SBJ Media: PGA Tour, Mountain West Get New Rights Deals

The next big media deal is about to hit, one that has the potential to reset the sports rights marketplace over the next several years. CBS and NBC have agreed on the broad terms of new deals that will see the PGA Tour reap a sizable rights fee increase of around 60%, multiple sources told me. The Tour also has agreed to terms with Golf Channel, which will see its rights fee more than double -- not a huge surprise since Golf Channel’s last deal was cut in 2006. It is not known if the Tour will take an ownership stake in Golf Channel as part of the deal.
Nothing has been signed yet; but the Tour and networks essentially have agreed on terms with only a few minor sticking points remaining. The PGA Tour did not take the short money here, opting instead for long-term deals that will run for nine years from 2022-2030. By early estimates, it’s likely that the PGA Tour could bring around $700 million per year with these new deals, compared to its current deals that were worth around $400 million.
CBS and NBC essentially will keep the same regular-season packages. The big difference will be seen with the FedEx Cup Playoffs. CBS and NBC will produce all three playoff tournaments, including the Tour Championship, in alternating years. As part of the nine-year deals, NBC will carry the playoffs five times and CBS will carry them four times. Previously, NBC and CBS shared these rights, with NBC producing most of them each year.
An official announcement is not expected to come until early next year. The big hold-up is with digital rights, which are currently held by NBC Sports as part of PGA Tour Live and are still being negotiated. ESPN has made an aggressive play for the rights, which in addition to PGA Tour Live, includes tournament coverage before the networks go on air. ESPN+ would carry the digital rights. Discovery also has emerged as a serious contender for the digital rights and appears likely to share them with NBC Sports if they can manage to work out a deal. Discovery holds the Tour’s digital rights internationally. After initial interest, it appears that Amazon has dropped out of the bidding. Sources said it was too difficult to handicap a favorite for the digital rights.
This is the first big media rights deal cut by PGA Tour Commissioner Jay Monahan since he took over from Tim Finchem at the beginning of 2017. He has secured healthy rights-fee increases and will keep his sport on broadcast TV, ensuring the widest possible audience. The Tour hired Evolution Media as counsel on its rights deals. CBS and NBC also emerge as winners, keeping rights to a property that generated a lot of interest among media companies. The deal answers a lot of questions about the new ViacomCBS, whose merger became official two weeks ago. Coming on the heels of its UEFA Champions League deal, this PGA Tour deal shows that CBS will be aggressive in getting sports rights. The deal shows how important the Tour is to Golf Channel -- and how important Golf Channel is to the Tour. As part of its offer, AT&T said it would turn Headline News into a golf-centric channel, but sources said AT&T never got close to a deal.

Fox Sports has reached an agreement with the Mountain West to carry a package of the conference’s football and basketball games that formerly was held by ESPN. Separately, CBS Sports Network renewed its package of MWC games. My colleague Michael Smith and I are told that the Fox and CBS deals combined will be worth about $35 million annually -- around $20 million from CBS and $15 million from Fox. The length of the deals is not clear yet, but MWC Commissioner Craig Thompson has said that he wanted shorter terms than the 10-year deals the MWC had previously. The games in the Fox package are expected to run primarily on FS1.
The new Fox and CBS contracts, which will go into effect July 1, provide the conference’s 10 schools -- not including Hawaii and Boise State, which have separate arrangements -- with a significant revenue lift. Under the old contracts, those 10 schools made $1.1 million per year, per school. That per-school figure should jump to about $3 million or more. The league’s media deals are complicated because Boise State’s home games are negotiated separately from the rest of the conference. In the previous arrangement, Boise was paid a $1.8 million annual bonus, a deal negotiated in 2012 when the school jumped to the Big East and then quickly returned. Thompson has said that Boise will continue to receive a bonus above what other MWC schools get as an incentive to keep the Broncos in the league. Hawaii also has a separate deal, as it is a football-only member of the MWC.
Fox is now in business with five major conferences -- the MWC, Big 12, Big Ten, Pac-12 and Big East. The network also is believed to be in the running for the SEC’s package of 15 football games that CBS currently has. Even though Fox won the bidding, ESPN will continue to have a bowl relationship with the Mountain West and work with the league on playing in the early-season basketball tournaments. The MWC worked with Wasserman as an adviser on the deal.

