League to bring U.S. back to velodrome AutoTrader.com renews with NBA Breaking Ground: NHRA looks to Paciolan Nike’s Converse sues 31 companies PowerBar narrows sponsorship focus From the Field of Information Management Roc Nation in acquisition mode End the one-size-fits-all approach How brands can reach the two Brazils Pete D’Alessandro
SBJ/May 2-8, 2011/MediaPrint All
The Asian Tour, which has been the proving ground for golfers such as K.J. Choi and Y.E. Yang before they became stars in the U.S., is broadening its reach with a new TV agreement with Golf Channel.
The deal was struck by Asian Tour Media, a new joint venture created by the tour and IMG Media’s Asia-Pacific division. Asian Tour Media will be the entity that represents and manages the tour’s TV distribution, which now is in 420 million households across 130 countries. That coverage area includes Fox in Australia, Sky Sports in the United Kingdom, ESPN in India and other networks that carry the tour through China, the Middle East, Korea and Vietnam.
The new arrangement with Golf Channel will put the Asian Tour in North America, Latin America and Japan. This will mark the Asian Tour’s first regular TV exposure in North America. Financial terms were not available, but Golf Channel pays a fee for the finished programs and sells the advertising around it.
“The Asian Tour truly is moving into a position where it’s receiving exposure worldwide,” said Robbie Henchman, IMG’s senior vice president and managing director for golf, Asia-Pacific. “That’s an important move for the tour and it’s important for the sponsors as well.”
Golf Channel in North America will air a one-hour package of highlights each week during the Asian Tour season, which includes 21 tournaments and runs from February through November. The shows come pre-packaged from IMG’s production team.
“Golf Channel is the pinnacle for golf exposure,” Henchman said. “To get on Golf Channel says that they’re recognizing the quality of the product in the Asian Tour.”
Through the last decade, IMG has worked with the tour to promote tournaments, but in the last two years IMG has worked on the TV distribution. The new 12-year deal between IMG and the tour to create Asian Tour Media encompasses all aspects of the TV broadcast, from production and talent to distribution. The media team is led by Henchman, the chairman of the Asian Tour Media board, and Michael Mellor, senior vice president of IMG Media, Asia-Pacific, a board director.
It’s similar to IMG’s arrangement with the European Tour, which formed European Tour Productions in the early 1990s and now produces more than 700 hours of programming each year. IMG says it hopes Asian Tour Media will eventually mimic the success of European Tour Productions.
At least four senior staffers have left EA Sports’ Tiburon development studio in Orlando, production site for “NFL Madden” and several other prominent video game titles, to join Row Sham Bow, an online gaming startup founded by former company executive Philip Holt.
Holt, who was Tiburon’s general manager until January, is building a non-sports gaming outfit “focused on direct-to-consumer platforms” such as Facebook and other social networks. Joining him in recent weeks from EA Sports have been Ian Cummings, “Madden” creative director and one of the more prominent public faces of the franchise; EA Sports chief technical officer Richard Wifall; software engineer Christopher Staymates; and chief software architect Nick Gonzalez. Row Sham Bow ultimately plans to expand to 60 employees.
“Our focus is on an entirely different demographic and set of platforms than those that constitute EA Sports’ primary business,” Holt said.
EA Sports executives branded the personnel shifts part of normal industry attrition, and several key “Madden” developers at Tiburon remain in place, including longtime executive producer Phil Frazier.
“The [gaming] community was shocked” by the executive departures, said Cris Benson, operator of The Fantasy Football Informer, a football fan blog focused on gaming. “However, most ‘Madden’ fans felt that the departure of Cummings could open the door to a new creative perspective.”
NFL executives said they have been notified of the personnel moves.
“We are aware of the changes,” said league spokesman Greg Aiello. “EA has been and will continue to be a great partner of the NFL,” he said, adding that the league has had no contact with Holt’s new company.
The moves come as part of an unusually frenetic period of activity for the “Madden” game, still nearly four months away from retail release. EA Sports last month shifted its traditional “Madden” release date of the second Tuesday of August to Aug. 30, a move the company positioned as an attempt to more closely align with the scheduled Sept. 8 start of the 2011 NFL season, should it begin on time.
EA Sports for months has steadfastly insisted that it will plow ahead with full development and marketing activities for “Madden” despite the NFL labor dispute. If there is no new labor deal by the time of the game’s release, however, industry analysts have predicted sales of “Madden,” which traditionally have surpassed 5 million, could drop by at least half.
Cleveland Browns running back Peyton Hillis last week won a spirited online fan vote to be this year’s “Madden” cover athlete. The monthlong promotion, representing a marked expansion from a more limited fan voting initiative last year, drew nearly 13 million votes.
