SBJ/October 1-7, 2012/Media

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  • NBC Sports Network has post-Olympics blues

    An expected Olympic bounce has instead turned into an Olympic hangover for NBC Sports Network, which has seen viewership ratings plunge to historic lows just weeks after setting record highs in London.

    Just two weeks after the Games, the week of Aug. 20-26, NBC Sports Network hit an all-time ratings low, dating to 2003 when the channel then known as Outdoor Life Network first became Nielsen rated. During that week in August, it averaged 71,000 prime-time viewers, which included a live Friday night MLS game (Philadelphia vs. Real Salt Lake) that drew just 40,000 viewers.

    To put that in some context, the NBC Sports Network’s viewer average that week was similar to the prime-time audiences for cable channels like ESPNews, Centric (which is the former BET on Jazz) and Discovery Fit & Health.

    NBC Sports Network’s viewership numbers stand in direct contrast to the network’s performance during the Summer Olympics, when the channel formerly known as Versus set a bevy of viewership records. It scored the biggest audience in network history on Aug. 9, when 4.35 million viewers tuned in for the women’s soccer gold-medal match between the United States and Japan.

    The network rode Olympic programming to average a record-high 590,000 total day viewers (6 a.m. to 6 p.m.) during the week of Aug. 6-12. In fact, the entire third quarter is shaping up to become NBC Sports Network’s most-watched quarter ever thanks to its Olympic performance.

    But the network’s performance after the Olympics raises the question of whether the theory of an “Olympic bounce” even exists.

    “The bounce exists for the two weeks during the Olympics,” said Brad Adgate, senior vice president and director of research for Horizon Media.

    The drop-off since London is dramatic.

    In the six weeks after the Olympics (Aug. 13 to Sept. 23), NBC Sports Network’s prime-time audience dropped 38 percent from the same six weeks of 2011. During that same six-week post-Olympic period, NBC Sports Network averaged 93,000 prime-time viewers. Its total day audience dropped 26 percent, to 48,000 viewers.

    Shows promoted during the Olympics — and launched just afterward — have not found audiences. The MLB show “Caught Looking” has averaged 22,000 viewers for its first five original telecasts. The network’s morning highlights show “The Lights” has averaged 10,000 viewers for its telecasts.

    For comparison’s sake, Versus’ most-watched shows in August 2011 came from genres that NBC has de-emphasized: mixed martial arts and Professional Bull Riders events, which regularly averaged more than 200,000 viewers.

    Even network stars like Bob Costas have drawn tepid interest post-London. An original “Costas Tonight” drew only 40,000 viewers on Aug. 29. That’s down 63 percent from the viewer figure of the three previous episodes (which averaged 109,000).

    Adgate pointed to NBC’s “Today” show as further evidence that the Olympic bounce doesn’t really exist. During the Olympics, the morning show trounced its competitors. For the week of July 30, “Today” averaged a 6.0 rating compared with “Good Morning America’s” 2.5, Adgate said.

    The week after the Olympics (Aug. 13), ABC’s “Good Morning America” was back on top with a 4.6 rating, compared with “Today’s” 4.4.

    “Once the Games end, networks and shows fall back to their previous levels,” Adgate said.

    That’s what happened at NBC Sports Network. But the viewer erosion put the channel well below the figures from a year before. NBC executives say they expected some viewer losses after making a decision to cut shows that brought good ratings, like MMA and outdoors programming, in favor of studio fare that is easier to sell and a better fit with the broadcast network. Plus, last year the channel carried several Pac-12 football games; this year, it has to make do with much lower-rated Colonial Athletic Association games.

    NBC executives say they use NBC Sports Network to support larger events that appear on the broadcast network, like the Olympics, “Sunday Night Football” and horse racing. NBC executives credit NBC Sports Network with helping the company produce the most-watched Super Bowl and Olympic Games in a seven-month span.

    One problem for the network is that it did not have many live events in those post-Olympic weeks.

    In a statement NBC Sports provided to SportsBusiness Journal, an NBC spokesman said: “Of course we want high ratings, and we have high ratings when we have live events, such as the Olympics, NHL, Tour de France and MLS.

