Williams. I would agree with that, Mr. Chairman. I 
think that the risk that Comcast runs is the longer this goes, 
the more people are going to be pushed into other alternatives. 
The problem is, in that interim time, we're losing critical 
exposure to our fan base.
    Chairman Tom Davis. Mayor Williams, let me just ask you. 
Are you concerned too that an owner hasn't been named? You 
heard Mr. Dupuy. Don't be shy. [Laughter.]
    Mayor Williams. Well, you know, I take some exception that 
I haven't spoken up on this. I mean I've been speaking on this 
for a year, but what I'm trying to do is I'm trying to bring--
no, I'm trying to bring a team here under very difficult 
circumstances where I'm dealing with a monopoly. When you're 
dealing with a monopoly, it's very difficult. You don't get a 
perfect deal. But what I've said from the very beginning is I 
don't want perfect to be an enemy of the good.
    You know, we've been told again and again that, you know, 
we're in the process of bringing an owner here, and there was 
this deadline and this deadline, most recently the deadline was 
that all the agreements had to be in place. Now after a long, 
arduous process, all the agreements are in place, and it's time 
to have an owner. I am in conversation with baseball probably 
every other day, one way or the other, through intermediaries 
or directly.
    Chairman Tom Davis. Do you think if baseball had named an 
owner at this point we might have had a different outcome, that 
they could have sat down with the different parties and 
pressured it in a way that Major League Baseball as the owner 
hasn't done. Any thought on that from anybody?
    Mayor Williams. I don't think that the actual deal--I think 
the actual deal itself would have been probably within the 
parameters that you see right now, because in terms of the way 
I look at it is--and I wrote an op-ed about this--I know some 
people would take exception to it--but Mr. Angelos had to be 
compensated in some way, and so most people felt, most sports 
columnists felt that the Chicago model was the way to go, and 
actually, in terms of rights, in terms of regional market, in 
terms of the number of games shown, it wasn't a bad deal, but 
any deal is a bad deal if it isn't on the air. I think the two 
things that Major League Baseball can do with the most impact 
right now, are, one to forcefully engage with the two parties 
to get the games on the air, and, two, as everybody here is 
saying, and as everybody in the city has been saying, to get an 
owner named as soon as possible.
    Mr. Koski. Mr. Chairman, if I could add to that?
    Chairman Tom Davis. Please.
    Mr. Koski. I think--yes, I absolutely believe the situation 
would be different if an owner had been named months ago. They 
would be able to negotiate. They could have bought into MASN, 
bought an additional share, a larger share that could have 
prevented this. They could have intervened. They've got money. 
There's so many different ways that this could have happened. 
And I think it's--although I think you're right, Major League 
Baseball is the ones that have to intervene strongly and get 
involved, I don't think we can trust them to do that. We can't 
trust them to be looking out for our interests, especially the 
way they handled the stadium situation, and to rely on that 
exclusively, it will be a problem.
    Chairman Tom Davis. Thank you.
    Mr. Cummings.
    Mr. Cummings. Mr. Mayor, the things that you just said, 
those two items about Major League Baseball getting involved 
and choosing an owner and trying to resolve this dispute, I 
take it that you've had discussions with them over and over 
again about that?
    Mayor Williams. My big thing with an owner--the two big 
things that are important to me in the ownership group above 
and beyond time are that the owner have a local connection 
because of the enormous contribution that the city's making, 
the fans are making to this enterprise; and No. 2, I think 
because of the history of baseball and the history of our city, 
and everything involved, it's very, very important that there 
be a strong minority ownership equity interest in the team. I 
think that would speak volumes to help redress some of 
baseball's troubled history in the past.
    Mr. Cummings. And what is the hold up right now? What are 
they saying is the hold up with regard to ownership?
    Mayor Williams. You're never really told there's any real 
hold up except at this point they're interviewing all the 
different candidates who are all coming in there. One of the 
things I am told, that they are looking to maximize the local 
interest and to the extent possible maximize a minority equity 
in the team, and I applaud that, certainly applaud the first, 
but I also applaud the second as well.
    You know why I'm not a spokesman for baseball.
    Mr. Cummings. I understand, and I hear you say that on WTOP 
the other day. And it just--and I also heard you say that there 
was a group that you favored. I mean, you made no doubt about 
it, and I just wondered do you think--sometimes when somebody 
with--you do remember that though? I don't want to put words in 
your mouth now, because I heard you say it about three times in 
the interview.
    Mayor Williams. Yes.
    Mr. Cummings. And you gave the reasons. And I'm not all 
familiar with all the teams, but you said basically what you 
just said about the criteria that you wanted. But I was just 
wondering, do you think that maybe your being in favor of a 
particular group--how many groups are there?
    Mayor Williams. Well, there are--I don't know how many 
there are total. There are three major groups in contention.