As he shopped the pay-per-view rights to Manny Pacquiao’s upcoming fight against Shane Mosley, the president of boxing promotions company Top Rank sent a set of basic financial terms to the three networks that play prominently in boxing: HBO, Showtime and ESPN.
He also asked the question that would frame Top Rank’s choice: What, from your vast spread of media holdings, would each of you provide to raise the profile of these fighters and this fight?
He wanted to know what HBO would deliver from Time Warner, and particularly from the Turner networks; what Showtime could find from across the realm of CBS; what ESPN could bring from Disney and ABC. Promotion of pay-per-view long has been driven by exposure offered by cable outlets and satellite providers, and by the premium channels that, while appreciated for their checkbooks and their air time, reach no more than a quarter of U.S. TV homes.
Todd DuBoef and his boss, Top Rank Chairman Bob Arum, wanted more.
“The currency was the audience, not the dollars,” said DuBoef, the president of Top Rank. “How do I make my product more available?”
“You layer in things and then you see: This is what we have; this is what we could have.”
DuBoef said he heard nothing of note from ESPN and little from HBO that he hadn’t heard before. But from Showtime, often seen as the underdog tugging at HBO’s hem, came word that CBS was willing to talk. The deal that emerged is unlike anything boxing has seen.
Will CBS’s experiment change boxing on TV?
“It’s all that CBS can bring to bear, including 115 million homes — I gotta give it a chance,” DuBoef said of his decision. “How could we not do it?”
“Top Rank was used to doing it the way they did it at HBO,” said Ken Hershman, executive vice president and general manager of Showtime Sports. “My pitch to them was you’re taking more of a risk trying to go through that same infrastructure time after time. It’s not growing the buys. They’re up and down and up and down. I felt like business as usual was more of a risk to them than coming our way and exploring this new opportunity.”
Thirty years ago, Seth Abraham changed the landscape of boxing as head of sports at fledgling HBO. Charged with landing high-profile sports programming to attract subscribers, Abraham offered fight promoters the allure of Saturday night prime time, backed by rights fees far larger than those offered by the traditional networks.
All the glitzy fighters were gone from CBS, ABC and NBC by the 1990s, residing instead on HBO and Showtime. Before long, all their biggest fights would air live exclusively on pay-per-view. The premium channels expanded their subscriber base and the fighters and promoters fattened their wallets. But the profile of the sport dwindled, a fact that all the stakeholders bemoaned but none effectively addressed.
And then, late last year, along came Top Rank with a proposal and in came CBS.
“I think this is the most important fight, out of the ring, in 20 years,” said Abraham, who served as president of HBO Sports until 2000, then worked as chief operating officer and president of Madison Square Garden through 2003. “There could be enormous consequences.
“If the pay-per-view rate is meteorically higher, you have to assume it had a lot to do with the promotion on CBS. So if CBS really impacts the buy rate for Top Rank, if the delayed broadcast on Showtime is a big success, I think what you’re going to see is that NBC/Versus will pay more attention, ABC/ESPN will pay more attention, and Fox and FX and their regional networks will pay more attention. If CBS and Showtime are successful for Top Rank, then I see a completely different boxing landscape that HBO will be facing.
“It’ll be a real slugfest for every important fight.”
When describing the potential audience for a fight, Abraham parcels it into three: The rabid, the adamantly disinterested and the broader sports fans, who drop in and out of boxing depending on whether they view a fight as a major event.
“You have the ones you’re always going to get, the ones you’re never going to get, and then the group in the middle, which is the group that really matters,” Abraham said. “The sports fan will watch Ali, will watch Tyson, will watch Manny Pacquiao. For most fighters, they don’t care and they won’t watch. But they watch big events. So how do you best use the resources of Time Warner, or in this case CBS, to convey that this is a big event?”
HBO’s creation of a “24/7” franchise that takes viewers behind the scenes with fighters and their camps in the weeks leading up to a big PPV was a game-changer for the network. It frequently credits those shows with creating or reviving fight fans and resuscitating sales of the fights, the larger of which now generate upward of 1 million buys and eclipse $50 million in revenue.
HBO’s shows are, for the most part, available in fewer than 30 million homes. One school of thought says taking the Showtime “360” show to CBS, which is available in 115 million homes, should increase buy rates. Skeptics point out that the impact of that exposure could be deadened by the stiff $55 to $65 PPV price.
There is no debate over the unprecedented quantity of promotion that CBS has delivered. The Final Four is a sporting showcase. Even though Saturday traditionally is the least-watched night of the week, it’s still a network prime-time slot for a “Fight Camp 360” dedicated entirely to the fight.
