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SBJ/October 15-21, 2012/MediaPrint All
Get ready for more changes in the college sports media landscape. The BCS, Big East and SEC are in the middle of negotiations that have the potential to reshape the marketplace yet again.
The BCS opened its media rights negotiations with incumbent ESPN earlier this month, and the network has an exclusive negotiating window through the end of October. ESPN also is in the midst of an exclusive negotiating window with the Big East that started in early September and also ends this month. But the BCS talks are far more likely to close quickly, as ESPN looks to complete a sweep of the new college football postseason that begins in 2014.
ESPN acquired the rights to the Rose and Champions bowls, paying an average of $80 million a year for each game over 12 years. Industry sources say the network also has reached an agreement for the Orange Bowl for $55 million a year over 12 years. That deal has been negotiated by the ACC because it has the tie-in with the Orange Bowl and it will collect the revenue from the game under the new arrangement.
The Big Ten and Pac-12 share the rights fee from the Rose Bowl, while the Big 12 and SEC are partners on the Champions Bowl.
Now that terms have been reached on the Orange Bowl to go with the Rose and Champions, ESPN has secured all three of the “contract bowls” in the new playoff structure. Each of those bowls will likely be the site for four of the 24 semifinal playoff games during the 12-year cycle.
The rest of the games — the other semifinals, all 12 championship games and other BCS bowls, like the Fiesta and possibly the Cotton and Chick-fil-A — are the games included in ESPN’s current talks with the BCS.
The conference commissioners, Notre Dame Athletic Director Jack Swarbrick and BCS Executive Director Bill Hancock are leading the talks for the BCS, along with consultants Chuck Gerber, a former ESPN executive, and Dean Jordan from Wasserman Media Group.
Sources expect ESPN to maintain its aggressive stance to lock up the rest of the BCS package. Estimates have the total rights fees for the new playoff structure exceeding $700 million a year. ESPN already has $215 million tied up in the three contract bowls.
Fox also is in the running for the BCS rights, though it is not considered a formidable contender. Turner Sports also has been mentioned as a potential bidder, though it remains a long shot at best. Industry sources do not expect ESPN to partner with another network for the college football playoff rights.
The Big East, meanwhile, is not expecting to cut a deal with ESPN during its exclusive negotiating period and will take its media rights to the open market after its window with ESPN closes at the end of the month. Bevilacqua Helfant Ventures and Evolution Media Capital are representing the Big East in its media rights negotiations.
But that does not mean ESPN is out of the running. One of the Big East’s most valuable properties is its men’s basketball tournament at Madison Square Garden. Sources say the conference is attempting to leverage that tournament as much as it can to drive up the value of the overall package. But ESPN, because of its desire to keep rights to a tournament that it has carried for more than three decades, is still expected to maintain a portion of the Big East package.
Fox, NBC Sports and CBS Sports also are expected to talk to the conference when ESPN’s window closes. Sources say the conference is almost certain to split its package among two or more networks. NBC, CBS and Fox need programming to fill the schedules at their all-sports networks — NBC Sports Network, CBS Sports Network and the expected Fox Sports 1. The Big East also is planning to reach out to nontraditional media companies such as Apple, Google and Netflix to gauge their interest in acquiring live sports rights.
The league is hoping that the number of media companies vying for rights will create a bidding frenzy that would push up the value of its media package. In April of last year, the conference turned down an offer from ESPN that would have been worth more than $130 million annually.
But the conference’s membership has shifted dramatically with the loss of West Virginia this year to the Big 12, and Syracuse and Pittsburgh next year to the ACC. With four new schools coming from Conference USA and two from the Mountain West, the Big East will be hard-pressed to build its value. The media deals for Conference USA and Mountain West range from $10 million to $12 million a year.
Finally, in Birmingham, Ala., the SEC is working with CBS and ESPN to renegotiate its rights fee, which experts believe will grow from $205 million a year to close to $300 million annually. The conference also is making plans with ESPN to form its own branded network.
Fox Sports Interactive Media has indefinitely postponed its planned relaunch of its college sports and recruiting network Scout.com, which would be rebranded as Fox Sports Next.
The company in August announced its intent to reposition Scout.com around the start of football season in order to create far greater integration with its national and regional TV coverage of college sports. Fox also planned a new blog-style presentation for the site with additional video and social media features for the new Fox Sports Next.
A series of significant technical issues with the site, however, have delayed the relaunch. Company executives declined to outline specific problems or publicly target a new date. An initial attempt at the migration to the new Fox Sports Next platform earlier this month rendered many pages inaccessible, angering subscribers.
Fox executives say the new Fox Sports Next brand will still be implemented at some point. In the meantime, Fox has reverted to the legacy version of Scout.com, where paid subscribers can access their content and post on message boards. A beta version of the new destination remains available at foxsportsnext.com. Fox has been working with New York-based digital agency Sarkissian Mason on the relaunch effort.
“We experienced technical difficulties during the transition to our new platform. While we’re working to address the issues, we have restored access to Scout.com,” Fox said in a statement. “Users should now be able to sign in and access Scout.com as before.”
Scout.com competes in a highly competitive segment of digital sports media that also includes rival recruiting sites 247Sports.com, Yahoo’s Rivals.com, and ESPN Recruiting Nation, among others. Scout.com launched in 2001, and Fox bought the property four years later.
Staff writers Tripp Mickle (left) and John Ourand talk about what the deal means for NASCAR and how it compares to rights fees generated by other sports.
Sources valued the deal at more than $2.4 billion over eight years, a sizable increase from Fox’s current eight-year, $1.76 billion agreement. The network’s new eight-year extension will see it retain the broadcast rights for 13 NASCAR Sprint Cup Series races and the entire Camping World Truck Series.
