SBD/June 6, 2011/MediaPrint All
Fox Sports Media Group Chair & CEO David Hill said the network wants to buy the rights to four Olympic Games, not just two. Hill, who made the comments today after Fox’ presentation to the IOC in Lausanne, Switzerland, said having the rights to the ’14, ’16, ’18 and ’20 games would be easier to “amortize” the production costs associated with covering an Olympics. Hill: “It’s simpler. … You have to make a major investment in technical hardware, which is (a capital expense), so anyone will tell you if you’re going to amortize that over four rather than two, you’re financially in a much better place.” Hill said Fox will submit two bids: one for the ‘14 Sochi Games and ‘16 Rio de Janeiro Games, and another for the ’14, ’16, ’18 and ’20 Olympics. Fox was the first to make a presentation to the IOC, showcasing its plans for covering the ‘14 and ’16 Games. The presentation was a mix of PowerPoint slides and video. It lasted an hour and 45 minutes, and a half-hour question-and-answer session followed. Afterward, IOC President Jacques Rogge said, “It was a good presentation, and I expect the two following to be good, as well. I’m happy with what they (Fox) showed, definitely.” IOC Dir of TV & Marketing Services Timo Lumme said it was "Fox at their best, a very good presentation."
TRYING NOT TO COME UP SHORT AGAIN: Hill led a six-person delegation and noted before the presentation began that it was “eight years to the day” that Fox last made a pitch for the Olympic rights. That time, it came up short, offering $700M less than NBC’s winning bid for the ‘10 Vancouver and ‘12 London Olympics. Hill said anticipation, nerves and “hope” that Fox wins marked this pitch. Fox’ delegation included Hill, Fox Sports Media Group co-President & co-COO Randy Freer, CFO Larry Jones, Exec VP/Research & Programming Bill Wanger, CMO Eric Markgraf and Senior VP/Media Relations Lou D'Ermilio. Hill said Fox Deputy Chair, President & COO Chase Carey did not attend because he was “comfortable” with Hill presenting the network’s case. Hill closed Fox’s presentation by saying he was going to miss NBC Sports Group Chair Dick Ebersol “hugely.” He added, “The Olympic movement owes him a huge debt. Dick Ebersol can get emotion out of a rock. He is a wonderful showman. He had this ability to select athletes that no one had ever heard of, and they became huge mega-stars. The fact that he’s not going to be around anymore, I’m certainly going to miss him.”
ESPN, NBC COMING TOMORROW: ESPN and NBC will make their presentations tomorrow. Afterward, all three networks will submit sealed bids. The IOC is expected to deliberate and announce a winner in the late morning or early afternoon. The organization is open to considering two bids from each network: one for the ‘14 and ’16 Games, and another for the ’14, ’16, ’18 and ’20 Olympics. The ’18 and ’20 sites have not been selected. IOC officials have said they expect a bid that exceeds the $2B rights fee NBC paid for the Vancouver and London Games. The IOC and USOC had nearly 18 people in the room to hear Fox’ presentation, including Rogge, Lumme, IOC Exec Committee member Richard Carrion, IOC VP/TV Rights Vincent Chupin, O’Melveny & Myers Partners Joe Calabrese and Chris Brearton, USOC Chair Larry Probst, USOC CEO Scott Blackmun, USOC General Counsel and Chief of Legal & Government Affairs Rana Dershowitz and others (Tripp Mickle, SportsBusiness Journal).
BIDDING AGAINST THE UNKNOWN: USA TODAY's Michael Hiestand writes about the Olympics rights bidding in a sports section cover story and notes that “nothing else in U.S. sports costs so much and has so many variables.” The network “winning this week's bidding faces intangibles such as how many Americans will win [how] many medals, time-zone differences and how evolving social media and technology like 3-D TV will change the media landscape and how the games are consumed by 2014 and 2016.” In addition, there are “issues networks probably don't even want to think about, such as the possibility of a terrorist act.” Getting the ‘14 and ‘16 Games “likely will cost billions.” Rio is in an "exotic locale in a favorable time zone for U.S. networks,” making the offers in essence "bids to lock up 2016.” NBC, which paid a total of $2B for the ‘10 Vancouver and ‘12 London Games, “lost $223 million on Vancouver” and “might lose as much next summer on London.” Still, the IOC “expects prices to go up” in this round of bidding. NBC “hasn't commented on its Olympic plans” since Ebersol announced his departure from the net. Fox and ESPN/ABC said that they “would have live coverage.” Fox Sports Media Group co-President & co-COO Eric Shanks last week said that the net “would change the Olympic TV formula by going live.” Shanks: “It just makes sense. You might as well try to reach as many people as you can" (USA TODAY, 6/6).