    Mr. Cummings. Do you think that is--do they see that as an 
interference at all?
    Mayor Williams. No, I don't, because I think I've said over 
and over and over again, that my No. 1 preference is the 
Washington Baseball Club, because of the local connection, 
because of the minority participation, because of their 
unparalleled access at every level of Government on both sides 
of the political aisle, because if you take people like--I 
mention Jim Kensey, Joe Robert are two examples. You know, 
substantial contribution to education and schools in the 
District, not just a scholarship program, but we're talking 
about the College Access Program. We're talking about the D.C. 
Public Schools. That ought to be recognized.
    Having said that, what I've also said, over and over and 
over again, this is my No. 1 group, but I'm happy with any 
group, and I'll work with any group, having said that, that has 
a local connection and minority equity of a significant amount.
    Mr. Cummings. Mr. Koski, I think that you are to be 
applauded for your efforts to take on an issue like this, and 
you said something very interesting just a moment ago, when you 
said that--well, you at least implied--that you don't have a 
lot of faith in Major League Baseball.
    Mr. Koski. I'll say it outright for you, I don't have a lot 
of faith in Major League Baseball.
    Mr. Cummings. This committee has had its experiences with 
the whole steroid issue, by the way, and Major League Baseball. 
I am just wondering, so you don't see Major League Baseball 
resolving this issue?
    Mr. Koski. I think they should be trying, but in my old 
age, I've learned that the right thing isn't necessarily what 
gets done, and, no, I don't think they'll do it.
    Mr. Cummings. And so as far as the integrity of the game is 
concerned, I guess you would--is it a rational conclusion, 
therefore, that the fans--you are fearful the fans may begin to 
lose interest even more, particularly when you got a team 
that's not No. 1 or 2?
    Mr. Koski. Yes, to an extent. I mean, I don't think you're 
going to lose them outright, but if your team is playing badly 
and you can't watch them, you stop thinking about them, and you 
stop thinking about them, you stop buying tickets, you stop 
showing up for your games, which is exactly what happened last 
season. You stop buying merchandise, and you don't want to 
string two seasons like that together before you try to fill a 
brand new stadium.
    Mr. Cummings. Thank you. Thank you all.
    Chairman Tom Davis. Mr. Van Hollen.
    Mr. Van Hollen. Thank you, Mr. Chairman. Thank you all for 
your testimony, and thank you, Mayor Williams, for your 
leadership in bringing baseball back to Washington. I want to 
congratulate you on that. I want to thank all of you. I want to 
thank County Executive Doug Duncan for his efforts with respect 
to getting the games on television just as soon as possible so 
the fans can be well served, and all of you for your efforts 
there.
    Let me start with you, Mayor Williams. Mr. Dupuy testified 
that if you took all the equities into account, that the deal 
that was struck by Major League Baseball is ``a fair deal.'' 
Would you agree with that?
    Mayor Williams. The deal with Mr. Angelos or the deal with 
the city?
    Mr. Van Hollen. Well, I understood him--what do you think 
about the deal with Mr. Angelos?
    Mayor Williams. I think overall, when Jack Evans and I 
wrote an article to this effect, when you look at the market 
that we had access to, when you look at the number of games 
that would be shown, when you look at the guaranteed revenue to 
our team of, I think it was $21 million, and you compare that 
to other places, I thought under the circumstances, where the 
Orioles had to be compensated, I thought it was a fair deal. 
Was it the best deal? No. But was my deal with baseball the 
best deal? No. But under the circumstances, we got a team and 
we're up and running. It doesn't sound glamorous or----
    Mr. Van Hollen. No, I hear you, and I think all of us want, 
obviously, to make sure the fans can see the games, and we also 
have an interest in making sure that the cost to our cable 
subscribers is a minimum. I mean, for example, we heard Comcast 
say they don't accept a la carte, which means that--in terms of 
the programming, which means that all of our constituents, all 
of the consumers are going to be paying whatever additional 
costs, and Comcast has been saying publicly as part of their 
argument, that if you take the Angelos deal, it's going to end 
up costing our subscribers a lot more.
    Now, I understood Mr. Cohen's testimony--he wouldn't 
guarantee that--all he would say was that when you have two 
regional sports networks, the experience is that it ends up 
costing more. I would be interested in you guys' assessment, 
beginning with you, Mr. Koski. I mean, is there any evidence to 
suggest that this region can't handle two regional sports 
networks and that the effect of having two regional sports 
networks would be to increase the cost to subscribers of 
Comcast?
    Mr. Koski. I would think, well, there are two answers to 
that. Yes, we can absolutely sustain two regional sports 
networks. Three's enough teams here and there's enough fans, 
and we've got two cities worth, albeit, Baltimore doesn't have 
a hockey team or a basketball team, but Ravens coverage along 
in the fall will sustain SportsNight.
