ESPN Scores Deal for BCS
$500M Deal Takes 3 Major Bowls, Championship from Broadcast
by Mike Reynolds -- Multichannel News, 11/23/2008 7:00:00 PM
As expected, ESPN last week reached a comprehensive, four-year pact to bring the Bowl Championship Series games to cable, beginning in 2011.
The deal, announced Nov. 18, will put the Fiesta, Orange and Sugar Bowls on the total sports network from January 2011 through January 2014, as well as the BCS championship game in 2011, 2012 and 2013. As such, college football's top games will migrate to cable from broadcast TV, where they will continue to be televised on Fox through 2010.
The pact, said to be worth some $500 million, followed a Nov. 17 decision by Fox — whose counter offer reached $100 million annually and came to include FX as a home for some of the games — not to match the ESPN bid.
George Bodenheimer, president of ESPN and ABC Sports, said on the conference call announcing the agreement that the pact would not result in any surcharge for distributors. ESPN collects more than $3 in monthly subscriber fees, the most in basic cable.
Bodenheimer called the championship rights deal the “icing on the cake” for ESPN, which televises college football 365 days per year and will lead to further growth for the BCS. He said the Rose Bowl, which has a contract with ABC through 2014, will remain on the broadcast network through 2010, noting that ESPN has not yet determined its schedule beyond that juncture.
Asked about ESPN's position on a college football playoff — President-elect Barack Obama has voiced his support for an eight-team system — Bodenheimer said that was “a decision for the university presidents and conferences.”
As is the case with most of ESPN's rights pacts of late, the BCS agreement extends to a variety of properties, including radio, digital, international vehicles, plus the marketing end for the 15 BCS games over the aforementioned time frame.
On the digital side, ESPN.com will operate the official BCS Web site, bcsfootball.org.
In addition, the games may be simulcast online on ESPN360.com and on ESPN Mobile TV.
Bodenheimer, on the conference call, said ESPN would be utilizing those platforms, but did not specify how. He did note that the company would be mindful of what it does on “the Internet because that impacts our relationship with cable operators.”
The pact also allows ESPN to make BCS games available after the fact on affiliates' video-on-demand platforms and via audio and video podcasts.
John Swofford, BCS coordinator and Atlantic Coast Conference commissioner, said on the call that Fox currently holds the same multimedia rights that ESPN will possess under the new contract.
Fox, according to sources, has turned a profit with the BCS through the first two years of its contract, which averages about $82 million per year.
Many of the reporters on the BCS conference call questioned the loss of another major broadcast sports property to cable. ESPN last week sealed an eight-year deal valued at $200 million for the rights to the four rounds of the British Open golf championships, beginning in 2010. Meanwhile, the bulk of the NBA playoffs air on TNT and ESPN, while TBS presents most of MLB's postseason.
“ESPN bailed out college football,” quipped one sports industry executive, who noted that the sports behemoth's multiplatform push for college football and the BCS could rub up against its growing list of properties. “Everything is becoming self-contained within one family of networks.”
He also took a swing at ESPN's multiplatform emphasis, pointing out that the most of NBC Universal's success with the Beijing Olympics was tied to the Peacock. “Some 90% of the eyeballs came from NBC and 85% of that was in primetime,” the executive said. “That's where they were charging the $400,000 to $500,000 per commercial.”
Bodenheimer, emphasized that ESPN's multimedia approach is how sports fans tap into athletics today and will increasingly do so in the future. He said the BCS acquisition will enhance a sport that is growing in ratings, attendance and media coverage. He also pointed out that 95% of the viewers who watched last year's BCS title game, in which LSU routed Ohio State, had “cable or satellite hook-ups.”
Both Swofford and Bodenheimer said they anticipated the differential between the U.S. 114 million TV household universe and ESPN's 98 million homes would continue to dissipate in the days before 2011, accelerated by the Feb. 17, 2009, transition from analog to digital TV.