IT'S A DIFFERENT WORLD: In N.Y., Richard Sandomir notes the IOC would “certainly like to repeat the no-doubt-about-it outcome of eight years ago, when NBC’s $2.2 billion bid (including its parent company General Electric’s Olympic sponsorship) beat Fox’s $1.3 billion offer.” But that outcome “is not likely,” as each network “might be calculating the least it can bid to win, not how much would be a knockout blow.” In “proposing to remove the shackles from live coverage, ESPN’s and Fox’s two-front challenge reflects a modern view of Olympic event consumption.” They know it is “more difficult than ever to prevent fans from knowing results almost instantaneously.” Sandomir notes they still “intend to produce a taped recap for prime time, just as NBC has.” What remains unclear is “how flexible NBC’s live-or-taped approach will be, post-Ebersol.” Newly appoint NBC Sports Group Chair Mark Lazarus “declined to comment.” Comcast’s own “media sophistication could prod it to produce a hybrid, with more live coverage but still plenty on tape” (N.Y. TIMES, 6/6).
The bidding for the next package of U.S. Olympics rights begins today in Lausenne, Switzerland, with NBC/Comcast, ABC/ESPN and Fox/News Corp. vying to land the coveted agreement. SportsBusiness Journal’s Tripp Mickle and John Ourand recently analyzed what can be expected from the bidding process.
Q: How will Dick Ebersol's departure from NBC impact the network's effort to land the '14 and '16 Games?
Mickle: The network still has the benefit of having NBC Olympics President Gary Zenkel as part of its bid and the relationships it established through years of working with international sports federations and the IOC, but not having Ebersol will hurt. Ebersol had an approach to Olympic bidding that resonated with the IOC. He always bid big, so big that he beat his closest competitors (Fox) by more than $700M last time. With him out of the picture, is Comcast willing to go big? And if it doesn't, will the new faces of Brian Roberts and Steve Burke curry favor with an IOC that favors longstanding relationships and appreciated Ebersol's passion for and stewardship of the Games? It creates a barrier to winning that wasn't part of the picture a month ago.
Ourand: It should have a huge impact. Ebersol was the one executive at NBC who had deep relationships within the IOC and the entire Olympic community. With all bids being equal, NBC would have had a big edge if Ebersol were still around. With him gone, that edge goes away, as well.
Q: ESPN has come out and said they would broadcast the Games live if they win. How will that help them in the bidding process?
Mickle: I don't think it will help or hurt ESPN. In fact, Fox has said the same thing. And with Comcast ownership of Versus and cable interests, I anticipate they will shift to a live broadcast, as well. The era of tape delayed coverage of the Olympics is probably over. Ebersol was committed to tape delayed coverage because he needed to sell primetime advertising on NBC in order to pay the Olympics rights fee. The only way to guarantee the viewership for that advertising was to delay the programming. Now that every one of the bidders can benefit from sub fees and has the possibility of retrans fees for broadcast channels, there's a second revenue stream that takes some of the pressure off the advertising sales that NBC was so reliant on in the past.
Ourand: It shouldn't help at all because all the networks have given hints that they are on board with this idea. Fox has said that it would carry events live. It's believed that NBC will, too.
Q: Fox/News Corp. has been described as a "wild card" in the bidding. What do they bring to the table that differentiates them from NBC and ESPN?
Mickle: Bandwidth and David Hill. By bandwidth, I mean that Fox has the room on its channels -- broadcast and cable -- to add the Olympics. Unlike ESPN, they wouldn't have to fit a Winter Games around NBA games, and they show fewer MLB games that would conflict with a Summer Olympics. Plus, they have the most room for subscription fee increases on channels like FX and Fox Sports Net. David Hill is passionate about the Olympics and he's an engaging salesman who could wow the IOC during Fox's presentation. Bidding will likely be close, and such salesmanship could be the difference maker.
Ourand: With two broadcast channels (Fox and MyNetworkTV), Fox can provide more events on broadcast TV than any other bidder. This is important to the IOC, which still sees broadcast television as much more important than cable television or digital and mobile video.
Q: NBC paid $2.2B for the '10 and '12 Games. What will the price tag be for the winning network this time?
Mickle: I think we're looking at a $4.2B bid for the 2014, 2016, 2018 and 2020 rights. The IOC had to wait out the recent recession before opening today's bidding. My guess is they would prefer to lock up a partner long term, someone they can work with and build a relationship with the same way they did with NBC over the last two decades.
Ourand: There's been no evidence that suggests rights fees for any live sport will drop. I'd be surprised if the IOC doesn't match the $2.1B average. I expect the cost to be amortized though four games, rather than two.
Q: Are the Olympics still a worthy investment?
