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:
Last week, John Ourand reported in SportsBusiness Journal about the state of the NFL’s ongoing contract renegotiations with networks. The league had hoped to have new deals in place before the start of the upcoming season, but the coronavirus pandemic has placed that on hold; however, things seem to be shaping up to mostly continue the status quo. CBS wants to keep its Sunday afternoon package, NBC wants to keep Sunday Night Football, Fox wants to keep its own package and specifically stating it wants to “keep an NFC-focused package”, presumably in contrast to the idea the league has floated in the past of decoupling the Sunday afternoon packages from the conferences. Ourand described ESPN as the wild card, as they have long groused about paying nearly twice as much as the broadcast networks for games but getting a weak package; ESPN argues that retransmission consent has leveled the playing field between broadcast and cable, and if they’re going to spend so much money they should be getting better games, though in contrast to what was reported in 2017, ESPN seems to be focusing more on upgrading its current package than dropping out or even reducing the amount it pays relative to the other networks. As has been previously reported, ESPN also wants to return the NFL to ABC and rejoin the Super Bowl rotation.
However, Ourand also noted that Fox said little about Thursday Night Football and characterized that as the likeliest package to change hands, and that became the biggest headline in other places‘ reporting on Ourand’s article.
As the NFL playoffs continue this weekend, the league hopes to complete a new CBA and new television contracts by the end of the year, and there could be big changes on the horizon. As part of the CBA, the league wants to introduce a 17th game to the schedule, potentially accompanied by a second bye week, in hopes of carving out an additional package to sell to media or streaming companies. As it is there should be plenty of interest in the existing packages, with Disney hoping to get ABC back into the Super Bowl rotation, as well as the prospect of ending the conference-specific tie-ins of the Sunday afternoon packages.
In my view, the former is more likely than the latter. I’m not sure I’ve seen any actually solid reporting that the conference tie-ins would completely end, and even if they did it would depend on Fox’s willingness to give CBS (or whoever wins the other Sunday afternoon package) equal rights to the top Sunday afternoon games in exchange for a lower rights fee. If Fox isn’t up for that, CBS isn’t going to accept taking the dregs of the schedule left over after the other networks take their picks, as I said before the season when I looked at what a fully unconferenced schedule might look like, and would rather simply keep its AFC tie-in that ensures fans of teams in markets like Boston, Houston, and New York are tuning in to CBS in a majority of weeks, with expanded crossflexing allowing them to air more NFC games, perhaps with more flexibility in the balance of crossflexes. (The Titans may have benefitted from the Chiefs winning in the early slot Week 17 giving the Texans nothing to play for, a set of games that may have been scheduled the way they were in part because the NFL owed Fox a crossflexed CBS game and so didn’t want to overcomplicate things by giving CBS another Fox game to anchor their early slot, even if the Patriots could still have played early, or punish both networks by giving Fox an actually meaningful AFC game that would have diluted the audience for the NFC East race Fox wanted to focus on. While many of my commenters, which I even agree with, would solve this problem by playing all games in each conference at the same time Week 17 with each broadcast network getting two games from each, there’s no evidence that’s actually under consideration.)
If the league does dissolve the conference tie-ins on the Sunday afternoon packages, it will need to reinvent its playoff schedule – and this is an area where ABC entering the Super Bowl rotation in addition to the existing partners, as opposed to replacing one of them, could help the league (or hinder it, depending on your point of view), and something I suspect the league’s move this year to put the Sunday divisional games at the same start times as the conference championship games may be in preparation for. The NFL playoff schedule has historically been highly tied to the networks’ conference tie-ins, and while having NBC trade in the weakest wild-card game for a divisional-round game in the last contract has gone some distance to allow the league some flexibility in scheduling playoff games, nonetheless the need for CBS to air only AFC games and Fox only NFC games is an overriding consideration on the playoff schedule. NBC and ABC effectively need to air wild-card games in opposite conferences, and the conference NBC’s divisional game comes from is set before the season, alternating between the two conferences so CBS and Fox know whether they’re airing one or two divisional games. Finally, the conference championships – annually the most-watched programming of the year outside the Super Bowl – always air on the networks of each conference’s respective Sunday afternoon package, alternating between the 3 PM ET and 6:30 PM ET timeslots. Dissolving the conference tie-ins means eliminating the underlying reason for this structure, and NBC and ABC would love to get conference championship games in years they don’t have the Super Bowl.
What structure might replace it? Here’s how I, at least, would structure things to keep all of the league’s partners happy:
- The conference championship games go to two networks that are not airing the Super Bowl. The network airing neither a conference championship nor the Super Bowl gets two divisional-round games, one from each conference, to compensate, including the late Sunday divisional game with first pick of the available games, with the conference championship networks getting the other two. Among other things, this allows a network to know that they will have the late Sunday divisional game ahead of time and schedule lead-out programming accordingly (something Fox wasn’t able to do this year). (If the Super Bowl rotation remains at three networks, the Super Bowl network gets two divisional games but the network airing the early conference championship game gets the late Sunday spot and first pick of available games.)
- The network airing the early conference championship game gets the Sunday 4:30 ET wild-card game and first pick of games on the weekend. Thus, all four networks get an NFL playoff game as a lead-in to primetime programming. To compensate the early conference championship network for not actually having their Sunday late game in primetime, that network also gets second choice of divisional games and timeslots; if the top two picks go to the same conference, the two-divisionals network gets the worse of the two games from the remaining conference. (This does not apply if the Super Bowl rotation remains at three networks; in that case NBC may keep the Sunday late wild-card game on lockdown as a lead-in to the Golden Globes, unless they end up shut out. I don’t know how the league would handle it if one network gets completely shut out of the NFL.)
- To compensate the Super Bowl network for only airing one playoff game before the Super Bowl, that network gets second choice of games and time slots on Wild Card weekend with the opportunity to leapfrog the early conference championship network for the best game (but only on Saturday night), depending on stadium availability and time zones, as well as the league’s preference that each conference get a game wrapping up at least one round of the playoffs each year, and that each non-Super Bowl network air at least one game from each conference. In both cases I would expect the second-choice time slot to be on Saturday nights (except, potentially, for NBC, to avoid pissing off Lorne Michaels) once out-of-home data is fully baked into Nielsen numbers, but for divisional weekend especially the Sunday early slot may remain strong.
- If there is no clear distinction between the two remaining networks based on the above criteria (or maintaining a balance of games from each conference for the late conference championship network), the two-divisionals network gets the remaining choice of wild-card games, as they would likely still be doing worse in gross playoff ratings points compared to the conference championship networks. On the other hand, the late conference championship network hasn’t really gotten to “choose” anything, so they may get to pick ahead of the two-divisionals network under certain circumstances, especially if they’re stuck with the AFC championship game.
- In the event the league expands the playoffs to 14 teams, the additional wild-card games go to ESPN and whoever picks up the remaining, “new” package. If the league wishes to stick entirely to broadcast television, one game goes to ABC (assuming ABC and ESPN pick up separate regular-season packages) with the other going to the Super Bowl network except in years that’s ABC. In those cases, over the course of an eight-year contract the extra game would go to CBS one year and Fox the other, in recognition of their having to produce many more games in the regular season and having more ability to bring in a second broadcast team seamlessly.
