Sunday, January 12, 2014

Questions to Ponder About NFL Thursday Night Rights Sale

nfl thursday night

News broke late Sunday night that the NFL is seeking bids from it's rightsholders (CBS, Fox, NBC, ESPN) as well as TNT for a package of anywhere between 6-8 Thursday night games at the beginning of the season. The package would start next season and would be part of a 1 year deal. I have a bunch of questions about this. Some that I can answer and some that I can't. Chime in on the comments section to give your input.

Sources: Reuters, NYT

1. Why would the NFL sell rights to games normally televised on NFLN? Doesn't it weaken NFLN? Unlike 2006, when the Thursday nighters first started on NFLN, the network is now pretty well distributed and essential to the sports television diet for many fans. It's very unlikely that less games will mean that cable operators will do whatever it takes to drop the channel from it's lineup, especially because there's a chance that NFLN could win the rights to a playoff game sometime soon either in the divisional round or in the wild card (this all depends on whether the number of teams in the playoffs expands). With that being said, any reduction of NFL games weakens the network whether that's the narrative they want to push or not because it means less ad revenue. It also means that cable operators have a reason to offer less carriage fees to the NFL.

2. Why won't the NFL let Google bid for these games? According to Reuters, "Google, which had expressed interest in streaming NFL games in the past, was not asked to bid, according to the person." This is probably because the NFL wants these games on a well distributed network. Money will probably matter when choosing a partner but distribution and reach will matter more. Google doesn't guarantee the wide distribution that television does because everyone has different types of speed for their internet connection and no one knows whether Google could truly handle the number of people that usually watch NFL games on 1 stream.

3. Why does the NFL want the games on a wide distributed network? They want to use that network's platform to promote Thursday night games and make them just as big as Sunday and Monday night games, which they aren't at the moment. Having the first couple of games on a big network could give NFLN the momentum it needs to get their ratings for games as high as ESPN's and NBC's ratings are whenever they air primetime football games. The first package of Thursday night games would basically be a promotional tool/preview of what to expect later in the season on NFLN.

4. Why is this deal only going to last for only one season? I really don't understand this one right here. Maybe it's because they feel like they'll only need promotional support for one year and want to eventually move all the games back to NFLN in the 2015-2016 season? Or maybe it's just a short term precursor to a longer term deal which could take into effect after the 1 year contract is up?

5. What other networks could bid? According to Reuters, "The league also sent out requests to other TV outlets (besides the rightsholders and TNT), according to one person with knowledge of the bids. Recipients of those bids couldn't be determined" The only two cable companies which I could see possibly bidding that haven't been mentioned are Viacom and Discovery Communications, although neither has ever shown interest in bidding for sports and probably wouldn't bid for such a short deal. Who knows? Maybe the league gets into a revenue sharing agreement with a well distributed network that's considered an outlier in main street America like Univision, Ion, PBS. Or maybe AMC or A&E make a surprise bid?

6. Could ABC get back into broadcasting NFL games? According to the New York Times, it's possible or should I say plausible. "It is conceivable, for example, that ESPN would buy the deal and put the games on ABC, its sibling network in the Walt Disney empire."

7. Does the NFL prefer a broadcast network or a cable network? According to the New York Times, "The league’s preference would probably be a broadcast network like NBC, CBS or Fox, but it would also be pleased if a cable channel got the package."

8. Who is the favorite? According to John Ourand of Sports Business Daily, "I think Turner, Fox and NBC, in no particular order."

9. Could Turner actually broadcast the NBA and the NFL side by side on it's networks? A lot of people have ruled Turner out because they can't see NFL games airing on TBS or TruTV while NBA games air on TNT. I don't see what the problem with that would be though. Having the two most watched broadcasts on cable on the same night could mean LOADS of ad revenue especially because Thursday nights are one of the most watched nights on TV.

Many people are going to be looking at purchasing various things such as a car, a movie ticket, food etc. over the weekend. Turner would have the opportunity to offer ads on the two most watched sports shows of the night and could even garner more ad revenue at a premium because of how much the NFL means to advertisers. This would also help Turner grow their Bleacher Report brand immensely. 

10. Could TNT's NBA slate get pushed back if NFL games were to air on TNT? Most likely. They would either get pushed back or moved. I could see TNT starting their NBA season later OR moving the games to Tuesday nights OR moving their slate to NBA TV, which would give NBA TV a better slate of quality games (Thursdays are usually reserved for marquee games in the NBA). Turner could even use the NFL games to promote NBA TV which would give it more attention than it usually gets.

11. Could Fox Sports actually air Thursday nighters on MyNetworkTV? According to John Ourand, it's possible. He was asked if Fox Sports 1 bid for rights and here was his response: "Fox Sports was, yes. Could be for Fox, FS1 or MyNetwork."

12. Why would Fox air games on MNT instead of FS1? 

- As mentioned before, NFL has a preference towards broadcast rather than cable because it wants to ensure the widest distribution possible. Wide distribution = more promotion for Thursday night games = cementing in people's minds that Thursday night means NFL just like Sunday and Monday night do.

- Fox has decently rated Thursday night programming at the moment including "Idol" and "X-Factor". Airing NFL games on Thursday nights short-term would jeopardize those shows as well as Thursday night ratings long term since Thursday nights are already interrupted by baseball in the fall.

- Football rights creates more value for the MNT owned-and-operated affiliates that it owns and opens the door to possibly selling those local stations to conglomerates like Sinclair, who are looking to acquire as many local stations as possible. The ad revenue from the games could even spark MNT to go back to producing original programming, although that revenue would probably go to the Fox Sports department rather than MNT's offices.


13. Who do I think wins? It's a two-way race between Turner and NBC in my opinion. NBC could use these games to enhance their own Thursday night schedule and/or help out NBCSN, so they're in desperate need of these rights. Turner, on the other hand, could use these rights to start their own sports network and/or garner more ad revenue/carriage fees than they currently get as it is. Those two have the most to gain which means those two will bid the most. At the end of the day, my prediction is that Turner will be back in the NFL business and will become a strategic partner in NFL Media which encompasses NFL Network and NFL.com. Long-term, we could even see Turner working with the NFL and NBA to produce joint events/interactions.

2 comments:

furpurrson said...

I have a question: why doesn't a professional writer know the difference between "it's" (it is) and "its" (possessive)?

Jessie Karangu said...

@furpursson - good point. Big grammar mistake, thanks for pointing that out (seriously) I've had that problem for a long time.

I have to say, you were very kind and considerate in the way you told me about this issue (sarcasm). Next time, when you have a criticism, try to be less condescending. It's not cool to be inconsiderate and hide behind the computer screen.

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