Group Created with Sketch.
Volume 23 No. 23

Media

The tour expects a sizable rights fee increase based on the amount of interest from media companies so far.
Photo: Getty images
The tour expects a sizable rights fee increase based on the amount of interest from media companies so far.
Photo: Getty images
The tour expects a sizable rights fee increase based on the amount of interest from media companies so far.
Photo: Getty images

The PGA Tour is confident that it will complete its next media rights deals by the end of this year even though its current agreements with CBS and NBC run through 2021. In the coming weeks, the tour will invite media companies to deliver formal pitches at its offices in Ponte Vedra Beach, Fla., with the goal of having new deals in place by January — two years before its current ones end.

 

All of the tour’s U.S. rights are up for bid, including its broadcast TV deals with CBS and NBC, its 15-year deal with the NBC-owned Golf Channel and its PGA Tour Live, which is part of NBC’s direct-to-consumer service NBC Sports Gold. None of the tour’s current rights deals grant exclusive negotiating windows or first-refusal rights to the networks — clauses that are standard in most rights deals. That means the tour is free to negotiate with any media company at any time.

“We’re in a position where we have every possible right that could be licensed and every type of relationship that could be created on the table for us,” said Rick Anderson, the PGA Tour’s executive vice president of global media. “We’ve been having informal discussions with everybody that you could think of in terms of rights relationships. … That’s been an extremely positive experience for us. There’s a tremendous amount of interest from traditional media companies and non-traditional companies.”

The PGA Tour has been holding informal talks on its media rights for the past several months. Still, its aggressive timing on new media rights pacts comes as a surprise since the tour still has two years to go on its current deals. If the PGA Tour signs new deals with CBS and NBC, it will be able to add new features two years early. If it moves on from CBS and NBC, the tour believes that it will need those two years to develop a new channel and digital presence.

Another reason for the tour to move early is to take advantage of an overheated media rights market before the NFL comes in and takes over a sizable piece of that market. The NFL’s deals are up in 2021 and 2022, and all indications are that the $5.5 billion of linear TV rights deals that the league collects annually will see a huge increase. The fear is that the sports rights marketplace will become much tighter after the NFL cuts its deals.

Current PGA Tour partner CBS says it plans to bid to keep its package.
Photo: Getty images
Current PGA Tour partner CBS says it plans to bid to keep its package.
Photo: Getty images
Current PGA Tour partner CBS says it plans to bid to keep its package.
Photo: Getty images

Tour executives expect a sizable rights fee increase given the amount of interest that media companies already have showed. The tour’s current broadcasters — CBS and NBC — have said they will bid to keep their packages. WarnerMedia has expressed a strong interest in picking up a package of rights. After largely getting out of the golf game under John Skipper’s watch, ESPN’s new Jimmy Pitaro-led regime has told the tour that it is interested in re-engaging. Fox has said it could be interested in a package of tournaments around its U.S. Open and the FedEx Cup playoffs, which now run in August before the NFL season kicks off.

Among the big tech companies, Amazon has showed the most interest and is expected to be invited to make a formal bid. Adding that all up, the PGA Tour feels timing and increased appetite for live rights are in its favor.

Anderson will lead the negotiations, with Commissioner Jay Monahan involved, and given the complexity of the negotiations, several senior executives from across various departments also will be involved.

The tour’s deals will be more than straight rights agreements. Anderson said he is looking for one or, potentially, two linear channels. He pointed to the content it has from the PGA Tour, LPGA, PGA Tour Champions and Korn Ferry tours as evidence that the tour has enough content to fill two channels.

“You have enough golf … to support a second channel or part of a second channel,” he said. “It’s a volume thing in terms of how much actual live hours of content you can program on an actual 24/7 linear channel.”

Anderson’s early talks have focused on media companies’ digital plans, which is where the tour could sell different packages to fans. This is where Amazon could come into play.