- Over the course of an eight-year contract, each network gets each conference championship game in each timeslot once. As a result, the conference championships mostly stick with their current pattern of alteration, but “skip” a year at one point so that each network gets a conference championship in the same timeslot they did four years ago, but from the opposite conference. Alternately, each network’s timeslot varies from the first rotation to the second, though my inclination is that timeslot is more important. In total, the league will try to give each network ten playoff games from each conference over the life of the contract, though some imbalances may be inevitable.
- Optional: Exclusive rights to the NFL Draft go to the network furthest from the Super Bowl, so the network that just completed their second season without it.
Here’s one idea for how the rotation might look. I’m assuming once the Super Bowl rotation goes to four networks NBC would want all their Super Bowl years to fall in Winter Olympic years, as in 2018 and 2022 (if the changes to the schedule result in the Super Bowl overlapping with the Winter Olympics on a regular basis, at least NBC is stopping any other network from stealing their Olympic thunder). With Fox reportedly selling national Super Bowl ad space to Donald Trump and Michael Bloomberg the day before the Iowa caucuses, I suspect the league would be accused of trying to tip the political scales if they gave Fox the Super Bowl in presidential election years on a regular basis, so I gave Fox the Super Bowl in the year after NBC, followed by CBS and finally ABC. For this first rotation, each network gets conference championship games in alternating years. “2D” refers to the two-divisional network, “SB” to the Super Bowl network, and the conference championship networks are referred to with the conference each network is slated to air followed by an “early” or “late” designation.
- 2023: 2D ABC, AFC early CBS, NFC late NBC, SB Fox
- 2024: 2D NBC, NFC early Fox, AFC late ABC, SB CBS
- 2025: 2D Fox, AFC early NBC, NFC late CBS, SB ABC
- 2026: 2D CBS, NFC early ABC, AFC late Fox, SB NBC
- 2027: 2D ABC, NFC early CBS, AFC late NBC, SB Fox
- 2028: 2D NBC, AFC early Fox, NFC late ABC, SB CBS
- 2029: 2D Fox, NFC early NBC, AFC late CBS, SB ABC
- 2030: 2D CBS, AFC early ABC, NFC late Fox, SB NBC
To help you understand how this works, here’s what the 2023 playoff schedule might look like under this system:
- Wild card: Saturday 4:30 PM ET NBC (or ABC), Saturday 8 PM ET Fox or ABC, Sunday 1 PM ET ABC or Fox (or NBC), Sunday 4:30 PM ET CBS
- Divisional: Saturday 4:30 PM ET ABC, Saturday 8 PM ET CBS or NBC, Sunday 3 PM ET NBC or CBS, Sunday 6:30 PM ET ABC
- Conference championships: AFC 3 PM ET CBS, NFC 6:30 PM ET NBC
- Super Bowl: 6:30 PM ET, Fox
- Optional: 2023 Draft on ABC and/or ESPN
Here’s an alternative where each network’s two-divisional year comes the year after the Super Bowl and “works their way up” to the Super Bowl the next time, with CBS and ABC switched.
- 2023: 2D NBC, AFC early CBS, NFC late ABC, SB Fox
- 2024: 2D Fox, NFC early NBC, AFC late CBS, SB ABC
- 2025: 2D ABC, AFC early Fox, NFC late NBC, SB CBS
- 2026: 2D CBS, NFC early ABC, AFC late Fox, SB NBC
- 2027: 2D NBC, NFC early CBS, AFC late ABC, SB Fox
- 2028: 2D Fox, AFC early NBC, NFC late CBS, SB ABC
- 2029: 2D ABC, NFC early Fox, AFC late NBC, SB CBS
- 2030: 2D CBS, AFC early ABC, NFC late Fox, SB NBC
One caveat: when it was first reported that NBC would give up a wild-card game for a divisional game in the current contract, it wasn’t entirely clear what would happen to the other three divisional games, and I kind of expected NBC to take two divisional games as a way of approaching as close to parity with CBS and Fox as possible without having a conference championship. Not only did that not happen, NBC doesn’t seem to have consistently if at all picked divisional games ahead of CBS or Fox, and the somewhat random timeslots and fixed conference alignments of NBC’s divisional games have made them seem something of an afterthought. So there’s no guarantee that the league is thinking in any way close to what I lay out here, and at the very least NBC may end up never getting multiple games in any round given how few games they produce and how relatively difficult it would be for them to bring in a second commentary and production team. Still, this seems to me to be the most logical course for the league to take if it takes away the underlying justification for the conference championships to be fixed to CBS and Fox as they currently are.
One last note with implications for all of this: although Disney is reportedly targeting a piece of one of the existing Sunday packages for ABC, my prediction for what happens in the new contract is that Monday Night Football returns to ABC, while ESPN picks up a (relative to the expanded schedule, at least) pared-back Thursday night schedule with exclusively teams coming off a bye and the late Thanksgiving game on ABC. Whatever new contract the league carves out with London/Saturday/special-occasion games goes to NFL Network in the short term while being earmarked for sale to a streaming outlet in the long term (I think the creation of an extra package is more about divorcing Thursday Night Football from NFL Network than actually selling such a scattershot package to one of the other networks). Relevant to the above discussion, I also think the return of MNF to broadcast could be bad news for NBC. Before the move to ESPN and Sundays becoming the league’s main primetime night, MNF routinely beat the Sunday afternoon packages, which have turned the tables and routinely beat SNF since then; shortly after ESPN took over Mondays, they started routinely threatening and beating the all-time cable audience records until the BCS/College Football Playoff moved to cable, something that never happened on Sundays.
I could see the league giving ABC more marquee games in the early part of the season than NBC, while late in the season, giving ABC limited flexible scheduling modeled off of what the league has done on Saturday of Week 16 the past two years while also giving ABC tentative games whose ratings performance depend on player healthiness and overall team performance as little as possible (i.e., Cowboys games). NBC would want the best game of the week at least a quarter of the time, as well as at least some early-season weeks where they have a better game than ABC (including at least some Cowboys games), but the worst-case scenario could result in flexible scheduling being NBC’s only advantage over ABC, in which case NBC could push for severely weakening the protection system, potentially with no protections at all for networks in singleheader weeks. If Sunday nights are weakened enough by a resurgent Monday night, that could provide all the more reason for NBC to pick up two divisional or wild-card games in certain years, just so NBC isn’t that much more obviously the “fourth network” where the league is concerned. As it is Disney picking up two packages and decoupling Sunday afternoon packages from conferences is likely to result in NBC paying less than any of the other networks outside of whatever extra package the league creates.
Last year, after the NFL Draft aired on broadcast for the first time ever, I wrote a blog post looking at the resulting ratings and what it meant for the NFL’s desire for “presidential election”-style coverage of the draft on every major network. This year, ESPN agreed to air all three days of the draft on ABC, with the first two days being college-focused coverage from College GameDay that aired on ESPN2 last year. This was somewhat surprising to me, because last year Grey’s Anatomy significantly outpaced Fox’s coverage in the 8 PM ET hour, and ABC was hosting what amounted to side coverage alongside the existing coverage on ESPN and NFL Network. I figured the league would want to repeat last year’s experiment another year, and if ESPN did decide to put the draft on ABC they would put it on only ABC, making pre-empting Grey’s more palatable and allowing both ESPN and ESPN2 to air NBA playoff games on Friday if needed. Still, it is understandable; ESPN is desperate to maintain their relationship with the league entering contract renegotiations, including pumping up ABC as a broadcast outlet for the league, while still preserving whatever impact the draft still has on their carriage fees.
