Sports+

Posted: Sat., Jan. 7, 2012, 4:00am PTColleges reduce cost of sportscasts

People have traditionally been able to "ooh" and "aah" at big-money sports contracts and TV rights deals with cool detachment, as if the salaries paid star point guards or fees extended to football owners were bits of gee-whiz accounting, otherwise divorced from reality.

Moving forward, though, consumers and a mostly docile sports media contemplating those mind-boggling figures will have to start to realize the shit is going to start hitting the fans -- and even more so, the non-fans.

For all the talk about "American Idol" or myriad award shows building toward the Oscars, one commodity dominates the TV calendar in January and early February like no other: football. And with a flurry of new TV contracts enriching the National Football League to the tune of roughly $5 billion annually once they kick in -- a staggering increase of more than 60% over existing agreements -- well, somebody's going to have to pay the freight on all this.

Broadcast networks will no longer be content to view sports as loss leaders -- the kind of must-have commodity they're willing to take a financial bath on to maintain circulation. They're going to want to offset their investment, either through sweetened retransmission fees from cable and satellite operators or altered agreements with affiliated stations.

Meanwhile, cable channels and systems -- especially ESPN, but also entities like Fox and Time Warner Cable -- have rolled the dice on sports as the best hedge against the worst possibilities of a digital future. While the prospect of people dumping cable, or "cord-cutting," has perhaps been overstated, championship games and playoffs represent the kind of live events people will absolutely demand, and potentially pay through the nose to get. (Full disclosure: I'm a part-time contributor to Foxsports.com.)

The push-comes-to-shove element hinges on the simple fact that TV isn't a landscape of unlimited resources. If networks shell out huge amounts of money for something, they're going to try getting it back somewhere, somehow. To quote the old song, something's gotta give.

So who'll feel the pinch? The aforementioned affiliates, and almost certainly smaller cable networks, which will get squeezed in future contract negotiations with system operators trying to offset higher fees to sports-carrying channels.

And, of course, consumers.

The prospect of rising cable bills has simultaneously renewed talk of establishing pay tiers and a la carte pricing -- both of which would require fans to ante up directly for the sports they crave -- probably more fair, on the face of it, than forcing said super-fan's grandma to shell out $5 a month for the privilege of getting an ESPN service she doesn't watch.

Of course, at least ESPN provides year-round service, which is more than can be said for something like NFL network, which still demands steep monthly fees -- more than 70¢ per sub per month, per SNL Kagan -- even when the league is essentially dormant more than half the year. And now college conferences and individual universities such as Texas U. are capitalizing on the insatiable appetite for sports by creating their own dedicated channels, further slicing away at the pie.

Theoretically, more choices for consumers are a good thing. But enterprises like ESPN are all about leverage. Having rights to the NFL, NBA or MLB actually creates more of that in dealing with distributors, advertisers and consumers.

Moreover, if some form of a la carte pricing does come to pass (or punt or kick), premium sports channels will only exacerbate the have/have-not divide that already exists between those who can afford arena luxury boxes and a majority resigned to watching their local heroes on TV (or the computer or hand-held device).

Highlighting this point, a reader recently wrote the Los Angeles Times lamenting the migration of all but a handful of college bowl games to cable.

After losing his job, he said, "I had to cut back on a lot of things -- one was cable TV," which now means he "can't even watch the Rose Bowl thanks to ESPN and the almighty dollar."

The leagues, universities and networks would no doubt clear their throats and feign sympathy when presented such cases. But the harsh reality is a marked shift from free TV toward a world favoring those who can afford to pay in order to watch others play. Because despite the prevailing image of sports as our shared sandbox, entering the new digital playground comes at a price. Contact Brian Lowry at brian.lowry@variety.com

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Posted: Sat., Nov. 26, 2011, 4:00am PT

Tiger Woods

It has been almost two years since Tiger Woods was involved in a single-car accident outside his estate in the posh Isleworth enclave of Orlando. His personal life has turned inside out, and his golf game derailed. He has had health issues as well, and has not won a tournament since capturing the BMW Championship in September 2009; his last victory at a major was the 2008 U.S. Open.

And many would say Woods has taken the business of televised golf with him down into the bunker.

