Bloomberg broke the news recently that Fox executives are considering a plan to launch a national sports network to compete with ESPN. The media largely focused on the impact of another deep-pocketed player in the lucrative sports rights marketplace.
No doubt live events are the core of the business, attracting large audiences and driving big ad and distribution dollars. The potential to launch a RSN in the LA market drove the $2.1 billion sale price of the Dodgers. The NFL dominates television because of its incomparable ability to consistently deliver large audiences.
Yet we overlook a huge story in all the talk about sports rights bidding and ESPN’s dominant position in live events. After more than 30 years Sportscenter, ESPN’s signature show, shockingly remains the only television program distributed nationally dedicated to sports news.
Can you think of another major programming category ceded to one network exclusively? The Today Show, 60 Minutes, The Tonight Show, American Idol…all were first movers in their respective genres and established dominant positions among audiences and advertisers. Yet that did not stop networks from creating similar, profitable programs.
RSN’s and league networks operate successful news franchises but they tend to be sport specific or locally focused. Fox and CNN made fleeting attempts nationally in the past. Versus never really tried to compete with Sportscenter.
Television is a copycat business. The failure to mount a sustained challenge to Sportscenter in 30 years must rank as one of the industry’s greatest historical anomalies.
While live events are a must, fans will watch games wherever they’re aired. The differences in network event productions have little, if any, impact on ratings. Therefore it’s extraordinarily difficult to build a brand with leased content. General sports news gives fans a reason to tune in daily, indeed multiple times a day. Without an alternative to Sportscenter, it’s difficult to imagine any network establishing a competitive brand.
The NFL’s impact on ESPN’s affiliate fees is well-chronicled, yet over the years the network’s sales teams have wisely emphasized the power of the brand in pitches to advertisers and affiliates. The heart and soul of ESPN’s brand is not Monday Night Football, it’s Sportscenter.
There is ample economic justification for other networks to make a challenge. The sports news marketplace, virtually wholly owned by Sportscenter, drives hundreds of millions of dollars annually for ESPN. Sportcenter’s success allows ESPN to monetize all events, even ones it doesn’t air.
Sportscenter remains a phenomenal, ubiquitous product. Some argue that trying to compete with such a juggernaut would be foolhardy. Between the highlight licenses and production costs it wouldn’t be cheap. There is no question however that NBC Sports Group, CBS and Fox possess the resources and skills to do it. Frankly it might be a wiser investment than some sports properties. From a marketplace standpoint there’s little doubt that marketers and media buyers would embrace, and perhaps disproportionately reward, a credible challenge to Sportscenter.
Moreover, creating a sports news media platform optimized for a 4-screen, socially connected world, presents an extraordinary opportunity to redefine the industry. It might be intriguing enough to entice cash-rich, non-traditional media players like Apple, Facebook or Google to mount a challenge.
Yes, it will take time. But perhaps the mountain isn’t as high as we think. Remember, American Idol seemed unstoppable in 2010. Now it’s chasing The Voice.