    We’re still finding our way with original programming, but the investment in that content has been rewarded by advertisers and cable operators, as we’ve replaced time-buys with quality sports programming that we sell ads against. The network has generated significantly more revenue this year than 2011. We will continue to acquire properties and create original programming that we believe is good for our already profitable business. We will not overspend on properties that we don’t feel make good business sense for us or our customers.”

    Insiders feel the network’s struggles can be attributed to the lack of enough live events during the week to attract viewers. This month, old movies like “Rocky” and “Any Given Sunday” have had coveted prime-time positions and have brought the biggest audiences to the network.

    The prospect of losing NHL games due to the lockout further complicates the channel’s fall schedule.

    “Live events are what draws viewers to sports networks,” Adgate said. “If the NHL doesn’t play, NBC Sports Network won’t have a lot of compelling live events.”

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  • NASCAR close to early renewal with Fox

    NASCAR is close to finalizing a new TV deal with Fox for the first half of the Sprint Cup season, but a deal for the second half will not be wrapped up until next summer at the earliest, according to several sources.

    Fox started negotiations for its package earlier this spring and has agreed on the broad terms of a new deal to continue in the sport, sources said. An announcement is likely to come in the weeks after the broadcaster’s media rights deal with Major League Baseball is announced officially.

    While Fox is finalizing its deal with NASCAR, ESPN and Turner have chosen to wait.
    Photo by: ICON SMI
    But the remaining inventory of NASCAR’s media package will be in question for the next year. That’s because ESPN and Turner Sports executives told NASCAR that they are not willing to start negotiations on their media contracts early. NASCAR approached both networks earlier this summer about new deals, but both chose to wait until their exclusive negotiating windows kick in next summer. Typically, negotiating windows last around a month.

    Despite declining ratings, particularly in the younger demographics, NASCAR stands to bring in more money from its next media deals. The addition of NBC Sports as a serious new bidder could create a bidding battle that could help push rights fees higher than many expect.

    ESPN and Turner Sports are in the sixth year of eight-year agreements valued at $2.74 billion overall. Their deals run through the 2014 season.

    ESPN, which carries the NASCAR Chase for the Sprint Cup Championship, is interested in renewing its deal. Turner, which carries six midseason races, is interested in adding more races to its schedule.

    Sources familiar with NASCAR’s plans said the organization hasn’t decided whether it will sell its entire package of rights to one partner, two partners or three, as it has in its current deal. That decision won’t be finalized until after it’s held initial conversations with ESPN and Turner.

    Fox, which also has an eight-year agreement that runs through 2014, wanted to begin negotiations early to account for its plans to rebrand one of its channels into an all-sports channel that it’s calling Fox Sports 1. Fox executives have told league executives that it wants to turn Speed into that channel. To do that, Fox is looking to lock up NASCAR rights so that it could keep its races as part of the cable channel’s long-term programming plans.

    Fox’s executives negotiated heavily with NASCAR this spring and summer. Those talks slowed in recent weeks as the broadcaster worked to finalize a new rights agreement with MLB. A formal announcement of Fox’s MLB deal is expected to come this week, after which the Fox-NASCAR talks are expected to resume and be completed. Sources said Fox would renew its current agreement, which includes the Daytona 500 and 12 early-season Sprint Cup races. It’s unclear if Fox also will renew its deal for NASCAR’s Camping World Truck Series, which currently airs on Speed, the cable channel Fox plans to rebrand.

    NASCAR’s decision to go forward with its negotiations with Fox alone carries some risk. If the sport negotiates a deal with Fox that is a modest increase on the network’s current $220 million a year deal, that could suppress the market, causing bidders for the second or third packages to use that as a benchmark in their own negotiations.

    By the same token, if Fox comes out and makes an offer that doubles its current agreement, NASCAR could set a floor for bidders looking to acquire rights for the other half of the season.

    But the pricing of a rights package for the second half of the season will have less to do with what Fox pays than the interest of NBC, CBS or some other network.

    If ESPN and Turner can’t reach agreements with NASCAR during their exclusive negotiating windows, NBC, CBS or another network could create a bidding war for broadcast rights. That has the potential to be the most favorable outcome for NASCAR.