Though the sport's core aud of upscale men 35-64 remains substantial (and an attractive one for high-end advertisers), golf has lost a big chunk of the more casual viewers, including women, who would tune in only to see Woods in action. This can be seen in the viewership numbers for recent years, which don't exactly paint a rosy picture.

For instance in 2008, the four-day Nielsens for the U.S. Open (which spilled over into a fifth day that featured a playoff between Woods, then the world's top-rated golfer, and Rocco Mediate) cumed a scintillating 47.9 million viewers on NBC and ESPN. The next two years, as Woods' game began to founder, U.S. Open ratings came in at about 37 million viewers. And this year, in which Woods did not play, total viewers for the four-day event fell to 30.2 million. In golf, lower scores are desirable; in TV ratings for golf, though, not so much.

Naturally, there is always the chance Woods will get healthy, re-discover his swing and claw his way back to the top. His game for the U.S. at the recent President's Cup showed flashes.

Woods' popularity was so singular that it's difficult to see any player able to pick up his mantle.

Luke Donald of Great Britain is the top-ranked player; Steve Strickler, at No. 4, is the top American. Rory McIlroy of Northern Ireland, at No. 3, has gotten a lot of publicity. But can any one of them entice casual fans to watch?

"There's no one that I know of right now (to replace Tiger)," says Art Spander, Bay Area sports columnist and longtime golf writer. "The PGA Tour keeps throwing names at you, trying out people. Rory McIlroy seems like a good kid, with some charisma. But I don't think Americans will follow him like they do Tiger."

Still, the health of golf is all about perception in a "glass half full or half empty" kind of way.

The PGA looks at a tournament as twice as interesting when Woods participates, but the public looks at one without him as only half as interesting, Says Darren Rovell, sports business analyst for CNBC: "People may define the state of golf as when Tiger is playing really well. But the PGA Tour doesn't look at it that way."

The weird thing is, the PGA may have a point.

In September, the PGA Tour announced it had agreed to contract extensions with NBC and Golf Channel (both owned by Comcast) and CBS that last until 2021, despite Woods' uncertain future. While terms of the deals were not disclosed, insiders say the PGA managed to gain increases over its existing deals.

A key reason for that may be due to the meteoric rise in sports rights. While ratings often decrease for certain sports because of audiences drifting to other forms of entertainment, that migration doesn't seem to be reflected in sports-rights fees.

For instance, in May, NCAA football's Pac-12 conference signed a 12-year contract with ESPN and Fox for close to $3 billion, the largest rights package for a college sports league. In September, ESPN and the NFL announced an eight-year extension worth $1.9 billion per year, a 72% increase over the average price of the current deal.

And in late October, Telemundo and Fox scooped World Cup soccer rights in the U.S. for north of $1 billion -- more than twice what Univision and ESPN had been paying -- for four tournaments, beginning in 2015.

"I don't think (golf) is in that bad of a position," Rovell says. "They did get a rights fees increase." Though he allows that the hike is "more a factor that TV rights in general are more valuable than anything having to do with Tiger."

Ty Votaw, the PGA's executive vice president of communications, says the PGA Tour operates from a different business model than most sports, with a unique major sponsorship mix that includes financial institutions, insurance companies, automakers, pharmaceutical firms and golf equipment producers.

"Advertisers want to be associated with our sport because of the quality of our audience," Votaw says, adding that the PGA Tour does not have ratings guarantees in its television deals.

And while the average golf audience may skew older than those of most other sports, Brad Adgate, senior vice president/director of research at Horizon Media, says the need for brand recognition ultimately outweighs demographics.

Moreover, the PGA Tour says its cumulative ratings for telecasts on CBS and NBC this year are up 7% over last season, and up 17% on the Golf Channel.

So ultimately, whether the sport, or its most popular player, can find its way out of the rough -- or whether it already has -- depends on how one looks at it, and who is doing the looking. Contact the Variety newsroom at news@variety.com

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Posted: Sat., Feb. 4, 2012, 4:00am PT Super Bowl XLVI viewers will be able to get interactive with the New England Patriots and New York Giants, as well as with films from Disney, Relativity and Universal, if they have a smart phone. This year's championship marks the first in which the game itself, the halftime show and about 40% of the commercials are "Shazamable."