    And to the second question, yeah, it probably will increase 
subscriber fees. If Comcast SportsNet costs $2 a month per 
subscriber, and MASN costs $2 a month per subscriber, yeah, I 
expect my $167 bill to go up to $169, well, probably $170, you 
know, profit.
    Mr. Van Hollen. Any other?
    Mr. Duncan. Well, I was very interested in Mr. Angelos' 
comments of--at the end he sort of threw out, we should be 
talking about putting these two networks together. He basically 
offered Comcast a share in the deal, so I thought that was a 
real interesting statement, and hopefully they'll pursue that. 
I mean that's one way to deal with the situation.
    Mr. Van Hollen. Right, thank you.
    Any other comments on? Well, you guys all heard the 
testimony. What would you recommend that we do, I think, 
working with you, to----
    Mayor Williams. Well, Congressman, I would say that what 
Executive Duncan said is the right to go. If you get the two 
parties talking about not only getting the games on the air, 
but talking about some kind of partnership, and over the coming 
days, you also have a new owner of the Nationals stepping in at 
the table. That's the best of all worlds there I think.
    Mr. Connaughton. Congressman, if I could just throw in just 
one caveat to all of this, and that is, other than traffic, the 
No. 1 complaint--the No. 2 complaint on a continual basis I 
get, is about cable fees and about the rise in cable fees, and 
about the issue on where they change the networks and the 
channels that are being offered. And so I mean we recognize 
that this is about commercial negotiations between MASN and 
Comcast, but we urge, obviously, it's about accessibility as 
well as making sure that it is something that doesn't continue 
to drive up the cost of cable, which again, today, I had 
several e-mails about this issue, and at the middle of all of 
them they were complaining generally about the cost of cable 
today.
    Mr. Van Hollen. Well, no, that's exactly right, and that's 
the point I've been trying to hit throughout the day, which is, 
with all due respect to any cable provider, Comcast or whoever 
it may be, I think that they are more interested in making sure 
their stockholders and investors have a return on their money 
than making sure that their consumers are paying the lowest 
rate possible, and I think all of you have experience in local 
government understand that, and I think the listeners 
understand that.
    We need to make sure--we as the elected officials need to 
make sure, No. 1, we allow our constituents the opportunity to 
view these games; but No. 2, we make sure that neither side is 
able to gouge them, and that we make sure that we are in a 
position to drive the best possible bargain that we can, given 
our limited ability to intervene in a contractual agreement 
between two private entities.
    Thank you. Thank you, Mr. Chairman.
    Chairman Tom Davis. Mr. Ruppersberger.
    Mr. Ruppersberger. Mayor Williams, I want to acknowledge 
your leadership in bringing the team here. I was involved in 
bringing the Ravens back to Baltimore, and it was a tough fight 
with the Maryland Legislature, and even within your own house, 
and I think really a professional team that brings pride to the 
community, it brings people together, it is something that you 
can go to a game with your children. I think it is very 
positive in the end including for economic development. But 
there are other arguments to the other side.
    In fact, I do want to say this, and Peter Angelos can take 
care of himself and he is a tough guy, but he cared about his 
team. He bought something he felt that by bringing a franchise 
to the Washington area would hurt his franchise, and it 
probably will from a cash-flow point of view.
    But as a fan, I can understand how people here would be mad 
at him and how he would be the villain. I don't think though 
that you would have a team here right now if Peter did not 
agree and negotiate with Major League Baseball. Now, whether 
Major League Baseball did the right thing, I mean, history will 
only tell. But I think--Mr. Koski, I really applaud you for 
being a fan. You and I are both fans and we will probably be 
against each other and cross swords when the Orioles play the 
Nats, but I think it is important we get the facts out on the 
table.
    I just learned this, but it is my understanding that the 
Nats will eventually have 33 percent of MASN. Now, that is 
something that no other Major League Baseball team will inherit 
or has, that they will with time get that 33 percent, which 
means of the profits. Where it is or how it goes, I am not 
sure. Let me get back to you if you can clarify, because I 
think it is important that we get those facts out on the table.
    Mayor Williams, I also applaud you for stating, look, it 
was the best deal we could do and I have to stand behind it 
because I was negotiating and we have a team, and that is the 
No. 1 issue, but now it is up to Major League Baseball to go to 
work with the new owner, and hopefully that owner will be as 
tough as Peter Angelos, and make this team extremely 
competitive. Because even though it is the Washington region 
and the Baltimore region and we have had our battles, I think 
if we come together as a region from an economic development 
point of view, the Baltimore-Washington Region will even be 
stronger. We have all been able to talk about that.
    Doug Duncan, I hardly recognize you, you have lost so much 
weight. I guess that is because you are running? [Laughter.]