Did we learn anything more about the future of the draft on broadcast? Let’s find out. This is going to be significantly shorter than last year’s analysis, and I’m going to assume, for the most part, you already read last year’s post for context.
The NFL Draft this past weekend aired on broadcast television for the first time ever. The first two nights of the draft saw NFL Network’s coverage simulcast on Fox, which will be NFLN’s Thursday Night Football partner next season. ESPN, which had long resisted the league’s calls to put its draft coverage on ABC, acquiesced to simulcasting its coverage of the third day on ABC.
For the league, the hope was that this would just be the beginning. The league made noise about the draft potentially being treated as an event on par with the presidential election, with coverage on every network, earning widespread mockery and being held up as more evidence of the league’s hubris. Even at its most popular, the draft has but a fraction of the popularity of election coverage, or even of most regular season games. Simulcasting the Super Bowl across several networks might theoretically make sense, though that would potentially cause it to lose its status as the premier advertising showcase if several different networks were running their own ads, as well as diluting its status as the biggest lead-in of the season. But most networks bail out of putting on anything people might actually want to watch against the Super Bowl; no one ran scared from the NFL Draft, except possibly Fox itself. Besides, splitting the draft across every network is a terrible idea in its own right. The league is highly concerned about tipping picks and pressures reporters not to do so on social media, but the best way to minimize the impact of tipping picks is minimizing the time between when the pick comes in and when it’s announced. That’s already a challenge with two draft productions that need to synchronize their ad breaks and need to have each of their reporters interview draft picks after they come out of the green room. Can you imagine how bad it could be with four or five?
The result of this year’s experiment might give the league pause about its “presidential election” ambitions. The league boasted the most-watched draft ever, but that was mostly attributable to the move to broadcast, and given that the boost in ratings was fairly modest (especially given how top-heavy the first round was with quarterbacks from name schools and the presence of both New York teams picking in the top three). Fox failed to win the night either on Thursday or Friday, which makes any “presidential election” talk seem downright ludicrous, at least for now. Given that, what’s the best path for how the league should handle the draft going forward? The way I see it, there are three broad options, which can be arranged on a scale:
- The “presidential election” approach with every network broadcasting the draft.
- Something like the status quo, with ESPN, NFLN, and a broadcast network showing the draft, with the latter either simulcasting an existing feed or providing its own production.
- Giving the draft exclusively to a single network, like how ESPN handled the draft on its own before NFLN started muscling in.
Let’s look at the ratings for each day of the draft and see what it tells us about what the best approach is for the league going forward.
Day 1: For the night, Fox’s coverage of the NFL Draft drew a 1.1 rating in the lucrative adults 18-49 demo, good for second place for the night behind CBS and barely edging out ABC. If you’re Fox and the league, you point to the fact that, despite one’s expectation that numbers would erode as the night wore on and you got away from the early, star picks, numbers not only remained mostly steady throughout the night but actually rose as the night went on, from a 1.1 at 8 PM to a 1.3 at 10 PM before crashing back down to a 1.0 at 10:30, suggesting more people discovered the draft was on broadcast at all as the night wore on and the numbers earlier on would be higher in future years. Certainly that’s what you say if you want to convince ABC to give up its Thursday night for the draft, including Grey’s Anatomy, which earned a 1.5 in the demo at 8 PM. But it’s hard to imagine CBS giving up its Thursday night, including the wildly popular Big Bang Theory (2.0 in the demo), for the draft without exclusivity. CBS was willing to move BBT to Mondays during Thursday Night Football season, but that was an actual game taking up multiple weeks; pre-empting BBT a single week for something drawing noticeably lower ratings is a nonstarter. If you gave CBS a captive audience for the draft, and the entire 4.04 demo rating the draft drew on all three networks (and possibly also the .04 ESPN2’s college-centric coverage drew), it might be a different story.
The previous week, Fox’s lineup of Gotham and Showtime at the Apollo drew .6 demo ratings, last place among the Big Four, so Fox would seem to be on board with doing it again next year under the status quo.
Day 2: Fridays typically draw a smaller audience than Thursdays, so the inevitable decline in ratings for the second night of the draft wouldn’t necessarily kick it off a broadcast network. Unfortunately, Fox’s .6 demo rating tied it with NBC for second behind CBS, and NBC was propelled by Dateline‘s .7 from 9 to 11 more than Blindspot‘s .5 at 8. NBC would be crazy to air the third round of the draft instead of that, at least not without exclusivity. All three of CBS’ shows outpaced the draft at the same time – MacGyver at 8 only drew a .7, but Fox drew consistent .6’s all night until 10:30 when it slipped to a .5. Even Fox itself might not be happy with these numbers; the previous week, MasterChef Junior actually won the night with a .8. It might make sense for Fox’s proposed refocusing of its network towards sports and news programming once its deal with Disney to sell its studio goes through, but who knows if that would actually herald the departure of a reality show like MasterChef. (It’s worth noting that the numbers are more forgiving in 18-34, where a .4 rating tied for the highest-rated show of the night.)
ABC would seem to be the only network willing to give up its Friday primetime for coverage of the second night of the draft, which raises an interesting prospect. Suppose ESPN tells the NFL it’s willing to put its entire draft coverage on ABC if the league doesn’t simulcast NFLN’s coverage on another network again, or in general gives another broadcast network an in. That could mean putting ESPN’s coverage of the second night of the draft on ABC… and only ABC, leaving ESPN to cover the NBA Playoffs and allowing a third or fourth playoff game that night to air on ESPN2 without getting bumped to ESPNEWS. Of course that’s likely to give ABC marks significantly higher than .6, and the temptation on ABC’s side would be to do the same thing with the first night and make it easier to swallow pre-empting Grey’s Anatomy. By my reckoning, coverage of the second night on ESPN and ESPN2 averaged a .59 for the night, though it’s doubtful all of that would devolve to ABC if NFL Network still had its own coverage, especially with an NBA Playoff game on ESPN2 drawing higher numbers than on ESPNEWS. It does show that giving exclusivity would again be enough to convince any network to show the second night; a 1.2 would be the highest-rated show of the night by a significant margin even before adding NFLN’s .39.
Day 3: The third day of the draft appeals mostly to hardcore NFL nerds who are actually willing to do a deep dive into the remaining players and who’s likely to actually make an impact in the league. It doesn’t have the sort of broad popularity the earlier days do; while ESPN and NFL Network have gotten better at treating the fourth round close to on par with the third, NFLN especially tends to devolve into regurgitating the earlier rounds, presenting offbeat and human-interest stories, engaging in frivolous games with the personalities on set, and generally just killing time until Mr. Irrelevant. ESPN is better, but honestly the best coverage of the third day for those who actually care about who’s still getting drafted might be the live stream NFL Now does on NFL.com; it covers the later rounds almost to a fault, delaying and re-airing the pick announcements if they come during a break rather than simply getting caught up like ESPN would.
There’s a case to be made for airing the first three hours on a broadcast network to take care of the fourth round, but while ABC didn’t have anything else to do the rest of the day and could show the entire final day, CBS or NBC would need to air golf coverage starting at 3 PM ET, and Fox might want to show NASCAR racing as they did this weekend. On this occasion there were actually conflicts earlier, as NBC was showing a Premier League game and Fox was showing Monster Energy NASCAR Cup Series qualifying from Talladega.