“When you start talking about capturing every player and every shot, the digital platform is where that would come to light,” he said. “We know that our opportunity extends beyond the current business model of cable and a linear channel. We can build a real digital platform that has content that people will pay for and in a different way than any other sport can do.”

The PGA Tour isn’t the only golf property seeking a deal. The tour also represents the LPGA in its media rights deal with Golf Channel that runs through 2021 as part of the strategic alliance made in 2016 between the two properties. 

The Players

 

Incumbents

CBS
CBS has held PGA Tour rights since 1970, and all indications are that the network wants to keep a package of tournaments for its broadcast network.

NBC
NBC has made it clear that it wants to keep its PGA Tour relationship. Sources said NBC is open to allowing the tour to take an ownership stake in the Golf Channel as an enticement to get a deal done.

Others

Amazon
Amazon has been the most active of the big tech companies in the media rights space and is expected to make a significant bid. Amazon’s advantage: The tour wants to pursue a digital strategy, which would be right up Amazon’s alley.

Discovery
Discovery signed a 12-year, $2 billion deal for the PGA Tour’s international rights. It paid $30 million to $35 million for Golf Digest this spring. But Discovery has not showed interest in the tour’s U.S. rights.

ESPN
Much of ESPN’s interest revolves around its streaming service ESPN+. But new President Jimmy Pitaro has expressed interest in the PGA Tour’s linear rights, too.

Fox
Sources say Fox is not interested in a big PGA Tour package, but the tour hopes it will want tournaments around the U.S. Open to help streamline its production and sales processes around the sport.

WarnerMedia
WarnerMedia has showed a lot of interest. Last week, AT&T’s Randall Stephenson said he is in the market for live sports rights for the company’s planned direct-to-consumer streaming service HBO Max. PGA Tour rights would fit that bill.

This week, Austin Karp, managing editor of digital, runs point for First Look. He has writers John Ourand and John Lombardo on the call for a discussion on the PGA Tour’s media rights. Writer Ben Fischer and Assistant Managing Editor Tom Stinson sit in for their take on our cover profile: Carolina Panthers owner David Tepper. Then we dive into this week’s Power Players (college edition) feature with writer Michael Smith. Also, Publisher and Executive Editor Abe Madkour on issues he’s keeping an eye on.

 

It’s one of those Hollywood stories with a sports twist.

Basil Iwanyk, whose Thunder Road Films has produced more than 30 movies, including the “John Wick” series and “A Star Is Born,” was researching a sports documentary late last year when he met Jaymee Messler.

Jaymee Messler will take athletes’ stories into the TV, film and audio space with the help of producer Basil Iwanyk.
Photo: taylor baucom
Jaymee Messler will take athletes’ stories into the TV, film and audio space with the help of producer Basil Iwanyk.
Photo: taylor baucom
Jaymee Messler will take athletes’ stories into the TV, film and audio space with the help of producer Basil Iwanyk.
Photo: taylor baucom

Messler, co-founder of The Players’ Tribune, had moved to Los Angeles to explore original programming and development and was trying to get a feel for the Hollywood landscape, meeting with filmmakers, buyers and content creators. “We nailed first-person editorial and digital storytelling at TPT,” Messler said, “but I knew there was a larger business opportunity in the TV, film and audio space.”

It was just supposed to be one of those brief meet-and-greets, but Iwanyk and Messler clicked immediately.

“I said, ‘Jaymee, we should start doing sports content, whether it’s digital, narrative, scripted, unscripted films — you are a pioneer in this world,’” Iwanyk said. “And she’s like, ‘100 percent, let’s do it.’” 

Last week, Iwanyk and Messler, along with sports industry veteran Greg Economou, unveiled their vision, (co)laboratory, a company that partners athletes, teams and leagues with moviemaking expertise, relationships and experience. The company will create everything from feature films and documentaries to TV series, digital series, streaming video, branded content and audio.

Both Iwanyk and Messler said last week it was something they didn’t want to do alone.

