Tag: Comcast

No One Goes to Hooters For Wings: Crazy Like a Fox Part 2, BlogPoll Ballot, Football Parlay and Classic Music Video of the Week

On By Frank the TankIn Big East, Big Ten, College Basketball, College Football, Illinois Fighting Illini, Sports242 Comments

It has been quite crazy in the real life of Frank the Tank over the past couple of weeks, so I apologize for the hiatus.  Let’s get right back into it:

(1) The Enemy of My Enemy is My Friend: Fox Emerging as Top Competitor to ESPN Instead of Comcast (Because That’s How ESPN Wants It) – When I wrote this post on potential challengers to ESPN back in March, I was fairly skeptical of anyone being able to step up to create a full-fledged all-sports network competitor.  Unlike Fox News Channel and MSNBC, which were able to establish audiences to compete with CNN with internal programming decisions within their full control, new sports networks are largely dependent upon winning sports rights from third parties (which aren’t guaranteed).  To its credit, though, Fox has been able to assemble a broad array of what I called “tier one” properties since that time, such as cable rights for Major League Baseball (including postseason games) and NASCAR.  When combined with the Big 12, Pac-12 and soccer (e.g. future FIFA events such as the World Cup, English Premier League, etc.) rights that Fox already has in hand, the likely-to-be-formed “Fox Sports One” looks like a legitimate counterweight to ESPN.  Rupert Murdoch and News Corp. certainly has a lot of experience building empires based on sports properties with BSkyB in the United Kingdom breaking through after the purchase of English Premier League rights and over-the-air Fox doing the same after winning NFL games here in the United States.  (If you were around in the early-1990s, there were legitimate concerns and tons of late night talk show fodder about whether enough people would be able to find the Fox network.  Within a couple of years of having NFL games, though, Fox established itself as every bit as powerful of a network as ABC, CBS and NBC.)  It looks like he’ll finally have a cable sports network in the US that will have access to top properties during the entire calendar year.

In contrast, it appears that Comcast has very few options left for its NBC Sports Network.  For all of the bluster from Comcast that it was looking to invest heavily in NBCSN, it has ended up losing out on every competitive bidding situation for sports rights over the past 2 years with the exception of retaining the NHL and Olympics rights that it already had.  The other properties that NBCSN has added during that time frame are generally low value, such as MLS soccer, Formula One racing and Atlantic 10 basketball.  Comcast may no longer have much incentive to spend significantly on NBCSN since there is literally nothing else of value available over the next few years outside of the Big East rights (which we’ll address separately in a moment).  As a result, I wouldn’t be surprised to see NBCSN go more toward the CBS Sports Network route of trying to keep costs down while providing an overflow outlet for the main over-the-air NBC Sports operation.

What’s interesting here is that ESPN effectively picked the winner between News Corp. and Comcast when it chose to work with Fox in winning the Pac-12 rights against NBC last year.  Once that occurred, it established (or maybe just reflected) a fascinating bond between Disney (ESPN) and News Corp. (Fox) along with Time Warner/Turner (TBS/TNT): no matter how much they might have hated each other, they all hated Comcast even more and showed that they would rather work together to squash NBCSN than let the fledgling network gain any traction.  ESPN and Fox have partnered on the new Big 12 TV deal, while Turner is going to pay twice as much as it does now for MLB rights for half as many games (with virtually all of the games that they’re losing heading over to Fox).  From the perspective of these media companies, it makes complete sense.  Comcast is the largest source of subscriber fees for all of the top cable networks, which means that a Comcast-owned sports network that has enough top tier properties to be used as leverage in carriage fees negotiations is much more dangerous for ESPN, Fox and Turner than any other potential competitor.  So, for ESPN, it was much better for them to allow Fox to rise up as its primary competition than Comcast/NBC.  It’s a classic “the enemy of my enemy is my friend” situation.

The Big East is sitting back seeing this dance unfold.  A few months ago, many sports media industry observers thought that it was a foregone conclusion that the Big East’s new TV contract would end up with Comcast/NBC.  Now, the view seems to have shifted to where a number of people are betting on an ESPN/Fox combo for the Big East (similar to what they have in place with the Pac-12 and Big 12).  What’s hard to tell is whether this is going to end up working out financially well for the Big East since, whether or not they ultimately sign a contract with any particular media entity, they need all three of ESPN, Fox and Comcast/NBC (plus CBS for basketball) to be legitimately interested in the conference’s rights to drive up the price.  If ESPN and Fox are working together while Comcast/NBC decides that it’s going to take a low cost approach, then the Big East may not receive the payday that many of the league’s fans are hoping for.  Therefore, the Big East had better hope that Comcast/NBC is willing to legitimately pay up to compete with ESPN and Fox and not just sell the availability of “exposure” with open Saturday time slots that ESPN can’t offer.  The fact that Comcast/NBC wasn’t willing to do that with MLB rights is a negative sign, but as always, we’ll find out whether that will be the case here soon enough.

