SBD/Issue 145/Sports Media

CBS' Extensive Sports Coverage Earns Millions From Advertisers

CBS' MMOD Earns $30M From Advertisers
CBS' use of streaming video for events like the NCAA men's basketball tournament and The Masters has "scored big where it matters most, turning a profit that has so far eluded most old-line media's net game," according to Grover & Lowry of BUSINESSWEEK. The net's March Madness on Demand took in $30M from advertisers "as 7.5 million college basketball fans streamed games on their personal computers, iPhones and other digital devices." While CBS will not give exact amounts, it said that it "turned a tidy online profit" from both the NCAA Tournament and The Masters. Meanwhile, online entertainment services such as Hulu have "yet to turn a profit despite huge traffic for its free, advertiser-supported viewing of TV shows." CBS Interactive President Quincy Smith said that ther net "hopes to entice the NFL to allow it to stream" Super Bowl XLIV in February to go along with its TV broadcast rights. The league "hasn't said yes, although it claims a success last year when it jointly streamed 17 games online with NBC as a test." NFL Senior VP/Digital Media Brian Rolapp said that the online streaming, which "numbered in the millions, didn't cannibalize TV viewing of the Sunday night games." He said that 80% of viewers "turned to the streams to complement TV watching." Rolapp added that the NFL "hasn't decided whether to stream games again this year, and would be open to discussing CBS's Super Bowl request." Meanwhile, Grover & Lowry noted MLB.tv "expects to generate $100[M] this year from the 300,000 fans ... willing to pay up to $109.95 a year to stream baseball games." ESPN360 last year "streamed more than 3,200 baseball, soccer, and other contests," and while the net "won't discuss income ... analysts believe the company likely turned a profit from the streams since it had already paid license fees on the sports events" (BUSINESSWEEK.com, 4/15).

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