September/October 2014
Volume 34 No. 6

Sept Oct 2014
View complete issue as a PDF»

Big Fights For Sports TV Audiences

By Isme Bennie

There is a growing belief that — as the TV universe splinters and viewing options multiply — large audiences can only be generated from live events such as sports, as the SPORTEL and MIPCOM TV markets on the Côte d’Azur can attest.
The “irrational bidding” for sports rights, per some Canadian TV analysts, will drive up prices and limit consumer choice, as costs will be passed on to the viewer. According to the CRTC, the Canadian Radio-television and Telecommunications Commission, Canada’s regulatory body, Canadian subscribers have been expressing their dissatisfaction with the price of sports channels and about paying for packages of channels that include those they do not want. As a result, the CRTC is currently looking to impose a pick-and-pay or a-la-carte system.

The effect of this unbundling on the marketplace is an important issue, said veteran Canadian broadcaster Jay Switzer, chairman of Hollywood Suite, a group of movie channels. “In general, both Bell and Rogers use the high demand for their sports channels to help them secure carriage for their less-in-demand cable networks across the country and — directly or indirectly — force most subscribers in Canada to pay for sports networks whether they want them or not. The CRTC seems to be pressing them to make packages available without sports and this will hurt both players if they succeed.” And allowing consumers to buy television channels individually would almost certainly drive up the price of the highly-desired channels like sports.

A few months back, each of Canada’s two sports media giants made an announcement featuring an iconic Canadian brand. Rogers Media Inc. announced that Scotiabank would be one of the major sponsors for its future NHL hockey coverage. TSN (The Sports Network), owned by Bell Media, announced a similar multi-year content and digital partnership with Canadian Tire Corp. This competitiveness — aimed at attracting and keeping the attention of sports fans — has also created tension between the two vertically-integrated Canadian enterprises.

The Score, the only significant smaller, independent sports broadcaster, was recently purchased by Rogers Media and rebranded into its Sportsnet family. But Sportsnet and TSN are not the only sports services available in Canada. Leonard Asper has a bouquet of fight-related channels, and beIN SPORTS was recently launched. Owned by the Ethnic Channel Group, and carried by both Bell and Rogers, it features international sporting events, including Spain’s popular La Liga. Public broadcaster CBC, meanwhile, has events such as the Pan American Games, the Commonwealth Games, ISU skating and the Olympics. It lost the rights to the 2018 and 2022 FIFA World Cup to Bell Media.

This sports craze was triggered by Roger’s pre-emptive C$5.2 billion 14-year deal for the National Hockey League (NHL) rights. Rogers, with a growing suite of Sportsnet outlets, wrested the NHL from the CBC in a move that gives it television’s crown jewel — Hockey Night in Canada — leaving the financially-struggling public broadcaster in a pickle.

The Rogers/NHL deal became effective last July, and Rogers is embarking on a huge marketing plan based on extensive research showing that viewers want the stories behind the game. From her CBC experience, producer Julie Bristow came to a similar realization and started Bristow Global Media Inc., focusing primarily on the creation of premium content to complement large live events like marquee sports and thus help expand their viewership. One example is NHL Revealed: A Season Like No Other, made for the CBC and NBC Sports.

TSN’s launch of additional channels will create a need for more Canadian content. “Other opportunities for independent producers are in fringe sports such as curling, highly-rated on both TSN and Sportsnet, and fishing, the number one participant sport in the U.S.” said sports content supplier Matt Kelley of MyMediaMaker. “These need supplemental digital content, particularly athlete profiles and mini-docs.”

Rogers has also secured a 10-year agreement to be the exclusive distributor of WWE’s flagship programming in Canada through 2024. Keith Pelley, president of Rogers Media, has said that he believes Rogers will become the dominant player in the media and content space over the next five years.

TSN is the most lucrative specialty channel in Canada, but its ability to remain number one in subscription and advertising revenue has been the subject of much speculation since the Rogers NHL deal. TSN’s earnings come primarily from subscriber fees, and these jumped about 90 percent in the two years from 2011-2013, though its subscriber base remained steady.

“We have been Canada’s sports leaders for the past 30 years and our commitment to serving sports fans has never been stronger,” said Phil King, president of Bell Media’s CTV Programming and Sports, pointing to the diversity of TSN’s line-up of properties. “We’ve stepped up our game digital-wise, and in May we announced that we are expanding with more content and more platforms than ever before to give Canadian sports fans more sports and more choice.”

TSN plans to launch three additional TSN offshoots, as a means of leveraging valuable content for which it has limited outlets, including over 1,000 hours per year of programming from U.S. sportscaster ESPN, with which it has a primary rights relationship. (Rogers SportsNet has a primary rights relationship with the FOX U.S. sports networks).

Last June TSN unveiled its sponsors for the 2014 Canadian [American] Football League (CFL) season. These include big brands such as General Motors, Nissan and Purolator. TSN is the official CFL broadcaster, announcing a new multi-platform commitment through 2018. It had already announced that it is offering fans new digital content to help round out its CFL coverage.

Earlier in the same month Rogers announced that it was streaming seven of its sports specialty channels to its subscribers’ mobiles and desktops, giving them access online to the Toronto Blue Jays (baseball), NBA (basketball), MLB (baseball), curling, Tour de France, and the NFL (American football), with expanded multi-platform coverage of its NFL Thursday Night Football deal.

Canada is not alone in this fight for sports. Witness 21st Century Fox’s now-abandoned bid this summer to acquire Time Warner Inc. that would have given it a live sports portfolio that could rival that of Disney’s ESPN. Live sports remains one of the industry’s sure bets.