SBJ/March 31-April 6, 2014/Media

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  • ESPN’s 25th year of MLB games comes with schedule flexibility

    ESPN is about to embark on its 25th season of carrying Major League Baseball games with a new rights deal that will see several changes in the way the channel covers the games.

    The new eight-year, $5.6 billion deal gives ESPN more flexibility in picking games, allowing it to focus even more on teams that deliver the best TV ratings. Take its exclusive “Sunday Night Baseball” franchise, for example. A specific team can appear six times on Sunday nights. In previous years, the same team could not appear on “Sunday Night Baseball” more than five times.

    ESPN will be able to focus even more on teams that deliver the best ratings.
    Photo by: JOE FARAONI / ESPN IMAGES

    All told, teams can have 10 of their games carried by ESPN this season across Monday, Wednesday and Sunday nights.

    “You can still expect us to maximize our Yankees and Red Sox and Dodgers and Cardinals appearances within ‘Sunday Night Baseball,’” said Julie Sobieski, ESPN vice president of league sports programming and acquisitions. “But it also means that we have the ability to take all the teams.”

    The new deal should allow ESPN to bring more teams outside of the league’s marquee markets onto its schedule, Sobieski said.

    “The Pittsburgh Pirates are probably the best example,” she said. “You’re going to see them a considerable amount of time on Mondays and Wednesdays.”

    The added flexibility will be best seen later in the season, when ESPN can add pennant race games. Under the new deal, the network can add two games per week during the last two weeks of the season. Plus, it has the rights to any tiebreaker games and a wild-card game.

    “It’s significant for us to have more baseball and more baseball at a time of year when everyone’s paying attention to the playoff implications,” Sobieski said.

    MLB largely has done away with blackouts on Monday and Wednesday nights. As opposed to past years, ESPN will coexist with the local regional sports networks that are carrying the game.

    “We’re now going to be able to reach fans on Mondays and Wednesdays in markets that we haven’t been able to reach them in the past,” Sobieski said.

    To celebrate its 25th season of “Sunday Night Baseball,” ESPN will turn “Baseball Tonight” into a pregame show. The network will rebrand its Sunday show as “Baseball Tonight Sunday Night Countdown” and will travel to the site of most Sunday night games. That move makes the show similar to ESPN’s popular pregame shows associated with the NFL (“NFL Countdown”) and the NBA (“NBA Countdown”).

    In another nod to its 25th season covering the sport, ESPN has produced a series of vignettes that will focus on the best on-field moments over the past 25 years.


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  • MLB on Fox: New voices, channel, platforms

    As Fox Sports embarks on its new eight-year, $4.2 billion deal with Major League Baseball later this week, its game presentation has undergone the biggest changes since 1996, when the network first started producing MLB games.

    Fox Sports will have new voices calling the games, a new TV channel carrying the games and new digital platforms hosting the games.

    “With its new eight-year deal, Fox has made an unprecedented commitment to baseball, and we want to make sure we give that same level of commitment back to Fox,” said Tim Brosnan, MLB’s executive vice president of business. MLB’s commitment comes in the form of more windows, fewer blackouts and increased flexibility for the network to pick games for its Fox Sports 1 channel.

    The new baseball deal starts after Fox limped out of 2013 with its lowest regular-season audience to date: an average of 2.4 million viewers a game. Last season, though, ended strongly for Fox. Thanks mainly to the presence of the popular Boston Red Sox, Fox posted its biggest ALCS audience since 2010 and best World Series audience since 2009.

    Plus, on the local front, Fox’s roster of RSNs posted big ratings in several markets. The Detroit Tigers (FS Detroit), St. Louis Cardinals (FS Midwest) and Cincinnati Reds (FS Ohio) averaged three of the four highest local TV ratings in MLB last season.

    “We look at the whole picture of baseball. More people are watching more baseball than ever before,” said Fox Sports President Eric Shanks. “If you look at the last 10 years, baseball’s probably at its healthiest point from a viewership perspective.”

