ESPN Scores With Four-Year, $500 Million BCS Pact

Bodenheimer Said Deal Will Not Result In Any Surcharge To Distributors

By Mike Reynolds -- Multichannel News, 11/18/2008 9:59:00 AM

As expected, ESPN has reached a comprehensive, four-year pact bringing the Bowl Championship Series games to cable, beginning in 2011.

The deal 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 -- ESPN also will unveil the weekly BCS standings on Sundays when they begin in mid-season -- from broadcast TV, where they will continue to be televised on Fox through 2010.

The pact, said to be worth some $500 million over the four years, comes after Fox, whose offer topped at about $100 million annually, elected not to match ESPN’s bid.

George Bodenheimer, president, ESPN, Inc. 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 programming 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.

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 through broadband sports service ESPN360.com and on mobile devices through 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’ vide-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 annually.

On Monday afternoon, Fox issued the following statement indicating that it would not match ESPN’s BCS bid: “Even with today’s vast economic uncertainties, Fox Sports made a very competitive bid to keep broadcasting BCS games free to every home in America, one that included a substantial rights fee increase, and certainly as much as any over-the-air network could responsibly risk. Unfortunately, the university presidents and BCS commissioners were not satisfied and they’ve decided to take their jewel events to pay television. We wish everyone well.”

Many of the reporters on the BCS conference call asked questions about 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 post-season.

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 by such barometers as ratings, attendance, interest 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 narrow in the days before 2011, a process that will be accelerated by the Feb. 17, 2009 transition from analog to digital TV.