Shazam, the popular audio/music recognition app, has seen its TV incarnation become one of the most popular iTunes downloads. It offers users exclusive content tagged to a number of programs, including awards shows, dramas and music competitions.

During the Super Bowl, Shazam users can tag ele-ments within the NBC broadcast to vote on their favorite ads, participate in game polls, receive discount offers, free downloads, enter sweepstakes, buy music, share their experiences on Facebook and Twitter and support charities. During the game, fans can get up-to-the-minute statistics and keep track of key plays and players, as well as buy official team and artist merchandise.

The rapidly growing London-based company, which logs 6 million tags a day, is working with 15 brands, including the three studios, on the biggest television advertising day of the year. Shazam charges them an incremental CPM on top of the TV buy. If the spot has an expected 1 billion impressions, its rate card is 35¢ on top of those impressions.

"For companies to trust us during the Super Bowl is a big deal," says Evan Krauss, exec VP of advertising sales for Shazam Entertainment. "We're not just putting a logo on the screen, we're part of the campaign in a big way. If you're running spots that cost $3.5 million apiece, plus creation, the extra time and work to make them Shazamable in a compelling way is huge."

Spots for Disney's "The Avengers" and "John Carter," Relativity Media's "Act of Valor" and Universal Pictures' "Battleship," as well as some programs on cable network Syfy, are slated to get the Shazam treatment: Viewers who tag the spots will receive extended trailers and other program or ticket purchase information.

And while Shazam pitches concepts to its clients for infusing interactivity, Krauss says industry creatives have been coming up with ways to use a film or show's characters to drive the added value Shazam offers.

Pepsi's interactive ad features the winner of the "The X Factor," Melanie Amaro, performing Otis Redding's "Respect" and will invite people to unlock a free video.

Shazam users who tag the halftime show, sponsored by Bridgestone, can unlock exclusive content, including new music and apps by Madonna and guests -- reported but not confirmed at press time to include Nicki Minaj, M.I.A., LMFAO and Cee Lo Green.

Other Super Bowl commercials that are Shazam-enabled include Toyota, promoting a sweepstakes to win two Camrys, and Best Buy, pushing a $50 gift card offer for consumers looking to buy and activate a mobile phone in 2012.

Call it the game within the game. Contact the Variety newsroom at news@variety.com

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Posted: Sat., Oct. 15, 2011, 4:00am PTThe need for attention-grabbing properties has made TV's hunger for sports more ravenous than ever. Yet all the cash flowing into these games has only made the sporting world more chaotic than ever -- and must have left networks wondering about the sobriety of their business partners.

Buoyed by the unquenchable appetite for sports, the new trend is for every pro franchise, college conference and even an individual marquee team, like the U. of Texas, to demand its own channel. And instead of pausing to wonder at what point the banana slices become too thin for consumers to notice, such outfits as ESPN, Fox Sports and Time Warner Cable appear content to let the inmates run the asylum.

While all of this raises questions about whether greed might strangle the golden goose, since nobody wants to risk being left behind, there's little evidence of concern about death by gluttony.

Despite splitting $9 billion annually, pro football's owners and players engaged in labor strife over the summer, then grudgingly reached a deal -- and returned in time to post predictably boffo ratings. Meanwhile, sharing a mere $4 billion a year has resulted in poverty-pleading NBA owners sidelining pro basketball players for at least the season's first two weeks, and possibly much longer.

Like the NFL, the NBA is coming off a terrific season ratings-wise, fueled by the free-agency fracas unleashed by pitchman supreme LeBron James and his Miami Heat teammates. Yet the league could squander that momentum if it sacrifices most or all of the season -- a distinct possibility.

The NBA's absence leaves the spotlight on Major League Baseball, whose postseason pyrotechnics actually have people buzzing about the game again. Of course, in order to fully appreciate America's pastime, one has to ignore the scandals pertaining to steroids or insolvent owners that have recently filled courtrooms.

Still, the wackiest developments have involved the aforementioned creation of an ever greater number of local or regional sports networks, some of which will suffer if the NBA lockout lingers.

