ESPN is closing in on an eight-year extension with Little League Baseball that will continue a 50-year relationship that the youth sports organization began with ABC in 1963.
The deal is not complete, but both sides have reached broad agreement on most terms that will see ESPN pick up all TV and digital rights through 2022.
Because a deal is not signed yet, Little League International President and CEO Steve Keener would not talk about deal terms. But he said Little League officials have had substantial discussions with ESPN. “We’ve had good and productive discussions, and we’ve got a great relationship with ESPN that we’d like nothing more to extend that, particularly as we approach the 75th anniversary of Little League next year,” he said. “ESPN’s interest in Little League is one of the big things that distinguishes us from any other youth sports organization and we certainly want to continue. But I can tell you, it is not 100 percent completed today.”
Despite increased sports TV competition from Fox and NBC, Little League never had serious discussions with anyone other than ESPN, which agreed to pay a healthy rights fee increase as part of the new deal, which starts in 2015.
It’s not clear how high the new rights fee will be. The two sides signed the current deal in 2007, with ESPN paying $30.5 million over eight years. The 2007 deal was historic in that ESPN committed to show all 32 Little League World Series games on one of its TV outlets — ABC, ESPN or ESPN2.
If the deal goes through as expected, it would be the first time ESPN will hold digital rights to Little League Baseball, which portends more tournament games being made available on ESPN3, its broadband service. Digital rights were not in the current deal.
In 2009, Little League Baseball signed a deal with Youth Sports Live to stream all non-televised tournaments for $14.95. Little League did not receive a rights fee as part of that deal, but took a small percentage of each subscription sold.
It’s unclear whether ESPN is pushing to move games from ABC to ESPN, as the Disney company has spent several years migrating sports from broadcast to cable TV.
Subway has been a Little League Baseball sponsor since 2005. “It is so well integrated within Disney and ESPN, that the tournament has become an event in August you can own, when there is really is not a lot else happening in TV sports,’’ said Paul Bamundo, Subways’s director of sports marketing. “Off the field, it is a property that has real depth.’’
NASCAR opens its exclusive negotiating windows with ESPN and Turner next month, jump-starting a process that will cement the sport’s media relationships for the next decade.
The networks will open talks July 1 and have 45 to 60 days to negotiate exclusively for the rights to 23 Sprint Cup races, according to several sources. Both Turner and ESPN have expressed interest in retaining their packages, but it’s not clear how much more each network will be willing to pay.
The sanctioning body last year secured a 33 percent increase from Fox Sports for the rights to the Camping World Truck Series and the first 13 Sprint Cup races of the season, including the Daytona 500, NASCAR’s premier race. It is expected to use that increase as a benchmark in its talks with ESPN and Turner about the remaining Sprint Cup races and the entire Nationwide Series schedule.
If ESPN and Turner balk at a price increase during the exclusive window this July and August, NASCAR almost certainly will take its rights 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 with a new cable sports channel to program.
NASCAR’s TV ratings continue to drop among the young male demographic, a development that gives some network executives pause when looking at the new packages. Network sources said the multiyear drop in the male 18-34 demo made it more difficult to sell races and shoulder programming than it has in the past.
Still, overall ratings remain high and there would be no shortage of suitors should the exclusive window end without a deal. NBC Sports President Jon Miller said last year that the network would be interested in the NASCAR rights if they became available.
“I will say the best ratings that NASCAR ever enjoyed is when NBC and Fox shared the package [from 2001-06],” Miller said during SportsBusiness Journal’s NASCAR Motorsports Marketing Forum last fall. “We would be eager to listen and have a conversation. It’s a great property.”
Turner and ESPN are in the seventh year of eight-year agreements valued at $2.74 billion overall. Turner currently shows six Sprint Cup races during June and July. ESPN carries 17 Sprint Cup races between late July and November and airs the entire Nationwide Series season.
NASCAR and ESPN declined to comment on the negotiations.
Turner spokesman Sal Petruzzi said the network has worked with NASCAR for 30 years. He added, “We are disciplined in our approach to negotiating sports programming rights and have made smart, strategic investments in this area and look forward to future discussions with our partners at NASCAR.”
ESPN President John Skipper and Turner Sports President David Levy will lead their networks’ talks with NASCAR. Norby Williamson, ESPN executive vice president of programming, and Julie Sobieski, ESPN vice president programming and acquisitions, also will be involved.