(2) BlogPoll Ballot

I seriously don’t try to win the Jim Tressel’s Numb Existence Award every week, but I’m on top of the list again despite my love for Toledo.

(3) College Football Parlay Picks (odds from Yahoo! and home teams in CAPS)

Indiana (+1) over ILLINOIS – I don’t care how bad Indiana might be (and believe me, they’re awful) – Illinois should not be giving points to any team.  Look, I’ve had some prolonged rough stretches as an Illini fan.  During my first three years of college in Champaign, the Illinois football team amassed a 5-28 record (including a winless season in 1997).  When Illinois finally won a game in 1998, fans rushed the field even though that win was against the mighty Middle Tennessee State.  2003 through 2006 featured an 8-38 stretch, which was mitigated a little bit by some glory years for the Illini basketball team.  However, I’m not exaggerating here when I say that this is the most dejected that I’ve ever seen the Illini football fan base.  At least with Ron Zook, there was the inkling of hope that his legendary recruiting ability would eventually turn things around.  Plus, I think we’ll eventually remember the Zook years as being “funny bad”.  Between the asinine 2-point conversion attempts in the first quarter, rugby punts and water skiing without water skis, Zook at least sucked with some style.  (Other examples of “funny bad”: “Evil Dead 2”, the “Cheaters” TV show, and the Henry Burris stint as quarterback for the Bears.)

The Illini team under Tim Beckman, on the other hand, has been completely listless since the loss to Louisiana Tech in week 4.  To use a sports cliche, it’s not that the Illini are losing per se that bothers me, but rather how they are losing.  Several other top Illini boosters are bothered by it, as well, and have made it known publicly that they aren’t happy at all with Beckman or Illinois athletic director Mike Thomas.  Granted, it’s tough to fire any new head coach after only one season (compounded by the fact that the Illinois athletic department is still paying buyouts to both Ron Zook and Bruce Weber at the same time), but we’re getting dangerously close to the point where fan anger turns to fan apathy, which is the worst thing that can happen to a program that can’t count on 100,000 people showing up every week no matter what like Ohio State and Michigan.  For practical purposes, I’m resigned to the fact that Beckman will almost certainly get another year (if only because Thomas would be admitting he made a major mistake in the hiring by axing Beckman so quickly), yet Illinois might be trading a short-term contract buyout issue for a legitimately long-term setback once again.

Cincinnati (+4) over LOUISVILLE – Even though Cincinnati lost a trap road game to Toledo last week, I believe that the real fight in the Big East will eventually come down to between the Bearcats and Rutgers.  Louisville has already had multiple close escapes with a very weak schedule, so the Cardinals’ undefeated record and #16 ranking are paper thin in my eyes.  (The sharps in Las Vegas apparently agree with me since this line has been dropping with money heading towards Cincinnati all week.)

Michigan (+2.5) over NEBRASKA – This ought to be a fun atmosphere in Lincoln with Michigan coming to town, but my feeling is that the Wolverines will end up running the table for the rest of the year to get to the Rose Bowl.

(4) NFL Parlay Picks (odds from Yahoo! and home teams in CAPS)

BEARS (-8) over Panthers – An organization in a tailspin versus the NFL’s best defense isn’t a great combo for Cam Newton and Ron Rivera.  Granted, I’m concerned about Jay Cutler’s bruised ribs (as his passes were nowhere near as crisp in the 2nd half against the Lions on Monday Night as they were in the 1st half), but the Bears have definitely taken care of business against all of the teams that they were supposed to beat so far this season.  Lovie Smith has had this team completely focused game-to-game.

LIONS (-1) over Seahawks – As stifling as the Bears defense might be, the Lions were actually able to move the ball fairly well down field in the 2nd half and it took multiple disastrous red zone turnovers by Detroit for Chicago to come away with the win.  I have no idea why Matthew Stafford seems to miss on half of his throws toward Calvin Johnson with Megatron being such a massive target, but those two connecting consistently is much more likely at home against Seattle than it was on the road against Chicago.