On this front the verdicts are not good. For the entire day, ABC drew 1.008 million total viewers and just 314,000 demo viewers, less than what ESPN drew for its half of the simulcast. The good news is those numbers are still better across the board than the early competition, except total viewers for the NASCAR qualifying. It’s not as friendly to the later competition, where it lost in both measures to the Xfinity Series race on Fox and the Stanley Cup Playoffs on NBC, and in total viewers to golf on CBS.
Combined, coverage of the third day on all three networks drew 2.914 million total viewers and 1.197 million demo viewers. That would make it the second-most-watched non-NBA sports-related event of the weekend behind the actual NASCAR race on Sunday, and only the NBA would top it in the demo. That doesn’t necessarily mean the other networks would fall over themselves to air the whole day with exclusivity, but it might if the networks could get around existing contractual commitments. Of the late afternoon sporting events, the NHL game did best in the demo with 644,000 viewers, just over half of the draft’s audience, while the Xfinity Series race did best in total viewers with 1.899 million. That suggests the decline as the third day wears on would have to be pretty precipitous for bailing out of exclusive coverage to be the best approach from a pure ratings standpoint, at least in the demo. But it’s hard to see the other networks taking that bargain without using it as a lead-in for an actual sporting event.
Where does the NFL go from here? The notion of treating the draft like the presidential election is probably dead for the foreseeable future, with CBS in particular laughing the prospect out of the room. If the draft ever does become popular enough for all four networks to drop out of their Thursday primetime lineups to simulcast just the first day, it’ll probably be more because of the decline of scripted programming on broadcast than the increased popularity of the draft itself.
The NFL and Fox would probably want to perform the same experiment again next year to establish how popular the draft could be on broadcast if more people are used to it, but depending on where Fox is a year or two from now, they would probably be fine if ESPN and ABC decided to go ahead and put their entire draft broadcast on their broadcast network, with the league preferring the simplicity of not switching networks mid-draft and Fox preferring higher-rated programming on Friday nights. ESPN would lose most if not all of the benefit the draft would provide to its subscriber fees, but those benefits have been neutered anyway with NFLN carrying the draft and now showing it on broadcast without them. But given how much this draft had going for it from a ratings standpoint, I could see them wanting to see at least another year’s worth of numbers before deciding to pre-empt Grey’s for the draft.
The real question comes when the current rights agreements come up for renewal in a few years, when the league will have to consider how best to maximize the popularity of the draft. Ideally, that would involve simulcasting it on as many networks as possible, which would mean maintaining some variant of the status quo. But the days when the league could give the draft to an upstart cable outlet that doesn’t air games because they don’t see how it would make good television are over, so if ESPN decides not to re-up for Monday Night Football, I could see the league taking away the ESPN and NFLN broadcasts of the draft and offering to rotate exclusive draft rights between the three remaining broadcast partners, perhaps going to the network that’s between Super Bowls, so this past draft would still go to Fox since the last Super Bowl was on NBC and the next one will be on CBS, but then next year’s draft would be on NBC, and the one after that would go to CBS. At minimum, the network that gets the draft would have to air the first two nights, but the league could be open to at least allowing the network to show only the first three hours of the third day, with the rest airing on NFL Network (as long as all three networks do the same thing). CBS would take the most convincing to dump BBT (if it’s still on) for its own production, trotting out Jim Nantz, James Brown, Tony Romo, Bill Cowher, Gary Danielson, Tracy Wolfson, and whoever they got to be their equivalent of Mel Kiper Jr., all for something that would get barely double the demo ratings, and the league could just end up handing every draft to Fox or NBC, but given where the state of television is likely to be in a few years it still shouldn’t take much. If the league is honest with itself, that’s a far more honest assessment of the future of the NFL Draft than its ludicrous “presidential election” dreams.
In 1987, ESPN achieved something of a holy grail for the cable industry, picking up a half-season package of Sunday night NFL games, paid for with the imposition of a surcharge on the fees cable operators paid them. In 1998, ESPN picked up the full season of Sunday night games, paid for by the negotiation of clauses with distributors ramping up the fees paid to ESPN every year. This was the start of the process that resulted in ESPN charging every cable subscriber over $7 a month, far more than any other national cable network, and a key component in ESPN’s ability to acquire top-of-the-line sports rights such as the biggest college football bowl games.
In 2005, Disney was outmaneuvered in its efforts to renew both ESPN’s Sunday night package and ABC’s Monday night package, as the NFL struck a deal with NBC to move the league’s marquee primetime package to Sunday night in order to institute flexible scheduling that would ensure good, competitive games late into the season. Disney was left paying as much as it had for both of its previous packages for a single package for airing on ESPN. Ever since, ESPN has paid nearly twice as much as the broadcast networks for a package not much better, if at all, than the marginally-attractive matchups it had been getting on Sunday night. ESPN executives have chafed at this, claiming that for the amount it pays it should be getting matchups at least on par with the broadcast networks; to be sure, part of the fee pays for ESPN’s ability to use highlights across its myriad of programs, but that’s only a fraction of it, maybe no more than a fifth. But when the time came to renew the deal, after nearly a decade of knowing what Monday Night Football had become with the move to cable, ESPN ponied up nearly two billion dollars a year, once again close to double what each of the broadcast networks were paying. ESPN’s package of NFL games may be weak, but they’re a big part of what makes ESPN so valuable to cable operators, what makes it such a must-have for sports fans, and without it ESPN not only becomes a lot less valuable, but that same package of games becomes a tool an FS1 or NBCSN can use to instantly establish near-parity with ESPN.
At the same time it was shaking up its existing primetime packages in 2005, the NFL carved out a package of late-season Thursday night games to air on its own network, hoping to turn NFL Network into a cash cow that could collect hefty subscriber fees directly for the league. The package grew until it eventually took up the whole season, both to coerce holdouts to carry NFL Network and to establish the worth of a package to sell to other parties. Initially, the league was thought to be selling part of the Thursday night package to another cable outlet like FS1, NBCSN, or TNT, any of which would be salivating over the prospect of using NFL games to increase their own worth to cable operators, but instead it ultimately sold the right to simulcast and produce half a season of games to broadcast networks while also selling the right to stream games to Twitter and later Amazon. Sure, Thursday night games meant teams would be playing on a short week, increasing the risk of injury and potentially resulting in sloppy games, and the league’s policy of making each team play on a short week exactly once during the season limited the package’s ability to show marquee matchups. But Thursday night was a place to collect another pound of flesh from TV partners and air the games that made NFL Network worth paying for for cable operators, as well as a place to experiment with new formats and partners. It wasn’t like there were any other places for them to do this. Sundays and Mondays were taken.
Things have changed quite rapidly over the past few years. Cord-cutting has taken off like a rocket as people increasingly turn to on-demand streaming services for their entertainment, undercutting the primacy of linear television. In the short term, this only increases the value of live sports as one of the few types of programming people will willingly watch live, without skipping commercials, and are willing to pay for cable packages to watch, but it also changes the very nature of linear television, as it’s becoming increasingly apparent that anything your network airs that isn’t live events is just filler between live events (as much as ESPN and Fox sometimes don’t seem to recognize this). In that context, highlight rights are considerably less valuable than they used to be.
