For gearheads, August 17, 2013, may well go down as Black Saturday. The first signs of it were the previous day, when many of the personalities heading up Speed Channel’s coverage of NASCAR practice and qualifying started talking about the end of an era, and the network’s Trackside talk show held its final edition ever. Then, when they woke up the following morning, Speed had been replaced with something called Fox Sports 1. For much of the day, Fox Sports 1 carried much of the same NASCAR coverage that had been on Speed, but that night it aired a bunch of fights from the glorified cagefighting promotion known as the UFC, followed by a couple of snarky Canadians yukking it up alongside a bunch of ex-jocks talking about just about every sport except their beloved cars. The succeeding days would see Speed’s lineup of car-oriented shows completely gone by the wayside, replaced by a bunch more shows talking about nothing but stick-and-ball sports. Just like that, the only network gearheads had that was totally dedicated to cars was gone.
Speed fans were not happy, and quickly took to the Internet to voice their displeasure, flooding the comments of just about any article having anything to do with the new network. Here are just some of the comments they posted, all reprinted with spelling, grammatical, and other errors intact:
what idiot decided we needed another stick and ball sport station? mma? boxing? you people are totally out of touch. speed was a car channel, the only car channel…hopefully this channel will fail miserably and maybe we`ll get a car channel back. we don`t need more retired jocks and announcer wannabes telling us the same retread crap that we get fed on 100 other channels.
did you really need anther stick and ball channel? I thought cutting wind tunnel to 30 min. was bad enough but then to cancel it!!…I have an idea, change the classic espn channels format. I can’t believe anyone whatches that channel…car guys spend a lot more money on motorsports than most stick and ball sports fans. I can only hope you will change your minds, but I will not know because I will not be watching any espn channels!
who in the world decided to take speed off the air my god another sports program channel really no speed channel come on this sucks now what I can watch chopped but nothing about cars which is a large industry you have gear heads every where that watched speed n all the shows including Barret -Jackson action . also gearz and all the other shows like pinks and motorcycle racing this sucks
we did not need another all live sports channel, not everyone watches sports, we want all the car shows back from speed and everything else it had on it, now what, where did all those shows go? this is crazy that corporations keep messing with everyones lives on what we have to watch and we still have to pay the price for it.
All of my car shows, car repair shows, collector car shows are gone. Not on the air anymore. No more Stacy doing donuts in a Year One Bandit Trans Am, or climbing mountain trails in some crazy 4X4 that he just welded together. NO, Just another ESPN Wannabee Channel sadly similar to how Comcast destroyed Versus with my fishing and hunting shows. Now both of those lame ass channels are playing European Soccer games instead. Seriously. Fox and Comcast can both go screw themselves.
the reason America is a great country is because of change. What makes it the best country on the planet is admitting our mistakes. FX1 is an obvious mistake. Im sure this channel was created to further better the lives of Fox share holders. SPEED was what built America, cars. trucks. racing. DIY! shows. buying selling/auctions. Ive been patiently awaiting some good from FX1, its just not there. a huge mistake! please, bring back SPEED, u can even keep your crappy FX1 channel, just put channel 607 back on my receiver so Americans can feel like Americans again. am i the only one that feels like moving to Canada? ha, i hear SPEED still aires there. Fix this mistake FX1, i refuse to watch your programming, at least ESPN is original. l.o.l.
While Discovery’s Velocity network remained and remains focused on cars, and several old Speed programs found their way to the fledgling MavTV network, neither is anywhere near as prominent or widely-distributed as Speed was. Speed fans had been swept up by a force far bigger than their own corner of the world, one no demographic could be rich enough to avoid. That the new Fox Sports 1 format was a carbon copy of ESPN, and so many other networks, was precisely the point: ESPN was making over $8 billion a year, over half a billion from subscriber fees alone, and a business model that’s making that kind of money is one any businessman would be falling over themselves to emulate.
Fox had spread out many of their sports contracts across several different networks – besides Speed, there was FX, Fox Soccer, and Fuel – but by consolidating them all onto a single network Fox hoped to charge cable companies higher subscriber fees and lure away some of the massive ESPN audience. Speed, in fact, was a victim of its own success: its presence in nearly 90 million households was far more than Fox Soccer, which had barely 50 million, and Fuel had even less, so it was, from the perspective of the Fox corporate bean-counters, a logical choice to convert to a prospective competitor to ESPN.