Falcons (+2) over EAGLES – I know that Atlanta has to eventually lose, but I don’t feel that it’s going to come against an underachieving .500 squad in the middle of Philly fan calls for the scalps of Michael Vick and Andy Reid.

(5) Classic Music Video of the Week: “No Sex in the Champagne Room” by Chris Rock

In honor of Tom Fornelli starting up The Champaign Room at SBNation to cover the Fighting Illini (the logo is even better than the name), here’s a memorable ditty from Chris Rock:

Enjoy the World Series and the rest of your week!

(Follow Frank the Tank’s Slant on Twitter @frankthetank111 and Facebook)

What American Idol Viewers Show Us About Rising TV Sports Contracts

On By Frank the TankIn Big East, Big Ten, College Basketball, College Football, Major League Baseball, NBA Basketball, NFL Football, NHL Hockey, Sports529 Comments

The Big 12 lost one of the best national TV draws in college football (Nebraska), the most popular college team in its largest and fastest-growing market outside of the state of Texas (Colorado) and its conference championship… and then signs a contract for a 350% increase for its second tier cable football rights with Fox.  Did Rupert Murdoch suddenly feel the need to go on a shopping free now that he doesn’t have to pay Glenn Beck anymore?  Is Dan Beebe getting a G5 and a pile of money so that Fox can cash in an insurance policy on Iowa State?  What gives?  Well, let’s take a look at some demographic shifts of the overall TV audience, how it has affected Fox’s most important property, American Idol, and how all of this explains why sports TV rights fees are generally going through the roof right now.

There are three massive changes to television over the past 5 years (and such changes are accelerating):

(1) More Old People Watch TV Than Young People – If you know anything about TV advertising, the overall Nielsen rating that a lot of networks like to trump in press releases is completely irrelevant.  The fact that CBS is the #1 watched TV network overall with top overall-rated shows in several categories has little bearing on what they are able to charge in terms of advertising rates.  Instead, the Nielsen number that really matters is what a show draws in the Age 18-49 demographic and, increasingly, the Age 18-34 demographic.  Historically, this emphasis on younger viewers has been justified with notions that older people are less likely to switch brands or purchase high-end products.  However, that really isn’t true anymore, as people over 50 generally have higher incomes and have shown to have more discretionary spending than their younger counterparts.

Now, the reasoning is a bit different: younger viewers are simply scarcer, therefore advertisers pay a premium to reach them.  Even though older viewers actually have more spending power than younger viewers, those older viewers watch more TV overall and can be reached throughout the day by placing ads on less expensive shows.

The difference between what advertisers will pay for a younger audience versus an older audience is massive – more massive than you probably could have ever guessed.  TVbythenumbers recently compared the ad rates for NCIS (which draws the largest overall audience of any scripted show on TV) and Glee.  It found that even though NCIS had 82% more overall viewers, the fact that Glee had 15% more viewers in the Age 18-49 demo and 92% more viewers in the Age 18-34 demo meant that Glee was able to charge 80% more than NCIS for every 30-second commercial spot.  It basically shows that viewers over 50 are effectively worthless from an advertising standpoint (and even viewers over 35 aren’t worth that much).  You can find a lot of shows that draw in the typical viewer of NCIS (even if that particular show brings in the most of them outright), while there are very few shows that bring in the demo that Glee delivers.  (For what it’s worth, I’m the type of person that enjoys dramas with deep and complex themes with subtle acting that doesn’t beat you over the head with blatant messages.  I can’t think of any show that provides less of what I’m looking for than Glee.)

With that type of advertising rate disparity, TV networks (both broadcast and cable) are continuously on the search for programming that attracts those younger viewers.

(2) More Women Watch TV Than Men – Here’s a fairly shocking statistic: out of the 63 prime time shows that were on the 5 major broadcast networks (for the purposes of this discussion, The CW gets counted as a “major network”) during the 2009-10 season, only 6 drew more male viewers than female viewers.  6 out of 63.  Three of those shows (The Simpsons, Family Guy and The Cleveland Show) are part of the Sunday night Fox comedy bloc that gets a lead-in from NFL games for half of the season.  Another one of those shows (24) is no longer on the air, a different one (Fringe) has been moved to a low-rated Friday night time slot and the last one (Chuck) has been on the cancellation watch list for a couple of years.  If you’ve ever wondered why ABC keeps churning out shrill high-budget prime time soap operas from Shonda Rhimes, there’s your answer.

