The PGA Tour announced yesterday it has concluded TV
rights negotiations. The TV deal gives it three broadcast
partners and three cable partners, from 1999 until 2002.
WHO GETS WHAT: CBS leads the way with 17 events per
year, ABC will have 11 and NBC will hold onto five. On the
cable side, ESPN will have early round coverage of 19
events, USA Network will have 12 and The Golf Channel/Fox
Sports Net will gain early coverage of 11 events, with
exclusive rights to one full event yet to be announced. PGA
Tour Commissioner Tim Finchem noted that the rights for the
new World Championship Series (WCS), which is co-sanctioned
by the five-member tours of the PGA Tours Int'l Federation
were included in talks. The WCS Stroke Play Championship and
the WCS Match Play Championship will be televised by ABC,
while CBS will televise the World Series of Golf (PGA Tour).
COMMISSIONER'S REMARKS: In a conference call with the
media, Finchem commented on the new agreement. Finchem: "We
have successfully segmented the schedule in a way that we
think is going to increase the visibility of the Tour in
different parts of the year and as a consequence, create
more value for the sponsors." Finchem added, "Suffice it to
say that gross revenues from all television sources we
expect now to double, and it would not be unreasonable to
expect that by the year 2000, our official purse at PGA Tour
events will average in excess of $3 million." On Fox's
interest: "It's been reported some places that Fox made a
lucrative offer. That's really not the case. We worked
hard, we felt like Fox was potentially an excellent
television partner ... they were in the same range as
everyone else on the financial side, in some cases perhaps a
little more conservative, in some cases a little more
aggressive. The problem with Fox was at the end of the day,
we just weren't able to structure a programming mix that fit
their objectives given some of the constraints they have
with hockey and baseball. We just couldn't quite get it to
fit. ... because of the market and the attractiveness of
golf, there was frankly more interest from television
entities than we could accommodate, which creates an
environment that is good if you are on our side of the
fence." Finchem, on the impact of Tiger Woods: "Frankly,
had Tiger Woods stayed at Stanford for another year these
negotiations, in my judgement, would have come out quite
well, but having a player who is going to move the needle on
the ratings like he does, obviously created significant top-
spin to the overall situation" (THE DAILY). Interviewed
during the final round of CBS' telecast of the BellSouth
Classic, Finchem added, "If you look at it from the
standpoint of the sponsors, we're going to have more
valuable programming, a little more programming, it's going
to be scheduled better so there's more promotion involved,
and the sponsors are going to have a more valuable product
to invest in" ("BellSouth Classic," CBS, 5/11).
RIGHTS FEES: The WALL STREET JOURNAL notes sources
close to talks said the three networks will pay more than
$100M a year in rights under the new deal, up from about
$40M they pay now (WALL STREET JOURNAL, 5/12). USA TODAY's
Rudy Martzke also puts the total value of the package at
about $400M over four years (USA TODAY, 5/12). The AP puts
the figure at $200M by the end of 2002 (N.Y. POST, 5/12).
The HOLLYWOOD REPORTER's Stephen Battaglio writes that fees
will increase to $200M, and notes prices "were driven up by
the stable ratings performance of most golf events on
television and strong ad sales for commercial inventory on
telecasts" (HOLLYWOOD REPORTER, 5/12). In L.A., Larry
Stewart also puts to price at $200M at the end of 2002 (L.A.
TIMES, 5/12). NEWSDAY's Steve Zipay: "Score an eagle for
the PGA Tour in its new TV deal. ... sources said the U.S.
broadcast rights alone will soar from about $42 million a
year to $107 million a year" (NEWSDAY, 5/12). CBS Sports
President Sean McManus: "We will make money but we'll be
nowhere as profitable as we had been" (N.Y. TIMES, 5/12).
CH-CH-CHANGES: CBS now has the Memorial, Byron Nelson
and Houston Open; NBC gained the Doral Open, BellSouth
Classic and Presidents Cup; ABC's coverage includes the Bob
Hope Classic; ESPN added the Mercedes Champ. and a Hawaii
event -- which will be televised in prime time.
REAX: In N.Y., Richard Sandomir: "The increased rights
fees are bound to squeeze profits, which may be why Fox
entered golf only on the cable side." Sandomir also notes
that the "key for NBC's package was staving off a PGA
attempt to shift the elite Tournament Players Championship
from March to May" (N.Y. TIMES, 5/12). USA TODAY's Rudy
Martzke: "Fox was interested in a world championship series
of three events but didn't boost its bid after the first
round." Fox's Vince Wladika: "We got out of this what we
wanted -- properties to build our cable assets" (USA TODAY,
5/12). One network source said that "virtually no
tournament" that runs long because of a playoff or a weather
delay will be cut away from (MIAMI HERALD, 5/12).