    Mr. Ruppersberger. Doug and I go way back as county 
executives, and we have really talked about regional issues, 
and it is good to see that we are on the same side, because 
when it came to the Ravens and Redskins, that was where we 
crossed paths. But I believe everyone here at this table really 
believes that it is so important that we have baseball, and we 
have baseball right away.
    It is tough for me to see Comcast--and I agree, Sean, is 
it? I agree. When I was a county executive and a county 
councilman, Comcast and cable, people were really getting upset 
and they weren't popular. One of the things that they did, they 
went back to the community, put their employees out in the 
community, and they really turned around from a public 
relations point of view.
    What Comcast management has to do now is decide how much is 
it worth for public relations versus what the long-term issues 
are as it relates to their stockholders and the competition 
that is coming down the road? And that is a corporate decision. 
We can't make that decision. I would hope that we go with the 
public relations side, because I think in the end, that would 
help them, and I want them to be strong, because as I said 
before, they put back into my community, but only time will 
tell that.
    But let me get to you, Mr. Koski, about the issue of the 33 
percent and how you interpret what those facts are.
    Mr. Koski. Well, that 33 percent happens in 30 years. It's 
not like----
    Mr. Ruppersberger. Oh, that is rather relevant.
    Mr. Koski. It's not like 5 years from now the Nats will be 
30 percent owners. It's 30 years from now. It's a long time. 
And, yes, that deal may be good for the Nationals down the 
line, even when they're a 15 or 20 percent owner. Doesn't do us 
any good this week when we still can't watch the games. So 
although long-term it may have some financial fruit for the 
Nationals, it's doing us no good now, and in fact, quite the 
opposite, it's actually hurting us, and if that hadn't been 
created, if the Nationals rights had been kept separate, they 
could have been sold to Comcast for that same $20, $25 million 
fee, which is all we're getting this year really anyway.
    Mr. Ruppersberger. Thank you. I think we are all in 
agreement, and again, I thank the chairman for putting this 
issue on the table.
    I was against the chairman--I felt that it might have been 
grand-standing--about the steroid issue, and I think that was 
one of the best hearings that I have participated in, and it 
really put the issue on the table, and I think, Mr. Chairman, 
putting this issue on the table, hopefully will get us to where 
we need to be.
    Chairman Tom Davis. Certainly can't hurt.
    Mr. Moran.
    Mr. Moran. Thank you, Mr. Chairman. I thank Mr. Koski for 
trying to expand the fan base and keep them informed, taking 
the initiative.
    I would like to ask the three local government executives 
if MASN is able to develop a network, a real network, more than 
just the games, and they find that to do so would maintain 
their profit margin, they have to substantially increase the 
rates, and if Comcast loses, gives up. If they don't have the 
Orioles and the Nationals games they may not be able to sustain 
the sports network that they've invested capital in building 
up, so that Mid Atlantic Sports Network may control the whole 
shebang. If they do, can they increase the rates for Cox and 
the rates that Comcast customers have to pay at the drop of the 
hat? Do they have any kinds of limitations on what level by 
which they're able to raise rates and how often? Do you have 
any control over that?
    Mr. Duncan. I think there's something over the basic rates, 
over the minimal service we've got some control, but then when 
you get into the tiered levels, which is pretty much what 
everybody gets, we have no control of that at all. I don't know 
if they're restricted to----
    Mr. Moran. The reason I ask, this is going to be part of 
the basic package. It is not a supplement. So that basic cable 
subscriber fee is going to go up as much as it has to in order 
cover Mid Atlantic Sports Network's charges, which could become 
substantial if they develop a network and they get basically 
monopolistic control over the whole Washington-Baltimore area 
for the two major sports teams. If that were to happen, do they 
have the prerogative, the ability, the right to pass on the 
increases whenever and however they want?
    Mr. Connaughton. Congressman Moran, we get, obviously, a 
lot of complaints about the rates, and our understanding is 
that under Federal, under the cable law, under Federal law, 
that we cannot regulate or do anything about the actual rates 
that they charge. But I would like to just maybe point out that 
we are seeing, you know, the cable--we have primarily Comcast, 
but we also have a couple smaller ones, and then we have 
Verizon coming down in a few months, but the thing that's 
happening is that they are obviously facing competition from 
DirecTV and even from over the Internet.
    So the issue is for them--I mean we're talking about why we 
want to see some agreement reached is that we can get more 
marketing to people about the Washington Nationals, and they'd 
be getting interest in building that fan base, particularly in 
places like, again, my community. I mean, we we're going to 
increase the population in 10 years by 50 percent. And so you 
look at where the potential biggest market growth is, it's in 
places like northern Virginia. And how do you reach out to 
these people, many of them new to the Washington region 
completely. But the issue is, is making the Nationals 
accessible to this new and growing population, but at a 
reasonable price. I think what they've got to recognize is that 
for the cable providers, they have to be even more competitive, 
given the fact that there's more and more competition, not only 
from the fact that they're going to be facing Verizon 
potentially coming to my community as well as other communities 
throughout the region, but also the fact that there's other 
providers of telecommunications services, but it is about money 
as well.