    The six biggest changes viewers will notice from Fox’s baseball telecasts:

    New channel

    Fox will move some games, such as Yankees-Angels, from its regional sports networks to national coverage on Fox Sports 1.
    Photo by: GETTY IMAGES

    The biggest change will be where the games are carried. Last year, Fox carried 26 Saturday regular-season windows, the All-Star Game, ALCS and World Series on its broadcast channel. This year, the broadcast channel will carry only 12 regular-season windows, in addition to the crown jewel events. Fox Sports 1 will carry 40 regular-season windows (most on Saturdays) and could televise as many as 15 playoff games.

    Twenty-six of Fox’s regular-season game windows will be what Fox is calling “regional elevates.” That’s when a game between two teams from Fox markets gets moved from the RSNs onto Fox Sports 1 exclusively. For instance, a “regional elevate” would be when the Yankees play the Angels because Fox operates both teams’ RSNs.

    “We created this schedule in partnership with our regions so that we don’t hurt their economics in their own market with a number of games that are exclusive to Fox Sports 1,” said Bill Wanger, Fox Sports Media Group’s executive vice president of programming, research and content strategy. “The thing we’re most excited about is dominating Saturdays with baseball coverage across all of our platforms. There will be no doubt in the viewers’ mind that Saturday is Fox baseball day.”

    New broadcast booth

    For the first time since it launched baseball in 1996, Fox will have new voices calling its games. Gone is longtime analyst Tim McCarver. In his place is a former player, Harold Reynolds, and a writer, Tim Verducci. Joe Buck still will do play-by-play and round out the network’s top booth.

    Shanks, Fox Sports executive producer John Entz, and former Fox Sports executive Ed Goren auditioned the three during a late-season game in St. Louis last year against the Giants.

    “There’s been a lot of debate about whether a three-man booth works in baseball,” Brosnan said. “This is a dramatic change and a bold stroke.”

    Buck, who was effusive in his praise of McCarver, said the booth will be more conversational than it has been in the past several years. Reynolds has a rapport with the current players, and Verducci has sources on the business of baseball.

    “What we’ve talked about as a group is trying to have more of a conversational feel to it,” Buck said. “It’s not going to be on April 5 what it’s going to be in a year. I think it’s going to come out of the gate sounding really fun.”

    Instant replay

    The league’s instant replay system will be new for all the league’s TV partners. But with most of baseball’s crown jewel events on Fox, including the All-Star Game and World Series, it may be noticed more there.

    MLB and Fox executives believe the TV networks will benefit from the league’s new replay system. “The treatment of instant replay on TV really has the potential for making a quantum leap in the baseball broadcast booth,” Brosnan said.
    Shanks said he has no concerns that the replay system will prolong games.

    “There’s nothing negative about the introduction of replay into baseball,” Shanks said. “Is it going to be a work in progress? The NFL replay system is vastly different today, and they tweak it every year. It’s here to stay.”

    New studios

    In 2012 and 2013, Fox and MLB Network co-produced a 30-minute pregame show from MLB Network’s Secaucus, N.J., studios. This season, Fox is taking the pregame show back to its Los Angeles studios. Kevin Burkhardt will be the main host for the 30-minute show. Former players like Frank Thomas, Eric Karros, Gabe Kapler and C.J. Nitkowski will be analysts.

    More streaming

    For the first time, Fox’s national games will be streamed to authenticated subscribers on Fox Sports Go, regardless of which channel is carrying them. “Fans are going to get probably close to 100 baseball games in Fox Sports Go, including the postseason,” Shanks said. “With this new deal, baseball is a big part of Fox Sports Go. Every Saturday and through the postseason, every game is going to be available on your phone or your tablet or your desktop.”