ESPN and the NFL are also looking at a future where the cable bundle collapses and the NFL can’t simply sell whatever it offers for a billion dollars to whatever cable network pays for it, which is no doubt part of the reason why it sold TNF to broadcast networks and streaming services rather than cable networks. In this context, ESPN’s future is no longer in collecting as much money as it can off the back of every cable subscriber, but in converting itself into a service offering its wares direct to the consumer, and it has less to worry about from FS1 and NBCSN – who have benefitted ESPN more by keeping the cable bundle propped up than hurt it in any way, and which now become more untenable propositions both in general and for the league specifically – than it does from Amazon and its ability to synergize sports rights with its Prime service. A package of mediocre NFL games may be valuable to cable operators that can pass on the cost to all their subscribers and that NFL fans can watch at anytime after paying for the entire cable bundle, but a subscription service offered directly to consumers can best attract subscribers by covering certain sports comprehensively, or else a broad array of important sports events that can combine to make it a must-have service for sports fans, and that single mediocre NFL game each week isn’t going to fit the bill and certainly isn’t going to be worth two billion dollars.
In that context, it’s easy to see why, as James Andrew Miller, the man who literally wrote the book on ESPN, suggested in a guest column for the Hollywood Reporter, ESPN might be thinking about going without NFL rights when they next come up for renewal, for the first time since 1987. ESPN has been removing clauses conditioning its high subscription fees on its continued carriage of NFL games from its contracts with cable operators, which makes sense when you consider the gap in fees between ESPN and NFL Network (and the fact that TNT charges more than NFLN without football or really much of anything other than NBA basketball and select NCAA Tournament games), and freeing up two billion dollars a year of spending money allows them to pay for events that offer a larger tonnage of content and may be more likely to entice more people to sign up for an ESPN subscription service.
Meanwhile, faced with a second year of headlines of declining NFL ratings, networks have begun complaining to the NFL about oversaturation of games and games being taken out of the Sunday afternoon packages. They want to move all London games back to 1 PM ET and end the “breakfast football” games that kick off at 9:30 AM ET. And they want the league to cut the Thursday night package back to eight games. That latter point would be difficult for the league to acquiesce to; all eight games would need to be exclusive to NFL Network to meet the network’s own contractural agreements with TV partners, preventing them from selling the games to another partner or a streaming service and once again forcing them to produce the games themselves, and potentially irking cable operators seeing NFLN’s tonnage being reduced to what it used to be when it was having trouble finding partners. And there’s nowhere else for it to go; again, Sundays and Mondays are all tied up. Or are they?
If ESPN decides NFL games are no longer vital to their business, if they decide to go without the NFL in the next TV contract, because of market forces that mean the NFL can’t prop up the cable bundle or any particular cable network anymore, that opens up a package of games that the NFL likely can’t sell to ESPN or any outlet looking to imitate it, but can use for whatever other purpose the league wants. They can put half the games on NFL Network, at least as long as it remains a tenable proposition within the cable bundle, and sell the remaining half to broadcast networks as they do with TNF now, or to a streaming service like Amazon, potentially selling the full season once the cable bundle completely collapses. Without ESPN preventing the NFL from doing whatever they want with MNF, the league could turn Mondays into the experimental night Thursdays are now, potentially doing away with Thursday games entirely except for opening night, Thanksgiving, and the week after Thanksgiving when both teams can be taken from the Thanksgiving games and play on a full week’s rest, curbing concerns about the league wearing players into the ground to collect a pound of flesh it’s becoming increasingly difficult to collect.
The competitive concerns motivating ESPN to keep paying up for MNF haven’t completely eased; ESPN wouldn’t want to walk away from the NFL only to pave the path for Amazon to become a competitor for sports rights. But I continue to believe that no entity that doesn’t at least control a linear television platform can truly be a player for major sports rights, and while Amazon has a lot more going for it than most Internet outlets, it’s not immune to those fundamental forces. At the very least, if ESPN continues to control a linear outlet it has a major asset to offer to sports entities, and if Amazon were to find its way onto one, and spend as prodigiously on sports rights as media companies have over the past decade, it would risk losing some of the advantages Prime has over cable networks if not recreate the worst excesses of the cable bundle. ESPN can handle creating a new competitor in Amazon while freeing up funds to maintain its supremacy in other ways, the NFL gets to continue raking in money from whatever revenue streams are available even if they aren’t as big, and players and fans could potentially find themselves in a world without Thursday Night Football and all the excesses and problems it represents and perpetuates. Everyone wins.
If it weren’t for the crappy state of everything else going on in the country (including Ajit Pai seemingly being about to dismantle net neutrality) it would be an exciting time for the evolution of the TV industry, as the cable bundle looks like it’s about to be on its last legs. Earlier this month, reports came out that Viacom, Discovery, Scripps, AMC, and A&E were joining forces to form their own, relatively cheap, skinny bundle called “Philo” – the inclusion of the last of which was very surprising to me, as A&E is co-owned by Disney and Hearst, which also (separately) co-own ESPN, and just the other four companies forming their own skinny bundle is the last thing ESPN wants. But Disney and ESPN have a bigger fight on their hands. Altice, the French conglomerate that now controls Cablevision and Suddenlink, hass Cablevision’s old carriage agreement with Disney expiring after this weekend. Disney has faced contentious carriage agreements with the likes of DirecTV and Dish in recent years, which have gotten certain elements of the media worked up over the possibility of showdowns with companies that had ramped up their rhetoric about the high price of sports and stood up to regional and college sports networks, but in the end the power of ESPN was too much to resist and the companies sucked up and signed up for another round of fee increases and adding the Longhorn and SEC networks. But just days before the expiration of the agreement, there seems to be no end in sight to the Altice standoff, and plenty of signs that Disney’s luck and indispensability has run out, not just with Altice but with other cable operators as well.
Were it not for these two stories, I wouldn’t normally think the decline of the cable bundle has reached a tipping point. Large majorities of people still subscribe to the cable bundle… but they’ve now fallen below the 80% mark, and it’s clear that things have reached a critical moment. Disney trying to add yet another high-priced regional ESPN spinoff, one with significantly less value than the SEC Network, certainly looks like an ill-timed misstep that sent things spiraling down further (and Disney wants Altice to add not only ACC Network to a fairly basic package in New York City, but SEC Network as well). On the other side, Disney has announced the launch of OTT Disney and ESPN services, with the latter being limited to events that won’t hurt the value of ESPN to cable providers too much to lose but the former being stocked by Disney pulling its movies off Netflix a relatively short time after signing a big deal to put them on. Continuing the return of sports to broadcast, Fox will air the majority of next year’s World Cup matches on its broadcast network, meaning if the United States makes it, matches that gave ESPN gerbonkers ratings in the last two World Cups will air on broadcast where they belong, possibly even on weekdays. And while I’m still, in general, skeptical of streaming services’ ability to win major sports rights while also justifying their cost, in the wake of their Thursday Night Football deal, it’s hard for me to argue against the notion that Amazon at least has the potential to overcome most, though not all, of the obstacles I worry about (the fundamental problem of streaming being inferior to deliver live events than real linear channels, which bedeviled Amazon this past Thursday, is in my view ultimately insurmountable) to become a real player for mid- to lower-tier sports events.
