SBD/March 29, 2012/Media

News Corp. Taking Steps To Form National Sports Net To Challenge ESPN

News Corp. execs denied channel could begin as early as end of this year
Fox Sports would not comment on reports that it was looking to launch an all-sports channel, but sources told THE DAILY that it is considering turning Speed, not Fuel, into an all-sports channel to compete with ESPN. Fox has talked with leagues and distributors, but sources stressed that Fox' plans are still evolving and nothing is firm yet. The network has been looking into launching such a channel and has been exploring its options. At one point, Fox was talking about converting Fuel into its motor racing channel, but that does not appear likely now. Speed is in 82 million HHs while Fuel is in just 36.5 million (Ourand & Mickle, SportsBusiness Journal). BLOOMBERG NEWS' Fixmer & Sherman reported News Corp. is "taking steps to start a national U.S. sports network on cable television aimed at challenging" ESPN. The sources added that News Corp. is "assembling the required rights from pay-TV carriers and sports organizations." With a national network, Fox would join Comcast Corp.'s NBC Sports Network and CBS Corp.'s CBS Sports Network in "taking on the dominant ESPN." News Corp. last year "secured rights to the Pac-12 Conference and Big-12 Conference games" and owns 20 RSNs. The company in October won TV rights to the '18 and '22 FIFA World Cup tournaments. A source said that the new channel could "begin service by the end of this year." Another source said that the effort is being led by Fox Sports Media Group Chair David Hill (BLOOMBERG NEWS, 3/28). News Corp. execs "denied that the channel could begin as early as the end of this year." A senior exec said, "That’s not going to happen. There is no final timetable." In N.Y., Bill Carter notes ESPN receives $5.06 a month "per subscriber this year," while most channels "receive less than a dollar." But to "extract that kind of value from cable systems, a sports channel would need a roster of highly desirable events." News Corp. may be "looking to position itself as a bidder for sports rights that could put a new network on the map as a legitimate competitor to ESPN -- for both viewers and fees" (N.Y. TIMES, 3/29).

BEEN THERE BEFORE: The WALL STREET JOURNAL's Adams & Stewart note News Corp. has been "down this road before." In the late '90s, the company "launched Fox Sports Net, a national program service that aired across its regional sports channels." The national service "allowed Fox Sports Net to capture national advertising." But "over the years, local programming on the regional channels increasingly took precedent, squeezing the amount of time for national programming." The regionals "still air some national programming but their main focus is on local sports" (WALL STREET JOURNAL, 3/29). In L.A., Joe Flint notes given "how lucrative its regional channels are, Fox and News Corp. executives have for the most part viewed a national network as a luxury item, not a necessity." And "going after ESPN would not be cheap." Sports teams and leagues would "no doubt welcome another competitor to ESPN because it would mean one more bidder for rights, which could lead to even higher prices" (L.A. TIMES, 3/29).
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