It didn’t work out the way Fox had hoped – several cable operators balked at paying the increased rights fees Fox demanded, insisting on paying the same rate they had been paying for Speed, and Fox only gave in a couple days before the launch – and the ratings would be so miniscule, especially in comparison to ESPN, that Fox ended up giving advertisers make-goods on its World Series coverage, but with rights to major college football and basketball and big-time European soccer on top of the UFC, and Major League Baseball, the NASCAR Sprint Cup Series, and the World Cup and US Open golf tournament coming down the pike, Fox likely felt that, in the long-term, they could take a bigger bite out of ESPN’s pie than anyone else. What were a few pissed-off gearheads to them when those were the stakes?
The challenges ESPN faces today are very different from the challenges it faced for the first twenty years of its history. Putting sports on FX made sense for Fox during the 1990s, when ESPN’s biggest challengers dating back to the 80s were the Turner networks and USA, general-entertainment networks all, with Turner arguably holding the upper hand with the NBA, half the NFL season, TBS’ long-standing Atlanta Braves coverage, and more. The continued presence of NBA games on TNT and baseball games on TBS today is very much an anachronism. With most cable providers not offering much more than 70-odd channels, a good chunk of which was chewed up by local broadcast stations, ESPN was the “sports channel”, just as other channels, following ESPN’s “narrowcast” lead, staked their ground to their own fields or, as Turner and other such networks did, threw up a potpourri of programming.
The growth of digital cable and direct-broadcast satellite services (such as DirecTV, which boomed in popularity on the back of its exclusive carriage of the NFL’s out-of-market games) in the late 90s and early 2000s changed all that by allowing an explosion of channels of all types, and the end result was a vindication of ESPN’s all-sports strategy. People had been talking about the possibility of television growing to a thousand channels; now half that number was very much a reality, even as HD increasingly chewed up that capacity as the latter decade progressed. Brand-new channels sprung up that were even more niche, looking to fill out all the new space the cable operators had, while existing channels expanded their brand onto more specialized channels (including CNNSI and ESPNEWS) and previously niche channels found their corner increasingly crowded out and broadened their appeal in response. In a sense, digital cable ended the first war over sports on cable with ESPN scoring a resounding victory, while setting the stage for a second war. Why did Fox need to put sports on FX when they could spread FX itself to several other networks (including Fox Soccer’s rebrand to FXX) and still have enough room for two all-sports networks?
One of the new channels was the 1999 launch of NBA.com TV, which launched with highlights, live look-ins, and other NBA-produced programming; although it started as almost a glorified barker channel for the League Pass out-of-market package, some saw it as a bulwark for the league in case they needed to take their games in-house in the post-Jordan era, as well as a hedge on this Internet thing whose role in sports going forward no one was quite sure of yet.
The NBA has long been at the forefront of new revenue streams and innovation, especially during David Stern’s leadership. The standard was that sports leagues had a network partner and a cable partner, and each only aired your product one or two days a week, but as it entered a new round of negotiations with NBC and Turner in 2002, Stern was open to a brand new scheme hatched up by ESPN, which wanted to get into the NBA without having to compete with Turner. ESPN and Turner would share cable coverage of the NBA, with ESPN having games on Wednesdays and Fridays and TNT holding on to a Thursday doubleheader that would be the only games of the night. ABC would take over the broadcast package, but wouldn’t show any games until Christmas and only show 15 games total (less than half of what NBC was showing); TNT would show the All-Star Game, and the playoffs would air mostly on ESPN and TNT until the Finals.
Placing its product so heavily on cable was a big risk for the NBA, but the end result was that the league saw a 25% increase in its rights fees despite a recession and ratings tanking in the post-Jordan era, as well as games all throughout the week. The new deal also put games on the renamed NBATV, and began a long relationship between that network and Turner, almost by accident: the league originally wanted to partner with Turner on a new basic-cable general sports network, but cable operators balked.
The NBA blazed a trail that other leagues would eventually follow; the NHL Network launched in Canada in 2001 and the United States in 2007, while Major League Baseball, though late to the network party, eventually launched one in 2009, using its Extra Innings out-of-market package to blackmail cable operators into acquiring a stake in it. The NFL launched the NFL Network, its time filled mostly with programming from the NFL Films library and some basic studio shows, the year after the NBA’s landmark 2002 deal, and it would end up becoming the focal point of the controversy over sports on cable for the latter half of the decade.