Simply put, the TV networks are badly in need of a sausage fest and can’t seem to create any.

(3) More People Are Using DVRs – Nielsen recently reported that DVRs are in 38% of all U.S. households as of September 2010, exhibiting extremely rapid growth as that number stood at less than 5% in 2006.  Those users of DVRs are also younger and more affluent than the average television viewer.  While Nielsen argues that DVR users still watch commercials in decent numbers, the reality of it is that the attraction of the DVR is to be able to skip those ads (cutting down an hour-long show with commercials into around a 40-minute show without them).  As DVR penetration continues to grow (and frankly, I thought that current 38% number seemed fairly low), more and more people are going to be avoiding commercials like the plague.

These changes in who watches TV and how they watch it has had some fairly interesting implications in pop culture.  For instance, a couple of weeks ago, the American Idol audience shockingly voted off (or more accurately, did not vote enough for) widely-perceived front-runner Pia Toscano, meaning that she placed ninth and had a shorter run on Fox than The Heights.  It was enough to make J-Lo start crying uncontrollably while Steven Tyler rose from his crypt and started bashing America’s passion.  Now, seeing that Pia was clearly the top pure singer while also being the best-looking of the competitors, that typically indicates a Charlie Sheen bi-winning combination.  However, when looking at the demographics for American Idol, it reflects general TV viewing trends: its audience is getting older and skewing much more to the female side.  My impression is that these older women prefer the John Mayer soulful acoustic guitar-types as opposed to the hot young divas, which is the main reason why (1) soulful acoustic guitar-types have won American Idol for the past two seasons, (2)  5 out of the last 6 American Idol winners were male and (3) only 2 American Idol contestants left on this year’s show out of 8 are female (rose jacket Rod Stewart copy Paul McDonald became the first male eliminated since the initial public vote cutdown to the top 13).

What American Idol has going for it, though, is that people still generally watch it live.  In the latest week where figures are available, only 9% of American Idol Wednesday viewers watched it on DVR compared to 29% of the viewers of Modern Family and 28% of the viewers of Grey’s Anatomy.  Add in that it still draws a fairly good percentage of the younger demographics compared to most shows on television and it is a complete ratings cash cow for Fox.  Last year, American Idol was able to charge over three times as much per 30-second ad spot compared to Dancing with the Stars, the latter of which actually draws a higher number of total viewers but a lower number in the Age 18-49 demo.

So, when looking at how the TV audience has shifted, it has become clear what type of program obtains a premium greater than any other: the program that draws the age 18-34 male that watches it live.

Let’s take me as an example of the target demo.  I’m a professional 33-year old male that’s about a loyal to TV shows as Antonio Cromartie, can count on one hand the number of scripted TV shows that I watch regularly, and will purposely watch all of such shows on my DVR in order to avoid a single moment of watching any commercials.  I don’t know about you, but I put my DVR right next to food and water on Maslow’s hierarchy of needs.  The catch, though, is that I watch a lot of sports.  Even better, I actually watch them live with commercials.  There is no better vehicle to draw me, a member of the most valuable demographic of all (the male under 35), than sports… and there are tons of people like me in that respect.

Dennis Dodds, who has his own excellent write-up on theories on why sports TV rights are rising, stated the following:

Sports have become one of the safest and highest-grossing buys for media companies. There are no coked-up, petulant stars to deal with. Well, at least not a lot of them. The only “winning” is done on the field. Sports are somewhat cheap to produce.  Sports are true reality television, almost immune to being DVRed. Advertisers love that. There is a built-in following whose interest doesn’t wane with time. Even the strongest TV series are canceled. Try taking Alabama-Auburn off the air.

The success rate of new scripted TV shows has become abysmal – ABC may end up not renewing any of its new shows from this season.  In contrast, sports programs are considered to have “high floors” – ratings may not necessarily go through the roof for every single game, but there’s always a good base of viewers , that base includes a lot of members of the most valuable demo, and those viewers watch it live.  The Nielsen DVR report linked above stated that sports and news programs are watched on DVRs the least of any TV categories.

