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Fox Sports’ shopping spree for local sports rights isn’t over yet.
In addition to its $1.5 billion purchase of a 49 percent stake in YES Network and its $6 billion offer to secure rights to the Los Angeles Dodgers for the next 25 years, Fox executives are deep into negotiations to pick up rights to the Cleveland Indians, sources say. Fox also has conducted on-and-off talks for the past several months to pick up Orioles and Nationals rights in the Baltimore-Washington, D.C., market, though sources say those talks have cooled considerably.
The market for live sports rights continues to be white hot, with rights fees and advertising revenue continuing to rise dramatically. Fox’s aggressive interest in local sports rights in Cleveland, Los Angeles and New York demonstrates its commitment to its regional sports network business, which has long been one of the most profitable parts of News Corp. It is also a public statement that it will continue to acquire local rights to ward off competition.
A potential deal with the Indians could be close at hand. Indians owner Larry Dolan launched the regional sports network SportsTime Ohio in 2006, with much of the RSN’s programming centered on Indians games.
But since its launch, SportsTime Ohio has had trouble with its cable carriage deals, which have among the lowest rates of all RSNs. Cable operators pay an average of $2.21 per subscriber per month, according to SNL Kagan, which is below the national RSN average of $2.49.
It’s unclear whether Fox is interested in picking up the Indians’ rights for its FS Ohio RSN, which already carries games from the Reds, Cavaliers and Blue Jackets. Fox also could be looking to buy the channel outright.
Rumors of SportsTime Ohio’s pending sale have been around for several years. Time Warner Cable has long been mentioned as a potential suitor. But sources say that talks with Fox have progressed fast enough that they expect a deal to be finalized before the 2013 MLB season.
Fox’s efforts to land the Mid-Atlantic Sports Network, where Orioles owner Peter Angelos serves as majority owner, are not moving as smoothly. Sources say Fox has spent the past several months in on-again, off-again talks to acquire all or part of MASN, which holds the rights to the Orioles and Nationals. Fox currently is not in that market and this would fit with its strategy to build on its RSN business.
Comcast, which operates Comcast SportsNet Mid-Atlantic, also had preliminary talks, which sources say did not progress far.
Several sources described those negotiations as currently off, saying that Angelos opted not to sell the RSN.
Fox’s involvement in talks with MASN came at MLB’s urging, sources said. MASN still is involved in a rights fee dispute with the Nationals. That dispute hasn’t been resolved, though both parties met at MLB’s New York offices last week. MLB hoped that a deal with Fox would solve the dispute. MASN and Fox have not met for several weeks, and no further talks are scheduled.
Fox’s move to acquire more local sports rights fits in with its strategy of building on its 20 RSNs.
The cost of live sports rights has increased radically in the last few years, as television networks try to grab the highest-rated live programming on TV. Fox felt burned in Los Angeles in early 2011, when Time Warner Cable negotiated the Lakers’ rights away from Fox Sports. The move caused Fox to be more aggressive about protecting its current RSNs and negotiating for new rights.
The move to own more local sports rights also will help Fox’s forthcoming national channel, Fox Sports 1. Fox has not formally announced its plans to rebrand its motorsports channel, Speed, into an all-sports channel called Fox Sports 1. But it has told rights holders and ad buyers that it plans to make the change in August.
Ford has signed a new agreement with Alli Sports, NBC’s action sports business, that will bring its “Octane Academy” reality show to NBC Sports Network and NBC.
The show, which features motorsports stars Ken Block, Brian Deegan, Tanner Foust and Vaughn Gittin Jr. competing against aspiring drivers, debuted in February on the Fox-owned cable networks Speed and Fuel TV. The deal with Alli Sports will result in six, one-hour episodes of the show’s second season airing on NBC Sports Network and the finale on NBC, which will co-produce the shows.
Ford’s “Octane Academy” made its debut in February on Speed and Fuel TV.
Photo by:JOHN ROE
The deal gives Alli Sports its second branded content partnership. It signed a deal last year with Red Bull to broadcast the energy drink company’s “Signature Series” and devoted 35 hours of programming this year to Red Bull events such as X Fighters, a freestyle motocross tour.
“We see these kind of opportunities — working with brands to co-create content and using our distribution system to drive more eyeballs for them — becoming a bigger and bigger part of our business,” said Alli Sports President Wade Martin.
Mary Ellen Abraham, Ford experiential marketing manager, said the company expects the partnership with Alli Sports to increase its total audience for “Octane Academy.” The first season drew more than 5 million overall viewers, with 2.87 million watching on Speed and Fuel TV, 1.45 million watching online and 1.1 million watching on Facebook and social media outlets.
“I think we’ll hit a bigger number, but our main focus is to improve consideration for young millennials and to improve opinion of Ford over imports,” Abraham said. “The expectation is that our reach would grow and consideration would grow with it.”
There will be a microsite devoted to “Octane Academy” on allisports.com, and Martin expects the content to drive digital traffic for the company’s website.
“We think it’s great content and it’s been really well-received digitally and socially,” Martin said. “These drivers are really popular, and we think they can help boost our audience numbers, as well.”
The USA Today Sports Media Group is rebranding its sports photo service, U.S. Presswire, as USA Today Sports Images, continuing the company’s reorganization of its content assets.
The Gannett group bought U.S. Presswire in September 2011, and the 8-year-old photo service covers nearly 10,000 events a year. The rebranding follows similar moves over the past year, including the creation of the USA Today Sports Pulse aggregating content from Gannett outlets, the formation of USA Today Sports Digital Properties to house its action sports, mixed martial arts and Big Lead Sports assets, and the renaming of HighSchoolSports.net as USA Today High School Sports.
“This helps take U.S. Presswire from sort of a little-engine-that-could into a bigger player with the full weight of a $5 billion company behind it,” said Tom Beusse, USA Today Sports Media Group president. “And by getting the USA Today attributions and photo credits into all these other outlets U.S. Presswire does business with, it helps make the USA Today brand name ubiquitous in the marketplace.”
USA Today Sports Images, competing against outlets such as The Associated Press and Getty Images, will launch a reworked photo database and website early next year to coincide with the rebranding.
The U.S. Presswire shift also is a key strategic step in USA Today Sports Media Group’s eventual plans to syndicate the USA Today Sports Pulse to non-Gannett media outlets.
“We intend to aggressively syndicate our content, but we really can’t be in the syndication business without having images we own, being able to fully supplement the text,” Beusse said. “That was part of the thought behind acquiring U.S. Presswire.”