As a long-time observer of the ever-evolving media landscape, I must say that the recent move by Comcast to spin off its cable channels is a clear indication of the times we live in. The once mighty crown jewel of traditional television is now being relegated to a supporting role, as the industry grapples with the challenges posed by the rise of streaming services and the fragmentation of audiences.
In November, when Comcast opted to separate its cable networks into a distinct independent entity (tentatively named SpinCo), it also included an additional twist: The freshly formed company, centered around channels such as USA, MSNBC, CNBC, E!, and Golf Channel, would boast of “prominent sports properties” including the Olympics, PGA Tour, Premier League soccer, and WWE.
Those sports will play a pivotal role in propelling the new company forward, especially since it’s venturing into territories beyond NBCUniversal… and operating independently from the broader NBC Sports division.
As a gamer, I’ve got to say, the specifics about the split are still a bit blurry. However, during a conference at Sports Business Journal on Nov 20, NBC Sports president Rick Cordella shared some insight: “From my perspective as a sports enthusiast, we’re committed to honoring all the logistics and promises made to our cable partners like Golf Channel and USA. We’ll do everything we promised.
According to reports, the company is currently working on a plan to share sports broadcasting rights among multiple companies. It’s expected that each company will establish sub-licensing agreements with the others.
Furthermore, it’s mentioned that Mark Lazarus, the CEO of SpinCo (previously with NBC Sports), expresses enthusiasm about exploring new possibilities within the sports sector following the completion of the spin-off.
The offshoot highlights an escalating pattern within the realm of cable television, suggesting that an increasing number of channels are devoted to sports.
As a gaming enthusiast and TV aficionado, I’ve got to hand it to FX – they’re known for their thought-provoking dramas like “The Bear” and “Shogun”, but here’s something unexpected: on November 16, they stepped into the world of UFC, broadcasting the preliminary fights for UFC 309. That’s right, FX brought MMA action straight to my living room, making it available in over 67 million U.S. homes! In the Disney family, there isn’t a more far-reaching cable channel than FX on that day.
On rare occasions, FX has broadcast sporting events, such as UFC prelims (which they last showed in 2019 due to a similar college football scheduling issue), and the rebooted XFL was one of their regular channels. However, the upcoming UFC fights in 2024 demonstrate that any cable channel can transform into a sports channel when content rights agreements necessitate it, or if a company wishes to enhance its channel to prevent cancellation or broaden its scope.
Perhaps the best example in the latter category is Warner Bros. Discovery‘s TruTV.
Originally known as Court TV, TruTV has spent recent years serving as Warner Bros. Discovery’s hub for unscripted comedy, headlined by the prank show “Impractical Jokers.” However, earlier this year, WBD disclosed their intention to start a primetime sports programming block on the channel.
The TNT Sports-branded block offers a variety of content such as live sporting events, alternative broadcasts, talk shows, and exclusive programs like the sports news magazine “Above the Fold,” which is hosted by the renowned journalist Jemele Hill, who previously worked at ESPN.
TruTV will be part of Warner Bros. Discovery’s (WBD) newly established division, which also includes sports-focused channels like TNT and TBS. This corporate reorganization aims to separate WBD’s profitable but dwindling cable networks from its rapidly expanding streaming services. The sports content on these channels is intended to help counteract the decline of linear TV, while simultaneously trying to bolster the company’s streaming platform.
The upcoming linear channel will predominantly feature sports and news, spearheaded by CNN, while our entertainment sector will continue to thrive on HBO and Max.
Moreover, various Olympic events such as boxing, cycling, and soccer often took prominence on channels like USA and CNBC within NBCUniversal’s cable network. Meanwhile, golf remained a mainstay on the Golf Channel.
Or consider Nickelodeon. The quintessential kids cable channel, Nickelodeon is part of the Paramount portfolio. And while the company has sports rights, its hoards them for CBS and Paramount+, leaving the cable channels high and dry.
This change occurred when the NFL decided it wanted its matches to be more appealing to younger audiences and families. Consequently, a Nickelodeon-themed NFL altcast was launched, an event that seems to grow in popularity each season, and additionally, brings live NFL games onto Nickelodeon.
Despite platforms like WBD and Peacock focusing on streaming by broadcasting most of their sports via Max and Peacock respectively, traditional pay-TV packages still play a crucial role for sports. Consequently, the greater number of sports a company can fit into its channel lineup, the more advantageous it becomes.
Bruce Campbell, WBD’s chief revenue and strategy officer, made it clear on November 13th during a talk at the Paley Center for Media in New York that we can’t ignore the fact that sports rights continue to hold significant value for our traditional broadcasting channels. He emphasized that this importance will be duly respected by us.
However, enhancing cable networks through live sports broadcasts contradicts the declared aspirations of sports leagues and owners, who have observed the decline of cable television with apprehension about their own future prospects.
Sports leagues aim for rising rights fees and a broader fan base that expands rather than contracts. As a result, more often, owners of sports rights are looking to combine the vast audience reach of traditional television broadcasts with the youthful demographics of streaming services.
Just look at the NBA’s new rights deals, which kick in next year.
Adam Silver, NBA commissioner, stated at the Paley Center on November 14th, we’re increasing broadcast exposures from 15 to 75. Notably, in our fresh contracts, every national game will be accessible through a streaming service, which is currently a minimal portion of our games. A decade ago, during our last round of TV deals, cable or satellite had over 100 million households. Now, when considering just traditional cable, it’s likely around 50 million. However, there are virtual MVPDs that broaden this number, but a significant portion of the U.S. currently lacks access to our games due to existing technology.
The NFL, like a beam focused on its target, prioritizes the range of its broadcasts and the depth of its streaming services. This is why it has secured the rights to air Christmas Day games on Netflix this year.
However, for proprietors of cable stations, especially those without extensive backgrounds in sports broadcasting, live sports events serve as a crucial method to maintain their significance within a struggling and competitive landscape where numerous affluent streamers are eyeing sports rights.
With traditional pay-TV packages dwindling, streaming services are stepping into the spotlight, according to Jon Miller, CEO of Integrated Media Co. This trend is creating a divide between those who have access to both entertainment and sports, and those with only entertainment. Over the past decade, streamers have poured money into just entertainment, but now they’re spending it on both entertainment and sports. To protect their agreements, legacy networks need to divert a larger share of their content budget towards sports, which means less money for entertainment.
For channels that have been active in the sports sector for some time, streaming represents the upcoming challenge. ESPN is currently developing a “premier” streaming platform, scheduled to debut in August of next year. However, it’s expected that pay-TV subscribers will be able to access it as part of their existing packages.
John Lasker, senior VP of ESPN+, explains that our approach with ESPN is to cater to all types of sports enthusiasts – whether they’re newcomers, long-time fans, casual followers or die-hard supporters,” said he, emphasizing that we aim to deliver sports content wherever and however our audience prefers to consume it.
Essentially, Cordella pointed out that the Comcast deal to separate its cable channels might be a small example representing the broader trends in our entire industry.
Initially, when NBCU was acquired by Comcast, its cable channels were considered the most valuable assets. However, in today’s diverse and fragmented media landscape, our perspective has shifted.
The final outcome sees sports playing a crucial role in sustaining the remaining portions of a dwindling cable package, all while making strides towards streaming platforms to establish a position in the upcoming territory.
Read More
Sorry. No data so far.
2024-12-17 16:55