Sports programming also skews toward the younger demographic than the average show on TV.  During the week that ended April 10th, the only shows in the top 10 of the overall ratings that had more than 30% of their audiences under the age of 50 were the two editions of American Idol (approximately 40%) and the NCAA Tournament National Championship Game (47%).  This is consistent with the demographics for other major postseason sporting events, where the World Series, NBA Finals, BCS bowls and NFL postseason last year all had more than 40% of their respective audiences in the Age 18-49 demo.  (Note that if you were able to buy stock in a league, you ought to bet on the NBA.  It’s the only major sports property that draws over 50% of its audience from the 18-49 demo as well as being the most popular in the growing minority populations just using last year’s figures.  With the NBA now having legit contending teams in New York, Chicago, Boston and Los Angeles along with the Miami superteam, the viewership numbers have been record-setting this season across all of its platforms of ABC, ESPN and TNT.)

Does this necessarily mean that all sports rights fees will necessarily rise at such dramatic rates?  The Pac-12 is looking for even a better deal than the Big 12 (you can count me in as someone that’s more skeptical that they’ll hit those numbers) and the Big East is looking at a possible tripling of its current rights fees.  One ongoing negotiation that may be a better indicator of where rights fees might go for those two conferences is for the NHL, which is a league whose current deal was signed when it was at rock bottom in terms of popularity, has had a resurgence in a couple of key markets (Chicago and Boston), but still largely has a regional as opposed to a national fan base.  The NHL is looking for a substantial increase of around 2.5 times the current deal with Comcast/NBC most likely being retained as the broadcasting partner.

A rising tide lifts all ships in an outright manner, but where the conferences sit relatively each other will likely remain the same: the SEC and Big Ten at the top, the ACC, Big 12 and Pac-12 in the next tier, the Big East at the next level, and then everyone else.  Similarly at the pro level, the NFL stands alone at the top, NBA and Major League Baseball are in the next tier, and the NHL will be behind them.  Still, the circumstances are good for all sports entities.  While the rise of Internet streaming and mobile devices are going to complicate matters for sports leagues to continue cashing in on cable dollars over the next decade, they’re all getting the benefit of a revenue boom today.

(Follow Frank the Tank’s Slant on Twitter @frankthetank111 and Facebook)

(Image from Huffington Post)

West Coast Represent: Pac-12 TV Talks and What it Means for Other Conferences

On By Frank the TankIn Big East, Big Ten, College Basketball, College Football, Sports1,303 Comments

There were a couple of separate articles today regarding Pac-12 television rights that point to some implications for other conferences.  First, Jon Wilner from the San Jose Mercury-News had a fairly in-depth article today regarding the status Pac-12 television contract negotiations.  Second, Percy Allen from the Seattle Times had an interview with Pac-12 commissioner Larry Scott that focused on the conference’s basketball TV rights.  Here are the main points from those articles:

(1) Fox is the most likely long-term TV partner for the Pac-12 with a possibility of some over-the-air football games on the mothership network, while Comcast/NBC is the second option;

(2) ESPN is not willing to pay as much for the Pac-12 as it did for the ACC for a variety of reasons (including lack of time slots and the value of the ACC’s syndicated basketball package);

(3) Larry Scott wants the Pac-12 Network to happen, but Time Warner Cable will be a large obstacle in the Los Angeles market; and

(4) Going forward, all media rights for all Pac-12 members will be controlled by the conference (as opposed to a portion being controlled by the individual schools as it is today).

Let’s examine each of these points from the perspective of the Pac-12 and how they apply to the college sports world at large.

Point #1 about Fox’s involvement isn’t a surprise considering the current relationship that it has with the Pac-12 and the media giant’s increasing focus on obtaining college sports rights over the past several months (including paying $140 million over the next six years solely for the Big Ten Championship Game).  The overarching questions going forward are (a) how serious is Fox about expanding its overall college sports presence and (b) are they willing to use Fox over-the-air for games?  Fox bid on the ACC package last year with an offer that was heavily reliant on FX as the main national platform.  Indeed, David Hill, Chairman of Fox Sports Group, sees an increase in sports programming on FX as a key in making that network competitive with the likes of TNT.  While Fox didn’t win that deal, they did procure a smaller agreement with C-USA plus rights to the Big Ten and Pac-12 championship games.  A hungry Fox can certainly bid up the price of rights for other conferences… as long as ESPN is willing to play, too.  (More on that in a moment.)