The NFL’s 2005 rights negotiations turned out to be a landmark for multiple reasons. ESPN was looking to renew its Sunday night package while ABC looked to continue an over 35-year-long relationship airing Monday Night Football. But Disney was in disarray as Michael Eisner was on his way out as its head, having recently fought off a takeover bid by Comcast, and both Eisner and the NFL was concerned about the dwindling ratings for MNF. The league wanted to move the NFL’s main primetime package to Sunday, where people would already be home and where flexible scheduling could allow the league to ensure quality matchups throughout the season, but ABC was loath to interfere with the ratings hits they had found on Sunday night.
Bob Iger, Eisner’s heir apparent, was convinced NBC had no interest in the NFL, and so was willing to wait for the dust to settle over his own ascension, but the league’s executive vice president of media, former ESPN head Steve Bornstein, slowly brought Dick Ebersol around and inked a $600 million/year deal to take over NBC’s Sunday nights. It’s possible Disney could have kept both packages for much less than they ultimately paid had they jumped in sooner; instead, Iger was left with no choice but to accept a $1.1 billion deal to put Monday night games on ESPN. (Under the old arrangement, ESPN and ABC had paid $1.15 billion combined.) Just like that, ABC’s Monday night tradition was over.
NBC benefitted from the new flex-scheduling arrangement, but ESPN began setting cable ratings records left and right. By the time ESPN’s first season of Monday night games was over, it already accounted for the nine most-watched programs in ESPN history – in other words, more than half the Monday night games in just the first season had beaten every single Sunday night game on ESPN – including one game that became the most-watched program in cable television history, beating a 1993 CNN debate between Al Gore and Ross Perot, a record ESPN would set again each of the next three seasons and then hold until the BCS deal came along.
Monday Night Football still had cachet, was still a destination program, even if the NFL considered it on par with ESPN’s old Sunday night package and lower in the pecking order than what NBC had; it was the one game that had people’s undivided attention all day, and ESPN was able to build up to it all day and make it a true event. NFL games may have put ESPN on the map, but the move to Monday night established ESPN’s NFL games – and thus ESPN itself, and cable as a whole – as destination, must-have television. On the flip side, the end of Monday Night Football marked the end of ABC Sports itself; by the time the 2006 season, the first under the new deal, started, all sports programming on ABC had been rebranded as “ESPN on ABC”, complete with ESPN graphics. Soon, the sports that were airing on ABC began to inexorably dwindle.
But the NFL also opened a package of eight games on Thursday and Saturday nights up for bid. While Comcast on behalf of its Versus network, NBC Universal on behalf of USA, and Turner all expressed interest, the league ultimately opted to put the games on its own network, foregoing a rights fee in exchange for getting better distribution for its network whose profits the owners would all share in. It didn’t work as planned; for the rest of the decade the league constantly fought cable providers for carriage. Comcast initially offered the network to its digital cable subscribers the first year but moved it to a sports package the next, while Time Warner Cable and Cablevision, among others, held out entirely, many refusing to carry the network unless the league made the Sunday Ticket package available to them.
The league was able to get broad distribution for the network on Comcast again and break several other holdouts by offering a modified version of the Red Zone channel DirecTV had been offering Sunday Ticket subscribers as a premium service, but couldn’t get Time Warner Cable and Cablevision on board until it increased NFL Network’s schedule to a full season in 2012. It was the first high-profile carriage dispute arising from quality sports programming being placed on a marginally-distributed network cable providers were loath to carry at the prices they were being charged, but it would be far from the last.
The power of sports programming has the potential to create some strange bedfellows. It is such that two very different media companies can be drawn very close together almost entirely on the back of their complementary assets that they can bring to a sports contract, to the point of drawing speculation about a merger. Such is the case with the split between the CBS Corporation and Viacom in 2005, a split borne of personality conflicts between Les Moonves and the head of MTV Networks as well as a generally stagnant business, one that promised to insulate MTV Networks from the slower-growth businesses that CBS inherited, yet which created two companies with very similar revenues – and CBS was the one better situated to take advantage of the boom in sports rights… if it weren’t for most of the old Viacom’s cable networks joining the new Viacom.
By 2010 CBS wanted to get out from under a contract to air the NCAA Tournament that was set to lose it considerable amounts of money each year, to the point of engaging in talks to get ESPN to take it off its hands. Certainly the NCAA was very interested in moving most of the tournament to cable, which not only had the potential to increase the rights fees the NCAA collected but also allowed every game to be shown nationally, without the regionalization CBS had engaged in. CBS ended up retaining the tournament by forming an alliance with Turner to show games on TBS, TNT, and truTV in addition to the CBS broadcast network. Turner had never shown college basketball before and truTV, once known as Court TV, had never shown sports of any kind before, but Turner went so far as to start alternating the Final Four with CBS starting in 2016 (later negotiations allowed TBS to show the national semifinals in 2014 and 2015 while the national championship game remained on CBS).