    Mr. Moran. I appreciate that, Sean, but other than the law 
of supply and demand, you have no regulatory control. None of 
the three of you. Same thing in D.C., Mayor? Yes.
    Incidently, did I hear you say, Mr. Connaughton that the 
Cannons are a minor league of the Nationals?
    Mr. Connaughton. Yes. In fact, Congressman, the chairman 
has actually been at--in fact, was there the night that they 
renamed what was at one time the Alexandria Dukes, I think when 
you were on the City Council or Mayor. They have now become the 
Potomac Nationals. We call them the p-Nats, and in fact, we're 
building them a new stadium, but they are a minor league 
affiliate now of the Nationals. And I was just mentioning to 
the Mayor, again, it's amazing to me, again, the cost that will 
incur, but the excitement that we saw last year when various 
major league players were injured, because of the proximity to 
Washington, we had those players coming down and actually 
playing for the single A affiliate.
    Mr. Moran. That is terrific. I missed that, and I am glad 
that is happening, although they may want to work on that name, 
the p-Nats, but--[laughter]--I just have one other question. 
Doug, in your testimony you said that ``if there's no action by 
the company by the time the Nationals finish their first 
home''--I think you meant their first home series.
    Mr. Duncan. Series, yes.
    Mr. Moran. This week. ``Then I believe Congress needs to 
step in and take appropriate action to ensure that baseball 
fans can watch the team of their choice.'' What action were you 
referring----
    Mr. Duncan. I was just asking you all to get involved, as 
you are now, to put pressure on baseball.
    Mr. Moran. Just public pressure.
    Mr. Duncan. Public pressure on baseball, on Comcast.
    Mr. Moran. Thank you, Mr. Duncan.
    Chairman Tom Davis. Thank you very much.
    Ms. Norton.
    Ms. Norton. Well, I do think this needs public pressure. I 
think these guys have been sitting off on the sidelines, and, 
boy, I think that is a real fly by here. If Mr. Koski has come 
in with a petition, I thank you, sir.
    I want to thank Mayor Williams. First of all, he sat 
through much of this hearing, and see, I know firsthand what a 
Mayor of the District of Columbia has to do and what a 
sacrifice it is to sit through and wait for this. I want to 
show him how much I appreciate that, and that I know, of 
course, that it's not been easy. But you know, the Mayor is 
used to coming on, being first on and getting out of Dodge 
here, in light of his considerable responsibilities. This, of 
course, is near and dear to his heart, but as I have said 
publicly, since the Mayor has wound down on his time in the 
District and has decided to go on to bigger and better things 
when he has concluded--though we don't know what he is going on 
to, that almost anything would be bigger and better.
    But I have told him that I am going to make it my business 
to make sure that he is remembered for more than his signature 
issue here, baseball, because he has done just that much for 
the District, and he deserves to be remembered for baseball to 
be sure, but certainly for all he has done, to in fact, lift 
this city up in countless ways.
    I want to thank the region. I want to thank you for being 
here. I want to thank the way in which you supported this team. 
When we have used the words ``fan base,'' we are really talking 
about you. Whenever we talk about base, and when you are 
talking about a city, albeit the core city, in a region, I 
don't care if we had the 800,000 people that we had when I was 
a kid. The growth of the region would mean we would pale in 
sheer numbers beside what your--what is it 3 million in this 
region amounts to, and we know good and well we could not have 
gotten baseball without you, without the fact that your 
demographics in every way argue for it.
    I want to say while I realize that you made a poke at 
competing for this--and I don't blame you--I also want to say 
that----
    Mr. Duncan. You're talking to Virginia.
    Ms. Norton. Yes, I am talking to Virginia, and I am talking 
to my good friend here who, while he wanted baseball all along, 
he and I have had a pact from the beginning--you know, when he 
was competing for it--that may the best man or woman win--so 
that he's not entirely fair, and the region has been nothing 
but stand-up folks for the District of Columbia. And, frankly, 
in many ways, we understand about the commuter tax. We don't 
forgive you, but you don't expect you to rush forward with 
that, and we will take this as some recompense for what you are 
not giving us in commuter tax.
