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SBD/June 26, 2012/MediaPrint All
The PGA Tour will take control of its digital rights beginning in January after not extending its current deal with Turner Sports. Turner has been working with the Tour on its digital business, including sales, marketing and operations, since '06, but the Tour has been running the editorial side all along. Similar to NASCAR's move to regain control of its digital rights earlier this year, the Tour will oversee its entire package of rights by bringing them in-house after the end of the year. During an evaluation process that lasted nine months, the Tour considered extending with Turner and also had deep conversations about partnering with one of its broadcast partners, CBS or NBC, before deciding to take over all control. Industry sources branded the PGA Tour-Turner Sports split as amicable, certainly more so than last year's divorce between Turner Sports and Sports Illustrated over the latter's digital business. But even as Turner held interest in retaining the Tour rights, there was not agreement on a financial model for a potential term beyond this year.
OMNIGON ON BOARD: For the Tour, the move was anticipated after it last year signed a series of new nine-year TV deals with CBS and NBC that provide the networks additional rights to activate their live broadcast rights on digital platforms. PGA Tour Senior VP/Entertainment & New Media Paul Johnson said Omnigon has been retained as the vendor to provide the technical resources for PGATour.com and other digital needs. Johnson: “The ability to have 100 percent control and flexibility in a marketplace that changes really fast was very important to us. Turner has been a great partner and the business has been very strong. We’re truly in a leadership position in golf for online, mobile and social. Taking the rights in-house is the right structure for the future.” Johnson said PGATour.com will continue under the same name and that hires will be made to beef up the sales staff for the Tour’s digital division. Johnson added, “The biggest change is that after this year Turner will not be representing us in the advertising market. We will now be representing our properties ourselves. We will sell our own ad inventory. We already were selling close to 50 percent of it and now we’ll be selling 100 percent. We’ll be ramping up our sales capacity, and dealing directly with clients and agencies.” Lee Bushkell, PGATour.com VP & GM, will oversee the sales side of the digital
WHAT IT MEANS FOR TURNER: Turner Sports Senior VP & GM Matt Hong said, “This was a collaborative decision. We're not getting out of golf, and we will continue to move forward looking to leverage our existing portfolio across all platforms." Turner Sports will continue to work with the PGA of America for PGA.com, and also exclusively sells the golf section of Yahoo Sports. PGA Tour VP/Digital Media & Business Development Luis Goicouria will handle the operations. Johnson said Goicouria came over from MTV nine months ago and has been instrumental in the process.
Fox Sports and the Hornets have reached a long-term television rights agreement. The net will televise approximately 75 regular-season games per season including games not selected by the NBA’s national TV partners. In the New Orleans market, Fox Sports Southwest will be re-launched as “Fox Sports New Orleans” in October to coincide with the start of the ‘12-13 NBA season. Fox Sports New Orleans will become the 21st RSN in the Fox Sports Networks family (Hornets). Neither Fox nor the Hornets will release financial details, but sources said that the annual rights fee is in the low-to-mid eight figures, comparable to the amount Fox pays for the Bobcats' rights in Charlotte. SportsBusiness Journal first reported the pending deal in May (John Ourand, SportsBusiness Journal).
MARKETING BENEFITS: In New Orleans, Jimmy Smith notes the agreement between the Hornets and Fox Sports “is expected to help the team’s marketing efforts by sending game telecasts to areas that had been excluded because of pricing conflicts between the previous network and local cable providers.” Since the Hornets relocated from Charlotte in ’02, games have been televised by Cox Sports "under what was a ground-breaking cable network deal" that paid the Hornets about $10M annually, and "created the basis for the CST network, which has grown significantly during the past decade.” A source said last month that the deal with Fox “would compensate the team comparably, probably 10 years in the neighborhood of" $100M. Under the new agreement, “many local cable viewers, especially those on the north shore served by Charter Communications, will be able to receive the broadcast signal on their provider’s basic tier of services, of which CST was not part because CST and Charter disagreed on cost factors.” It is “unclear whether the Hornets’ current broadcast team of play-by-play announcer Bob Licht and analyst Gil McGregor will remain in place, though both are employed by the Hornets” (New Orleans TIMES-PICAYUNE, 6/26).
Unable to "put a value on coming Olympic Games, the Canadian Broadcasting Corp. and Bell Media have walked away from their partnership rather than put together a new bid for exclusive Canadian television rights," according to Houpt & Ladurantaye of the GLOBE & MAIL. The broadcasters have been "locked in negotiations for more than a year" with the IOC for the '14 Sochi and '16 Rio de Janeiro Olympics. The breakup "raises the possibility that no domestic broadcaster will be willing to meet the financial terms demanded by the IOC." While the Games have "traditionally been ratings hits for Canadian broadcasters, they are expensive to secure and produce." Despite the "success of the Vancouver 2010 Games, for example, the domestic broadcast consortium of Bell Media and Rogers Media lost money." The partnership submitted two bids that were rejected by the IOC, including "a first pitch" of $70M and a second one "that was believed to be marginally higher." That was "less than half of what the Canadian networks bid" for the rights to the '10 Vancouver and '12 London Games. But "without the guarantee of NHL involvement in the Russian Games and time-zone complications, it's difficult for the broadcasters to gauge domestic interest." There is also "another NHL wrinkle: The CBC, Bell Media and Rogers are all interested in bidding when the rights to 'Hockey Night In Canada' come up for renewal in two years." While CBC yesterday said that it "was willing to explore new partnerships, Bell Media said it was unequivocally out of the bidding" (GLOBE & MAIL, 6/26). CTV President of Sports & Exec VP/Programming Phil King said, "We presented not one, but two fiscally responsible bids that are reflective of the Canadian marketplace" (HOLLYWOODREPORTER.com, 6/25).