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  • Multiple story lines help lift Tigers to top of local TV ratings list

    Buoyed by a tight race in the AL Central, plus Miguel Cabrera’s run for baseball’s first Triple Crown since 1967, the Detroit Tigers are poised to win Major League Baseball’s local TV ratings crown this season.

    The average rating for Tigers' games on FS Detroit were on pace to be the highest in team history.
    Photo by: GETTY IMAGES
    With about 1 1/2 weeks left in the regular season, Tigers games on FS Detroit were on pace to be the highest in team history. Games have averaged a 9.13 rating so far this season, a massive 42 percent increase from last season. The 168,000 average homes that tune into Tigers games is the third-highest audience in MLB.

    “A lot of great story lines have captured the attention of Tigers fans this season, and it’s reflected in the ratings,” said Greg Hammaren, senior vice president and general manager of Fox Sports Detroit.

    Another strong story was in Cincinnati, where Reds games on FS Ohio are on pace to finish second in overall ratings. Its 8.64 average rating is, by far, the team’s highest local TV rating since at least the mid-1990s and shows renewed interest in a franchise that is set to make the playoffs for only the second time since 1995.

    The Reds are followed by the Cardinals on FS Midwest (7.68) and Pirates on Root Pittsburgh (6.52).

    Those ratings come as MLB teams have seen their local TV ratings drop 6 percent overall so far this season.

    On the lower end of the league, the Astros’ 1.02 rating is on pace to become MLB’s lowest local TV rating since 2008, when the Nationals registered a 0.61 rating. The team, which has lost more than 100 games during its final season on FS Houston, has averaged only 22,000 households per game, a 33 percent drop from last season.

    Despite the Yankees' being in a pennant race, their games are on pace to be the lowest rated on YES Network in 10 seasons. If ratings don’t increase in the season’s last week, the team’s 3.87 rating will mark the first time Yankee ratings have fallen below a 4.0 since 2003. This year’s ratings are down 17.5 percent from the Yankees’ high of 4.69 in 2007.

    The surprising Orioles and Nationals have lifted MASN’s ratings in the Baltimore-Washington corridor. Ratings for Nats games have risen higher than any other team, up 74 percent to average a 2.54. The Nats have clinched the first playoff spot in Washington, D.C., since 1933. Orioles games are up 42 percent, which is the league’s fourth-highest increase. The O’s are guaranteed their first winning season since 1997. The Dodgers (up 70 percent), Rangers (up 51 percent) and Tigers (up 42 percent) also posted significant ratings increases this season.

    Last year’s ratings champion, the Phillies, saw their ratings drop 39 percent on Comcast SportsNet Philadelphia this season. Their 5.61 rating dropped to seventh on MLB’s local TV ratings list.

    “The Phillies continue to provide strong ratings, but are off of their historic highs of the last couple of years,” said Jon Litner, group president of NBC Sports Group. “Ratings are up and down for our regionals. Overall, we have a few home runs and a few double plays.”

    Nielsen data represents all 29 U.S.-based teams. Through Sept. 23, Sportsnet drew an average total audience of 552,200 for its Blue Jays broadcasts, marking a 9 percent increase over the 2011 season average audience, according to BBM Canada.

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  • The view from Day One for new RSNs in L.A., Houston

    Cable operators will launch two regional sports networks today, as Comcast takes over the Rockets and Astros rights in Houston and Time Warner Cable takes over Lakers and Galaxy rights in Los Angeles. Staff writer John Ourand talked with the architects of both channels, Time Warner Cable’s Melinda Witmer and NBC Sports Group’s Jon Litner, about what these new networks mean to the business.

    What’s unique about your channels?

    WITMER:
    There is a real opportunity to speak much more in depth to the passionate fan. There is a lot that fans of the Lakers want to know about them and about the operation in a much more in-depth way than they’ve generally had access to in the past. I asked Jeanie Buss, “What do your fans want to know?” They want to see [Steve] Nash put on his jersey for the first time. Or they want to see Dwight Howard meeting the management for the first time. They want to see what their lives are like, or how their training works. They want to know what it takes to become a Laker Girl.