“That’s really a lot of prime real estate, beachfront real estate,” said Kelly Kahl, senior executive vice president of CBS Primetime, who has programmed the network’s nightly lineup since 2001. “Now we have to translate this enormous reach into buys. Step one is letting them know the fight is there. Step two is getting them to click the button. Time will tell, but we’re certainly hopeful.
“I think everyone is looking to see whether we can move the needle.”
‘The death knell for boxing’
When CBS Sports lost the NFL in 1994, Rick Gentile was executive producer. He thought boxing’s popularity among men would make it a natural replacement for pro football. Gentile met with Abraham, asking whether HBO might want to combine with CBS on fights. HBO would get broader exposure for some of its boxers and CBS would get programming to fill its void. Abraham told Gentile he was interested.
“I went back to CBS excited, and our sales executives shot me down in about a minute,” said Gentile, who now serves as director of the Seton Hall University Sports Poll. “I saw that, and I saw what HBO was paying for fights, and I knew it was over. … It was the death knell for boxing on the networks.”
It was the departure of sponsor Budweiser in the mid-’90s that eventually booted boxing from the air at CBS. Reminded of the brand’s exit, the man who long ran sports marketing for Anheuser-Busch, Tony Ponturo, flashed back to the way Bud got into boxing. It was as a favor to R.J. Reynolds, which had signed a one-fight deal with Don King but feared it might run afoul of federal tobacco ad regulations. A-B agreed to take its place.
“I woke up one morning and we had a full-page spread in SI of the fight, with the Bud logo as big as a house,” Ponturo said. “If you can get an advertiser in and they have a good experience, you can get them hooked.”
Gentile saw Arum recently and reminded him that, regardless of the interest he might build in Pacquiao, the networks would not move back into boxing unless they could attract sponsors. “I got sponsors,” Arum told him.
“I think Bob is right in every way when he says this could be the kick-start,” Gentile said. “Having said that, I can see the corollary. Nothing could happen. We’ll see.”
Also in this issue: Hewlett-Packard signs Pacquiao for new table campaign.
Despite the threat of work stoppages in the NFL and NBA this fall, TV network executives are expecting a strong upfront selling season this spring — including in the NFL marketplace.
NFL partners, including Fox and ESPN, say they already have started talks with potential advertisers and expect the league’s telecasts to be well sold by early June and could match last year’s record pace.
“It’s business as usual from our perspective,” said Ed Erhardt, ESPN’s president of consumer sales and marketing. “We can’t control what will happen with labor. Advertisers have told us that they are planning to buy the NFL and NBA. We’ve already had conversations about what that should look like.”
The upfront selling season — when advertisers buy annual TV schedules — typically starts in the middle of May. Most business is written in early June and sets the tone for the rest of the year.
The NFL ad sales market, in particular, is an important one for TV networks. NFL games were the highest-rated programming on television last year, with NBC’s “Sunday Night Football” finishing as the top prime-time broadcast show during the last NFL season and ESPN’s “Monday Night Football” finishing as the top cable show. For the past two years, the NFL market has moved before the rest of the overall TV market, essentially setting the pace.
“There’s a lot of money in the NFL market during the upfront buying process,” said Jon Diament, executive vice president of Turner Sports Ad Sales, whose networks do not have NFL games to sell.
One reason network executives are convinced the upfront market will be strong is because inventory in last year’s scatter market was so tight. Advertisers that bypassed the upfront for last year’s scatter market wound up paying 30 percent to 40 percent more for spots in the scatter market, network executives said.
Ad sales are cyclical. When the scatter market is tight, the following upfront generally will be strong. Conversely, when advertisers find deals in the scatter market — as they did during the recession — the upfront market generally will be weak.
“We’re looking at business as usual,” said Neil Mulcahy, Fox Sports executive vice president of advertising sales. “We’re optimistic that things move ahead, and we have to keep moving forward.”
The NFL and NBA labor situations are causing some confusion in the marketplace, but several network sales executives said they are having no problems finding early interest in the games.
Network sales executives say they expected the NFL upfront marketplace essentially to be set by the beginning of June, meaning that there would be only limited inventory in all NFL windows, including Sunday afternoons. They say advertisers still are putting money down on the NFL because they don’t want to lose access to the programming, and are optimistic that there will be games.
Problems will occur if the NFL misses games. Because NFL ratings are so much higher than the rest of TV, it’s impossible to offer make-goods on games that are not played. Sources say the networks are prepared to refund money to advertisers for lost games, sources said.
Some advertisers have talked about hedging their bets by buying time in other fall sports, like college football, MLB’s postseason and NASCAR.
“Nobody is buying in place of the NFL. They are buying to hedge their bet on the NFL,” Erhardt said. “There’s nothing that would lead me to believe that sports would have anything but a very strong upfront.”
Network executives expect the auto category to continue to set the pace for the market. The insurance and telecommunication categories also are expected to stay strong.