Steve Herbst, NASCAR vice president of broadcasting and production, will represent the sanctioning body. Sports Media Advisors, a media consultancy headed by former IMG and NHL executive Doug Perlman, and Proskauer assisted NASCAR on its Fox deal and are expected to be supporting it on the ESPN and Turner negotiations.
A new study suggests that the usage of second screens while watching live sports has been overstated.
Just 4 percent of U.S. sports fans are using Internet-connected devices to follow live sports that they’re also watching on TV, according to new research from Sporting News Media.
Seven percent of American consumers are using Internet-connected TVs to consume sports content, up from 5 percent a year ago. Eleven percent of fans said they would be willing to pay for live sports online, down from 15 percent a year ago. And just 4 percent of fans believe second-screen concurrent usage will have the biggest effect on how sports is consumed in the next two years.
“A lot of what’s in this study validates the power of live sports on television, as you would certainly expect. But it also shows that a digital strategy that simply piggybacks on TV is not necessarily where the mainstream consumer is,” said Jeff Price, Sporting News Media president.
“There’s sometimes a disconnect between the hype of certain things and the reality, and these results show a digital strategy should exist on its own merits,” Price said.
Since conducting last year’s market study, digital sports outlet Perform has created the Sporting News Media joint venture with American City Business Journals, parent company of SportsBusiness Journal. Once again, the results will be distributed to the company’s clients and business partners.
Among the other findings in the study: 77 percent of fans attuned to social networking follow sports on Facebook, 47 percent of those fans use YouTube to follow sports, and 33 percent Twitter.
“There’s a good story here for both Facebook and Twitter with a lot of opportunity going forward,” Price said. “But again, it’s the same sort of thing in terms of where the mainstream fan actually is. Twitter has been on a big rise of late, but it’s still Facebook where you see the greatest scale in social.”
At last week’s Cable Show in Washington, D.C., I hosted a panel session with Joe Dupriest, who is the company’s senior vice president and CMO. I was particularly interested in his unique perspective, overseeing marketing efforts for three professional sports teams in three leagues. The differences between the leagues aren’t as big as you might imagine, as they each are dealing with similar issues.
> Differences between ESPN and NBC
ESPN has a rights deal with the NBA; NBC has a rights deal with the NHL. Dupriest clearly feels the NBA gets much more exposure through its deal. “The NBA has an ESPN deal, so they’re going to talk up the NBA all the time,” he said. “On the Wizards side, it’s great to have that, but on the Capitals side, you don’t.”
|MonumentalNetwork.com features programming around the Capitals, Wizards, Mystics and Verizon Center.
> Live in-market streaming
Over the past several years, some of the most frustrating negotiations between RSNs and the leagues revolved around streaming local games to local audiences. For years, teams and their RSNs have wanted to let in-market fans stream live games to computers, tablets and mobile phones. To date, they have not been able to agree on how to do it. Dupriest predicted that such an agreement was still several years away.
“People want to watch on an iPad,” he said, “but the leagues are still maintaining those rights, so it’s still a little bit gray on whether you can do separate deals for TV and mobile.”
This season, Monumental dipped its toe into the local streaming waters by streaming all of the Mystics’ games online. The games can be seen only by people within the D.C. market, and users do not have to be authenticated as cable subscribers — something RSNs would never allow with NBA or NHL games.
While Dupriest did not reveal specific usage numbers around the Mystics games, he said Monumental has been happy with the early results. “It’s driving a lot of traffic into our network, and it’s setting ourselves up as a legitimate sports network even though we’re not on cable,” he said. “It’s not an earth-shattering deal that’s going to generate millions of dollars for us, but it’s setting us up for future success and proving the ability and the model.”
> Team-owned RSNs
Monumental launched MonumentalNetwork.com in January with a lot of shoulder programming around the Wizards, Capitals and Verizon Center. Dupriest was noncommittal about whether the online video service eventually would morph into a full-fledged RSN, but he said it provides an option for when the Wizards’ and Capitals’ rights deals with Comcast SportsNet end.
“We started changing our model and started looking at our teams not just as teams on the court, but our teams are content,” he said. “Why are we letting everybody else make money off of our content? Why do we need somebody else to distribute our content? Why don’t we just distribute our own content?”
Dupriest said he was conscious of RSNs’ role in rising programming costs.
“When your bill goes from $50 10 years ago to $150 — and at some point it’s going to cross $200 or $250 — people are going to wake up and ask why they are paying for that,” he said. “It’s a big concern.”