Iwanyk
Iwanyk
Iwanyk

“The athlete community and the sports community and the film business and television business are really similar in that it is really, really hard to penetrate,” Iwanyk said. “People that are in there don’t trust outsiders — and for good reason.”

Iwanyk is a New York Mets, Jets and Knicks fan, and the documentary he was researching last year was “62,000:1,” about the 1969-70 seasons when those New York teams all won championships. It ran earlier this summer on the SNY network.

Economou
Economou
Economou

“Looking at the landscape, I thought, ‘God, it feels like a lot of sports content is monochromatic,’” Iwanyk said. “A lot of it is pretty traditional stuff. And athletes for the first time are getting their voices heard, and I realized there is a huge opportunity to start a sports content company.”

Thunder Road Films has produced movies that have grossed more than $3 billion, including “We Are Marshall,” “The Town” and “Sicario,” but Iwanyk didn’t want to attempt to launch a sports content company on his own. “Yeah, I could show up and be the ‘Movie Guy’ and sit down with the athletes. But they would be looking at me sideways like, ‘How is this person not going to let me look like an idiot?’”

Iwanyk is a fan of The Players’ Tribune and the way it’s helped athletes be comfortable telling intimate stories, including sensitive and potentially embarrassing ones. He likes the fact that Messler built a startup, “which now sounds like a no-brainer but at the time was like, ‘What?’”

But more than anything, Iwanyk admired the reputation Messler has built and the relationships she has across sports. “She has the trust of the athletes and the street cred with the athletes and the athletic community,” he said. “And I have the trust of the filmmakers, actors, actresses and screenwriters.”

Messler said she could not launch such a venture without Iwanyk. “He brings something so important to the table,” she said. “It’s very hard — you can have a great idea, but if you don’t have the best writers and filmmakers and directors, it’s much more traditional sports storytelling and we are trying to bring a higher quality approach. Without his relationships, I feel like you have to reinvent the wheel every time you create a project.”

Financial details and equity stakes were not announced.

Based in Los Angeles, the company will have an original production arm, (co)lab studios, which will provide athletes with development funds and content creators — including actors, directors, producers and writers. Additionally, (co)laboratory will help teams, leagues and brands develop a content strategy, Economou said.

“Sports properties are already seeking to become better storytellers,” said Economou, who has held executive positions with the NBA, Charlotte Bobcats, Madison Square Garden, Dick Clark Productions and most recently Ticketmaster. “So, in addition to developing our own original content, a major focus of ours will be working with sports teams, leagues and brands investing in sports on content-related projects.

“We want to help reimagine how brands are telling stories and help them create more authentic connections with consumers by leveraging the entertainment space and the best content creators.”

Iwanyk said the market for sports content has undergone massive change in recent years. “Five, six years ago, there were a very limited number of buyers for sports content,” he said. “ESPN was a clear one. Fox Sports. There weren’t a lot. Now, there is ESPN; there is Netflix, Apple, Hulu, DAZN; there are regional sports networks; there is Facebook Watch; there is YouTube. It’s endless what a booming market for sports content there is.”

Messler said the founders brainstormed for a while before coming up with the name (co)laboratory. “It has a dual meaning: (co)lab is short for ‘content laboratory,’ which is what we are in the literal sense, but it also represents what we stand for, which is collaboration,” she said. “We are uniquely bringing the worlds of sports and entertainment together to collaborate and create. The name felt right.”

The past week in sports media showed how far sports TV executives will go to keep divisive U.S. politics out of sports. Some on-air talent may want to talk politics during their shows, but sports TV executives increasingly are taking a harder line in making sure they stick to sports.

Early last week, ESPN President Jimmy Pitaro refused to budge on the network’s “no politics” policy after one of its top personalities, Dan Le Batard, devoted a radio segment to bash the behavior of people attending one of President Donald Trump’s rallies.

