SBJ/December 19-25, 2011/Year End

Stories of the Year

Labor pains — and gains
The NFLPA’s DeMaurice Smith and NFL Commissioner Roger Goodell announce an agreement to end the league’s lockout.
Photo by: Getty Images

It was built up as a watershed year in labor/management relationships, and at the end of it all, the NFL, NBA and MLB all reached new labor agreements, but only MLB reached a deal peacefully. The NFL and NBA talks tested the mettle of owners, lawyers and players, as the back-and-forth often turned contentious. The NFL went to the wire, reaching an agreement barely in time to avoid losing games, with the annual Hall of Fame preseason game the only casualty. However, the NBA was forced to scrap its original calendar, and now is prepared to start a shortened season on Christmas Day.

Fox scores upset, lands
the World Cup

ESPN appeared to be an easy choice to renew its World Cup deal in October. Its top executives, especially John Skipper, are big soccer fans, and its comprehensive coverage during the 2010 event was widely praised. But Fox surprised the industry by paying between $450 million and $500 million for the rights to the 2018 and 2022 events, which will be held in Russia and Qatar. NBC-owned Telemundo agreed to pay $600 million for the Spanish-language rights. Fox’s jaw-dropping bid should help the company’s Fox Soccer Channel, which still has a lot of room to grow.

The sad decline of the Dodgers
Photo by: Getty Images

Last year’s ugly divorce trial between Los Angeles Dodgers owner Frank McCourt and ex-wife Jamie turned out to be only a prelude to 2011’s epic battles between the team, MLB and Fox Sports. The cash-strapped club nearly missed several payrolls, briefly had a league monitor assigned to them, and ultimately filed for Chapter 11 bankruptcy protection. After a fractious summer of legal volleys between the Dodgers and MLB, McCourt struck a settlement in which he agreed to sell the franchise by April 2012. It was a low point for one of the most revered and historic teams in all of sports.

NBC goes all in with Olympics
Comcast’s Brian Roberts (left), IOC President Jacques Rogge and IOC member Richard Carriòn celebrate NBC’s winning bid.
Photo by: IOC / Julliart

The International Olympic Committee spent almost three years courting networks to bid on its U.S. television rights. Its decision to postpone the process until 2011 because of the economy turned out to be a boon for the organization. Just weeks after losing its top executive and Olympic champion, Dick Ebersol, NBC bid $4.4 billion for the rights through 2020, blowing away its competitors by more than $800 million. The deal gives the IOC financial security for the next decade, and NBC the continuity of keeping the Olympic rings tied to the Peacock. Now, can NBC make its massive bet pay off?

The growth — and PR problems — of college sports
Pac-12 Commissioner Larry Scott was hired to mine more revenue out of the conference’s rights, but even he couldn’t have envisioned the record $250 million-a-year haul from ESPN and Fox that vaulted the Pac-12 from a sleepy West Coast afterthought to the leader of the pack. Seeing revenue riches, schools and conferences constantly wrestled with realignment, which fed a damaging public perception that college sports was more about revenue growth than the student athletes.

Time Warner Cable plants a major stake in sports
When Time Warner Cable picked off the rights to the Los Angeles Lakers early this year, the cable operator sent a message to every sports right holder in a TWC territory: The company is open for business. Under the direction of Melinda Witmer, the company launched a Time Warner Cable Sports division with high-profile executives David Rone, Mark Shuken and Dan Finnerty. There’s no doubt that the company has a seat at the table. It’s been monitoring the Los Angeles Dodgers bankruptcy, talking about buying Cleveland RSN SportsTime Ohio, and helping to launch the Pac-12’s suite of seven channels.

NFL hits media jackpot
The NFL revenue machine just keeps on growing. After announcing an eye-popping $1.8 billion per year deal with ESPN in September, the league neared deals with CBS, Fox and NBC that will see each broadcaster renew its NFL package for at least an average of $1 billion per year — an across-the-board increase of more than 60 percent. Look next for the NFL to carve out another Thursday night package to sell. Thanks to the latest deals, the NFL will wind up generating close to $7 billion annually in national media revenue starting in 2014, representing an amazing $220 million payout per team.

UFC fights to the forefront
Photo by: Getty Images

The day before a blockbuster event that drew 55,724 fans to Rogers Centre in Toronto in April, UFC President Dana White sounded like Nostradamus. “By the end of this year we’ll do something even bigger,” White said cryptically. “We’re going to blow you away.” Six month later, “UFC on Fox” promos aired prominently during World Series telecasts and on NFL Sundays, hailing a watershed for the hot property. The network’s financial package, which sources placed at an average of $90 million a year for seven years, more than doubled the reported $35 million a year that the UFC had received from incumbent Spike. Fox’s proven ability to take a fringe sport and expose it to the mainstream was attractive to the UFC, which still sees itself as a property in the early stages of growth.

Ebersol, Bodenheimer exit stage left
Bodenheimer
Photo by: Shana Wittenwyler
Ebersol
Photo by: Getty Images

The year saw two longtime media leaders move on, with Dick Ebersol stepping down from NBCUniversal Sports and Olympics, and George Bodenheimer announcing his decision to step away from day-to-day operations at ESPN. Ebersol, who later returned as an adviser to Mark Lazarus, provided more of a ripple effect on the industry, as the move allowed Comcast to assert its authority over NBC Sports. ESPN should see fewer changes. Bodenheimer’s replacement as president, John Skipper, has pledged to keep the business running the same it has for the past several years.

Farmers Field takes root
Rendering by: AEG

AEG’s proposed football stadium in downtown Los Angeles, despite being anything but a definite, pulled off a 30-year, $600 million naming-rights deal with Farmers Insurance. Farmers Field still awaits a final funding plan, all the necessary government approvals and, not the least of all, an NFL tenant. But the virtual naming-rights deal helped reinvigorate a naming-rights market that later in the year saw MetLife align with New Meadowlands Stadium.
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