DirecTV is staying in RSN biz Retooled Chase finishes strong Women staying tuned to NFL Sports Media: Networks keen on “TNF” NFL Net finds good spot for new shows Home for MLB Net morning show Networks plot to stay in cable bundles NHL tests virtual ads for dasherboards Decision 2014: Our research Decision 2014: A closer look at the data
SBJ/April 28-May 4/Media
‘This thing is much more than a sporting event’
Published April 21, 2014, Page 8
■ Haven’t the last few television deals with NBC been five-year deals?
EVANS: The last three deals, one that predated me and two since I’ve been here, were five-year deals. And when we did this 10-year extension, we still had two years to go on the old deal, so it’s really 12 years from today. So we still had the ’14 and ’15 Derby under the old deal and this takes us out to the 2025 Derby.
■ How did this come about?
EVANS: This wasn’t a formal process. We have a great relationship with NBC, and, I think, they feel the same way about us. So we just started talking about it. There wasn’t one specific thing about a hard number, but one of the things sticking in our minds was in 2024 we’ll have the 150th Derby. That’ll be a huge event. The 100th Derby in 1974 was a big event. It just seemed we should go at least through that, so it wasn’t a scientific method, but that was one of the driving factors. And I think we both valued longer rather than shorter, and 10 was just a round number.
The Kentucky Derby, Churchill Downs’ most famous race, will be on NBC through 2025 as part of a recent deal.
■ Why NBC?
EVANS: The thing I love about how NBC treats our event is it’s NBC Sports, but they have figured out this thing is much more than a sporting event. It’s a fashion show; it’s a food show; it’s a culture show; it’s a lot of things other than a sporting event. They have committed the resources during the program and in advance of the program, using the other NBC assets. Last year — it won’t happen this year — but last year on [Jimmy] Fallon’s show, they had a “public picks a Derby winner” skit. So we get a lot of coverage on other NBC properties other than NBC Sports, and, in the actual telecast of the Derby, they have found a way to treat it other than just a classic sporting event. That has really worked for us and it reinforces what we think the Kentucky Derby is, so we have had a good partner who is doing the things you feel are important to do. You want to extend that as long as you think you can make it work.
■ Is it true you negotiated the extension with NBC Sports Chairman Mark Lazarus?
EVANS: Yes. Mark and me. It goes back to a dinner we had, I don’t remember the date. I think it was last summer, early fall. We got to talking and this came out of it.
■ After the first dinner with Lazarus, how was the deal negotiated?
EVANS: We had a few discussions. It took a couple of months. And a few of the discussions were more social than business. We had no negotiating session where me and six of my folks and he and six of his folks showed up in a room somewhere and met in private caucuses and worked out the details. We basically did this by phone and email.
■ Have you had any other networks come to you?
EVANS: In the past we have. But, I mean, from what I have learned there are some people who think their sports property isn’t presented properly in the television show aspect of it. We don’t hold that view. We think the way NBC treats our product is exactly what we want. So, if you have a great relationship and it’s working and the numbers are supporting it, do it.
■ In the announcement, you said the deal met your financial objectives. Can you expand on that?
EVANS: Sure, I can expand on that. It really did meet our financial goals. We’re not going to talk about numbers.
■ Does the deal reflect the market increase in value of sports rights?
The way NBC treats the Derby “is exactly what we want.”
■ Did you have an outside consultant?
EVANS: No, we just keep track of this ourselves.
■ Is it a large, complicated agreement?
EVANS: No. It’s a pretty simple agreement. I think the thing to think about on this thing is it’s one day for a few hours. There is no schedule. There are not multiple television networks covering the product the way it is with football. It’s not a many month thing, like the Olympics. It’s a fairly simple event and it’s not too hard to get your head around the details because there are not that many details.
■ How many pages is the agreement? What does it cover?
EVANS: It’s probably 10. It is pretty comprehensive. It deals with television rights, domestic and international. Radio rights, domestic and international. Digital rights, same way. The world of technology changes so fast, that I almost guarantee you that there is something that neither one of us have thought of that will happen in the next 12 years [that is not covered]. But, hopefully, we can figure that out when we run into it.
■ What is going on with the 2015 Breeders’ Cup and where it will be run?
EVANS: I don’t really know. We have offered to make Churchill available, if they want to do it. So far nobody has told us a particular year that they want to do it.
■ Does Churchill have a shot at future Breeders’ Cups?
EVANS: I would think so. It would be hard to disqualify Churchill Downs as a place to hold the Breeders’ Cup. It’s done it seven or eight times. It’s produced the highest attendance and handle numbers, I believe, of any host venue. Last year we put more than $40 million in improvements into the property. Somewhere in the neighborhood of 3,000 premium seats. We added The Mansion at the very top end. There are 300 seats in The Mansion. This year we are opening a new area called the Grandstand Terrace, an outdoor, garden-type area to watch the racetrack. We started up, this week, a 15,224-square-foot video board to watch the racetrack, which is huge. Now everybody in the infield will actually be able to see the race.
■ Churchill recently announced a higher takeout on wagers. Will it affect the wagering on the Derby?
EVANS: I doubt it. We are coming off the low point. The Kentucky tracks had some of the lowest takeouts in the country. So it’s not like we were at the top of the list or the highest. So I don’t think it’s that big a shock for our customer.
■ What about the hardcore horseplayers, who are also the biggest gamblers?
EVANS: Well, I am sure somebody somewhere will change their betting behavior. But, in the end, what bettors want to see are large fields, and with higher purses we can get large fields. Someone joked we can take the takeout rate to zero, but if there aren’t any horses to bet on, it doesn’t really matter what the takeout rate is.
■ How big a hit was The Mansion and how can you improve on it?
EVANS: It was a big home run. It’s a little more complex because a lot of the people who are going to be in The Mansion this year, the second year, were there last year. And for the premium prices they are paying, they don’t want to get the same experience again. I don’t know if it’s the highest ticket price in sports, but if it’s not, I don’t know what’s higher.
■ It was reported last year the lowest ticket price in The Mansion was $7,000. Is that accurate? What is it now?
EVANS: Actually that is below the low end. We haven’t talked about that specific number.