Mickle: Yes. They have an intrinsic value that other sports don't enjoy. It's easy for the cynic to laugh off their messages of peace and good sportsmanship, but the Olympics really do provide those and they do it on a world stage. NBC has benefited from the Olympic seal of approval for years by having the five-ring logo alongside its Peacock. That, of course, isn't something you can measure, but it's there. The more tangible upside is that the Olympics draw more female viewers than any other live sporting event. As a result, they're a great way to build ties to advertisers interested in a female demographic and a great way to drive viewership on a network's other female-oriented programming.
Ourand: Absolutely. Olympic programming allows a broadcast network to dominate primetime ratings for two-and-a-half straight weeks. That alone is worth a healthy rights fee. But Olympic programming also helps cable networks to grow their distribution and increase the license fees distributors pay for them. For the right price, the Olympics are must-have programming.
MORE ON THE BIDDING: Mickle and Ourand took time to discuss their thoughts on this week’s bid process in Lausanne. Listen to them debate who will emerge with the rights (their first choices may surprise you), why and who to keep an eye on during this important bid process.
ABC earned an 11.1 overnight Nielsen rating for last night’s Heat-Mavericks NBA Finals Game Three from 8:00-11:00pm ET, down 3.5% from an 11.5 overnight for the comparable Lakers-Celtics Game Three last year, which aired on a Tuesday night. The 11.1 overnight marks the second-best Game Three overnight since ABC acquired NBA rights prior to the ’02-03 season and is also up 23.3% from a 9.0 overnight for Heat-Mavericks Game Three in ‘06. Game Three peaked at a 15.1 rating from 10:30-10:45pm. The telecast led ABC to a win among all nets in primetime last night and marks the 22nd straight NBA Finals telecast to be the top primetime program on its respective night. Miami-Ft. Lauderdale led all markets with a 32.3 local rating, while Dallas-Ft. Worth earned a 26.7 rating. ABC finished with a 9.3 final rating and 15.5 million viewers for last Thursday's Mavericks-Heat Game Two, up 1.1% in ratings, but down 1.2% in viewership from Lakers-Celtics Game Two last year, which aired on a Sunday night (9.2 rating, 15.7 million viewers). Through two games, ABC is averaging a 9.2 rating and 14.3 million viewers, up 3.4% and 2.9%, respectively, from a 8.9 rating and 14.9 million viewers through the same point last year (Austin Karp, THE DAILY).
PLAYING FAVORITES? In Dallas, Barry Horn wrote ABC/ESPN "apparently believes the NBA world revolves on a Heat axis." The network is "simply overly invested in the Heat, and the broadcasters, the faces of the franchise, are now left to take the heat." As much as Mike Breen, Mark Jackson and Jeff Van Gundy "testify they walk a straight line and talk down the middle, it sure sounds as if the Mavericks have been getting the short end here" (DALLAS MORNING NEWS, 6/4). In Orlando, Shannon Owens writes ABC "adores" the Heat, and "has given plenty of shine" to G Dwyane Wade and F LeBron James. Last night, ABC's "lovefest continued for most of the broadcast as the halftime report was exclusively dedicated to Miami coverage." But Owens adds, "In terms of personality, the Mavericks don't exactly provide Masterpiece Theatre for the NBA. The Mavericks' focus and low-key persona helped keep them in Game 2, but it isn't keeping them on the small screen" (ORLANDO SENTINEL, 6/6). Meanwhile, FOXSPORTS.com's Brian Lowry writes Jackson "has become the master of the meaningless, uttering limp observations and silly catchphrases -- 'Mama, there goes that man!'; 'Hand down, man down'; 'Energy and effort' -- that, content-wise, amount to little more than empty calories." Van Gundy "certainly can be irritating," yet his "opinions and one-liners -- wrong-headed and strained as they sometimes are -- come across as clear and forceful in comparison to Jackson, and his criticism usually is pointed." Also, Lowry writes "nobody will confuse Breen with Marv Albert, but at least he has a terrific voice and knows how to convey a sense of excitement" (FOXSPORTS.com, 6/6).
READY FOR THE MIC? There has been plenty made about Shaquille O'Neal's future as an NBA analyst following his retirement last week, but in N.Y., Bob Raissman wrote when you "get past all the speculation, self-promotion and hype, O'Neal is far from being a sure thing to succeed as a studio analyst." O'Neal "usually takes a humorous approach," and he is "less inclined to be serious." Also, there is "every reason to believe O'Neal might be reluctant to offer pointed critical analysis, take shots at coaches and players." Raissman: "If that were to be the case, O'Neal would be a disaster in the studio, especially with his soft-spoken, monotone delivery" (N.Y. DAILY NEWS, 6/5).