There’s also the recent history of carriage standoffs to consider. Before its acquisition by Altice, Suddenlink kept Viacom channels off its systems for nearly three years, with Cable One possibly still leaving those channels off their lineups, and both companies made clear that they were just fine without Viacom’s networks. Viacom is on the expensive end of the non-sports four and, at least at the time, didn’t have as many shows with serious buzz as the others, so it could have been considered more expendable than most other Big Nine members. By dropping Disney channels, Altice would be risking a significantly larger backlash, not only from sports fans but from fans of Disney Channel’s kids shows, especially with the Yankees playing their wild-card game on ESPN Tuesday. But if it coupled dropping the Disney channels with a significant drop in customers’ bills, it could gain more than that in goodwill from non-sports fans.
Meanwhile, sports and Disney fans aren’t as out of luck as in the carriage disputes of the past, thanks to online cable providers like Sling TV. No service carrying ESPN would cost less than the $10-15 that’s likely to be the most Altice would refund customers; Altice’s moves wouldn’t totally break up the cable bundle unless they dropped multiple companies’ programming. But what would hurt Altice, but is likely to hurt Disney more in the long term, is if customers dropped Altice’s TV service entirely in favor of Sling or a more comprehensive service like PlayStation Vue, DirecTV Now, YouTube, or Hulu. Based on listed prices, dropping down from a TV+Internet bundle to just Internet should save $20/month with Optimum for New York customers; throw in fees charged only to TV customers, and that could be enough to justify getting one of the online bundles for $35/month (and that’s assuming they don’t drop Optimum entirely for Verizon FiOS). Sports and Disney fans that drop Altice’s TV services entirely are no longer directly putting pressure on Altice to add them back to the lineup. If that gives Altice enough backbone to leave Disney off the lineup entirely, especially if people with no investment in those networks start telling them not to restore them and threatening to quit if they do (especially once Philo launches), it puts Disney, and ESPN more specifically, in a very tight spot financially, as well as in terms of standing up to other providers, with deals with Verizon, AT&T/DirecTV, and the old Time Warner Cable deals now controlled by Charter looming over the next two years.
In 2011, Dish chairman Charlie Ergen suggested there was room for a cable or satellite operator to position themselves as a cheaper non-sports alternative; today he thinks Altice can survive without ESPN, and he certainly must be rooting for it. If Altice is successful at saying no to Disney and ESPN, it gives other providers, as well as potential future online providers, more confidence to say the same. Altice is not one of the larger providers, but if they manage to weather the storm and spend two years or more without ESPN on their lineup, Disney will suddenly look like an emperor with no clothes, and will find it hard for their demands to be met when they enter negotiations with AT&T, Charter, and further down the line, Comcast and Dish, and will find it especially difficult to get the ACC Network off the ground. Couple that with the pending launch of Philo representing the one thing Disney hoped to avoid by staying shackled to the cable bundle, and suddenly there’s a very real possibility that ESPN goes full-on direct-to-consumer with all of their content before the end of the decade (and indeed A&E’s inclusion in Philo starts to look more understandable if Disney thinks the cable bundle is already collapsing). Sports fans would probably still need Fox, NBC, and Turner’s networks to get all the sports they want and need, at least in the short term, but a successful standoff with ESPN would also allow cable operators to show down with those companies for lower fees and lower penetration for expensive regional sports networks. It’s possible the sports four-and-a-half will start to find that clinging to the old cable bundle model will bring down their smaller and non-sports networks more than prop them up, making a sports-specific bundle an increasingly viable proposition. At that point, Disney might just bail on cable operators and even their would-be competitors and seek to salvage whatever revenue (and data) they can for themselves.
Even if Disney and Altice reach a deal, it could still be bad news for Disney, ESPN, and sports leagues. Disney wants to ratchet up its fees and restore some of the coverage lost when they gave providers flexibility to offer skinny bundles. If Disney takes lower fee increases than they’re hoping for and keeps ESPN at present levels of penetration to avoid the catastrophe of being outright dropped, they’re going to have to budget less money for production and rights fees. Look for more layoffs to come down the pike and ESPN to scale back on what they’re willing to bid for rights as they come up early in the next decade. And the ads Altice has been running have arguably already increased awareness of just how much of their cable bill is being passed on to ESPN regardless of how much or little customers watch it, meaning if a deal is reached without ESPN being dropped, there could be a deluge of customers dropping service.
Keep an eye on how this situation develops over the next couple days, because no matter what happens, it could well mark the point of no return for the sports cable boom, as well as the beginning of the end for the cable bundle as we know it, and the start of shaping whatever comes next.
Back when I was posting more regularly about the sports TV wars – in part because the wars themselves were burning brighter and the stakes seemed higher – a point I routinely made was that, as good as the wars would be for the largest, most popular entities with content that could attract large audiences to sports networks, they would be an absolute boon to lesser entities that might not otherwise attract much of an audience at all, or even enough to justify their existence, as the glut of sports networks looked for properties to fill out the rest of their time. Truly tiny leagues and conferences didn’t see much of a bump from the wars (a TV deal with CBS Sports Network only kept the UFL afloat for an additional half season) but lower-mid-tier leagues, the sort that could attract audiences approaching a million on broadcast and regularly top several hundred thousand on networks the size of FS1 and NBCSN, saw their visibility vastly increased. As I explained in my book The Game to Show the Games (and as expanded upon here previously) no sport benefited from the glut of sports networks more than soccer, even before the sports TV wars properly became a thing, as a veritable soccer boom enveloped English-speaking America driven in large measure by coverage of the English Premier League on Fox Soccer Channel and its predecessor Fox Sports World, driving NBC to not only break the bank for Premier League rights but to make it as much of a tentpole for NBCSN as the NHL.
If no sport benefited more than soccer from the sports TV boom, no single deal demonstrated the power of TV to elevate a sport more than the Premier League’s deal with NBC. NBC’s high-quality coverage, semi-regular games on broadcast television, and dizzying array of games on NBCSN only scratched the surface of what NBC would do for the Premier League in America. Perhaps more remarkable was NBC’s decision to place all the games it couldn’t fit on its linear networks on an array of “Extra Time” channels and available for streaming for any subscriber to a cable package that included NBCSN. American viewers could watch every single Premier League game live, something people in England itself couldn’t say, if only because the Premier League contracts there were arranged to protect gate revenues, especially at lower-tier clubs.
This week, NBC announced that those games not airing on NBC’s linear services would now be available on a “Premier League Pass” subscription service, no longer free with NBCSN. The headline on Re/code touting this deal focused on the “no cable subscription required” aspect of the service, which is a bit disingenuous considering games on NBC’s cable networks aren’t part of the deal, but not really any different from people who get ESPN3 from their Internet provider (or who sign up for ESPN’s long-delayed direct-to-consumer offering) and get to watch mid-major college sports and less popular events without access to ESPN’s actual linear networks. Despite its uselessness to cord-cutters, though, I was surprised to see headlines on more soccer-focused sites bemoaning what a big step backward this was for NBC’s coverage of the Premier League, with Vice Sports going so far as to claim that the move of what it admits is “the crappiest third” of Premier League games to a premium service amounts to NBC “kill[ing] America’s EPL Golden Age“.
