Thoughts on @Ourand_SBJ’s Predictions for Sports Media in 2021

As we approach the end of the year we see the arrival of the season for reflecting on the past and predicting the future, and in the sports media business there’s always something going on that make the business of predictions exciting; whenever big rights deals come up for renewal the possibilities seem endless for what might happen, and as the legacy television industry struggles to come to terms with the advent of cord-cutting moves taken now will have ramifications for decades to come. John Ourand’s annual prediction column in the Sports Business Journal is generally good for a mix of bold predictions, assessment of the current landscape, and surprisingly odd analysis for someone so well-connected. I’ve dedicated entire tweet threads to his column in the past, but I haven’t entirely abandoned the notion raised way back when I started my Tweeter that anything that took up multiple tweets would go in a blog post instead, so here’s my take on Ourand’s predictions for 2021:

NFL renews its main packages: Unlike last year when Ourand suggested the league would move to an unconferenced format but with Fox having a clear “A” package over CBS’ “B” package, which (as you can see on the link to last year’s thread) never made much sense to me, this time Ourand predicts that the league would largely maintain the status quo. The most notable aspect of that to me is that Ourand predicts that the extent of ABC’s involvement in the NFL beyond the playoffs and Super Bowl is adding more simulcasts of Monday Night Football on ESPN, not a full-fledged package of its own. That would be a huge failure for Disney, which has been determined enough to get ABC a full package that they’ve been linked to trying to take away (or at least drive up the price of) CBS’ AFC package and have even been reported to be targeting NBC’s Sunday Night Football.

The problem with Disney getting a full package for ABC is obvious: Disney also wants NFL games on ESPN to drive up its subscriber fees and keep people tied to the cable bundle for as long as possible. I continue to believe that what makes the most sense is for MNF to move to ABC and ESPN to pick up another package, presumably Thursday Night Football, but then the problem becomes that the league likes having a package of games to prop up its own NFL Network and sell to streaming providers, a role TNF has traditionally filled. Which brings me to…

Thursday Night Football moves to Amazon: What’s struck me about all the reporting on the league’s new TV deals over the last year is that any talk of the league carving out an additional package of games out of international games, Saturday games, games on new nights, and other detritus has essentially evaporated and been forgotten about, even though that was supposed to be the point of the league adding a 17th game in the new CBA adopted earlier this year. There hasn’t been any reporting that the idea has been dropped per se; it’s more like reporters and prognosticators haven’t even thought about it or forgotten about it, even as the various games postponed due to coronavirus this season has resulted in mostly-joking comments about the league testing out the notion of colonizing more nights of the week. But unless the league wants to keep TNF‘s current status quo, where a broadcast network airs most but not all of the games with NFL Network and a streaming service simulcasting them – and Ourand suggests there’s little appetite for that among networks – there’s no other way for them to make Disney happy, meet their own goals for NFLN and streaming services, and keep Disney from poaching one of the Sunday packages. Ourand’s analysis supports the idea I came up with, that NFL Network would join forces with a streamer to take full control of a single package (something another expert poo-pooed when I brought it up to him), in something of a return to the pre-2014 TNF status quo; I’m just not sure that package would be TNF, though it certainly could be with ESPN taking a new package (and such would certainly be cleaner than shuffling TNF around).

NBC takes a stake in NFL Network: The logic Ourand offers for why the league would go with NBC (to ensure carriage on Comcast systems) is sound but somewhat odd, for both parties, given what he predicts about NBC later in the column; it really comes off as a prediction more at home in 2011 than 2021. In the age of cord-cutting the league really needs to protect what they have and perhaps even defend NFL Network’s entire existence. Also, anyone who takes a stake in NFLN would need to find some sort of synergy, which would likely affect whatever games NFLN airs. If they’re only shared with a streaming service they’d want it to be their streaming service; if maintaining the current TNF status quo it would have to be on their own broadcast network (and indeed this thread suggests both those things, or at least one of them, are table stakes for any company to accept any sort of simulcast agreement at this point). Both of those factors suggest ESPN should be more in the running than Ourand gives them credit for, though NBC would probably be the next-strongest competitor as they seem to be most serious about adding sports to Peacock of any of the non-Disney legacy media companies. Alternately, any company taking a stake in NFLN could have their streaming service take over…

