Saturday, August 17, 2013

Fox Sports 1 changes the entire landscape

By Rick Morris

Today’s launch of Fox Sports 1 (FS1), the newest and most formidable cable competitor to the ESPN monolith, rates as possibly the biggest development in the TV sports wars since the launch of Fox Sports itself when the network acquired NFC rights in 1994.

The new network, which came online at 6 AM EDT in place of Fox’s former Speed Channel (which will survive in a Canadian-only manifestation), debuts in 90 million+ homes, a new record for a sports cable channel.  However, Time Warner Cable, Direct TV and Dish held firm on their payments of $.22 per subscriber for Speed, meaning that the quest to leverage the new outfit for $.80 per home (with a hoped-for rise to $1.50 eventually) will wait for another day.  How important are those nearly 100 million homes to Fox?  Well, ESPN is in over 100 million, albeit at about $5 per subscriber, a massive amount that Fox will have to begin to approach if they are to achieve their targeted profitability by 2016.

Fox’s decision to blink for the time being and defer the showdown with cable and satellite providers is probably wise, though, because they are coming out of the gate with some of their core programming right away: NASCAR truck racing, UFC and the new SportsCenter alternative Fox Sports Live (with Jay Onrait & Dan O’Toole, stars of ESPN Canadian sister station TSN’s SportsCentre and the supposed modern equivalent of the Patrick/Olbermann combo of the ‘90s).  And this week marks the debut of the new daily 5 PM talk show with Regis Philbin, Crowd Goes Wild.  The question of how The Reege fits with the targeted young demographic will be fascinating to follow.

Also debuting today is Fox Sports 2 (FS2), a channel to expand the sports cable coverage even more, and it is taking the place of Fuel on the TV dial.

[In a coincidence of the calendar, today also marks the beginning of NBC Sports’ exclusive American rights to the Premier League, the most commonly recognized home of top soccer to the casual fan.  Mostly on NBCSN (the rebranded NBC Sports Nework), but also on NBC and other channels, every Premier League game all season will be televised, marking the biggest invasion of big-time international soccer in US television history.  Given that, in reality, there is little to no difference in the quality of play between the Premier League, Spain’s La Liga and Germany’s Bundesliga, it’s unrealistic to expect America’s other sports channels to cede the perception of superiority in this large niche area to NBC indefinitely; both of those leagues will receive much larger bids for American rights during the next contract cycle.]

Today’s launches are a much bigger deal than when CBS and NBC rebranded existing cable networks as expansions of their sports departments, partially because FS1 starts off in so many more homes.  This also differentiates FS1 from in-house sports leagues that have sprung up over the last decade or so from the NFL, MLB, NBA, NHL, Big Ten and other entities, which have all struggled with carriage reach in the beginning.

Additionally, with the track records of success of Fox News and FX – which itself is undergoing a TBS/TNT-type expansion this fall by moving their comedy properties to a brand-new FXX channel – the assumption that Uncle Rupert won’t allow this venture to fail must be made, not least of which because of the company’s previous history in this space.

After establishing a brand of regional Fox Sports cable networks in the mid-‘90s, Fox Sports News (later renamed the National Sports Report) was created in 1996 as a SportsCenter-alternative to wed the central Fox Sports brand to each of the individual entities.  However, with the channel airing at different times in different cities due to the array of sporting events being televised, it never came close to capturing the country’s imagination and it folded with a whimper in 2002.  In the parlance of Mike the Cleaner from Breaking Bad, the attempt to graft a national element on the regional stations was a “half measure.”

Thus, this full-throated attempt by Fox Sports has long been anticipated, particularly with NBC and CBS having made these inroads before them.  However, with those two entities fairly light on exclusive sports rights of any note, it’s no wonder that Fox did not feel sufficiently interested in beating them to the punch.  This move, while only announced last year, clearly has been on the drawing board for much longer than that.

FS1 will broadcast NASCAR, UFC and some college football, college hoops, boxing and international soccer.  Some of these events will migrate to FS2 as well.  Starting in 2014, Fox Sports 1 will begin broadcasting some MLB regular season and postseason action as well, one-upping ESPN with the latter.

Given the importance that all networks are placing on live sports programming – largely because, from an advertising perspective, they are the most likely shows to be watched live and thus with the commercials unable to be skipped – the biggest battleground between FS1 and ESPN in the next few years will be in locking down major TV rights.  The NFL’s rumored interest in selling off the Thursday night games that they air in-house on their own network – now that they have shrewdly used those games to leverage their way into more homes – would provide FS1 with a wonderful opportunity to grab a piece of America’s biggest sports property, albeit with games that don’t carry the cache of the Sunday night network clashes or the rich history of Monday night.  And ESPN’s NBA contract looms as a fat temptation for Fox in the next few years, although the smart money has ESPN retaining those rights at all costs since it is commonly assumed that the loss of their share of the NASCAR deal to NBC had to do with banking money for the Association in a short while.

Regardless of the reason for ESPN prioritizing other matters above NASCAR rights retention, their body language tells you all that you need to know about the seriousness of this challenge.  In no way shape or form did they ever do anything to indicate trepidation about the aforementioned similar moves made by NBC and CBS.  And before FS1 even hit the airwaves, the “Worldwide Leader” brought back two talents who left under very heated circumstances and have maintained hostilities until relatively recently, Keith Olbermann and Jason Whitlock.  And although the move is largely targeted towards the digital space, the overall ESPN entity hopes to benefit from the acquisition of Nate Silver’s 538 brand from the New York Times and its transformation into a Grantland-like online magazine.  Yes, ESPN is sweating.

Their move toward sensationalistic debate/trolling programming in recent years has been widely panned critically, even as ESPN supporters point to the apparent bottom line success.  With their widespread superiority in terms of carriage to their CBS and NBC rivals – to say nothing of the difference in overall awareness of those channels, since NBCSN has advanced to 77.9 million homes without penetrating the national awareness to a commensurate degree – ESPN’s brass has emitted a “Hey, where else are you going to go?” attitude about complaints regarding their “All Tebow, All The Time” direction.  But that attitude is fading and being replaced with a resolve to fight the newcomers tooth-and-nail, because they aren’t going anywhere.  Fox Sports helped shake up traditional TV sports programming with their NFL coverage in 1994, not least of which with the “Fox Box” that provided constantly-updating time-and-score information on the screen.  So it’s undeniable that the company’s braintrust has some cards that they haven’t even put on the table yet.  Game on.

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