Certainly for Premier League fans used to signing up for the cable bundle, this is a huge step backwards. $50 is a relatively steep price, though for an entire season of Premier League games it compares favorably to American sports leagues’ pay-per-view/out-of-market/streaming services, which often top $100. And it’s not like Premier League fans can save money by just signing up for Premier League Pass, since again, it doesn’t include games on NBC’s linear networks. But it’s hard to declare the loss of the least interesting, most perfunctory matchups, that were already consigned to streaming and overflow channels, as completely undermining the visibility and value of the Premier League on American television, especially since given the ongoing shifts in the media landscape, a move like this may have been inevitable. Even if Extra Time wasn’t really “too good to be true” even at the time, setting aside specialized channels and propping up the cable bundle even more was becoming difficult to justify. With Premier League Pass, NBC is pivoting towards the sports distribution system of the future, one that more specifically targets fans of various sports, that sports networks in general will have to pivot towards.
As such, I’m not sure I agree with Richard Deitsch that this is entirely about monetizing a more expensive Premier League rights deal; if so it would raise the question of whether the deal was really worth it to begin with. I think there’s a bigger picture to look at here. Going back to its days as Versus, NBCSN has staked its territory around providing comprehensive coverage of sports that might get shorter shrift at ESPN or Fox, and that’s a territory that lends itself well to providing services oriented directly at those niche sports fans. The NBC Sports Gold service already sells access to many of those niche sports bundled together for up to $70 a year, but depending on how many butthurt Premier League fans (especially those that have attached themselves to teams further down the table) swallow their pride and pony up, Premier League Pass could easily make them more money. I could easily see NBC as laying the groundwork for the day it may ultimately have to shutter NBCSN in its current form and fold many of its rights into networks like CNBC or USA as the cable bundle finally utterly collapses, folding together many of its mid-to-lower tier rights into a direct-to-consumer offering targeted at the niche sports fans NBCSN serves today. I may have felt Fox was better positioned to run down ESPN than anyone else (certainly Fox themselves did) before it turned out Fox didn’t quite have the quality of rights to convince people to turn to FS1 on a regular basis, and I’m skeptical that anyone other than ESPN will survive the collapse of the cable bundle and shift to Internet streaming, but NBC may be better positioned than any of the alternatives to pivot to marketing a national service directly to the consumer, offering a simple value proposition to fans of niche sports (ignoring the question of the fate of local sports and what it would mean for Fox and NBC). With Premier League Pass, NBC is building the groundwork and subscriber base for whenever the day may come when NBC Sports Gold has to become its main offering to sports fans.
Ultimately, I think the effect of the Internet will be to collapse any intermediate distinctions preventing a step down from the ESPN level directly to pure streaming, with the only distinction being between the resources and quality poured into that streaming, with the likes of Amazon, Twitter, Facebook, and potentially Google on the high end, down to lesser offerings oriented towards more niche audiences like Premier League Pass, all the way down to free streams where there’s no room for monetization and no budget for any but the most rudimentary setups at all. For the truly tiniest leagues, I’m already seeing signs of streaming, of various degrees of monetization, being a boon to them; when the number of channels is effectively limitless, there’s little reason not to put up a stream of every game you have so long as you have the resources for it, especially when it comes to leagues popular in their home countries that just need to export their feeds to the States. But for these mid-tier leagues that have become used to comprehensive coverage subsidized by non-sports fans who continue to subscribe to the cable bundle, the party is over. Even if you believe that the most apocalyptic scenarios still involve the vast majority of Americans continuing to subscribe to some sort of comprehensive cable bundle for the foreseeable future, there’s still clear evidence of the fear of cord-cutting and sports-free packages driving sports networks to reduce their investment in mid-tier properties that don’t drive enough viewership and subscriptions on their own to justify the level of expense the cable bundle has inflated their perceived value to. Services like Premier League Pass are the first sign of sports networks sending a message that it’s time for sports fans to pay more of their fair share of the boom of sports television that has erupted in recent years.
If you’ve been paying more attention to the sports media landscape than I’ve been covering for you, you know that ESPN this past week let loose with a barrage of layoffs, firing over a hundred people including a number of prominent on-air and online personalities. Obviously, this is in part ESPN attempting to trim the fat for a cord-cutting future, one where live event rights to compel people to sign up and stay signed up for cable, or any future direct-to-consumer offering, are the most important thing for the future of the business and all else is just gravy, something only to be risked if they make enough money to justify it, a future where linear television exists primarily as a conduit for popular live events and anything else is just filling time. Hence, heavy cuts to ESPN’s journalism operations, which don’t help ESPN collect higher subscriber fees or appreciably boost ratings, and studio analysts, which are mainly relevant if at all as programming bracketing live games, especially with highlight shows like SportsCenter being less relevant with highlights being widely available online, but comparably fewer cuts to live game analysts and announcers. But not all sports are created equal. ESPN makes these cuts on the heels of a multi-million dollar agreement with the Big Ten that hasn’t even been officially announced yet, one that to an outside observer makes little sense in the context of the layoffs, but which ESPN sees as critically important, as high-value programming driving subscriptions and eyeballs and which, even splitting the contract with Fox, deprives Fox or any rival of that programming that might bestow money and credibility on them and potentially allow them to move closer to on par with ESPN (the impending launch of the ACC Network, on the other hand, looks all the more questionable). But less popular sports, especially those sports that require a large amount of personnel separate from or superfluous to your other sports, might not be worth the expense.
To my knowledge, no more than two play-by-play men have been confirmed to be fired as part of the layoffs, one of them being longtime auto racing announcer Allen Bestwick:
With thanks to all who checked on me, I was also on "the list". pic.twitter.com/MBiGnS3NJg
— Allen Bestwick (@AllenBestwick) April 29, 2017
Before Bestwick, the last two announcers of the Indianapolis 500 were Marty Reid and, in an infamous one-year experiment marred by over-emphasis on Danica Patrick, Todd Harris. Neither is still with ESPN. During ESPN’s most recent stint covering NASCAR races, the three lead announcers for the Sprint Cup series were Dr. Jerry Punch, Reid, and Bestwick. Punch is also among those that were fired. As Bestwick’s tweet indicates, he’ll continue to serve as a lame duck for the rest of the IndyCar season, including the 500 (as will Punch), but after that? Quite possibly the only personality ESPN has left with auto racing announcing experience is Paul Page, who called the 500 all but three years from 1988 through 2004, and who currently is reduced to calling the Nathan’s Hot Dog Eating Contest and nothing else. Even discounting the play-by-play spot, if ESPN can’t replace Punch the 500 will have fewer than three pit reporters for the first time at least since ABC started airing it live, and hiring someone new would seem to defeat the point. And next year is the last year of ABC’s contract to air a grand total of five or six races, which raises the question: why would ESPN invest money in a sport when they just fired its play-by-play man and best pit reporter (as well as main alternative for the play-by-play spot) as part of attempting to cut their expenses to the bone?