CBS’ lack of any credible cable network prevented it from holding on to the tournament on its own, but neither was Turner in particularly good position to mount a bid without CBS. For the moment, the ability to partner with a broadcast network remains a critical piece of any effort to build a strong cable sports operation. To be sure, Turner’s strategy, as an owner of general-entertainment networks with almost-vestigial sports programming, has generally consisted of limiting itself to high-profile, big-ticket items like the major sports, but that didn’t prevent it from losing the rights to its portion of the NASCAR schedule, in part due to monetary losses. Since the NCAA Tournament deal, Turner has repeatedly looked for other properties to put on truTV, and has reportedly looked into turning it into a sports-heavy network, possibly moving over their MLB and NBA programming from TBS and TNT, but hasn’t been able to secure any other properties to put on the channel.
CBS’ broadcast network and Turner’s cable networks have talked about alliances for other sports rights, and CBS and Time Warner present complementary pieces in other ways as well – the two entities each own half of the CW network – with the only real point of competition between their respective television networks being the premium-cable networks HBO and Showtime. Even so, you’d expect any talks of an actual merger between the two companies to be limited to a very superficial analysis by a poster on a message board, yet it’s something respected financial analysts have discussed since the start of the NCAA Tournament alliance. There are a whole host of reasons to expect such a merger to remain limited to people’s fantasies, but given just how important sports have become, it’s easy to see just how enticing such a merger can look to armchair CEOs.
The prospect of ESPN and Fox competing to rack up sports rights, while also fending off advances from NBC, as CBS and Turner lurk trying to get their own piece of the action, has sports leagues salivating at how high it could drive their rights fees. Even for those without a horse in the race, the competition between the bunch of them can often seem like something out of a soap opera.
Major League Baseball has already seen the benefits the newfound competition can net them. Already it had benefitted from the steps taken by the NFL and NBA to move to cable: its 2006 rights re-negotiations placed almost the entire postseason on TBS, which ended its long tradition of national Braves games in favor of a general package of games on Sunday afternoons, with only the World Series and one League Championship Series remaining on Fox. (Previously Fox and ESPN had split the postseason with Fox airing both LCS’s and marquee Division Series games, effectively taking over Fox’s primetime in early-to-mid October.) But by 2012 it found itself in position to take advantage of its position as programming it would be hard to replicate, certainly in the near term, on sports networks.
First, it renewed its existing deal with ESPN. The new deal was not much different from what ESPN had before: ESPN kept its Sunday, Monday, and Wednesday night packages, only adding games on holidays, one game from the new Wild Card round, and any tiebreakers, yet ESPN paid close to double what it had been paying under the old contract. Doubtless a big part of the premium ESPN paid was to reduce the value of baseball to any other competitor, especially NBC, by locking them out of any of the most popular cable packages. Baseball intended to consolidate its remaining inventory to a single partner.
Desperate to maintain its presence in baseball that helped build TBS into what it became today, Turner began talking with CBS about an alliance that could allow CBS to air as little as the All-Star Game and World Series, but baseball was skeptical about the offer. That left the remaining inventory as Fox’s to lose, but Fox was unwilling to take on the weak Sunday afternoon package TBS had held for the price baseball was asking, so baseball ultimately split the rights between TBS and Fox. End result: Fox has two time slots every Saturday, with the vast majority of those games airing on Fox Sports 1, and splits the division series with TBS along the same league lines as the LCS, again with as many games as Fox wants, potentially up to and including (as is reportedly planned this year) every one of its LCS games, on Fox Sports 1, except for two games surrendered to MLB Network, while TBS reduces its Sunday afternoon commitment to the later half of the season. Both entities also paid double what they were before, despite TBS’ reduced commitment.
The biggest leagues and conferences may be salivating at having multiple competitors groveling at their feet for the valuable programming they represent, but smaller leagues, conferences, and events may benefit even more. With multiple ESPN networks, plus Fox Sports 1, NBCSN, and CBS Sports Network, there’s a lot of time in the day that needs to be filled. All these channels are desperate for programming, and that’s very good news for entities that might otherwise be completely ignored.