Tennis Channel "could be on the block by the end of the year if regulators agree to hand it another 20 million households," according to sources cited by Claire Atkinson of the N.Y. POST. Sources said that a "positive decision in the matter, pending before the Federal Communications Commission, would lift the Tennis Channel's distribution from 34 million homes to more than 50 million -- boosting its value and tilting its owners' minds toward a sale." Sources added that with an "expanded distribution platform, the value of the Tennis Channel could leap" from its current $300-400M "up to roughly" $1B. Bankers are "eyeing the independent network ahead of a likely distribution expansion." A source said an FCC judgment in Tennis Channel's favor is "likely." The source added that the FCC "may decide the issue as early as next month." Tennis Channel was created in May '03, and is part-owned by an investor group that includes Apollo Partners, Bain Capital, Battery Ventures, CCMP Capital Advisors and Columbia Capital. Sources said that the net's "annual revenue is around" $100M, and it is "close to being profitable" (N.Y. POST, 6/26).
PunchForce, a new technology designed to "measure the speed and force of a boxer's punches and transmit that information instantaneously to viewers" of HBO's boxing broadcasts, "could help this struggling sport fix one of its most nagging flaws,” according to Tony Olivero of the WALL STREET JOURNAL. The system would offer “perspective about what actually took place between contestants, enhancing the ability of viewers to judge the judges.” It could give boxing “a second wind at a time when fight fans increasingly are turning to mixed martial arts, or MMA, a form of combat that more often ends with decisive knockouts.” The technology “has yet to launch,” but the Nevada State Athletic Commission “already has approved the use of PunchForce.” The FCC “granted approval to PunchForce in February, essentially ruling that it wouldn't interfere with other transmissions.” But the device “remained on the sidelines” for the controversial Timothy Bradley-Manny Pacquiao bout. Precisely why PunchForce is not “expected to play a role in any imminent bout ... isn't clear,” as the technology is a "closely guarded secret at HBO.” An HBO spokesperson said that it was “premature to discuss the technology.” But a source said that HBO is “planning a high-profile launch in January.” The source said the launch will be part of a "rebooting of the HBO boxing franchise." PunchForce “still must get the OK in other states.” In addition, boxers would “need to agree to wear the sensor on their wrists" (WALL STREET JOURNAL, 6/26).
Social media has "invaded youth sports," as a growing number of Internet "start-ups are making their play to bring youth baseball teams, soccer leagues, and hockey clubs into the era of Facebook and Twitter," according to Michael Farrell of the BOSTON GLOBE. Mass Premier Soccer, a Massachusetts youth league, last year "started using Korrio, a social network exclusively for soccer leagues." Seattle-based Korrio is "making a push to dominate the youth soccer market in Massachusetts," and the Massachusetts Youth Soccer Association says that the area "has the country's second-largest number of participants, after Southern California." Korrio has "signed up more than 50,000 users in the state in the past year." But there is "competition on the field, including WePlay Inc. of New York and TeamSnap Inc. of Boulder, Colo., which are open to all youth sports and are making inroads into Massachusetts." Korrio offers administrators "back-end tools to run a sports league, bringing multiple aspects of team organization together in one online resource -- everything from registration to record keeping." Once players and parents sign on, they "have access to such information as game times, directions to the field, and weekend weather reports." Social networks like Facebook "offer some of the same capabilities as Korrio but are not built specifically to run sports leagues." Korrio, which has raised $5.8M in "venture funding, makes money by charging teams an annual fee of $8 per player, and the company says it has hundreds of thousands of players using the service nationwide." By comparison, TeamSnap has raised $1.7M in venture investments and "charges leagues $250 a year and additional fees for services like compiling game statistics, and has signed up 45,000 users in Massachusetts" (BOSTON GLOBE, 6/25).
NBC's coverage of the Olympic Swimming trials last night earned 4.7 overnight rating. The number was good enough for NBC to win the night and marked the best overnight ratings for swimming-only trials since '96 (THE DAILY). The friendly rivalry between U.S. swimmers Michael Phelps and Ryan Lochte was examined on NBC’s “Nightly News” last night as the U.S. Olympic swimming trials are taking place in Omaha, Neb. NBC’s Kevin Tibbles said, "Formidable titans drawing from each other, pushing each other ... and they are bringing attention to the sport like never before, from magazine covers to video games and a myriad of commercials and sponsorships” (“Nightly News,” NBC, 6/25).
TEXAS TWO-STEP: In Austin, Kirk Bohls cited a source as saying that Time Warner "is interested in trying to buy the Longhorn Network or at least partner with ESPN on the property" (STATESMAN.com, 6/25). However, TWC later dismissed that report and issued an official statement to Bohls stating, "We have not had any conversations to purchase the Longhorn Network nor made or received any proposals to purchase the Longhorn Network" (STATESMAN.com, 6/25).GONE SILENT: In Phoenix, Dan Bickley questions the temporary removal of D’Backs TV announcer Daron Sutton by writing, "This mysterious disappearance doesn't work." Sutton's "sudden ejection from the broadcast booth has led to rampant speculation." Bickley: "Fair or foul, you can't remove a play-by-play guy out of the broadcast booth during the middle of the season without explanation." The D'Backs have shown "very little public support for Sutton, other than to say that he hasn't broken any laws and is simply taking some time off." D'Backs President & CEO Derrick Hall "clarified one point and one erroneous report -- that Sutton was not suspended for a local radio interview or for being occasionally critical of the team." Hall said, "That report was an absolute joke" (ARIZONA REPUBLIC, 6/26).