    The Mayor, of course, was put in a very awkward position 
because he was competing with you, and a few other no-nothing 
jurisdictions outside of this region. We know what baseball 
understood, that it was hard to beat this region if you were 
looking for another home. But here was the Mayor, who was put 
in a position of engaging in both an auction and a legitimate 
negotiation. That is to say he had to somehow say, ``Me, me, 
me, me, me,'' you know, somehow make them understand that they 
should come here, and since he is the city's chief executive, 
that was his role, and at the same time he had to sit down and 
negotiate the best deal for the District, a very, very 
anomalous and bad position for a negotiator to be in. Of 
course, you know, I think that the Mayor should have played 
good cop-bad cop, because the bad cops are always the Council, 
and they might have helped him earlier in those other 
negotiations.
    Mr. Mayor you have taken a lot of brick-backs because 
somehow in playing this dual role of vying for and yet getting 
the best price, you somehow have--baseball has managed to get 
what they and most other people considered to be a generous 
deal. So more than anyone else at the table, your view of the 
deal, it seems to me, would have some effect here, because you 
paid at the office, as they say.
    I looked at your testimony, and you have indicated that you 
weren't at all involved to come to a resolution, and I 
appreciate that. But, look, you won now, here. And some of the 
answers to your questions seem to indicate that you thought 
perhaps the question was about the deal that you in fact made 
or those who were your proxies made. I am the first one to 
understand the awkwardness of that position. But now that the 
deal is made and you now have an additional task, your job 
isn't over, the city's job isn't over. Now that the deal is 
here, they have to build this fan base, yes, some in the 
District of Columbia, but mostly where these gentlemen are 
from.
    Would you have preferred that Comcast come to a resolution 
with baseball, that we could have been this season on regular 
cable, that most of our region watches? If you had your 
druthers, would you have preferred this resolution or are you 
indifferent to the fact that we have the MASN created out of 
what you have done, and now most of the residents here won't 
see it, and most of the residents in the region won't see it. I 
just want to know what your druthers are here.
    Mayor Williams. My druthers is if I had to do it over 
again, I think in negotiating--and I think your 
characterization of a collapsed auction and negotiation is 
exactly right, you know, and I'm just between a rock and a hard 
place. But having said that, we should have involved, rather 
than through official representation of the Council, really 
involved the nitty-gritty of the Council at the very beginning 
so that was all out on the table at the very beginning. If I 
had to do it over again, definitely would have done that. Would 
have been difficult, but definitely should have done that.
    And we started out, not only were we dealing with the 
representatives of Council, but we also were on this kind of 
good faith notion that--it's like when we, you know, you're a 
constitutional professor, you know, and we did the 
Constitution, we were going to get around the federalism, and 
then we'd get around the slavery, and we would get around the 
District voting rights, and we would get around a lot of 
things. We were getting around to the whole notion of naming an 
owner. We just trusted that an owner would be named. Obviously, 
if we had to do it over again, we would have made that a 
condition precedent to what we were doing, and that was a 
tactical issue. So that's No. 1.
    No. 2, when it comes to the issue with Mr. Angelos, seems 
like one party that really should have been at the table at the 
very beginning--my understanding is maybe they weren't--was 
Comcast. Just as I should have foreseen that there would have 
been issues with not having an owner in place sooner rather 
than later, not having all the Council as opposed to just a few 
members of Council in place sooner rather than later, I think 
they should have foreseen that there would be issues down the 
road that Comcast would see this as a threat to its line of 
business and put up a fuss, and here we are.
    Ms. Norton. That is why, in trying to unravel the legal 
questions that they have thrown on the table, I wanted to 
disengage that from the notion of what people consider a ``fair 
deal.'' That is not what people who are negotiating think 
about. Their job is to think about the best deal for 
themselves, and, of course, that is what has happened, and it 
may be unfair to this party or that party, but they would not 
have reached a deal if their view was it was unfair. And so you 
have to go on from there and move forward.
    Mr. Mayor, you indicated--and I know you have said over and 
over again to your constituents, you have said it publicly, 
that you have been talking with Major League Baseball about the 
necessity to get an owner. Could I ask you if you have had any 
conversations with Comcast or anybody in your administration 
has had any conversations with Comcast?
    Mayor Williams. The initial conversation when Comcast 
came--but I'm sure they did with the other jurisdictions--let 
us know that they were entering into this suit. Then there have 
been periodic conversations as to the progress of the suit. 
We've had some conversations with them about what preparations 
there were to try to get the games back on the air, and then 
thanks to the offices of the Congress here and our friends with 
the fan support, this issue is on a higher plane now, and I 
commend that. But there had been some discussions on the local 
level.
    Ms. Norton. Comcast owes us a lot in a lot of ways. The way 
they do the region, if I may ask you, Mr. Mayor, I would ask 
that one of your good lawyers on the sports authority or in the 
city, simply back up what the chairman is doing here and the 
committee is doing here today, by simply having a sit down with 
Comcast, a very serious sit down with Comcast. Could I ask you 
to do that soon?
    Mayor Williams. Sure.
