SBJ/April 7-13, 2014/MediaPrint All
In the days leading up to Opening Day, MLB executives signed a bevy of carriage renewal deals for MLB Network and the league’s out-of-market package, Extra Innings, ending months of sometimes rancorous negotiations with the country’s biggest distribution companies.
Many of MLB Network’s deals ended at the beginning of the year, meaning that several distributors, including Comcast, Time Warner Cable and DirecTV, carried the network without a contract for at least three months. But since the beginning of the year, MLB said it has cut more than 200 total distribution deals in the U.S. and Puerto Rico. It also added 20 new distribution partners and launched in Canada on Rogers Cable.
The deals, which are described as multiyear, were completed late last month. Typically, these deals run for around four or five years. It puts MLB Network in 70 million U.S. homes, according to Nielsen’s April figures. By comparison, NFL Network is in 72 million homes, and NBA TV is in 59 million.
Distributors had paid MLB Network about 27 cents per month, according to SNL Kagan. Sources said the network received an increase from that rate, but the league is not getting the 50 cents per month it originally sought at the beginning of these renewal negotiations.
These deals, which were led by MLB executives Tim Brosnan, Tony Petitti and Chris Tully, mark MLB Network’s first carriage renewals since its January 2009 launch.
One of the sticking points during the carriage renegotiations dealt with streaming rights. Most distribution deals these days include some sort of authenticated streaming — something that is more complex with baseball given that MLB Advanced Media has operated MLB.TV as a stand-alone business for more than a decade. In their old deals, cable and satellite operators did not have the right to stream Extra Innings.
To cut through that logjam, MLB agreed to bundle its MLB.TV out-of-market streaming package with Extra Innings. Extra Innings subscribers will pay $195 and have access to both for the season. By itself, MLB.TV costs $130.
When it launched five years ago, MLB used Extra Innings as an enticement to get cable and satellite operators to carry the channel. It would not sell Extra Innings to distributors unless they also agreed to carry MLB Network.
Distributors seemed to sour on the out-of-market package, complaining that MLB.TV devalued the TV product by undercutting it in price. Two years ago, Time Warner Cable’s chief content officer, Melinda Witmer, said Extra Innings was performing below expectations on Time Warner Cable systems.
“We know today that a consumer can buy directly from baseball at a lower retail price than we can sell it at,” Witmer said at the time.
The network has received praise for its high-quality programming. But the channel has struggled with low ratings, though there are signs that its programming is starting to take hold. In 2013, the network averaged 141,000 viewers in prime time, a low figure, but still 33 percent higher than in 2012.
Major League Baseball’s 2014 season begins with more live streams of national games. But local in-market streaming, something the sport has grappled with for more than five years, will go another season without a significant rollout.
MLB’s new national TV contracts go into effect this year, allowing for live, digital simulcasts of nationally televised games, including crown jewel events such as the All-Star Game and World Series. The league’s national TV partners — ESPN, Fox and Turner Sports — each plan to stream their games on an authenticated basis. ESPN and Turner live-streamed some MLB games in prior seasons. Fox Sports is the new entrant to this space this year with its new Fox Sports Go mobile application.
YES Network quietly pulled the plug on live streaming, a service it began in 2009.
Sources describe the consumer adoption as disappointing. Estimates for the first season in 2009 were about 6,000 subscribers for “Yankees on YES,” a minimal take-up rate for the country’s largest media market, with less-than-stellar growth in subsequent seasons. The San Diego Padres also experimented with in-market streaming, with little success.
That leaves the Toronto Blue Jays as the only team that offers live streams of games locally, providing authenticated live streaming through Rogers Anyplace TV. Online viewing for authenticated Rogers SportsNet subscribers carries no additional cost, while mobile viewing has a $5 a month surcharge. The Blue Jays operate under a different set of broadcasting and territorial rules in Canada, and are aided by the fact they have the entire country as their market territory and are owned by Rogers Communications, also the parent company of Rogers SportsNet and the Rogers Centre.
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“Unfortunately, I think fans are going to go another season without their in-market games available on devices other than television,” said Eric Shanks, Fox Sports president. “There’s been great strides taken that the national games and all of the postseason are going to be available multiplatform. But there’s clearly still work to do on the local side.”