TAKING TURNS: In Denver, Dusty Saunders writes NBA and NHL execs, in partnership with ABC and NBC, respectively, "have wisely refrained from televising Finals games on the same night or day." Still, "early figures show the NBA is far more popular on television than the NHL." Games One and Two of Mavericks-Heat "averaged more than 15 million viewers," while Bruins-Canucks Game One "had an audience of about 5 million" (DENVER POST, 6/6).
NBC earned a 2.5 overnight Nielsen rating for Saturday night's Bruins-Canucks NHL Stanley Cup Final Game Two. Last year's comparable Blackhawks-Flyers Game Two earned a 4.1 overnight, but that game aired on a Monday night. Bruins-Canucks Game Two is also down from last year's Stanley Cup opener (2.8 overnight), which aired on a Saturday night, but up from Ducks-Senators Game Three in '07 (1.5 overnight), which also aired on a Saturday night and marked the last time a Canadian team played in the Stanley Cup Final (Austin Karp, THE DAILY).
MILBURY'S AT IT ONCE AGAIN: In St. Petersburg, Tom Jones writes NBC studio analyst Mike Milbury "has become the mouth that roars, America's version" of the CBC's Don Cherry. Jones: "No other analyst on television has viewers saying, 'Did you hear what he just said?' as much as Milbury. His commentary is emotional, occasionally absurd and not always even logical. Half the time, viewers are probably rolling their eyes. But it's interesting" (ST. PETERSBURG TIMES, 6/6). USA TODAY's Michael Hiestand notes Milbury during Game Two "used no uncertain terms to address" the controversy surrounding Canucks LW Alex Burrows not being suspended for biting the finger of Bruins C Patrice Bergeron in the opening game. Milbury said, "If I had known in the late '70's that it was OK to pig out on human flesh, I would have eaten Guy Lafleur. This is a disgraceful call by the league." Burrows scored the game-winning goal Saturday night just 11 seconds into overtime (USA TODAY, 6/6).
TAPPING INTO A NEW RESOURCE: ESPNW.com's John Molori profiled NESN's Kathryn Tappen and wrote her "meteoric rise in sports broadcasting" has been "swift and striking." Since joining NESN in '06, Tappen has "moved from reporter to lead Boston Bruins studio host and has thrived in the ever-boiling Boston sports cauldron." Tappen: "It's been a great run. I've seen people come into this market unprepared and get burned or even humiliated by a coach. Even people who come from cities like New York or Philadelphia don't know what it's like to work in Boston. The fans are so passionate. If you say something that is incorrect, they will definitely call you on it. When you cover people's favorite teams, it's like you're a part of their families" (ESPNW.com, 6/4).
NBC earned a 2.6 overnight Nielsen rating for Rafael Nadal's four-set win over Roger Federer yesterday from 9:00am-2:00pm ET, marking the best French Open men's final overnight since Andre Agassi beat Andrei Nedvedev in five sets in '99 (4.0 overnight). Nadal-Federer is also up 63% from a 1.6 overnight for Nadal's victory over Robin Soderling last year. West Palm Beach topped all U.S. markets for the Nadal-Federer match with a 5.1 local rating, while DC finished second with a 4.0 rating. NBC also earned a 1.7 overnight for Li Na's victory over Francesca Schiavone in the women's final on Saturday from 9:00am-12:00pm, flat compared to Schiavone's win over Sam Stosur last year. NBC Friday drew a 1.3 overnight for Federer's win over Novak Djokovic and the conclusion of Nadal's win over Andy Murray in the semifinals, up 30% from a 1.0 overnight for semifinal coverage last year. NBCSports.com also had an average of 48 minutes per stream for live coverage of the Federer-Djokovic match (Austin Karp, THE DAILY).
IN THE BOOTH: In Denver, Dusty Saunders writes NBC's three-person crew of Ted Robinson, Mary Carillo and John McEnroe kept Nadal-Federer "in focus." McEnroe "again displayed his ability to keep hype out of his delivery" (DENVER POST, 6/6). However, in St. Petersburg, Tom Jones writes Robinson's presence during yesterday's final "made the NBC three-person booth too crowded." McEnroe and Carillo are "so good that they don't need setting up," and if "one sport out there doesn't need a true play-by-play announcer, it's tennis" (ST. PETERSBURG TIMES, 6/6).
BATTLE OF BABOLAT BALLS: In the first set of the Nadal-Federer match, McEnroe noted that “we’ve seen more ... unforced errors" from Nadal “then we’ve ever seen." Part of that "is probably due to this lighter ball” from Babolat “that flies and the players -- even Nadal -- have to accept that it’s going to happen.” Carillo said, “They’re lighter and they fly through the air more. ... Nadal prefers those old balls as much (as anybody), but he doesn’t want to say anything because it’s the same company that made these balls that pays him millions of dollars” (“French Open,” NBC, 6/5). Nadal has an endorsement deal to play with Babolat racquets (THE DAILY).