“The NFL will still be some of the top programming content, guaranteed. You’re buying the Rolls Royce. And even if it has a couple of nicks and dents along the way, it’s still going to perform.”
Despite the NFL’s wide-ranging challenges during the 2017 season — including declining ratings by nearly 10 percent, a continuous CTE discussion, hotly-debated National Anthem protests and league licensees decreasing by as much as 20 percent, among other obstacles — senior media rights executive Daniel Cohen isn’t worried about the NFL’s position among premium sports programming.
And neither is Lachlan Murdoch, Executive Chairman of 21st Century Fox and one of two sons of media tycoon Rupert Murdoch.
“Live sport has never been more important than it is today. … NFL programming is hands-down the most powerful in all of media,” he said on Fox’s earnings call this past week.
The network won the league’s Thursday Night Football broadcast package from 2018 through 2022 with a reported winning bid in the range of $3 billion to $3.3 billion, a decision Chief Executive Officer James Murdoch recently defended following critical comments in October of football’s over-saturation.
Sports Business Journal media reporter John Ourand said that Fox will pay the NFL $550 million each season over the next five years while ESPN’s Darren Rovell and his sources estimated the number closer to $660 million.
Either way, the annual payment by Fox is at least a 20 percent increase from CBS and NBC’s $45 million per game this past season.
“The quality of the games have suffered a little bit. People need content. These companies need content. Content is getting more expensive because if you don’t have it, you have nothing else to do. Fox certainly needs the content because talk doesn’t carry the ratings,” Rovell said on The Big Lead’s Glass Half Empty Podcast during Super Bowl LII week.
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Cohen, who launched Octagon’s media rights consulting division last August, highlighted to Sports Business Chronicle how Fox is getting back to its roots of live programming and buying more premium content. The decision comes weeks after it was reported that Disney would be purchasing a sizable portion of 21st Century Fox for $52.4 billion, a deal that includes Fox’s film and television studio, regional sports networks and cable channels FX and National Geographic, among other entertainment assets.
On Sunday evening, the Wall Street Journal reported that Fox actually rejected an offer from cable conglomerate Comcast that was in the low $60 billions, over 15 percent higher than Disney’s bid.
Fox’s grab of Thursday Night Football, which will be simulcast on NFL Network, now comes with more expansive mobile rights, too. It allows the network to distribute both TNF and Sunday’s games to subscribers over digital platforms, including mobile phones for the first time. Octagon’s Cohen said that he’s closely following how Fox is able to package the TNF and Sunday rights as well as additional Fox programming into an advertising bundle.
“That’s really where I can see them making up for the acquisition cost,” said Cohen, who also added that there’s more platforms and thus, more inventory, for Fox to sell against.
Tag Garson — Senior Vice President of Properties at Wasserman — said that when the deal is viewed in its totality, “you can see how the numbers would make sense for (Fox).”
Said Garson: “Start to look at the all-encompassing rights along with the 16 or 17 owned and operated stations that Fox also has under their umbrella. … Certainly after they’ve made the decision to invest more in sports and in news as has been reported of the recent sale of their assets to Disney. I certainly was not surprised that they had won the bid.”
The senior media executive, who in years past spent time acquiring content and programming for ABC Sports and ESPN, said that there’s a few schools of thought when it comes to the NFL. In one camp, there’s the belief that it’s highly-rated programming and therefore, it’s necessary to have because a network knows it’ll “win the night.” On the flip side, Garson described how having football in primetime for consecutive weeks disrupts other previously-scheduled series, arguably a point of frustration for some.
“I don’t really subscribe to that theory,” said Garson of the latter, “so I think what Fox did is they said, ‘We can get 11 weeks of primetime programming that we know is going to rate well, it’s going to reach the adult 18 to 49 demo., which is important, but in particular, the male 18 to 49 demo, which is critical in sports. We’re going to be able to program 11 weeks, expand our rights on Sunday games as well as the Thursday schedule’.”
Regardless of what narrative one subscribes to for the ratings challenges, the NFL still wins. Of the 50 most watched broadcasts in 2017, 37 came from The Shield, according to Nielsen data.
“We’re still living in a time where the NFL will deliver strong ratings, even if they’re not as big of ratings as they used to be,” Garson said.