NFL Sunday Ticket leaves DirecTV: The writing seems to be on the wall for this as DirecTV is struggling badly, with numerous calls for AT&T to sell it, and doesn’t seem to have much interest in renewing. A streaming service seems to be the most likely destination; Amazon, if they pick up NFLN simulcast rights, would seem to be most logical, but I could understand if the league wants to spread the wealth to numerous services rather than play kingmaker with just one. ESPN+ makes the next-most sense for a variety of reasons, among them their existing carriage of out-of-market games from MLB, NHL, and MLS. Verizon sounds like it makes sense on paper given their existing agreement with the league for streaming live NFL games in-market, but it would weaken the appeal of Sunday Ticket to an actual streaming service and I’m not sure how it would actually work. (Incidentally, Ourand’s reference to no one knowing “what will be included in the Sunday afternoon packages, as they wait for the NFL to finalize its core packages” could be taken as an oblique reference to the possibility of the league carving out a new package.)

Apple gets involved in sports rights: Ourand notes that Apple has already made at least one hire to head a sports division, so clearly there’s interest on Apple’s part even if it may seem odd on the surface (though Apple’s strategy seems to be the most vaguely broadcast-like of any streaming service so it makes a little more sense to me than it used to when I thought Apple would attempt to lock any content to their own devices). While Apple is likely to get involved in Sunday Ticket and NHL rights, Ourand notes that the company “moves slowly and likes to pressure competitors”, meaning they’d be more interested in driving up the price for everyone else than actually winning anything themselves, and doesn’t expect them to actually take any rights for themselves until “sometime after 2022”.

NHL signs deal with NBC/Fox: I’m not sure the NHL can really support a relationship with more than one national TV partner stateside, though either Fox or ESPN would make sense as a second partner alongside NBC. ESPN makes a little more sense given their existing relationship on ESPN+ and (technically) the NHL Network, though, and if Fox executives are thinking as Ourand hints at the end of this section, that taking over NHL rights would mean the end of NASCAR on Fox in 2024, it may make them reticent to sign on the dotted line. NASCAR means more to Fox than most sports mean to most networks, and Fox, as the only partner to remain continuously involved with the sport since it started selling rights as a group, is probably a partner NASCAR doesn’t want to lose. I’d feel more optimistic it’d  be worth it to Fox if they were taking the NHL’s entire national TV inventory.

WarnerMedia doubles down on live sports: Not only does Ourand predict Fox would take NHL rights but that WarnerMedia would make a bigger run at the rights than ESPN. Ourand’s suggestion that WarnerMedia would turn HLN into a sports channel recalls their run at NHL rights for TruTV last time the rights came up for bid; at this point TruTV might have more reason to exist outside sports than HLN (as much as we make fun of TruTV’s… eclectic… selection of shows each time the NCAA Tournament comes around they’re more successful than anything HLN has), but for Ourand to suggest one company start a sports network while another (see below) ends one in favor of turning another of their cable networks to something closer to what TBS and TNT are now is, once again, odd. Securing rights to sports for HBO Max makes more sense, though I thought WarnerMedia had already claimed HBO Max would show NBA games?

NBC keeps EPL rights: Not much to say about this one except as a lead-in to the next item.

NBC shuts down NBCSN: Earlier this year NBC found itself unexpectedly taking back US Open golf rights which meant the rescheduled tournament would bump a Notre Dame game off their broadcast network. The game ended up airing on USA, not NBCSN as might be expected, seemingly because NBCSN had horse racing that overlapped with the Notre Dame game’s timeslot (there was also an English Premier League game airing before that but it appears to have been rescheduled at some point after the USA move was announced). Shortly thereafter, however, the Wall Street Journal suggested that Comcast would make more of an effort to put more sports on USA, potentially at the expense of Golf Channel and NBCSN.

This reflects the reality facing the linear TV landscape in the age of cord-cutting: there is not nearly as much content warranting a spot on a linear TV schedule as there is space on all the linear TV networks out there, and the old “narrowcast” model that ruled much of the cable TV era is looking increasingly untenable. So the idea that media companies would try and condense all their high-value content onto a smaller number of networks makes sense, and given the above developments it certainly makes sense that NBC would at least consider being the first to shutter their sports network and move all their sports content onto a general-entertainment network, but doing so by the end of 2021 would be awfully quick and aggressive. Certainly new NHL and EPL contracts would set the stage for Comcast to be able to do so by splitting NHL rights with another partner (as long as USA has the WWE’s Monday Night Raw NHL games on Monday nights as NBCSN has now are a nonstarter, to say nothing of USA’s other original scripted and reality programming) and, as Ourand suggests, giving Comcast the explicit right to air EPL games primarily on USA and Peacock, but it still seems almost unfathomable (though telling) that Comcast would shutter a network as relatively healthy as NBCSN so quickly without even playing cable network musical chairs (especially since the main thrust of the above WSJ article was all the “narrowcast” networks in the NBCU portfolio that mostly hog space on cable lineups today, such as E!, Oxygen, and Syfy). Could it happen in 2022? That’s a different question.