As for Comcast/NBC, call me skeptical of them ever becoming a truly major player in college sports.  Comcast-owned Versus certainly is looking for more sports programming, but that’s a fairly unattractive national cable partner compared to ESPN or FX on its face and you’re more likely to see sports move away from NBC as opposed to any events being added.  Sports programs in general are loss leaders for over-the-air networks and the last thing that NBC needs is more losses.  In fact, NBC Universal CEO Steve Burke told Wall Street analysts covering Comcast specifically yesterday that NBC’s current “sports properties lose hundreds of millions of dollars per year.”  NBC lost $220 million on the 2010 Vancouver Winter Olympics and even its gold-plated NFL Sunday Night Football package loses around $100 million per year.  So, it doesn’t exactly sound like the new Comcast ownership is going to be spending very much money on more sports on NBC.  If anything, those quotes from the head of NBCU indicate that they’re preparing to cut back heavily.  Therefore, any conference hoping for Comcast/NBC to come through with some great offer is going to be severely disappointed.

From the Big Ten’s perspective, I see Fox only as a viable option in the conference’s next TV deal if there is essentially a replication of the SEC’s agreement with CBS: the top game of the week gets coast-to-coast over-the-air coverage.  I can’t realistically see the Big Ten considering a deal with Comcast at all.  While much has been made of the Big Ten’s partnership with Fox regarding the Big Ten Network, it must be emphasized that the conference still receives substantially more money from ESPN compared to the BTN.  There are also more Big Ten events on ESPN today than there were prior to the BTN being formed.  From the very beginning, the BTN has always been intended to be a supplement to ESPN coverage as opposed to a replacement.  The Big Ten is smart enough to know that the time slots that it has secured with ABC and ESPN provide incredible exposure and the conference doesn’t want to kill the proverbial long-term golden goose for short-term financial gains.  Any new deal going forward has to provide even more exposure than today’s deal.  Thus, I could see the Big Ten pushing to a movement of the games that are regionalized on ABC right now to national over-the-air Fox coverage.  However, I highly doubt that the Big Ten would ever seriously consider moving ESPN games to FX (and definitely not to the patchwork quilt of Fox Sports Net affiliates).  It’s interesting to note, by the way, that the two conferences that make the most money outside of ESPN (Big Ten with the BTN and SEC with CBS) also make the most money from ESPN. Money certainly talks, but the Big Ten seems to be a property that ESPN will pay up to get them to stay (and the desire to stay on ESPN will be reciprocated by the conference).

That leads to Point #2, where apparently the Pac-12 is a conference that ESPN is not willing to pay up for.  More specifically, ESPN appears to believe that the Pac-12 TV package is worth less than comparable ACC rights.  This doesn’t surprise me at all.  I’ve been fairly consistent on this blog that the ACC is in much better shape than what a lot of sports fans (that have concentrated on the conference’s relative weakness on the football field over the past few years) believe. 

National marquee brand names are extremely important for determining college sports rights and the ACC has 2 big ones for football (Miami and Florida State) and arguably the 2 very biggest ones for basketball (Duke and North Carolina).  The ACC basketball package is also unique in that it draws football-level ratings in several of its markets, which is something that none of the other BCS conferences can claim (even those that might be better on the court in a given year, such as the Big East).  If and when Miami and Florida State get back on track, you’ll see a dramatic turnaround in the football perception (and TV ratings) of the ACC.  In contrast, the Pac-12 is largely reliant on the strength of USC for football and UCLA for basketball in terms of drawing national interest.  Beyond the LA schools and Oregon’s wacky uniforms, the Pac-12 continues to struggle with getting much notoriety in the Eastern 2/3rds of the country.

The Pac-12’s inability to get much of a large bid out of ESPN should be a small warning sign to the Big 12 and a large red flag to the Big East, who are both hoping to receive large TV rights increases from the Worldwide Leader.  Several conferences last summer were under the impression that ESPN paying such a large amount to the ACC meant that the network’s greenback gushers were wide open and they could switch the style up, but if they hate let ’em hate and watch the money pile up.  Instead, it looks like ESPN is going to keep all its money in a big brown bag inside a zoo.  Dan Beebe and the Big 12 members may sweat it out a bit as there were some financial assurances from ABC/ESPN this past summer that aided in keeping the conference from splitting apart.  Personally, I’m a believer that ESPN understands the big picture and seeing that they presently want to avoid the formation of superconferences, they’ll pay enough to the Big 12 so that the conference makes good on its promises to Texas, Oklahoma and Texas A&M.  With ESPN’s investment in the UT network, the Big 12 needs to stay alive and a few extra bucks on the conference contract would be money well-spent.