    More baseball

    Fox will have more games. It also will have more shoulder programming around those games. It is rolling out a nightly show called “MLB Whiparound” for Fox Sports 1 that will look and feel a lot like ESPN’s “Baseball Tonight” and MLB Network’s “MLB Tonight.”

    It also is producing several shows with MLB Productions. One, “Derek Jeter: Baseball Pays Tribute,” is a show that will premiere later this spring.


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  • Golf Channel gets Ryder Cup Friday coverage for first time as ESPN deal comes to an end

    NBC’s 2006 trade of Oswald the Lucky Rabbit to ESPN officially has run its course, as NBC Sports Group picked up the rights to Friday coverage of the Ryder Cup.

    As part of the Oswald trade, ESPN carried the Ryder Cup’s Friday matches from 2006 to 2012. But this September, NBC-owned Golf Channel will step in and carry the Ryder Cup’s Friday coverage, marking the first time that network will carry the tournament.

    NBC in October signed a deal with the PGA of America to keep the Ryder Cup rights through 2030, a deal that officially starts in 2015. But ESPN ceded the rights to the Friday coverage back to NBC early in exchange for a package of rights that includes EPL and Olympics highlight rights, sources said. NBC also allowed ESPN to negotiate a talent contract with Michelle Beadle, who still was under contract to NBC.

    All told, NBC is planning to produce 26.5 hours of live golf across NBC and Golf Channel from the Ryder Cup, which will be played in Scotland this September. Previously, NBC tape-delayed the event’s Saturday matches when they were held in Europe.

    Golf Channel plans to re-air some of the early morning coverage, though it has not scheduled a time slot for it yet. The event also will be streamed to authenticated subscribers via NBC Sports Live Extra.

    As for Oswald, the cartoon character lives on at Disney through a variety of video games and merchandise.

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  • Popular overseas bouts shift model for HBO

    He can picture it already, the spectacle of petulant super middleweight contender George Groves riding to the ring atop a London bus, a crowd of more than 60,000 stretched to the far reaches of iconic Wembley Stadium for what likely will be the U.K.’s most lucrative fight ever.

    London-based fight promoter Barry Hearn pictures viewers in the U.S. breaking their normal viewing habits to tune in to HBO on a Saturday afternoon, sucked in by the mass of the event.

    Promoters hope to pull Saturday afternoon viewers to HBO for Carl Froch and George Groves’ rematch.
    Photo by: LUSTIG / MATCHROOM SPORT
    “We used to say ‘America is the land of milk and honey; Get yourself to the States and make some money,’” said Hearn, chairman of sports event company Matchroom, which will promote Groves’ rematch against his popular British rival, Carl Froch, at Wembley on May 31. “That has now changed. We can make a better financial case for staging this fight in the U.K. than in America, and that has never happened before.”

    Boxing always has been a global sport, but the U.S. long has stood as the economic driver. You could stage a fight in Antarctica so long as you made sure it went off at a time that was right for networks in the States. For the last 20 years, that network has been HBO and that time has been Saturday night.

    But as the economics of the fight game have shifted, with HBO offering lower fees than some networks in Europe, overseas promoters putting on shows that sell out large venues, and pay-per-view re-emerging in the U.K., HBO has ceded some of its leverage.

    The question for HBO now is whether to ignore meaningful fights from around the globe or to tweak its model to accommodate them. Of late, it has chosen the latter. Froch-Groves II will be the fourth event HBO has telecast live from Europe in the last year.

    “It’s still not our preference to go on a Saturday afternoon, but for the right opportunity we’re willing to do it,” said Ken Hershman, president of HBO Sports. “The fact is, the biggest and best events will sometimes take us abroad. We’ll do that when we can do it rationally in terms of budgets if it’s something that adds value for our subscribers.”

    Thus far, the afternoon fights have drawn an audience that is a bit less than half of the 1.2 million that typically tunes in on Saturday nights. But when paired with prime-time rebroadcasts, they’ve floated up to the norm.