The issue comes largely down to economics. Distributors expect access to live streaming rights at no additional costs. But rights holders on the other side of the table are loath to give away a potentially valuable asset. With baseball still
“Our first objective is to make sure that streaming stays inside a TV Everywhere, authenticated model,” said Jeff Krolik, Fox Sports Regional Networks president. “Our second objective is to convince people that there’s no extra pot of gold at the end of rainbow here. … Customers want to be able to watch television on their mobile device, on their tablet, just as if it were an additional outlet in their home. They’re not looking to pay an additional fee for that. They feel that’s something we should deliver.”
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“You have the old line that ‘politics is the art of the possible.’ I sort of think about this the same way,” Bowman said. “Every spring we start the season with hope, not only for our teams on the field, but that something happens in this space. We remain interested and hopeful, and continue to have conversations.”
Fox Sports executives similarly remain hopeful the deployment of their new national
“It’s just part of the deal,” Shanks said. “It’s no longer something extra or something new. You can’t delineate between a digital right and a TV right, and however else you want to try and slice this up. It is part of the rights that you buy. That’s pretty clear and consistent with every deal that’s being done now.”
Other U.S. sports leagues have made some progress in developing business plans for in-market streaming, but actual digital delivery of those games locally also remains a work in progress in many markets. At the beginning of the NBA season, Fox Sports signed a deal to stream that league’s games. Fox also signed deals with Comcast, Time Warner Cable, Cox and AT&T to stream NBA games. But the distributors’ rollout of that service has gone slower than expected, and only AT&T U-verse and some small Comcast systems in the Southwest offer NBA in-market live streaming. Fox Sports’ RSN group is negotiating with the NHL, but with that league soon to start its postseason, any deal would be for 2014-15 at the earliest.
“I’m still a little baffled,” as to why baseball in-market streaming is so limited, Shanks said. “The fans are probably a little baffled.”
An annual rite of spring, the NFL’s schedule release is one of the most closely watched events among sports media executives. Network brass lobby aggressively for the league’s top matchups starting weeks before the Super Bowl, then anxiously await to see how their efforts paid off.
Executive editor Abraham Madkour and media writer John Ourand discuss the upcoming release of the 2014 NFL schedule and what it could mean for ESPN, CBS and the league's other media partners.
Not only that, but multiple media sources are expecting the CBS package to appear much stronger than ESPN’s “Monday Night Football” package, too.
A team led by NFL executive Howard Katz is working on the schedule, which could be released as early as late next week.
The NFL in February awarded CBS an eight-game package of early-season games, accepting the network’s $250 million bid to carry the games in 2014, with a one-year option. Carrying the games means CBS will be pushing the debut of its highly rated Thursday night prime-time lineup to later in the fall.
NFL Network will carry an eight-game package of late-season Thursday night games — after simulcasting the early-season games airing on CBS. Sources have been told to expect a stark quality difference between the games that CBS and NFL Network carry.
CBS’s involvement in the Thursday night package is one of the biggest stories heading into the NFL’s season, with the league and CBS both placing big bets on the ratings and ad sales success of Thursday night.
The NFL has placed a clear emphasis on its Thursday night presence, as it expects its games to dominate prime time on Thursdays as they already do on Sundays and Mondays. Once it achieves higher Thursday ratings — New England Patriots owner Robert Kraft told reporters last month that he expects ratings to double on CBS compared to what the league has had for its NFL Network Thursday night games previously — the league can sell the Thursday night package at a higher cost.
NFL Network’s 13 regularly scheduled games last season averaged 7.1 million viewers, by far the lowest of the NFL’s partners.
Even with a schedule that rivals NBC’s, John Miller, head of the NBC Sports Agency, said he does not believe that the Thursday night package will rate as highly as Sunday night. That’s because more people, in general, watch television on Sunday nights than Thursdays.
“That’s not to say it won’t be valuable, because there is a high volume of advertisers, movie companies and autos in particular that will want to be there because it’s right before the weekend buying experience, and I think CBS will do well,” Miller said. “I don’t think it will match the numbers for ‘Sunday Night Football.’ I think they will do significantly better than the NFL Network did by itself — not the least of which, it’s increasing the distribution by 40 million households.”