The deal also includes TV Everywhere rights, which will allow Fox to stream its races to a Fox Sports-affiliated website. These streaming rights have become a standard part of media deals.
A formal announcement could come as soon as today.
This marks the first increase Fox has paid in more than a decade for NASCAR rights. Beginning in 2015, its average rights fee to NASCAR will jump from the $220 million it has paid annually since 2001 to more than $300 million.
NASCAR has been consistent programming for Fox during the first half of the season, from February to early June. This will continue that schedule, while the deal also clears the way for Fox to move forward with its plans to convert its motorsports network Speed into an all-sports cable channel that will be called Fox Sports 1. No formal announcement is expected on the new channel, but Fox has trademarked the name Fox Sports 1 and cut agreements with Major League Baseball, NASCAR, UFC and college football that allow it to show live footage of those sports on a new all-sports, cable channel.
While not quite the level of increase seen by college conferences and MLB for their rights fees, the deal marks a healthy annual increase for NASCAR and continues to prove the value of live sports programming.
The amount of NASCAR’s increase was a major question mark across the industry two years ago when NASCAR ratings were in their fifth consecutive year of decreases. Fox agreed to pay more despite watching NASCAR deliver a 4.8 Nielsen rating and 7.9 million viewers, down 14 percent and 15 percent, respectively, from the 5.6 Nielsen rating and 9.3 million viewers the series delivered in 2007, the first year of the current broadcast agreement.
NASCAR won’t begin negotiations on rights for the second half of its season until next summer. Turner and ESPN, which hold those rights, opted to wait until then to begin exclusive negotiations with the sanctioning body.
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.
But NASCAR will now use its increase with Fox as a benchmark in its negotiations with ESPN and Turner, setting itself up for significant increases.
If those parties balk at the price, NASCAR will turn to the open market and look to bring in NBC, CBS or another network. Fox could even return to the table for those rights, especially if it has a new cable sports channel to program.
NASCAR hasn’t made a decision about whether it will sell its rights to one, two or three broadcast partners. It is keeping all of its options open.
Fox’s negotiations were led by co-presidents Randy Freer and Eric Shanks. NASCAR was led by Steve Herbst, vice president of broadcasting and production.
Sports Media Advisors, a media consultancy headed by former IMG and NHL executive Doug Perlman, and Proskauer assisted NASCAR on the deal.
SportsBusiness Daily/Journal staff writer Tripp Mickle talked with The Sporting News about the implications of the new TV deal.
The cable TV market will test the strength of Comcast’s NBC acquisition shortly, as NBC Universal’s carriage deals with some of the country’s biggest distributors expire at the end of the year, according to several sources.
NBC’s affiliate group, led by Matt Bond, executive vice president of content distribution, will be negotiating extensions for its cable channels with Dish Network and Charter — distributors that represent more than 18 million subscribers.
At the same time, NBC will have to negotiate a new deal with the National Cable Television Cooperative, an organization of 900 small-to-midsized cable operators that represent 25 million subscribers.
These talks, which will include NBC Sports Network and the Comcast SportsNet regional sports networks, will mark the first big carriage negotiations for the group since Comcast acquired NBC in January 2011. The combined broadcast and cable assets of the two companies add a level of complexity to these deals that has not surrounded these channels before.
The timing of the negotiations is not great for NBC Sports Network, in particular, as its highest-rated programming generally comes from NHL games and the league is in the middle of a work stoppage. Cable operators pay an average 31 cents per subscriber per month for NBC Sports Network, according to figures from SNL Financial.
These types of carriage negotiations between programmers and distributors frequently become public and contentious. Occasionally, subscribers lose access to the channels when talks reach an impasse.
Dish Network, which has more than 14 million subscribers, has been embroiled in several public spats recently that have involved dropping channels. The satellite operator had a dispute with Big Ten Network last month that has since been resolved. But before it was resolved, BTN went dark on Dish Network systems for about a week.
Sources say NBC will have to negotiate its entire lineup of cable channels with Dish Network. Charter, which has more than 4 million subscribers, also will negotiate for all of NBC’s cable channels, sources said.
As for NCTC, NBC is negotiating for up to 18 networks. Last year, NCTC signed Golf Channel, E! and Style to deals through 2015. The group’s deal with NBC Sports Network expired earlier this year, though the two sides worked out an extension that ends in December.
ESPN picked Amina Hussein to produce its “NBA Countdown” studio show from Los Angeles this season.
Hussein, who has been with ESPN for 10 years, is moving from Bristol, Conn., to Los Angeles to take the job as coordinating producer. Since August 2011, she produced the network’s popular “Sunday NFL Countdown” from Bristol.
Hussein was captain of the Holy Names University women’s basketball team in Oakland in 1998-99.
Last year, ESPN produced its NBA pregame show without a host, using a quartet of analysts — Magic Johnson, Michael Wilbon, Jon Barry and Chris Broussard. Hussein said the studio show will not have a dedicated host again this year. She did not address rumors that ESPN’s Bill Simmons was in the running to be a regular on this year’s show. A source said Simmons has had discussions about the show, though nothing has been finalized.
“The opportunity to work with Magic and Wilbon was very intriguing to me,” Hussein said.
Hussein says she wants the show’s conversation to be “free flowing” and focused on the issues of the day. In the first few weeks, for example, she expects a lot of talk on the league’s new flopping rules.
Hussein is one of the few women to produce studio shows in sports. Hussein credited Stephanie Druley, who is Longhorn Network’s vice president of production, with helping her get a start in producing NFL studio shows. Druley had been a senior coordinating producer for ESPN’s NFL studio shows.
During her career at ESPN, Hussein was a coordinating producer for “SportsCenter” and “NFL Live” before “Sunday NFL Countdown.”
“I take some pride in being able to make a path for myself in a male-dominated field,” Hussein said.