This is especially the case for CBS Sports Network, which is substantially weaker than the others, and which has signed contracts with the likes of Major League Lacrosse, the National Lacrosse League, the Arena Football League, and the last, abortive season of the UFL. After George Mason’s magical run to the Final Four and other NCAA Tournament success, the CAA managed to secure a substantial number of games on NBCSN, only to lose many of their best teams to the Atlantic 10, which also had a deal with NBCSN; NBCSN also has agreements with the likes of the Canadian Football League.
However, no sport may have benefitted more from the rise of cable sports networks than soccer, whose rise in the American sports landscape has been intertwined with the rise of digital cable, especially the Fox Soccer Channel, which launched in 1997 as Fox Sports World. For its entire existence through its closure last summer, Fox Soccer was the home to England’s Premier League, and as such was instrumental in spiking its rise in popularity. By the end, the Premier League was joined by games from Italy and occasionally France, as well as Europe’s biggest club competition, the UEFA Champions League, while GolTV, a significantly smaller operation launched in 2003, carried games from Spain and Germany, and sublicensed some of the former to ESPN.
Then Al Jazeera, the outfit best known as the news operation that aired Osama bin Laden’s tapes, stepped in, spiriting away the Spanish, Italian, and French leagues to create a network in beIN Sport that cable operators would have to carry, decimating GolTV and taking away a significant part of Fox Soccer’s depth. Fox Soccer, in many ways, became a victim of its own wild success; it built up the Premier League so much stateside that NBC swept the league away with a new deal that made it featured programming for NBCSN. Combined with also losing its MLS inventory to NBC, it made Fox Soccer’s conversion to the entertainment channel FXX inevitable, even with the Champions League set to be joined by World Cup soccer and other FIFA competitions. But starting next year Fox will take the German Bundesliga away from GolTV, leaving them with mostly South American leagues and potentially setting up the Bundesliga as the second-most popular European league in the states with most other leagues on the much-smaller beIN Sport.
Television has long had an impact on the biggest sports, but with sports increasingly becoming more important as programming for cable networks than in their own right, nearly every one has contorted itself to extract more money out of its partners, even in ways the fans may not like but will watch anyway. Such was the case when the NCAA considered expanding the basketball tournament to 96 teams during its 2010 renegotiations, as well as when baseball introduced its new wild-card games – in both cases motivated at least in part by a desire to increase inventory to sell to television networks. No doubt the evolution of the BCS to the new College Football Playoff was motivated as much by the desire to extract more money out of a TV partner as by the outrage surrounding the BCS system. And of course we’ve already seen how TV money has fueled conference realignment in college sports. Even smaller sports have been affected: Oracle head Larry Ellison signed an agreement to show the 2013 America’s Cup on NBCSN and designed a fast-yet-dangerous boat to make the race more TV-friendly, earning criticism and pricing almost all potential competitors out of the race.
Nothing shows the power of TV money to shape a sport, however, quite like the NFL. Forget the introduction of the Red Zone channel or the recent move to 4:25 ET starts for its late-afternoon doubleheaders. Consider that the NFL (and to a lesser degree, football as a whole) has come under fire in recent years over the issue of concussions and player safety more generally – yet the league has expanded its Thursday-night slate to a full season, meaning every team will have to play after only three days’ rest once a season, and continues to toy with the idea of expanding the regular season to 18 games, meaning more wear and tear on players’ bodies. But two more games means collecting another pound of flesh from the TV partners, and an expanded Thursday night slate means the possibility of selling some of it to a cable outlet – possibly one like Fox Sports 1 or NBCSN that would fall over itself to get the valuable programming of the NFL, even if the quality of play on Thursday nights has tended to be poor.
But when the NFL finally did sell part of the Thursday night package earlier this year, they made clear that whoever got the package would simulcast games on NFL Network, and that they were primarily looking to do business with a broadcast partner, not a cable network. The NFL didn’t like how the Thursday night games were lagging behind the other packages in viewership; by putting games on the largest possible platform, the league hoped make Thursday more of a destination night for football, thus increasing the value of the package for a longer-term deal. Audience size still matters, even for the almighty NFL, and broadcast television still provides the largest audiences. How much of the relatively weak Thursday night audiences are due to NFL Network’s still-relatively-limited distribution, how much due to some of the weaker teams the NFL’s rules require to play on Thursday night (the NFL has made clear it sees CBS’ part of the Thursday package as on par with NBC’s Sunday package), and how much due to the poor play that comes with only three days off, are all things the league will find out as the package plays out later this year. The requirement to simulcast games on NFL Network suggests that the NFL may still be leaving open the possibility of keeping games there without selling any at all over the long term.
Tomorrow: How the bubble may already be bursting and what the future might hold for sports and television in general.