Miller said he expects CBS’s Thursday night package to equal or perform better than ESPN’s “Monday Night Football” package.
Even if the ratings aren’t as high as Sunday, Frank Hawkins, a former NFL executive who is a founding partner of media advisory Scalar Media Partners, believes the NFL will reserve some of its marquee matchups for CBS’s Thursday night schedule.
“My guess is that CBS on Thursday is going to look more like NBC on Sundays,” he said. “Howard’s a genius about being able to balance all five networks that carry NFL programming.”
Complicating matters is the provision that mandates each team must play at least one Thursday night game each season. The league’s 17-week schedule, which now includes three Thanksgiving games, provides for 36 Thursday TV window slots for the 32 NFL teams to fill.
The league does not play a Thursday night game in the final week of the season.
Any schedule that doles out some of the biggest games to CBS’s new Thursday night schedule is certain to irk ESPN executives, considering that the network pays a much higher rights fee than its broadcast competitors and clearly wants a strong Monday night package. Since ESPN started producing “Monday Night Football” in 2006, it has had less compelling matchups than NBC’s “Sunday Night Football.” ESPN has long lobbied for a stronger schedule and last week reiterated that it plans to have a schedule commensurate with the league’s most expensive package, regardless of what the league puts on Thursday nights.
“We have scheduling provisions in our new deal which gives us some insurance,” ESPN said in an emailed statement.
At an average of $1.9 billion per year, ESPN pays, by far, more than any other NFL TV partner. Over the years, NFL executives have viewed ESPN’s package as the premier cable package, which is different than the premier broadcast prime-time package. Much of ESPN’s rights fee covers highlight rights and shoulder programming that typically bring good ratings.
Insiders say that in creating its schedule, the NFL has two different schedule levels. It saves “premier” games for NBC’s “Sunday Night Football,” showcasing rivalry games. You can bet that at least one Seahawks-49ers game will be on “Sunday Night Football” this year. For the coming season, the Seahawks, 49ers and another regular-season Broncos-Patriots game will be in strong demand. The league’s NFC East teams — the Cowboys, Eagles, Giants and Redskins — consistently draw high ratings as well.
Of course, a game that looks good before the season may be a bad matchup as the season wears on. Last season, for example, Fox, NBC and ESPN pushed for a late-season matchup between the Giants and Redskins because both teams are traditionally strong draws that were expected to have good seasons. Neither team made the playoffs, as the Redskins only won three games and the Giants won seven.
Media executives also will be watching to see how much a stronger Thursday night schedule affects the NFL’s Sunday afternoon broadcasters.
“How much is going to be taken out of CBS and Fox’s packages?” Hawkins asked. “The league didn’t create more ‘A’ game inventory.”
The “Monday Night Football” schedule is intended to be more of a mix, with occasional “A” games supplemented with more “ordinary” games, insiders say. NFL Network’s Thursday night schedule was filled with lesser games, including such matchups last season as Cleveland-Buffalo and Houston-Jacksonville.
Why is it so hard for networks to find a good, young broadcaster to become their new TV face for the game? Apparently, it’s a lot easier said than done.
I expected to find a sympathetic ear when I brought this topic up to Boomer Esiason last week. In 1998, Esiason joined ABC’s “Monday Night Football” booth as a game analyst, choosing TV over an offer to stay in the NFL for another season or two. Esiason said the transition to the broadcast booth was tougher than he expected, and he wished he was able to cut his teeth in a lower-profile environment.
“I wish I got that job today as opposed to when I got it,” he said. “It takes time to understand the mechanisms of television.”
Production executives were unanimous in saying that networks need patience to develop younger broadcasters so they can be ready for a national spotlight. “It’s a matter of investing in new talent,” one said. “We’re making decisions about people in five seconds. We need to invest money and time into this process.”
If I had to staff an MLB broadcast booth, I’d focus my search on several areas.
> Players at the end of their career: Esiason created this blueprint when he ended his career early to join “Monday Night Football.” He says such a transition might not be as easy today, for the simple reason that today’s players are better paid.
