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Tag Archives: Premier League

What The New Premier League TV Deal Says About NBC, ESPN, And The Future Of The Big Ten

NBC retains rights to the Premier LeagueA little more than a year ago, I predicted that ESPN would take the Premier League away from NBC in 2016. My reasoning behind this prediction was fairly straightforward:

NBC is owned by Comcast, and ESPN cannot allow Comcast to build a competitive sports network because that would give Comcast leverage over ESPN in carriage fee negotiations.

Fast forward 15 months later, however, and boy, how wrong was I on that one? ESPN, as it turned out, didn’t even place a bid for Premier League TV rights in the USA. NBC retained those rights for another six years, with various reports putting the deal in the neighborhood of $1 billion.

So why didn’t the “Worldwide Leader in Sports” not bid on one of the biggest sporting properties on the planet? Perhaps the fact that ESPN lost more than 3 million subscribers since July of 2014 had something to do with it, or that its parent company, Disney, ordered $350 million in cost cuts through 2017, or that Wall Street got quite bearish on media stocks in general and Disney in particular. All of those factors ultimately kept ESPN from spending any money on the Premier League — to say nothing of its various college and pro football commitments, of course.

While NBC appears to come out of this as a winner, with the general consensus being that NBC’s Premier League coverage has been outstanding, this deal says quite a bit about the current state of sports on pay TV, starting with this fact:

1.) The Premier League will remain tied to the cable bundle for another 6 years.

The Premier League will remain tied to the cable bundle.NBC Sports Group Chairman Mark Lazarus paid lip service to the notion that NBC could offer the Premier League to fans in a different format than it does now. Don’t buy it. NBCUniversal is a Comcast subsidiary, and it owns a lot more channels in the bundle than NBCSN. Comcast still wants as many people as possible paying for all those channels. That means you can expect Comcast to do whatever it takes to keep Premier League fans tied to the cable bundle — even as those fans share TV Everywhere passwords with each other to watch matches on NBC Sports Live Extra.

Of course, someone at NBC Sports will eventually figure out how to play ads on the Live Extra apps for Roku and Apple TV, ensuring that they’ll make money off those password sharers, too, who will in turn get tired of hearing the same Wayne Newton song five times every halftime.

2.) The price of NBCSN will be going up soon.

Currently, NBCSN is in 83.87 million homes and collects a carriage fee of $0.30/month from each home. That adds up to a bit more than $300 million per year. $200 million of that goes to the NHL, while $83.3 million will go to the Premier League this season. If the price of the Premier League just doubled, you can expect the price of NBCSN to increase with it.

Plus, since Comcast owns NBCSN, it can increase that channel’s carriage fee automatically in at least 20% of its homes. Look for NBCSN to start asking $0.40 to $0.50 per month within 12 months.

ESPN, meanwhile, still makes $6.61/month per subscriber, even though it’s losing 300,000 subscribers per month. Those subscriber losses, however, aren’t the only reason ESPN took a pass on the Premier League:

3.) ESPN is saving up to keep the Big Ten.

ESPN made its bones on college sports and continues to be at its forefront. Losing one of the five major college football conferences to another network would be a huge dent in its reputation. By not bidding on the Premier League, ESPN is making its intentions clear — it wants to keep Big Ten sports in its catalog, and it can still commit a lot of money toward that objective.

The question, though, is whether the Big Ten wants to stay with ESPN. Could another network sneak in with a big enough bid to take the Big Ten away from ESPN? Fox, in particular, has a history of placing huge surprise bids on sports rights, not to mention a current working relationship with the Big Ten in the form of BTN. Or perhaps ESPN could lose enough subscribers that commissioner Jim Delany would decide it’s wiser to look elsewhere. I’ve written before how ESPN’s competitors could gain the upper hand by using broadcast coverage as leverage:

It wouldn’t be a stretch to imagine the Big Ten’s current broadcast partners emphasizing ESPN’s rapidly declining subscriber numbers to commissioner Jim Delany and asking him how comfortable he is tying his conference’s future to a sinking ship. After all, broadcast TV has always reached more homes than cable, and as cord cutting and cord shaving increases, that gap between broadcast and cable will only grow…

CBS, meanwhile, can point to its high ratings for SEC football games and tell Delany it can do that for the Big Ten, too, and wouldn’t it be valuable to Big Ten coaches to have these games on in the homes of recruits that increasingly can’t afford cable?

ESPN is already paying $100 million per year for Big Ten first-tier rights and might have to pony up twice that to keep those rights. This will lead to more questions from Wall Street about whether ESPN can maintain any semblance of profitability in the long term. Losing the Big Ten to another network, however, might be a much bigger blow to ESPN’s college sports dominance. It’s going to need that extra $100 million per year to maintain that dominance. The Premier League is an expensive trifle in comparison.

We don’t know yet which way the Big Ten will go in terms of TV rights, but its decision could have a major impact on the future of sports on TV. This Premier League deal was never going to have that impact, which might be why ESPN was willing to let NBC keep those rights. ESPN still has four of five major American pro sports leagues and a piece of all five major college conferences in its rights catalog. Keeping those rights will be more important to ESPN in the long run — not to mention its biggest challenge yet.

What You Pay For Sports on World Soccer Talk

The good folks over at World Soccer Talk asked me to write about the current state of the Premier League on U.S. TV. You can read that article here. The article also covers Major League Soccer’s new TV deal with ESPN and Fox Sports, and explains why that deal is as big as it is. Continue Reading

What You Pay For Sports on EPL Talk

The good folks over at EPL Talk, a site that’s let me write for them before, invited me to chime in on NBC Sports’ new 3-year, $250 million deal with the Premier League — and more specifically, why NBC has made the online streaming component of this deal a “TV Everywhere” service, rather than a… Continue Reading

Filed Under: NBC

Why Major League Soccer’s Average Attendance Figures Are A Poor Measure Of Its Popularity

A few weeks ago, The Atlantic Wire reminded us that Major League Soccer has the third-highest average attendance among professional sports leagues in America. They framed this by calling the NBA “549 Fans Less Popular than” MLS. As lies, damn lies, and statistics go, those average attendance figures are tremendously misleading in terms of determining the… Continue Reading

Filed Under: MLS

     

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