A day later, NBC Sports Group’s top ad sales executive, Dan Lovinger, said one of the Olympics ad sales pitches that is resonating most with ad buyers is that the Olympics is a politics-free environment that will be sandwiched between the Democratic National Convention and the Republican National Convention next summer.

ESPN personality Dan Le Batard pushed for the flexibility to talk politics on his show but executives balked.
Photo: espn images
ESPN personality Dan Le Batard pushed for the flexibility to talk politics on his show but executives balked.
Photo: espn images
ESPN personality Dan Le Batard pushed for the flexibility to talk politics on his show but executives balked.
Photo: espn images

“At an important time when political discourse will be peaking, the Olympics will be the most unifying event our country has seen in years,” said Lovinger, executive vice president of advertising sales. “Brands understand this and will benefit from the positive association with the Olympic movement.”

The line between sports and politics has become blurrier recently. In the past few weeks, for example, ESPN was not shy about covering the feud between Women’s World Cup star Megan Rapinoe and Trump. It covered the Red Sox’s White House visit — a political sideshow where most of the team’s Latin and African American members stayed away in protest.

But TV executives increasingly believe the line between sports and politics is not blurry at all. It’s an easy decision to cover Rapinoe or the Red Sox visit. But a discussion of the White House’s immigration policy — which is how they viewed Le Batard’s segment — does not have a place on any ESPN platform, its executives say.

ESPN says it has research that shows its fans turn the channel when political storylines become part of the programming. Similarly, NBC is finding that ad buyers increasingly are looking for programming that is free from politics.

“[At the Olympics,] everybody roots for one team,” Lovinger said. “There’s no red, there’s no blue; it’s just red, white and blue, and that appeals to the advertisers quite a bit.”

Lovinger referenced the Pyeongchang Olympics in 2018, when North Korea and South Korea came together to light the cauldron.

“The Olympics still are an incredible environment for brands,” he said. “The advertisers vote with their wallets and we’ve seen increased support as the Games have gone on.”

The idea that the Olympics is free of politics is fanciful. It was 51 years ago that American sprinters Tommie Smith and John Carlos conducted a protest during the medal ceremony. The ongoing battle over doping prevention and punishments in Olympic sports is a proxy for the broader disputes between Russia and the western alliance. Former Olympics host Bob Costas gained a reputation for talking on-air about political problems in the host countries.

Lovinger said NBC will remain committed to covering those stories, even if he is selling advertisers on a politics-free zone.

“If something is a story, it will be part of our coverage,” he said. “There may be some political discourse. But I guarantee you that it will be far less than what’s going on two weeks prior or two weeks after at the conventions.”

 

John Ourand can be reached at jourand@sportsbusinessjournal.com. Follow him on Twitter @Ourand_SBJ and read his twice-weekly newsletter.

It wasn’t so long ago that DirecTV marketed itself as a distributor that never let channels go dark as it negotiated deals for TV carriage. Cable operators were the ones who picked distribution fights; not DirecTV.

Times have changed.

CBS-owned and Nexstar-owned broadcast stations are not available on DirecTV, as the satellite provider has been fighting carriage fee increases. And speaking of its Nexstar negotiations, AT&T CEO Randall Stephenson told an analyst call last week that its DirecTV unit and Nexstar were far apart. “We’ll have to be resolute on this one," he said.

News that DirecTV lost 778,000 subscribers in the second quarter — in addition to reports that streaming service DirecTV Now lost 168,000 subscribers in the quarter — put numbers to the distribution fights it has been having.

It’s not just DirecTV. Dish Network dropped Univision for nine months in a dispute that was resolved in March. It dropped HBO in November. And it’s now trying to negotiate new deals for the Fox-branded RSNs and the Disney-owned FX and National Geographic channels.

The prevailing view is that programming cost increases affect the satellite business more than cable systems, which make much bigger profits off broadband than video. Satellite, of course, does not offer broadband.