“It depends on the players’ financial situation,” he said. “It was easier for me to jump to TV because I would make more money and have a longer career in the media.”
When asked which players would make good TV analysts, Esiason highlighted two with the New York Mets: Curtis Granderson and David Wright. “The problem is that they will each make more than $100 million in career earnings,” he said. “Why would they want to spend time and effort talking about the sport on TV when they don’t have to?”
Another name that I’ve been told to keep an eye on is Red Sox catcher David Ross, who at least one TV executive describes as funny, engaging and opinionated. Sean Casey, 39, is a rising star at MLB Network.
> Look beyond ex-athletes: Is there a rule that says all TV analysts have to be ex-athletes? There are plenty of knowledgeable reporters who can discuss game strategy as well as anyone.
I don’t think Fox is getting enough credit for putting a reporter, Sports Illustrated’s Tom Verducci, on its MLB “A” team. This is a bold move. I have not seen Verducci call a game yet, but I’m willing to bet his grasp of in-game tactics will be top notch.
> Court the Hispanic audience: Turner made one of MLB’s best on-air hires last year when it brought in Pedro Martinez as a studio analyst. I wasn’t expecting much when Turner announced his hiring last September, but I found him to be engaging and opinionated. At just 42 years old, he has a long future in a baseball broadcast booth if he wants it.
Manny Acta does a nice job for ESPN in the studio. Ozzie Guillen is entertaining. Right now, there are too few Hispanic broadcasters on English-language games. This is an area where networks should become more diverse.
> Back a Brinks truck up to Terry Francona’s house: Hiring a 54-year-old white guy does not achieve my goals for youth or diversity. But Terry Francona was fantastic as a game analyst for ESPN. It would be worth a conversation to see whether he would be willing to take the long-term security of a broadcast deal over trying to bring Cleveland its first World Series title since 1948. I recognize that any deal would be a long shot: Francona took the Indians to the playoffs last year, and the team is set up to contend for the next several seasons.
> Chemistry: I expect Fox’s booth to get positive reviews this season. That’s because its executives say Joe Buck, Reynolds and Verducci meshed immediately during an audition last summer. “The hardest thing to do in a booth or on a studio show is find chemistry,” said Fox Sports President Eric Shanks. “There’s a rapport, an energy. Tom’s insight and connection to the game is different from Harold’s and different from Joe’s. They all bring something unique and special. There’s a chemistry that immediately leapt off the screen.”
John Ourand can be reached at firstname.lastname@example.org. Follow him on Twitter @Ourand_SBJ.
SportsBlog.com, a Nashville-based, user-generated sports content site, has closed on a $1.5 million Series A round of venture financing and recently struck several content partnerships aimed at boosting the site’s audience and overall profile.
The funding round was led by Sports & Entertainment Advisory Group, a venture fund also based in Nashville, and will be used to accelerate new business development. The site, meanwhile, has signed content deals with several former NBA stars to create a new “Legends Corner” on the site, and also hired Priscilla Eshelman and Greg Clements to lead a new in-house sales team. Eshelman and Clements worked together in sales and business development capacities at Salon.com.
SportsBlog.com operates as an open blogging platform, similar to how Bleacher Report was founded and originally operated before gravitating toward a more professionalized structure under Turner Sports’ ownership. More than 20,000 bloggers contribute to SportsBlog.com, and traffic is surpassing 8 million monthly unique users, according to internal metrics. Most writers are unpaid, but SportsBlog.com operates a leaderboard where most-read contributors can earn money.
Among the former basketball stars writing content for the new “Legends Corner” destination are Dale Ellis, Tim Hardaway, Sam Perkins, Danny Schayes and Spencer Haywood. The initiative follows up on a content partnership SportsBlog.com struck late last year with the National Basketball Retired Players Association, and another deal with the Women’s National Basketball Players Association that has WNBA stars such as Tanisha Wright of the Seattle Storm writing on the site.
“We see a certain momentum building behind us,” said Roy Dano, SportsBlog.com founder and chief executive. “We think this round of financing, and the new sales team, will really jump-start us.”