An MLB team shuns an RSN; launches DTC/AT&T sells its RSNs: Perhaps the biggest sign of the twilight of the traditional RSN model came when Sinclair announced it was selling the names of the old Fox RSNs to a casino; they will become known as Bally Sports sometime in 2021. Imagine what a team with an agreement with a Fox RSN must have thought: a group of networks once assembled by Rupert Murdoch with dreams of taking on ESPN will now be named for a casino and presented as an extension of their sportsbook operations, and your team and even your league didn’t get any say as to which one. Even as sports gambling has become legalized and legitimized in recent years, it still feels like an awfully low-rent place to end up and a slap in the face to those fans that aren’t interested in (or worse, offended by) gambling (especially considering that local MLB games on RSNs have long been the most popular programming on television in the summer). And it really punctuates, and is punctuated by, how Sinclair ended up with the RSNs in the first place: because by the time the feds said Disney couldn’t keep them, Fox didn’t want them back, and most other contenders, to the extent they even existed, a) were arguably smaller names than Sinclair (particularly Ice Cube’s Big3 basketball league) and b) weren’t willing to pay nearly as much.

You can see why MLB and the NBA, as Ourand predicts, would put their weight behind a bid by Comcast to merge Sinclair’s RSNs with Comcast’s own RSN group – if not to save the RSN market, at least to control their own transition out of it. Indeed, MLB actually put together a bid to buy the RSNs when they went on the market, initially on its own and later in a joint bid with Liberty Media, which according to commissioner Rob Manfred was developed with the idea of transitioning to an NFL-esque centralized sale of local broadcast rights and smoothing baseball’s transition to a post-cable bundle world. (Liberty’s John Malone, for his part, indicated that the bid was intended to “save the cable bundle“, implicitly by transitioning the RSNs to an a la carte model, but at that point it might have been too little too late.) But in its entire time of running RSNs Comcast has shown little interest in running an RSN in a market it isn’t the major cable operator in, if they were really interested they would have been in any way active while they were on the market last year, and the prospects of the RSN market have only dimmed since the Sinclair deal closed, so the prospects are dim for any sort of white knight riding in and saving the RSNs from Sinclair’s mismanagement – to say nothing of whether they could even get out of the Bally deal. And if, as Ourand suggests, another failed attempt to reunite AT&T’s RSNs with (with the exception of the former CSN Houston) their former Fox brethren resulted in AT&T selling them to a private equity outfit (you’d think if Comcast was interested in any RSNs it would be the AT&T ones, which are all in Comcast markets and which they’ve been linked to in the past) that would put the writing even more clearly on the wall for the RSN model, and a clear signal for some enterprising team to bail out now and transition to the distribution paradigm of the future.

I’m not sure, though, that that paradigm is the direct-to-consumer model Ourand predicts. More likely, in my view, is that teams follow the path blazed by MLS teams that have reached agreements with YouTube TV and Amazon in recent years, establishing places in existing bundles. (The fact that MLS has already blazed this trail is also why I think the most likely Big Four team to take this path first is one of those weird southern NHL teams with no fanbase like the Coyotes or Panthers, not the MLB teams Ourand predicts.) Part of the problem faced by sports leagues is their commitment to regionalization, to encouraging people to root for the team near their hometown. When the out-of-market packages were launched, they were only available through cable and satellite providers, and the assumption was that most people subscribed to a cable package with an RSN showing their local team, and would pay extra to see games involving other teams. With the advent of the cord-cutting era, this was turned on its head, and now if you don’t subscribe to a cable package it’s easier to see out-of-market teams than teams you’re in market for. (This is especially the case for teams not on a Fox or NBC RSN, which are much less common on virtual cable providers like YouTube TV.) In my view, this in-market vs. out-of-market distinction is non-negotiable to the leagues, and I strongly doubt they’ll go with Ourand’s suggestion of simply selling local broadcasts via existing out-of-market packages if it would make access to local teams indistinguishable from non-local teams (especially for baseball which constantly fears that maybe half a dozen teams would have any relevance whatsoever if the barrier to entry for following them were low enough).