    Litner
    Witmer
    LITNER:
    In addition to exclusive game coverage with the Rockets and Astros, we will have a dedicated studio in the heart of Houston that will serve as a beacon for greater Houston and southwest region sports fans. It will serve daily news in a talk show format, leading into live news desks. We’re finally giving Houstonians and folks in the southwestern part of Texas what they’ve been craving, which is their own destination sports network. It’s a blueprint that we have used in other parts of the country and had a track record of success.

    How are negotiations going with distributors?

    WITMER:
    We’re in discussions actively with everyone. Some are closer than others. Nobody knows how this works better than we do. We know that it sometimes takes time. I have no doubt that we will ultimately get significant distribution.

    LITNER: We have a distribution deal with Comcast, which obviously is a significant chunk of the core market. We’re in active discussions with DBS and telco and other cable providers. Those discussions are ongoing.

    Why are we seeing so many sports channel launches these days?

    WITMER:
    Most of what’s happening in the RSN business today is not a whole lot different from what has been happening for years. It’s just different markets and different times. There’s been a lot going on, certainly on the college level with conference realignment and a reliance on television revenue to help support universities and their athletic programs. I’m not surprised that there’s been more talk about potential additional product coming to the marketplace.

    LITNER: It’s no different than it’s been in the past. There have been some networks that have had stronger value propositions than others. Some will gain distribution quicker than others. Time will tell how much stress is in the market. In a world of fragmented audiences and a world of DVRs and a world of choice, live sports continues to be a driver of audience and technology. Nothing is as strong as live sports, particularly when the teams are winning.

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  • Sports Illustrated delivers rebuilt mobile website

    Sports Illustrated today will debut a substantially reworked mobile website, representing one of the first major projects of Jim DeLorenzo, new SI.com vice president and general manager.

    Though a regular fixture among the most-trafficked U.S. sports websites, SI’s smartphone presence to date has been lacking in function and design compared with many of its competitors.

    The rebuilt SI mobile product features much more photography and multimedia, additional touch-screen functionality, content synchronization with the online version of SI.com that did not previously exist, and sharply heightened social media and commenting features.

    Also new to the SI mobile destination is a live game-tracking feature, Game Flash, that previously was available only on the personal computer version of the site. In addition to taking fuller advantage of advancing smartphone hardware technologies, the new site also is being seen by SI executives as a means to broaden its overall digital traffic patterns beyond traditional weekday high points.

    “This is going to provide a much fuller and deeper experience that our readers have come to expect,” said DeLorenzo, hired in May after prior posts at Octagon Digital, CBS Local Media and AOL.

    Lexus has signed on as a presenting sponsor of the mobile site relaunch. The new destination is a forerunner to rebuilt SI iPhone and Android mobile applications expected before Christmas.

    The current SI mobile efforts are focused on smartphones, as the company established an early leadership position on tablets with its digital delivery of the print magazine.

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  • USA Today Sports Pulse adds to local sites

    USA Today Sports this week is beginning a broad rollout of USA Today Sports Pulse, an online syndication strategy delivering national content to its battery of more than 100 Gannett Co. local newspaper and TV station websites.

    The new content strategy will provide sports material from USA Today,

    Sports On Earth, The Big Lead, MMAJunkie.com and other flagship destinations to the local markets, attempting a digital integration envisioned over the last two years by Gannett Co. executives. As Gannett has reshaped USA Today and its related properties into a more digitally focused news operation and recently introduced a new branding concept for the 30-year-old newspaper, greater interplay between national and local news outlets has been a key company priority.

    Stories appearing within the USA Today Sports Pulse will be selected on several criteria, including relevance to local markets, online consumption data and the amount of social media sharing. Material will include photo galleries and video in addition to text content. The effort was beta tested in five individual Gannett markets over the summer before this week’s broad rollout.

    “Putting national with local and local with national we think makes a lot of sense,” said Dave Morgan, USA Today Sports senior vice president of content and editor-in-chief. “One of the biggest assets and biggest levers we have is this vast reach of distribution in our portfolio, and the Pulse is a key element in leveraging that.”

    Eventually, USA Today Sports executives intend to syndicate the Pulse to non-Gannett properties.

    Bleacher Report content has been syndicated previously in USA Today, but that distribution will cease with the introduction of the Pulse.

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