Time Warner initiated a bidding war in Los Angeles by snagging rights to the much-beloved Lakers, prompting Fox Sports to preemptively seek to extend its relationship with the Dodgers via a 17-year, $3-billion deal. The only problem was that Dodger owner Frank McCourt desperately needs the cash to, among other things, settle his messy and very public divorce, prompting MLB commissioner Bud Selig -- concerned about how McCourt might spend the $385 million Fox pledged to commit upfront -- to step in and halt the agreement. (Full disclosure: I'm a part-time contributor to Foxsports.com.)

College football, meanwhile, has tampered with decades of tradition and upended historic rivalries in a frenzied attempt to reconfigure itself into "super-conferences" in order to maximize TV revenues.

Although the conference-hopping has temporarily cooled, the amount of time devoted to pondering where teams would land during the off season was exceeded only by the steady drip of scandals over players receiving improper benefits. In their own way, each thread illustrates the lack of rational authority governing what many derisively refer to as amateur athletics.

Through all of this, major media companies have essentially thrown up their hands, insisting their billions in fees play no part in perpetuating flaws in the current system.

This much is certain: The money keeps growing. Consider ESPN's $15 billion deal to extend its "Monday Night Football" rights through 2021 -- increasing its annual payment more than 70%, to $1.9 billion. For a network that needs exclusive programming to command lofty fees from cable operators and consumers, the NFL is simply must-have TV -- suggesting additional payments from other networks, and thus plenty more cash for owners and players to fight over in the future.

Still, focusing on networks and leagues ignores another constituency in this equation -- and perhaps the most significant one: Die-hard fans, who might periodically express their disgust over battles pitting millionaire players against billionaire owners, but who in practice can't stay away for any length of time.

As long as fans remain addicted to the exploits of their favorite teams, in other words, all the major sports will have them -- and the TV industry -- by the balls. Contact Brian Lowry at brian.lowry@variety.com

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Posted: Fri., Dec. 30, 2011, 4:00am PTThe National Football League has never been hotter, and that is evident in the list of TV's most- watched sports telecasts of the year.

Fifteen NFL games -- including last season's playoffs and this regular season -- drew a larger audience in 2011 than any other sport. The college football championship game and the deciding game of the World Series came closest (see chart).

Of course, the NFL's primetime broadcast package, NBC's "Sunday Night Football," is bigger than most of primetime's top entertainment series in demographics as well as total viewers. Five years ago, in the franchise's first year on the Peacock, "SNF" was the season's No. 6 show in adults 18-49, but it has vaulted to No. 1 this season (8.0 rating/19 share in the demo, and more than 20 million viewers overall).

NBC has done little else in primetime this season -- it has only one entertainment series among the top 25 shows -- but football has enabled it to hang in the ratings race in the fourth quarter.

And after adding an 18th regular-season game to its "SNF" roster last season (against the World Series), NBC was recently awarded a 19th game -- on Thanksgiving night -- beginning next season.

It wouldn't be a surprise to see rival networks (especially ABC, the only major that doesn't air NFL games) start to more aggressively tout nonsports averages, as gaudy numbers for the country's most popular sport are a misleading representation of NBC's performance and only masks the net's underlying problems. Contact Rick Kissell at rick.kissell@variety.com

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Posted: Sat., Nov. 26, 2011, 4:00am PT

A Penn State student participates in a candelight vigil on campus for victims of child abuse.

December is associated with many things, but for sports fans, it's an especially bountiful period. Not only is the NFL building toward the playoffs, but there are dozens of college bowl games and the traditional Christmas-day showcase for NBA basketball.

Only this year, those holiday stockings are looking frayed -- not that it's easy to trust the networks, as reliant as they are on televising sports, to adequately reflect the distastefulness surrounding the games people play.

Pro basketball narrowly averted sitting out the holidays, as owners and players jockeyed over how to divide an annual $4 billion in revenue.

The college bowls, meanwhile, have been sullied by scandals. Allegations of child sexual abuse at Penn State has eclipsed all others, but it took a story of that hideous magnitude to overshadow headlines involving potential rules violations by traditional powers like Miami, Ohio State and LSU.