The question that leaves is what does replace it on the Internet where borders so often fall away into irrelevance. In my view, of course, local broadcast stations would most naturally provide the regionalization the leagues want, as they already do for the NFL (and a part of me wonders if, or at least hopes that, part of Sinclair’s plan for the Fox RSNs is as a way to transition teams towards such a broadcast-centric model), but as long as they can be received for free by anyone with an antenna yet feel dependent on retransmission consent to be competitive for any relevant programming whatsoever they probably won’t provide the revenue the leagues want. That probably leaves hitching their wagon to an established streaming service with an interest in sports to be available in their base package to drive subscriptions or at least for less than a single-team package on the out-of-market package, such as the aforementioned YouTube TV or Amazon, or perhaps ESPN+, DAZN, or (tying in with Ourand’s earlier prediction) Apple. (Peacock would be an option only insofar as Comcast might consider putting games on the NBC Sports RSNs on there, and HBO Max seems like an odd fit.) Indeed Manfred’s suggestion of moving to an NFL-style distribution model could mean selling all teams’ rights to a single streaming service, which could then also offer Extra Innings (or other out-of-market packages) as an add-on, as ESPN+ does now.

This would need to be balanced, though, with the prospect that a service could lose its value proposition by sending a disproportionate slice of its subscriber fees to pay for sports rights just as the cable bundle did, as well as whether any service has the capacity to handle the sort of demand they’d be faced with (and won’t cripple said capacity for the sake of their main business model). Perhaps the NBA, NHL, or especially MLB, if they don’t reach the conclusion on their own, eventually find that only linear television can truly provide the reach they’re looking for without drawbacks, even if they might have to take less money, at least in the short term.

ESPN renews MLB deal: This may end up panning out before we even get to 2021, with it already being reported that ESPN will, in fact, take a greatly reduced load of games in a new TV deal where they cut back to Sunday Night Baseball only, plus unspecified involvement for ABC. But ESPN will also take on every game in a proposed new first round of the playoffs, essentially taking this year’s “Wild Card Series” and making it permanent.

While MLB’s playoff schedule will make a little more sense with TBS essentially having as many first-choice picks of regular season games as ESPN and Fox/FS1 with their new Tuesday night package, giving ESPN exclusive rights to one round and then having them disappear for the rest of the playoffs shows they still don’t value having a postseason TV schedule that makes sense. If they won’t go with the NBA route of having networks control specific days, they could at least have ESPN and TBS share rights to a single league’s playoffs for the first two rounds, with, if they don’t take specific series (though that could be close to a practical necessity for the wild card round – certainly if FS1 had rights to the other league I would expect them to pawn off one series to MLBN, and considering what ESPN had to do to cover seven wild-card series with two broadcast teams covering two series remotely I can’t imagine how they’d handle all eight once the pandemic ends), TBS having rights to Tuesdays, Saturdays, and whichever day ESPN ends up airing NFL games on, easing the main objection to ESPN airing lots of baseball playoff games in their commitment to NFL and college football games in October, while ESPN gets the rest of the week. As long as ESPN has exclusivity and a weekend time slot where the more valuable series and rivalry games tend to be played, they should have more of a presence in the postseason than TBS, so I would give ESPN one full LCS and maybe even the potential for ABC to alternate the World Series with Fox. But that would actually make sense from the perspective of the viewer, so of course MLB won’t go with it.

2021 still will not be the year for VR: It’s funny how Ourand’s snarky column-ending “I need to make sure at least one of my predictions comes true” prediction sometimes isn’t the sure thing he paints it as. Certainly with how much marketing muscle Facebook has been putting into Oculus it may well be that within the next year VR becomes a fixture at least in upper-middle-class and higher homes. Whether that makes 2021 “the year for VR” in sports is another matter; the Oculus ads heavily tout it as a platform for video games, but I can’t imagine VR would add much to a passive experience like watching a sports contest, and while HD has essentially become the standard form of television sports has been no stranger to technologies that have been hyped as transforming the viewing experience and ended up being seen as gimmicky at best, with 3D being the most obvious example from the past decade or so. (Indeed technologies like 3D and 4K seem to have caught on more with movies than sports!) So if we restrict this prediction strictly to sports, yeah, at least one of Ourand’s predictions will come true (two, if we count the ESPN/MLB deal).

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