    Ms. Norton. I appreciate it. I mean I am not saying that 
people have not done it, but I think that a good way to--we are 
trying to get people to understand, it is pressure. It is not 
legal pressure. It is pressure that perhaps works best, and we 
are not asking you to publicly criticize Comcast, but I would 
like, in light of what Comcast owes the city, to have somebody 
sit down and talk some turkey with them the way that I know 
your people have been doing with Major League Baseball.
    Mayor Williams. You know, Comcast is a good corporate 
citizen. I will say that about them, and I do believe that when 
Mr. Dupuy made a commitment to you and to the chairman and to 
others that they would sit down and try to knock some heads 
together, I believe that they will do that. I think hearing----
    Ms. Norton. You are willing to have somebody sit down and--
--
    Mayor Williams. And I would certainly echo your tough cop 
approach. I think good cop-bad cop's a good thing.
    Ms. Norton. I know, Mr. Mayor, and the difference between 
you and me is it comes naturally to me. [Laughter.]
    Chairman Tom Davis. You don't have to comment on that, 
Tony. [Laughter.]
    Ms. Norton. Mr. Mayor, the whole notion of the price and 
that's all people think about, and of course, baseball is known 
for twisting arms, and we know that they have extracted a 
terrible bargain from everybody, so I mean, if they didn't do 
it here, it would have been probably the first of the century. 
But I would like to know what you think the real financial 
impact, not in, you know, here is a bunch of dollars, not 
having an owner is on the city? If, for example, we had an 
owner today, ergo, what would now be occurring?
    Mayor Williams. A lot of different things. I mean if we had 
an owner today, an owner would be probably sitting in Comcast's 
offices and sitting in Mr. Angelos' office, you know, trying to 
get this thing done, knowing how important it is to get those 
games to the widest possible audience. Now, why is that?
    Because the owner would also know that when we financed the 
stadium, what were the three major revenue streams financing 
the stadium? There was the ballpark fee, as everybody has come 
to loathe it. Then there is the rent that the team is paying. 
And then there is revenue from every--revenue taxes on 
everything that moves at the stadium, purchase of tickets, hot 
dogs, tee shirts, you name it. 70 percent of those folks, as 
you referenced and I have referenced, come from our regional 
friends. They are all coming into the city coming to the game. 
This owner would be livid because this owner would know that 
fewer and fewer people are going to come to the games if they 
can't see the games at home. As Sean was saying, if I can't go 
home and watch a game every other night on TV, I'm going to 
lose interest going into Washington to see the game in person. 
So that's an impact on the city.
    Another impact on the city, not having an owner, is here we 
are designing the stadium, right? I mean wouldn't you want to 
be at the table while this stadium is being designed if you're 
paying $450 million for the team? I would want to be at the 
table.
    And the last thing, and this is the most important thing--
and also the minority participation is important--is because an 
owner can speak to the city in a way that I can't, the Council 
can't, you can't, the business leadership can't. The owner can 
involve those players, get those players up on Capitol Hill, 
get those players up in Northeast, talking to children, talking 
to people around the region, and really building regional 
spirit and positive feeling about the team, which is really 
needed right now.
    Ms. Norton. These are very important elements. Mr. Mayor, 
in light of that, do you agree--and indeed, I would ask others 
at the table as well--do you agree that it was necessary to get 
a lease before an owner was chosen? Necessary, now.
    Mayor Williams. Well, it was required formally. I don't 
know----
    Ms. Norton. Was it required in writing?
    Mayor Williams. The way the negotiations became 
conditioned, essentially we would approve the lease, the owner 
would be done, basically----
    Ms. Norton. Was that part of the contract, Mr. Mayor?
    Mayor Williams. It's part of our agreement now that they've 
got to have an owner I think by All-Star break, and we've got 
to have certain things done which we've done.
    Ms. Norton. Yes, but I have asked you if there was a 
written contract that said we have to sign a lease before you 
choose an owner?
    Mayor Williams. I don't know if it's in the contract. I 
don't think it's in the contract.
    Chairman Tom Davis. They made that pretty clear.
    Mayor Williams. Is it? Pardon me?
    Chairman Tom Davis. They made it very clear.
    Ms. Norton. Was that in the contract?
    Mr. Koski. I don't know if it was in the contract, but it 
was definitely clear.
    Ms. Norton. You know, if it was not in the contract--you 
see the advantage that they have there. Now we are sitting here 
negotiating without anybody to speak for us. So if I could get 
away with that, that is what I would have done too.
    Go ahead, Mr. Mayor.
    Mayor Williams. I think that--again, I am not their 
spokesman, but I think that when they saw a couple weeks, this 
time I think it will be a couple weeks, and we want to get it 
done this week, obviously, if we can.
