August 15, 2005
Utter Domination by the World Wide Leader?
I’ll assume most of you pay little or no attention to the hockey situation so I’ll try and make this as little about hockey as possible.
As some of you may know the NHL is returning to the ice this season. However there is not as of yet a TV contract for nationwide coverage. Before the lockout the NHL was on ESPN and occasionally had marquee games on NBC or ABC, but primarily the nationally televised games were on ESPN. Last week Comcast entered a bid for the TV rights. The bid was $100 million for two years, but ESPN has the right to match this offer as part of their previous agreement.
Here is some food for thought: Should ESPN match this offer and buy the TV rights to the NHL, not because they want to televise hockey games, but because they don’t want Comcast to?
You see, ESPN has such a commanding presense in the world of cable sports there doesn’t seem to be other choices. Sure, we all have our regional Fox Sports Net, and depending on what cable or satellite package you use, you may have a combination of CSTV, OLN (the station owned by Comcast, which would actually broadcast the NHL), or lord knows what else is out there, but in the end, when somebody wants to watch sports, get scores, or catch highlights of the day’s events, the worldwide leader is where they go.
ESPN thrives on this. They are without rival when it comes to sports television, everthing they touch turns to gold. Think poker, the x-games, college world series, Jenny Finch, Kobayashi, and I haven’t even brought up the behemoths that are SportsCenter and College Gameday. So why risk ending this domination because of a measly $50 million per year?
Before the NCAA limited the number of scholarships available for college football, certain teams like Notre Dame would not only recruit the great players that fit into their system and would help them win, but they would recruit the great players that would fit into their opponents’ systems and never let them see the field. Why wouldn’t ESPN do the same thing in order to prevent the chance of Comcast becoming a true rival?
And if they do step in and swipe the NHL from the hands of Comcast, shouldn’t it qualify as anti-competive business practices?
Please note that I am in favor of ESPN purchasing the rights to the NHL, and do not in anyway, shape, or form support government intervention which might stop this from happening.
4 Comments
RSS feed for comments on this post.
Sorry, the comment form is closed at this time.
All the NHL has to do is write into the contract that whoever is awarded the bid must broadcast x% (let’s say 60%) of regular-season games. That way, if ESPN gets the bid, they’re locked into broadcasting games regardless of whether they want to or not. Of course, they’ll do everything they can to make sure they’re run at off hours, or on The Deuce, but the NHL is protecting their league by ensuring that the rights are not only owned, but used.
Like you, I don’t agree with the government stepping in to regulate this. This can be easily taken care of by contractual agreement between the NHL and whoever they sell the rights to. If ESPN doesn’t agree to those terms, then they don’t get to buy the rights. I’d guess that something of this nature was in the original contract between the NHL and ESPN, but I’m not sure.
There’s a similar problem in motorcycle racing. It’s a niche market, and the Speed Channel owns the broadcast rights. Speed makes so much money with NASCAR and F1-related programming, that they do very, very little to promote motorcycle racing broadcasts. They do things at off hours, and only broadcast races once, where they used to rebroadcast Sunday races on Tuesday evenings. It sucks for fans, but that’s what TiVo is for. I’m sure they’re contractually bound to actually *show* the races, but don’t necessarily need to broadcast them live.
Sorry,
It was mentioned in the link but I forgot to include the stipulation in the Comcast contract that they would, in fact, be required to show two games per week. I didn’t mean to suggest that ESPN would buy the TV rights and then not actually air the games, just that they would buy the rights to avoid allowing Comcast to become a legitimate threat to ESPN’s dominance in all things sport.
Actually, this guarantee of actual air time is the reason I am in favor of ESPN hijacking the rights. They’ve been showing hockey for twenty years now, know how to do it, and have the best analysists and annoucers south of the border.
Two games a week doesn’t sound like much compared with Brad’s suggested 60% of regular season games, but this is for the national TV rights only. Each team will still have its own local TV deal, the Blue Jackets, for instance will have nearly all of their games aired on Fox Sports Ohio.
Well, that clarifies things a bit. I pulled the 60% number out of my #%@, so pay no attention to that
. If this is the case, then I see a lot less issue with this.
Let me ask you this. Would they really be hijacking the rights? It seems to me that they are the incumbent here, and have a contractual right to keep the broadcasting rights as long as they match all other offers. It sounds to me like ESPN probably was paying a lower price because they were the highest bidder until Comcast came along. Comcast increased demand for a good (broadcasting rights) with static supply, and thus the price to keep them went up. The ball simply sits in ESPN’s court whether the price makes sense for them to buy up the rights (and protecting their place in the market is part of that calculation).
As I understand it, the previous contract was for more than $50 million per season, and when the NHL and ESPN entered into negotiations, talks ended when ESPN turned down a $60 million per season deal. My guess (and hope) is that ESPN was waiting for someone else to set the market, and then match the deal since they retained that right. Had no other network bid on the NHL, ESPN would have really had ‘em by the…
Anyhow, a friend of mine and I were talking about this before the Comcast deal came up. We decided that if we were in charge of the TV rights, we would have offered ESPN the rights for this season for almost nothing, with the stipulation that they had to televise a minimum of three non-conflicting live games per week with at least one of them being on regular ESPN as opposed to the deuce. Simply being on ESPN will/would give the NHL a much needed sense of legitimacy. Plus it would pave the way for Wednesday Hockey Night, all season long.