ABC has felt like it’s been on its way out as a television partner of the IndyCar Series since the then-Versus network took over cable coverage in 2009; that it would renew its relationship in 2011, after the Comcast-NBC merger that would have allowed Comcast to unify coverage under one roof if ESPN didn’t want to, was somewhat surprising, but with the subsequent departure of NASCAR and the NHRA from ESPN leaving those five-six IndyCar races on ABC as the only motorsports content ESPN produces, it may be an expense ESPN feels it can’t afford when only the 500 truly produces appreciable numbers, even with Bestwick and Punch broadening their repertoire into college sports in recent years. About the only reason to keep it around is to keep ABC’s status as the only television partner the 500 has ever had, but that hasn’t stopped many other longstanding associations from changing hands in recent years – perhaps most pertinently, the move of golf’s British Open first to cable as the only home of live coverage and then to NBC, ending its long relationship with ABC and bringing major golf back to NBC after that network had its own long relationship with the US Open ended in favor of Fox. It’s easy to see ESPN throwing up its hands and letting NBC have full rights to the entire series, including the Indy 500 with coverage potentially hosted by Bob Costas or Mike Tirico, and Bestwick and Punch joining NBC’s team for IndyCar, NASCAR, or both. ESPN’s relationships with the British Open and NHRA were both bought out a year early as the new contracts began, and ESPN attempted to do the same with NASCAR; it’s easy to surmise that ESPN would not only be willing to give up IndyCar rights but surrender the final year of its deal similarly, and thus leave ESPN without any motorsports coverage for the first time practically since its founding.
All this brings me to one last important point. I’ve mentioned before what a boon the sports TV wars have been for smaller leagues and conferences that have been able to get television exposure and revenue that would have been unthinkable ten years ago, even if on relatively obscure networks. Now, however, the most immediate victims of cord-cutting might be those smaller leagues – or perhaps more to the point, mid-tier leagues like IndyCar that don’t move the needle but attract considerable expense regardless. If the firing of Bestwick and Punch suggests ESPN won’t even come to the table in the next IndyCar negotiations, IndyCar’s best bet to attract much of a rights fee in its next contract might be dependent on whether or not Fox is interested in sweeping in and picking up the rights, and Fox may balk at airing the 500 and risking a rain delay that bumps up against the NASCAR race the same day. (NBC also airs Formula 1 from Monaco the same day, but that may be less of an issue.) Otherwise, barring a surprise CBS-Turner combined bid, NBC might be able to essentially name its price, similar to where it found itself with NASCAR when ESPN and Turner abandoned ship on the sport. ESPN’s newfound frugality is very bad news for entities that don’t offer enough high-quality content to justify increased rights fees or a significant number of maintained subscriptions. It reduces the number of outlets available to them and forces them to find shelter with entities that remain vulnerable to suffering even more than ESPN if the linear cable market contracts further. If you’re banking on increased rights fees but your next contract negotiation is even a year away, and you’re not one of the major college conferences, pro leagues, major golf competitions, NASCAR, FIFA, or the Olympics, it’s time to ratchet down your expectations considerably.
Another Olympics has come and gone, and with it another round of hand-wringing over NBC’s tape-delay policy, fueled further this time around by NBC’s historically low ratings for its primetime coverage. NBC’s primetime coverage averaged a 14.4 household rating, dominant over the rest of TV but the second-lowest mark for a Summer Games since at least 1968 and probably ever, beating only Sydney in 2000, with declines especially acute among key young-adult advertising demographics. People are still trying to figure out the reasons for the low ratings, especially since everyone expected numbers much closer to London (the highest-rated non-North American Summer Olympics since 1972), but plenty of wags on the Internet and among sportswriters are pointing the finger at NBC’s long-standing and woefully outdated policy of tape-delaying the marquee events for primetime. This, of course, despite the fact that Rio is only an hour off of the East Coast and many events, including the marquee track and swimming events, aired live in primetime, meaning if anything NBC is likely to come to the conclusion that the Games suffered because they were live, not because they were taped. London had no events live in primetime, while NBC pulled strings to get Michael Phelps’ chase for gold into the morning time slot in Beijing, putting it in primetime on the East Coast. The result: London’s completely taped coverage beat Beijing’s mostly-taped coverage, which beat Rio’s mostly-live coverage. It sure looks like tape delay helps NBC’s ratings rather than hurts them, no matter how much people on social media may whine about it.
Further fueling this attitude is the popularity of the Olympics on the West Coast, where even NBC’s live primetime coverage is delayed, and thus where the whining about tape delays reached a fever pitch, but which is perennially the region where the Olympics are most popular, something NBC Sports chairman Mark Lazarus pointed out. But the dominance of the West Coast is not what it used to be; Salt Lake City and Denver were the top two markets, but San Diego was the only other market in the Pacific or Mountain time zones to crack the top 20. In Beijing, those three markets were joined by Portland in the top 10, and at least in the first week (when Phelps raced), four more West Coast markets placed in the top 17 with higher-than-average ratings, including every West Coast market in the top 40 except for Seattle (which gets the CBC’s live coverage on our cable systems). Had that held, it would seem to suggest that, even holding the time slot and specific games constant, tape delay only improves ratings. Instead, it raises the question of whether the West Coast, and indirectly audiences in general, really are souring on tape-delayed Olympics coverage.
Of course, since 2012 NBC has allowed people to stream almost all the events live regardless of where they live, albeit with the Olympic international feed’s announcers, and NBC claims that when streaming and cable are added in (for the first time ever, NBCSN and Bravo aired coverage in primetime that cannibalized some of NBC’s audience), the Rio Games trailed only London as the second-most watched ever. Streaming, however, remains only a teeny-tiny subset of total viewing, with the total amount of streaming for the entire games accounting for as much consumption as an hour 45 minutes of NBC’s primetime coverage.
But even though live sports streaming in general has a fraction of the popularity of viewing sports on linear TV, that only gets to the real problem with NBC’s “Olympics as ultimate reality show” approach, namely that it treats the Olympics as a type of programming that is slowly losing its relevance to linear television. Indeed, as “cord-cutting” increasingly emphasizes being able to watch what you want when you want, leaving live events as the sole area where linear television retains a purpose in the face of the rise of the Internet, NBC’s approach of streaming the Games live and delaying events to be neatly packaged for its linear network seems to be exactly backwards. As I’ve said before, streaming is not and may never be well-suited for airing major live sports events, and while complaints about Olympic streaming seemed to be more about the experience of getting through NBC’s authentication and its insistence on delaying the Opening Ceremony even on the stream than the sluggishness experienced in London, if NBC continues to insist on streaming as the only guaranteed method of watching marquee events live, it will only put themselves under more and more strain, or alternately greatly increase the cost of delivering the Games smoothly, as streaming becomes more normalized as a means of watching content. On the other hand, it’s disingenuous for NBC to insist on packaging the marquee events for showing when everyone is at home and then require that those events be shown at the same time for everyone even when they’re not live; after all, not everyone has a 9-to-5 job where primetime is the most convenient time to watch the Games. There is a place for recorded, prearranged programming on linear television, but that place is heavily reliant on social media, and social media was disproportionately represented by those that didn’t like NBC’s current strategy.
By the end of NBC’s current contract running through 2032, I could see NBC’s linear channel(s) (assuming it still exists as such) sticking strictly to airing the marquee events live, while also offering its traditional packaged coverage for streaming online whenever someone wants to start it for those who want the Olympics as “ultimate reality show”. That NBC does not do this already, instead forcing both the sports and reality fans to watch tape-delayed, packaged coverage at a specific time in order to maximize ratings for that specific time and sell ads at the highest price, is a sign both of how far streaming has yet to go to achieve normalcy, and a sign of how slowly linear television is embracing its true nature and the key to its future.