    Ms. Norton. Do you all think, given what you know about 
sports and about teams waiting in the wings, about what is at 
stake, particularly given that there is nothing in writing in 
the contract that it was necessary for everything to be done in 
the city, including the lease signed before anybody would step 
up to become an owner?
    Mr. Koski. I don't think so at all. I think there was 
either seriously interested groups long before these things 
were in place, and I think they would have relished the 
opportunity to make these decisions and have influence on these 
major components of the team they're about to own, absolutely.
    Mr. Connaughton. I just maybe want to point out that, I 
mean the Mayor, obviously, and the city were dealing with a 
very complicated situation in which the ownership was, 
obviously, from all the league and all the owners, including 
Mr. Angelos, he was trying to work within that framework, which 
made it, I think, even more complicated than a normal, let's 
startup a team, let's buy a team from an owner, and one owner 
moving to another. I think that many of the issues that you all 
are dealing with here are a result of the fact that you have 
this very complicated ownership interest, and the fact that you 
do have a market that this team is being located in, and I 
would like to say it was the Potomac Nationals market, but it 
is the Baltimore Orioles market, which, believe it or not, I 
know our owner actually is going to get compensated because he 
owns the marketing rights even for the minor league franchise 
here in northern Virginia.
    But I have to compliment the Mayor on this, and understand 
that in some ways it is trying to satisfy all these groups and 
still come out with a deal, and get it through the City 
Council, and making sure that Major League Baseball feels that 
they got the most for their investment in this process is 
something that he really should be commended for.
    Mr. Koski. The Mayor's point that the owner should be 
homegrown is so unbelievably important when you figure how many 
bad owners there are in baseball, where their own fans 
absolutely hate the owners of their teams because they won't 
stick up for them, they won't make the right choices, they 
won't invest money. So it could end up hurting us, but.
    Ms. Norton. Could I also ask one more question? Mr. Mayor, 
will you say a final word about the effect of limited TV 
exposure on the city and its revenues, and for the region 
beyond the cable prices, are there any revenue implications for 
the region with limited TV rights? Go ahead, Mr. Mayor.
    Mayor Williams. There is an effect on the team, and hence, 
if there's an effect on the team, there ultimately could be----
    Ms. Norton. Later for the team. I want to know what the 
effect is on the city.
    Mayor Williams. I know, I am saying.
    Ms. Norton. Oh, OK.
    Mayor Williams. And because of that, then you're going to 
have depressed multiplier effect around the activity of the 
team, right in sales and retail and everything else. You also 
have--you could depress viewer interest in sports cable, and 
since you have less interest in cable, there's an effect on the 
city there in terms of taxes.
    Mr. Connaughton. I just maybe--I don't want to say maybe. 
I'm a typical Nats fan, and that is in Virginia local 
government is part time. I still work here in the city. I come 
into the city pretty much every day. I'm a season ticket holder 
for the Nationals. But I'm in with several other friends of 
mine. It means I'm not here--I may get every third game. 
Obviously, I want to follow the games in between. And it's the 
fact of trying to get that interest built up.
    Particularly what I think is fascinating about this market 
and that one of the reasons the Nationals may have been as 
successful as they are last year and I think in the future, is 
that almost all of us, at least in Virginia, let's say, outer 
suburbs or from someplace else, and have the opportunity to 
come see teams that they grew up with play the Nationals. So 
you're not only getting the opportunity to serve--where people 
are becoming Nationals fans, they also get the opportunity to 
see the teams that they grew up with. I was a Mets fan. I used 
to work at Shea Stadium when I was a kid. I'm going to be there 
next week for the games against the Mets. I'm taking my kids. 
But it is, when I come in here, I usually go out to eat. I 
usually--obviously, we're paying for parking. We're paying the 
taxes on the tickets. My kids all got their red hats. They all 
got their shirts. Of course, they're getting bigger, we're 
going to buy more.
    I think at the end of the day it's reaching that market, 
particularly I'm just going to talk from the Virginia 
experience. We're growing so rapidly, that is a natural market 
and a growing market, an affluent market that you all have to 
reach into, and one of the best ways is through broadcast.
    Mr. Duncan. We think it strengthens the district, 
strengthens the region, and sports teams, particularly, that 
you all have mentioned have a really unifying effect on this 
entire region, whether it's George Mason's team, the University 
of Maryland Terrapins winning, the women's national 
championship, the Redskins, the Nationals. The stronger the 
team, the stronger the region.
    Chairman Tom Davis. Let me just thank this panel. Thank you 
very much. I want to thank you all for your patience sitting 
through--I see how frustrated you are sitting out there in your 
respective roles as head of your country governments, and the 
fan club, with these groups. Hopefully, this hearing will help 
bring them closer together, and let's just keep the heat on. 
Thank you.
    The hearing is adjourned.
    [Whereupon, at 4:32 p.m., the committee was adjourned.]

                                 
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