    Froch-Groves II will not air in prime time on HBO, but only because the network has a live concert from the Rock and Roll Hall of Fame scheduled for that night. Froch against Denmark’s Mikkel Kessler in May from London attracted a live audience of 493,000 and another 517,000 for the re-air. Heavyweight champ Wladimir Klitschko against Olympic gold-medalist Alexander Povetkin from Moscow got 534,000 viewers on an October afternoon and another 705,000 that night. Sergey Kovalev against Nathan Cleverly from Wales in August pulled 367,000 viewers in the afternoon. It did not air again that night but proved an opportune way to showcase two fighters who had not been on HBO. Kovalev won, graduating to a U.S. fight that had the eighth-highest rating of any fight on cable last year.

    “What we’ve found is that we really are serving the same hard-core audience that comes to all those shows but that they may just watch it at different times,” Hershman said. “Our fans are not accustomed to looking to us for a fight at 4 or 5 in the afternoon, so oftentimes we’ll pair it with a live fight at night to maximize the audience.”

    It’s important to note that this is no rank-and-file U.K. fight. Froch won the first fight in front of a sellout of 21,000, on a controversial ninth-round stoppage while trailing on all three judges cards.

    A week before tickets to the rematch went to general on-sale, the head of Matchroom’s boxing division, Barry Hearn’s son Eddie, tweeted a presale invitation to his 149,000 followers, 35,000 of which provided email addresses in order to get access. All 60,000 tickets sold out in 52 minutes. Eddie Hearn is working to get the London transit authority to allow him to expand capacity at Wembley to 80,000.

    Even at 60,000, the gate likely will eclipse

    $8 million, Barry Hearn said. That would equal the 15th-largest Las Vegas boxing gate of the last decade and more than triple the gate from the most recent Vegas pay-per-view, Canelo Alvarez’s stoppage of Alfredo Angulo. The U.K. pay-per-view revenue would eclipse $20 million if it performs as Matchroom expects.

    With all that money coming from the home market, Matchroom views the U.S. rights as ancillary. HBO is paying less than it would pay for a fight in prime time. And because it can get a high-quality feed from BSkyB, it also will save on production costs.

    The value for Matchroom, Hearn said, lies mostly in the exposure for Froch and Groves, who could end up fighting in the U.S. on HBO or in a pay-per-view. That’s another reason Froch-Groves was attractive for HBO: It plays heavily in the weight class and the two that bracket it, with investments in Andre Ward, Julio Cesar Chavez Jr., Gennady Golovkin and others.

    “It’s OK to do a fight or two abroad, because they are fun, large spectacles,” Hershman said, “but we also want to get those fighters over here. Some are precluded from coming over here because of an economic model they have. That can make it less appealing for us.”

    That’s the conundrum HBO faced when it last ventured to Europe with greater frequency. As Wladimir Klitschko and brother Vitali rose to dominance, HBO aired their fights from Germany and elsewhere, content to time-shift in order to have the brothers in prime time on the occasions that they fought in the U.S.

    But as HBO’s boxing budget shrank and the take from German TV and European arenas increased, it no longer made financial sense for the Klitschkos to fight in the States. HBO responded by sitting out some of their fights.

    “We thought that was a mistake,” said Tom Loeffler, managing director of the Klitschkos’ K2 promotions company, which also promotes Golovkin. “I think [Hershman] is looking at it more globally. Yes, you’d rather have the fight here, but eventually, either Froch or Groves could come to the States. If fans here are familiar with them, there’s only going to be more interest.”

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  • TV execs worry broadband services are cord-cutting catalysts

    Two of the biggest threats to the sports TV industry are launching later this year, when 120 Sports and NFL Now roll out their broadband video services.

    That’s the opinion of several sports TV executives who view these kinds of over-the-top services as potential threats that could take money out of the pay-TV industry.

