2008 CABLE SHOW: Sports Nets Tout Value of Content; Ops Warn About Repercussions
Digital Platforms Providing New Sources Of Incremental Revenue From Sports Content
By Linda Moss -- Multichannel News, 5/20/2008 7:39:00 PM
NEW ORLEANS—Several sport programmers Tuesday sang the praises of their content’s value, to passionate fans and as fodder for new-media platforms, while cable operators cautioned that spiraling prices have to be held in line.
Both sides, however, seemed to agree that the sports programming business is “in stress”—because of rising costs—but not broken, during a Cable Show panel called “Good Sports: Understanding the New Sports-Media Ecosystem.”
During the session Randy Freer, president of Fox Regional Cable Sports Networks, maintained that sports programming may actually be a bargain these days.
“Sports in general are often characterized as ‘the price is too high,’ but the price may actually be low, when you compare it to the amount of people watching, and how sports in general has helped the cable business and the satellite business and other businesses grow,” Freer said.
Insight Communications CEO Michael Willner put on a referee’s striped shirt to moderate the panel, where—surprisingly—there were no fireworks despite the usually controversial topic.
Comcast SportsNet president Jon Litner, talking about the cable company’s regional sports channels and pressure from escalating sports-rights costs, said, “That business is healthy, but under stress…there’s got to be some rationality brought into the equation here….At some point we’ve got to take a step back, and find a better way to grow the business together.”
And from the operator side, Robert Wilson, senior vice president of programming for Cox Communications, sounded a similar note about the sports “ecosystem.”
Said Wilson, “It’s working, but it’s under extreme pressure. We are trying to be the voice of the consumer.”
Panelist Melinda Witmer, Time Warner Cable’s chief programming officer, said that while distributors may want to super serve sports fans, non-sports fans don’t necessarily want to foot the bill for that content.
“We do sit in the seat of the consumer when we’re buying,” she said.
Litner, Freer and Sean Bratches, ESPN’s executive vice president of sales and marketing, all pointed out that technology, and digital platforms, are providing new and lucrative ways to mine incremental revenue from sports content—for both programmers and distributors.
“Sports fans in America have never been better served,” Bratches said.
ESPN spin-off channels, like ESPN2, and outlets like wireless and broadband are not cannibalizing the audience for the core linear channel, according to Bratches.
“ESPN has never been more highly viewed than last year….The average sports fan spends almost two hours a day with ESPN media,” he said.
Instead new media gives ESPN the “ability to showcase sports content that traditionally hadn’t been highlighted,” according to Bratches.
He said, “The more you super serve the fan, the more they’re ingesting more of the content.”
Bratches added that ESPN is working with operators like Wilson to exploit sports content on outlets such as on-demand and HDTV.
“Our ratings last month were 43% higher in high definition homes than they were in standard definition homes,” Bratches said.
Litner echoed Bratches remarks when talking about Comcast’s regional sports networks, saying, “At the end of the day, people really root for their home teams… for us to expand that to new-media platforms I think is a great way to grow our business.”
Willner suggested that increases in sports costs, and hence cable prices, might prompt lawmakers and the Federal Communications Commission to try to intervene, which “could do some serious damage to our business.”
To ward that off, Bratches said the cable industry needs to communicate the value the $40 to $50 expanded basic package, which is less than the price of a ticket to many sporting events, to lawmakers in Washington, D.C.
And warning against government intervention in the sports-programming business, Litner said, “At the end of the day, these are private commercial transactions.”
Both Witmer and Wilson said they were opposed to sports-network exclusivity.
“Exclusivity is not necessarily good for the consumer,” Witmer said.
According to Wilson, “It drives prices up.”
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