Auburn Kev 1,653 Posted October 31, 2018 Share Posted October 31, 2018 Interesting take from Clay Travis on the SEC/CBS Television Deal and what the future could hold for SEC Football TV Broadcasts. Source Quote CBS’s SEC Deal Was A Steal: What Happens Next? Posted on October 31, 2018 by Clay Travis - OKTC On Saturday CBS Sports will air two top ten SEC games, #6 Georgia at #9 Kentucky at 3:30 et and #1 Alabama at #3 LSU at 8 et, as part of its multi-year agreement to carry the SEC’s top weekly games on CBS. The Alabama at LSU game will probably be the most viewed so far this season and Georgia at Kentucky will continue the SEC’s run of dominating afternoon ratings in college football. Both of these games will continue the trend begun over twenty years ago, in 1996, when CBS snatched up SEC games for the first time. Initially CBS split the telecasts nationwide, carrying the Big East in some east coast markets — frequently Miami or Virginia Tech back then — before going exclusively to the SEC just after the 2000 season. It has been a remarkably successful partnership between CBS and the SEC, but the primary financial value, as I will discuss below, has been almost entirely on CBS’s side. Given that CBS receives the first pick each week of SEC games — for a total of 15 games each season, including one doubleheader weekend like this one coming up where CBS gets the top two picks — as well as the SEC title game, you’d think CBS must pay a ton of money for the exclusive rights to these telecasts, right? You’d be wrong. In fact, CBS pays an average of just $55 million a year, on a contract deal that runs through the 2023 football season. Yes, just $55 million total for 14 regular season SEC games and the SEC title game, a grand total of 15 games. That equates to roughly $3.7 million per league game. That’s insanity. Putting that number into perspective, ESPN will pay over $110 million per Monday Night Football game. And the audiences aren’t that dissimilar. An average Monday Night Football game on ESPN draws about twice what an SEC game in the afternoon draws on CBS. So how did this deal end up happening? And more importantly for most fans, what’s going to happen in 2023 when the SEC on CBS deal expires? Both are fascinating questions to discuss and contemplate. First, the current CBS deal was a product of then-SEC commissioner Mike Slive and his TV negotiator, Chuck Gerber. Both men, who were fantastic individuals, have passed away in recent years, but Slive wanted the SEC on CBS as a branding opportunity. He instructed Gerber to focus less on the money received for the games and more on the branding opportunities for the conference. If CBS, then and often since the nation’s most popular broadcast network, guaranteed to carry the SEC every week to a nationwide audience it would give the conference a prime destination window into homes across the nation. No matter where you lived, you’d be able to see the SEC’s signature game. There is no doubt that Slive was right and that the hundreds of SEC on CBS games have gone a long way towards providing substantial value to the conference’s overall brand. But there’s also no doubt that Slive and other conference officials have bristled at CBS’s unwillingness to recognize the steal of a deal they locked in years ago, particularly when the SEC expanded and added Missouri and Texas A&M. Rather than look at conference expansion as an opportunity to commit long term to the conference — as ESPN did, creating the SEC network and signing a long term deal through 2034 for all the league’s other games — CBS played hardball in negotiations over conference expansion refusing to even increase the payout on a per capita basis to the league as it increased from 12 to 14 members. (The SEC was stunned that CBS, making tens of millions a year on their lucrative TV deal, didn’t agree to pay the conference at a bare minimum, ten million more per year when Texas A&M and Missouri were added to the conference.) Instead CBS, in a decision that will likely loom large as this deal nears completion, refused to do anything except give up its exclusive window for games in the afternoon. (Prior to expansion no other SEC games could air during the 3:30 to 6:30 eastern window for the CBS game of the week). The result? Despite adding the entire state of Texas through the addition of Texas A&M, which has been a boon for national ratings given the increased league interest in the football mad state of Texas, CBS paid no more to the league to carry the broadcasts. As a result of these contentious negotiations in the wake of conference expansion, it’s highly unlikely the SEC will remain on CBS after the 2023 football season. (CBS has previously told Outkick it intends to extend its deal and maintain its partnership with the league, but the chances of that happening, based on everything I’ve been told, are minimal at best). The tension between the SEC and CBS has not abated this season, by the way, either. Recently on the pregame show before the league’s game on CBS, analyst Brian Jones said he believed the SEC’s league office, which is based in Birmingham, might be biased in favor of Alabama and that was why LSU’s Devin White was suspended for targeting and Alabama’s players have not been. Host Adam Zucker said as follows: “And it gets reviewed in Birmingham and you’re saying that you think there is more involved than just pure judgment that it was targeting?” Brian Jones responded: “Well I see flags thrown on certain teams and I see them not thrown on certain teams,” Jones said. “And I’ll leave it at that.” That’s a pretty blockbuster accusation from the league’s TV partner, that the league is conspiring to favor Alabama. The fact that it aired on CBS left SEC officials furious. It’s one thing when fan message boards light up with accusations that a conference favors one team or another, it’s a different level entirely when the league’s own TV partner says it as part of the league’s pregame telecast. Here’s that discussion which was promoted and shared on the main CBS Sports Twitter feed: CBS Sports Network ✔@CBSSportsNet The talk of college football world the last few days has been @LSUFootball's Devin White.@JonesN4mo, @AaronTaylorCFB, @RandyCrossFb and @CoachNeuheisel debate his targeting suspension for the first half of the game against Alabama. 