"I honestly don't think the sport has ever had as tumultuous of an off-season as we had during this year," ESPN's Kirk Herbstreit told CNN.com in August -- and that was before Penn State was forced to oust legendary coach Joe Paterno.

Suddenly, Southern California's forfeited national title and returned Heisman Trophy look almost quaint by comparison.

In newspapers, sportswriters and editors appear almost giddy to have the opportunity to write about bigger stories than just wins and losses. Many have attacked the various scandals and labor discord -- first the NFL, now the NBA -- with gusto, anticipating the sort of front-page placement that normally eludes them.

Television, by contrast, is in an especially tough position. After all, TV helps make all those big-money salaries and disputes possible by throwing billions in rights deals at owners and university presidents.

If big money is a corrupting influence in spheres from politics to Hollywood, it can be especially corrosive in sports. And the payments only promise to keep growing.

Whatever pleas of poverty they might make elsewhere, network fees for sports rights aren't going anywhere but up. That's been clear in a flurry of recent TV deals, including ESPN's renewal of "Monday Night Football" through 2021 for about $1.9 billion annually, an increase of more than 70% from the previous pact.

In addition, various entities are in pitched bidding wars to ally themselves with major franchises by sweetening the pot with dedicated cable channels, from the U. of Texas to the Los Angeles Lakers, who split from Fox Sports and signed with Time Warner Cable in a 20-year deal valued at $3 billion. That left Fox scrambling to cement its relationship with the L.A. Dodgers, and being drawn into the legal woes of owner Frank McCourt, who tried to leverage TV rights to maintain his hold on the team. (Full disclosure: I'm a part-time contributor to Foxsports.com.)

As the sports universe's biggest spender, ESPN winds up ignoring its role more often than most. Analysts spend untold hours wringing their hands over who belongs in the Bowl Championship Series title game, for example, but seldom mentions the $125 million their employer pays annually for BCS rights, which make a terribly flawed system an equally lucrative one. (Recent reports of a proposed overhaul don't elicit much hope, since the same university officials -- who have steadfastly resisted a playoff -- remain in charge.)

In many instances, television accounts for more than half of a particular sport's revenues. With live sports one of the few DVR-proof commodities, it's no wonder those games have become so precious and vital to programmers.

The corollary of that, though, is understandable skepticism as to whether those same networks will dare bite the hands they're feeding, and report on excesses when doing so risks damaging relationships with the very parties they need to sign on the dotted line.

In terms of watching sports, modern TV innovations provide the best seat in the house -- often superior, notably, to the experience sitting in an arena or stadium. If you want to know what's going on within a sport, however, look elsewhere. Because for the networks, it's hard to honestly present a clear picture when you're in the middle of it, blemishes and all. Contact Brian Lowry at brian.lowry@variety.com

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Posted: Fri., Dec. 23, 2011, 6:37pm PTFox Sports earned a favorable U.S. District Court ruling Friday in its efforts to halt an accelerated sale of the Los Angeles Dodgers' post-2013 cable rights.

Judge Leonard Stark issued a stay, pending a Jan. 12 hearing, of a federal bankruptcy court ruling two weeks ago that enabled the Dodgers to begin selling those rights, even though they were not to come to market for nearly a year.

The bankruptcy court had previously ruled in the Dodgers' favor on the theory that it would maximize the value of the bankrupt franchise, which is legally bound to be sold by April 30.

The stay upholds, for the time being at least, Fox Sports' contractual exclusivity through Nov. 30 on negotiating with the Dodgers for cable rights that follow the expiration of their current deal.

Had Fox lost on these grounds, it would have accelerated the ability for others to make a play for the Dodgers, namely Time Warner Cable, which is likely to seek complimentary programming for its soon-to-be-launched cable channels dedicated to the Los Angeles Lakers.

However, it has been stipulated that the next owner of the Dodgers is not bound to accept any TV rights deal made by the Dodgers' current owner, Frank McCourt. As a result, the Dodgers' ultimate cable TV fate will likely remain open until the ownership transition takes place.

The fate of Fox Sports' Prime Ticket channel is widely believed to depend on its ability to retain the Dodgers long term. Contact Jon Weisman at jon.weisman@variety.com

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