When I saw that Jeff Shell would replace Steve Burke as NBCUniversal CEO, my mind immediately raced to 2005 and 2006. That’s when Shell orchestrated two of the most significant sports media deals in Comcast history -- ensuring that a company best known as a cable operator would be a huge player in the sports marketplace for the next 15 years.
In 2006, Shell grabbed exclusive cable TV rights to the PGA Tour for Golf Channel, a deal that I consider one of the most lopsided that I’ve ever seen. The deal transformed Golf Channel from a commentary channel to one that distributors had to carry. Before cutting the deal, Golf Channel was foundering; distributors paid only about 25 cents per subscriber per month for it. Immediately after getting the Tour rights, Shell increased Golf Channel’s rate by about 15%. I remember Charter protested the rake hike and dropped the channel. But with live PGA Tour coverage, the cable operator faced a subscriber revolt and put the channel back on its system after only a few weeks.
Just a few months earlier, Shell signed a deal to carry NHL games on Comcast’s sports network, starting the transition from Outdoor Life Network to OLN to Versus to what is now NBCSN and setting the cable network’s growth over the next decade. While at Comcast, Shell followed the same strategy that he used years earlier at Fox Cable -- pick up as many sports rights as you can and find a way to monetize them.
Shell was one SBJ's early "Forty Under 40" Hall of Fame honorees. He was selected in 1999, 2000 and 2001.

By now, you’ve probably seen the video of Newtown High School winning the state championship on a last-second pass seven years to the day after the Sandy Hook tragedy. If you haven’t, take a look. The team was featured on “Sunday Night Football” last night. NBC Sports gave me some insight on how the network got the team in studio one day after its thrilling win.
NBC provided some insight via email: “Driving back to New York after the Army-Navy game, Mike Tirico and producer Rob Hyland watched the viral video of Newtown High School’s first state title in 26 years. The next morning, Tirico texted Hyland suggesting that they invite the coach and some key players to appear on 'Football Night in America' that evening. Hyland agreed and reached out to the school, inviting the entire team and anyone else they wanted to bring. NBC Sports’ director of production planning Ben Davies and senior director of administration Terri Leopold handled the logistics."
Around 85 players, coaches, cheerleaders, school officials and one mascot climbed on board two motor coaches at 4:30pm ET for the hour drive to NBC Sports’ Stamford studio. NBC: "When the group arrived, they received NBC Sports apparel, met Tirico, Tony Dungy and Rodney Harrison and were given a tour of the production facility. You want some stats? They ate 35 pizzas and six dozen cookies.
Around 8:15pm ET, the group moved to Studio 3, which houses the 'Football Night in America' field set. 'FNIA' director Mike Sheehan and vice president of studio operations Tom Popple blended the 85 players, coaches, cheerleaders and mascot with Tirico, Dungy and Harrison for a segment that ran during halftime. By 8:45pm ET, the team was back on the buses and headed home. It was a school night after all.”

Around 85 players, coaches, cheerleaders, school officials and one mascot were at NBC Sports' Studio 3 "Newtown-NBC"

It’s the end of an era at CBS, where coordinating producer Lance Barrow -- who has been with the network since 1976 -- announced today that he will leave the production truck after the 2020 PGA Tour season. Barrow will be replaced by Sellers Shy. Barrow has a distinguished CBS career that spans more than four decades. He started as a spotter for Pat Summerall and eventually worked his way to be CBS' top NFL game producer from 2004-17.
The Caribbean Professional Baseball Confederation hired Octagon to be its exclusive media rights advisor. The deal is a good one for Octagon, as it includes the always-rowdy Caribbean World Series featuring the top Latin American teams every winter.
Comcast hired Monty Sarhan to help the company negotiate carriage deals with programming networks, Cablefax’s Amy Maclean reported. Sarhan had been GM of Epix; before that he was general counsel at WWE. As Senior VP/Content Acquisition, Sarhan will report to president Greg Rigdon and replace Jen Gaiski, who is leaving by the end of the year.
Good numbers for the UEFA Champions League coverage. The European tournament's group stage on TNT averaged 220,000 viewers, marking the best figure in more than a decade for that stage on English-language TV in the U.S. It's also up 16% from last year. The Round of 16 sets up well, with U.S. star Christian Pulisic and Chelsea set to play Bayern Munich and an always-popular Real Madrid playing Manchester City.
Congrats to ESPN’s Katina Arnold, who was inducted into the PR News Hall of Fame last week -- a well-deserved award for a well-respected exec. Check out the Twitter mentions for @katinaESPN last Thursday to find out just how well respected.
Gotta love D.C. in the winter: This is the storm that caused my daughter's school system to cancel classes today. It appears forecasters expected more snow.