Not a Conspiracy Theory After All: CSN Files Bankruptcy Petition Citing "Total Gridlock"
On Friday, CSN filed for chapter 11 bankruptcy asking a court to allow them to restructure. According to the heavily redacted court papers, CSN is citing "total gridlock" as the reason behind the move and is asking a judge to place a trustee in charge of the channel that could make decisions on behalf of all the parties. Currently, all four CSN principals -- the Rockets, the Astros and two representatives from Comcast/NBC Universal -- must agree unanimously on major decisions, which include negotiations with network providers.
CSN has yet to reach an agreement with carriers other than parent company Comcast keeping Astros and Rockets games off 60 percent of the televisions in Houston. It is what led, in large part, to the Astros garnering a 0.00 Neilsen rating for a game one week ago.
Back in January, we reported that the impasse between CSN Houston and some of the larger television service providers like AT&T, Dish Network and DirecTV was the fault of the Astros, who believed the network should hold out for what they deemed fair market value for the channel. According to sources, attempts by the Rockets and Comcast/NBC Universal to get games on the air were blocked by the Astros.
Just a few days later, the Chron did an extensive write-up on the mess and called our story a "conspiracy theory":
As emotions run high, conspiracy theories run rampant. The most recent came last week, with a Houston Press report that the Astros scuttled an agreement that would have provided CSN Houston carriage on DirecTV for the opening of the Rockets' season.
All three local principals - Hutchings, Postolos and Brown - said the report was incorrect.
"There was never an agreement in place," Brown said. "There was never anything that was even considered by the (network) board. There is no truth to the story."
Hutchings said the partners "have been unanimous in that we are all trying to get this channel fully distributed and want what is best, and there hasn't been any dissension."
I don't like to say I told you so, but it has been clear for some time to anyone with knowledge of the situation that the Astros and owner Jim Crane have been the holdup in negotiations. Crane even told the Chron in March, "We're not going to blink" in negotiations.
It's true that Dish Network and DirecTV, in particular, have drawn proverbial lines in the sand when it comes to paying big money for regional sports networks, but all indications are the Rockets and the other parties at CSN have been more than willing to negotiate to get games on the air, while the Astros have behaved like the lone juror who refuses to believe a boy with a face that sweet could have murdered his whole family. The end result is a deadlock that has literally killed ratings for the Astros and left the majority of fans blacked out.
The Rockets remained curiously silent on the bankruptcy filing, but the Astros called the filing improper. Additionally, they claim to have not been paid media rights fees by CSN for the last three months, suggesting they may have cause for their own litigation.
It could be weeks or months before the courts render a decision on the filing and even then it is difficult to predict exactly what will happen. There are a number of scenarios possible including the appointing of a trustee who could, assumedly, take control of negotiations with carriers unilaterally. But that is just one of many possible outcomes.
For now, CSN remains off the air for the majority of Houstonians and the chances of getting them on before the Rockets start their season in a few short weeks seem fairly slim. Despite the fact that the court filings are so heavily redacted they look like releases from the government concerning Area 51, at least now we have a clear picture on the negotiations stalemate and we can finally put the conspiracy theories to rest.
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