    Executives with these services say they are looking to attract “cord nevers,” a name the industry uses for young people who have never subscribed to a pay-TV service. But sports TV executives worry that these types of services also will attract “cord cutters,” an industry term for people who give up their pay-TV subscriptions in favor of broadcast and Internet video.

    The industry has worried about cord cutters for a long time. Channels like ESPN and Fox Sports get revenue on a per-subscriber basis; the more subscribers a distributor has means more money for sports channels, which translates into the ability to pay higher fees to leagues.

    Chris Bevilacqua and Jeff Krolik discuss over-the-top services.
    Photo by: TONY FLOREZ PHOTOGRAPHY (2)
    If these free over-the-top services start to attract cord cutters, the sports business as we currently know it will be threatened.

    “Over-the-top is a Trojan horse that threatens our very business,” said Jeff Krolik, president of Fox Sports Regional Networks. “Live local sports drives the cable ecosystem. The cable ecosystem has worked well for all of us. We have to be very careful about anything that can
    Mark Shuken
    erode that.”

    The looming threat of over-the-top services provided one of the more interesting back-and-forths at the World Congress of Sports earlier this month. During one of the panel sessions, two network executives debated with a team consultant about the threat posed by these networks.

    Here’s a transcript of that back-and-forth, edited for context:

    Chris Bevilacqua, co-founder, Bevilacqua Helfant Ventures: Is there going to be over-the-top in a meaningful way with live sports content? The answer to that is probably yes. The consumer will still end up getting all of their Los Angeles-based sports programming, maybe in the current form of RSNs, but maybe not. Maybe it’s just programming packages delivered to the end user in some way that they have a choice to get it and to get it fully distributed.

    Mark Shuken, senior vice president and general manager of TWC Sports Regional Networks: The core content resides in the rights that we’re granted and we acquire. If we do it right with our leagues and team partners, those rights are complementary. Ultimately, as long as we’re careful about protecting the core rights, they can be complementary.

    Krolik: Over-the-top makes me nervous. Over-the-top makes all of us nervous. Our No. 1 objective is to preserve, protect and defend the basic cable model against all enemies, foreign and domestic.

    Bevilacqua: I’m not sure I would agree. Why wouldn’t you go over-the-top, if you could get your RSN price? The cord-never generation is not buying cable now. If you were able to deliver them a product, and it was a subscription product that you’re getting paid for, why would that be a bad thing?

    Krolik: Mark and I worked together at what was then SportsChannel Pacific, which was a subscription-based business [like you’re talking about with over-the-top services]. We paid one team $650,000 a year. Not a game, a year. They were happy to get it. [Rights fees were low.] A subscription-based business, an a la carte business …
    Bevilacqua: I’m not saying a la carte. I’m saying a bundled package over-the-top that addresses a segment of the population that isn’t buying pay-TV now. It should be additive. I know you don’t agree, but I think there is some way to make it all work in the ecosystem. The WWE is a good test case because they have some broadly distributed licensed packages and they have, now, an over-the-top network. The retail experience is really complementary to a broad licensing strategy. Both can work harmoniously if it’s packaged the right way.

    Shuken: If you’re Time Warner Cable, your evaluation of your entire product offering and your entire economic model is protecting that golden goose. I didn’t say that over-the-top is cool and it will all be great. I said that if it protects the core rights and there’s a way to cross promote and ultimately benefit the core rights, it could work. But I agree, from a Time Warner Cable perspective, from the distribution perspective, we’ve got to be very sensitive to how we protect that model.

    Bevilacqua: But Time Warner Cable is one of the biggest broadband providers in the world. If you’re carrying something over your network, and we go usage-based pricing [where the heaviest Internet users pay more], why is that bad?

    Shuken: They’re not mutually exclusive. It’s all about the execution of it. Trojan horse? Could be. Opportunity? Could be. I think it’s somewhere in the middle if you do it right.

    John Ourand can be reached at jourand@sportsbusinessjournal.com. Follow him on Twitter @Ourand_SBJ.

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