The Big East is a different matter.  That conference has already bore the brunt of having football games moved by ESPN to Thursday nights initially, and then when the SEC, ACC and Pac-12 saw that Thursday was a great night for exposure, the Big East has been kicked around to several Friday nights and even some Wednesday evenings.  Much of the hope of a Big East TV contract increase rested on leveraging its valuable and massive basketball package into better football exposure.  However, if ESPN isn’t willing to pay the Pac-12 TV rights in line with the ACC, then it stands to reason that they’re going to value the Big East even less.  Unless Fox or Comcast swoop in with competing bids for the Big East, the conference’s schools are going to have a difficult time coaxing the increases that they’re hoping for from ESPN.  I’m sure that you’ll see the Big East get what amounts to an inflationary increase (maybe 150% of what they receive now), but not enough to get on the same tier as the other BCS conferences.

Under Point #3, Larry Scott seems extremely determined to start a Pac-12 network.  However, Jon Wilner pointed out a large potential obstacle: Time Warner Cable.  He noted that TWC is the largest cable provided in the Los Angeles market and they’ve had a habit of getting into carriage fights regarding regional sports networks.  What Wilner neglected to mention (and I find to be even more important) is that TWC just sent a Valentine’s Day present to Jerry Buss of what’s rumored to be around $150 million per year to create two new regional sports networks in the LA market (one English language and the other Spanish language) built around the Lakers.  With 3 Fox Sports networks in that market already, that means that the LA market will be supporting 5 RSNs and making it even more crowded than the New York City market.  This crowded environment in the Pac-12’s most important market has huge implications on whether a conference network can realistically be formed.  The Big Ten Network only had to compete with 1 RSN in each of the markets within its footprint (even in its largest market of Chicago, which only has Comcast SportsNet Chicago).  Thus, it was a more palatable for the cable providers to give in when the BTN was RSN #2 on their systems… and even then, it took over a year of carriage fights for them to get to that point.  It’s a much different value proposition for the Pac-12 attempting to enter into market that already has 5 other RSNs – TWC has a whole lot more leverage to demand lower subscriber rates or refuse basic carriage entirely.  Note that a potential Big East Network would face the same issues in the NYC market with so many RSNs already clogging up cable bills.  This was a factor in the Big Ten ultimately deciding to not go after schools like Rutgers or Syracuse in this last round of expansion, as the BTN absolutely had to get basic carriage in the NYC market in order to financially justify those additions, and they didn’t see that happening anytime soon.

Finally, with respect to Point #4, Larry Scott confirmed that all media rights for all Pac-12 members would be controlled by the conference.  This is important for one massive reason: the University of Texas.  With the Pac-12 taking that position, it has effectively wiped out any reasonable possibility of Texas joining the conference in the future, as the new Longhorn Network would be unable to exist under those conditions (and I don’t see UT giving up in excess of $10 million per year for any reason).  For the fear mongerers (who are all wrong, by the way) that continue to believe that UT’s ultimate goal is to end up independent or in the Pac-12, at the very least, that Pac-12 option is gone.  (I’ve listed a multitude of reasons of why UT wants to stay in the Big 12 in perpetuity and, in fact, needs that league to live, but many people seem to believe what they want to believe on that front.)

Fans of all conferences should keep a close eye on the West Coast since how the Pac-12 proceeds will be a significant indicator of how TV networks will pay for college sports in this next round of contracts.

(Follow Frank the Tank’s Slant on Twitter @frankthetank111 and Facebook)

Big Ten Network Beats Comcast with 3 Yards and a Cloud of Dust

On By Frank the TankIn Big Ten, College Basketball, College Football, Illinois Fighting Illini, Sports6 Comments

I’m one of the fortunate souls that has had DirecTV for several years, so I personally was able to avoid the issues stemming from the spat between the Big Ten Network and Comcast (among others) over this past year. While the football offerings on BTN weren’t drastically different than the old ESPN Plus syndicated package, it was definitely a boon for college hoops junkies such as myself to be able to get midweek doubleheaders of basketball (particularly when I needed to watch something to take my mind off of the last Illini b-ball season). Unfortunately, many of my Big Ten fan brethren were stuck with cable and ended missing a large portion of their respective teams’ football and basketball seasons. Tom Izzo at one point called it a PR nightmare with all of the Big Ten fans not having access to games and he was right at that particular moment. Take it from me, for all of comparable stories about the NFL Network and MLB Extra Innings this past year, there is absolutely nothing that compares to the level of venom spewed when the fan of a major college sports program can’t watch a game due to television contract disputes. When you consider that the Big Ten arguably is the strongest and has the most passionate fans of the BCS conferences (I have a multitude of reasons as to why this is the case as compared to the SEC, but that’s another debate for another day), that could have been a pretty toxic mix for conference commissioner Jim Delany.