9:29 PM - Oct 23, 2018 206 164 people are talking about this It all added up to just another reason the CBS and SEC partnership is likely to end sooner rather than later. Honestly, if CBS were smart about its SEC deal, which it hasn’t been so far, it would go straight to the league this week, hat in hand, and offer $200 million a year for a five year extension to 2028. That’s a billion dollars total which it could amortize over the course of the next decade, roughly doubling what it pays the SEC now for the entire package. I don’t think the SEC would say yes to this offer, but going to roughly $130 million a year for the next decade would at least put the contract somewhere in the ballpark of reasonableness.) The problem is, who has the authority for CBS to make a deal like this? No one knows in the wake of the Les Moonves collapse. So who will get the games after 2023? Rest assured, there will be many bidders. Among them: Disney/ESPN, which airs every other SEC game, desperately wants the CBS game of the week to give it total control of all conference match-ups. But would the SEC want one network to control all of its games? That seems unlikely barring a monster offer. Which is why the new Fox network could make sense. What’s Fox’s goal with its network? As much primetime sports as possible. Given that a new Fox will be aligned with Fox News, the WWE, and NASCAR what better fits the network’s heartland strategy than appealing to the 11 SEC states? It’s honestly a no brainer for Fox. This would allow the SEC to continue to take advantage of a major network broadcast partner and it would also give Fox the potential to pair the SEC game of the week with the Big Ten game of the week. This would also give Fox the potential to carry every major league’s title game except the ACC’s. Over the same long weekend Fox could carry the Big Ten, the Big 12, the SEC, and the Pac 12 title games. There’s also the possibility Fox could make a monster offer to the SEC that was conditional on the games airing on FS1. Can you imagine the money FS1 could make if the SEC game of the week was on cable? If Fox is interested why wouldn’t Comcast/NBC also be interested? NBC could pair the SEC game of the week with the Notre Dame game and turn into a significant competitor for college sports overnight. In addition to all of these bidders, it’s unlikely that Turner — the SEC once had a deal with TBS — which is now spending substantial dollars on sports, would allow this property to come up to auction without bidding a substantial amount as well. As if that weren’t enough in five years there may well be interest from Apple — CEO Tim Cook is a rabid Auburn football fan — Netflix, Facebook, Amazon, Google and other major tech companies who might view the SEC’s signature product, at a relatively affordable price, as a good way to test the value of sports on their platforms. Moreover, how about this idea, what if the SEC decided to sell the title game to the highest bidder and then decided to put its SEC game of the week on pay-per-view direct to consumer without any commercials at all? How many college football fans would pay $150 a year for the SEC game of the week commercial free? Or how much would an online streaming company like DAZN or another competitor pay to have the SEC game of the week exclusive? This seems like a potentially viable option as well if maximizing revenue is the goal. All of these deals lead to a massive payday, potentially the highest ever struck in college sports history on a per game basis. In the meantime, as Georgia travels to Kentucky and Alabama heads to LSU, just how good of a deal does CBS have for its doubleheader? The best in sports by far. Several years ago the Rose Bowl and the Sugar Bowl cost over $80 million by themselves. If you were a TV executive would you rather have the Rose and Sugar Bowls for $160 million total or the SEC title game? Personally, I’d rather have the SEC title game. Think about this for a minute, the Rose Bowl by itself, a single game, costs $25 million more than the entire SEC on CBS package does. Given that ESPN pays over $200 million per college football playoff game, there’s a strong argument the SEC title game, even pulled off and auctioned separately, could be worth $100 million standing alone. Combine the SEC title game with the SEC game of the week and you’re probably talking about a TV package that would be worth $250 million standing alone on the open market right now. Potentially more, depending on how the NFL rights deal works itself out. This raises a larger question, if the SEC doesn’t want to resign with CBS, and if CBS has blown its chance to extend the SEC for years ahead, both are which I am confident is true, is it possible the deal could end before 2023? Why wouldn’t, for instance, Disney/ESPN, Fox, Turner or NBC try and buy out the remaining years on the SEC’s TV deal with CBS and sign a multi-year extension right now? Would CBS allow that to happen or are they intent on waiting out the final five years of the deal and ending up with no SEC on CBS at all then? Stay tuned, because while the on field drama in top ten match ups featuring Georgia at Kentucky and Alabama at LSU this weekend may be great fun, the off field drama of where the SEC will end up in future years may be even more entertaining. Link to comment Share on other sites More sharing options...
AU64 10,122 Posted November 3, 2018 Share Posted November 3, 2018 On 10/31/2018 at 10:36 AM, Auburn Kev said: Interesting take from Clay Travis on the SEC/CBS Television Deal and what the future could hold for SEC Football TV Broadcasts. Source That's the risk associated with such a long term deal. Five more years is pretty long (2023) but I'm guessing that CBS's unwillingness to adjust the deal as it has grown lucrative beyond anyone's expectations is gonna cost them one way or the other. Still time for them to "do the right thing" but not likely or there would have been a re-negotiation and extension by now as noted in the article....and also as noted, maybe CBS would rather just ride out the cash cow and see what the cable and over the air markets look like in 5 more years. Probably all the top execs will be gone by the time the contract expires and meanwhile they will be enjoying the fruits of what turned out to be one of the great sweetheart deals of all time. Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.