At the end of the day, though, it appears that the Big Ten largely got what it demanded from Comcast, which was basic cable coverage within the Big Ten footprint and sports tier coverage everywhere else. While tons of people on Big Ten message boards exclaimed last year that they would have been willing to pay extra for the BTN, I completely understand and agree with why the network dug in its heels on the basic cable issue. The fundamental economics of the cable industry dictate that basic cable coverage is the road to riches (unless you’re HBO) and premium tiers aren’t really “premium” as much as they are a cable ghetto. ESPN is a financial powerhouse because it can charge in excess of $2.50 per subscriber for every single cable household in the country and the similar stories can be stated for the various regional sports networks within their respective metro areas. For the Big Ten to cave on this point would have invalidated the economic advantages of setting up the network in the first place.

What Comcast miscalculated here was that it kept comparing BTN to the NFL Network in terms of how much those channels were charging when it really was more akin to the YES Network situation in New York when the corpse of George Steinbrenner started it up . It’s all about critical mass squared – as in critical mass of viewers times critical mass of games. The NFLN only offers less than a half-season of games and they are still shown over-the-air in local markets for the applicable participating teams. There isn’t a critical mass of games that makes the NFLN particularly valuable to even diehard football fans (although I prefer their highlight shows exponentially over ESPN’s). As a result, although there is a critical mass of people that love the NFL over all other sports programs, the fervor from the general public to watch a limited schedule of NFLN games was pretty shallow. At this point, sports fans don’t believe that they’re missing anything yet with just eight weeks of games – I’m sure that the NFL understands this and you can count on a significant addition to the number of games on NFLN when the next league television contract is negotiated.

Compare the NFLN experience with the Steinbrenner clan’s true money-maker. When the YES Network, which carries the majority of New York Yankees games, first went on the air, it went into a year-long dispute with Cablevision over the subscriber rates. Thus, Yankees games were not shown in most New York City households for an entire season and the parties didn’t finalize a deal until moments prior to the subsequent opening day. Cablevision threw out many of the same arguments about YES as Comcast did with respect to BTN, such as the entire subscriber base shouldn’t be paying so much for a “niche” product and that it should be relegated to a sports tier. Go figure, though, that there happen to be a lot of Yankee fans that live in New York City and if they’re like me, pretty much the entire reason why they purchase cable in the first place is to watch sports. The Yankees had a critical mass of games to offer exclusively to a critical mass of fans. Likewise, the BTN exclusively showed at least a couple of football games for each conference member along with a truly full slate of basketball games. In every Big Ten state outside of Illinois (which is a center of alums from all of the Big Ten schools) and maybe Pennsylvania (Penn State football is behind the Steelers and Eagles, but ahead of everyone else), a Big Ten sports program is either the first or second most popular sports team (college or pro) in that state in an average year (i.e. Ohio State is the biggest sports draw in all of Ohio). So, the BTN had a critical mass of potential viewers who had quite the fervor to watch the critical mass of games that the network was offering. Comcast either eventually figured this out or at least admitted that no one was buying the NFLN comparison and had to stem the tide of Midwestern sports fans flocking to DirecTV and other providers offering the BTN.

Now that the BTN is getting the carriage that it has been seeking, don’t be surprised that the SEC will be right around the corner in setting up its own network (which has already been considered). The SEC will have the benefit of learning from the Big Ten’s travails and probably will be able to avoid the regional cable issues (if only because SEC fans have the passion of Big Ten fans coupled with ownership of a lot more guns), although it’s unlikely they could get a national basic deal that the BTN has with DirecTV since the television markets aren’t as large or affluent. The other BCS conferences will surely attempt to do the same over the next few years, but the revenue production for them will almost certainly be short of what the Big Ten and SEC could expect to make.

In the meantime, all of the Big Ten fans out there that haven’t switched to the dish yet (even though I recommend doing so) won’t need to fill their time next winter with hockey games on Versus. Football and basketball will be back in those homes and that’s great for the conference’s schools and fans alike.

(Image from Koo’s Corner)