<figure class="image"><img loading="lazy" class="alignnone size-full wp-image-101688" title="espn-always-on" src="https://worldsoccertalk.cms.futbolsitesnetwork.com/wp-content/uploads/2014/05/espn-always-on.jpg" alt="" width="642" height="428" srcset="https://images.futbolsites.net/wp-content/uploads/sites/6/2014/05/17054844/espn-always-on.jpg 642w, https://images.futbolsites.net/wp-content/uploads/sites/6/2014/05/17054844/espn-always-on-150x100.jpg 150w, https://images.futbolsites.net/wp-content/uploads/sites/6/2014/05/17054844/espn-always-on-300x200.jpg 300w, https://images.futbolsites.net/wp-content/uploads/sites/6/2014/05/17054844/espn-always-on-600x400.jpg 600w" sizes="(max-width: 642px) 100vw, 642px"></figure>
Last week during “upfronts,” those giant press conferences where television networks pimp their new programming to advertisers, ESPN president John Skipper was asked whether his network would bid on the next Premier League contract, which would begin in 2016.
“We’ll be interested in it,” Skipper <a href="http://www.sportsbusinessdaily.com/Daily/Closing-Bell/2014/05/13/EPL.aspx">told the press</a>. “We love the English Premier League.”
This quote came just days after <a href="https://worldsoccertalk.com/2014/05/12/mls-to-announce-90-million-per-season-tv-deal-with-fox-espn-and-univision/">Major League Soccer struck a new 8-year rights deal with ESPN and Fox Sports</a> worth an estimated $75 million per year — nearly a four-fold increase over MLS’ previous rights deals, which were worth just $19 million per year. (MLS’ Spanish-language deal with Univision also increased from $8 million per year to $15 million per year.)
That’s not all ESPN and Fox Sports have been teaming up to buy lately. In the last four years, ESPN and Fox Sports have agreed to spend $1.2 billion per year for Major League Baseball, $200 million per year for Big 12 college sports, and $200 million per year for Pac-12 college sports. This alliance seems likely to spend big to take the Premier League away from NBC after 2016.
Why? NBC is owned by Comcast, and ESPN cannot allow Comcast to build a competitive sports network because that would give Comcast leverage over ESPN in carriage fee negotiations.
Right now, ESPN commands a carriage fee of $5.40 per month. That money flows directly from your cable bill to the network. ESPN2 also collects a carriage fee of $0.68 per month. Those numbers are <a href="http://www.mediapost.com/publications/article/193856/espn-set-to-pass-7-sub-fee-in-2017.html#axzz2OiBGPF2h">expected to increase by 6.5% sometime this summer</a>. With those two channels in more than 97.3 million homes, ESPN stands to collect more than $7.5 billion in carriage fees over the next 12 months.
This is how ESPN is able to spend $1.9 billion per year on the rights to NFL Monday Night Football and more than $1.3 billion per year on a wide variety of college sports. It is also how, <a href="http://www.forbes.com/sites/kurtbadenhausen/2014/04/29/the-value-of-espn-surpasses-50-billion/">according to Forbes</a>, ESPN has attained an estimated valuation of $50.8 billion. That makes ESPN roughly 36% of the value of The Walt Disney Company.
Because of this, ESPN must ward off any threats to its revenue stream — such as a major cable TV carrier owning a sports network that might ever be considered on par with ESPN. Some have even suggested that ESPN <a href="http://sports.morganwick.com/2012/10/why-espn-effectively-created-a-fox-sports-network-and-why-nbc-was-never-going-to-compete-with-either-of-them/">encouraged Fox to create a national sports channel</a> in order to prevent NBCSN from attaining any sort of dominance. After all, any cable package that includes Fox Sports 1 also includes ESPN and ESPN2. You can watch Fox Sports 1 all day, and ESPN will still get its share of your cable bill.
NBCSN, meanwhile, collects only $0.31 per month from each of the 78 million homes it reaches. That brings in only $290 million. Thus, NBC’s strategy with NBCSN has been to focus on sports with smaller, more dedicated fan bases and keep spending low to allow the channel to pay for itself. NBCSN can afford to pay $83.3 million per year for the Premier League and $200 million per year on the National Hockey League, but anything more than that would require some help from the parent company.
Comcast could do it, of course. The cable TV behemoth posted net incomes of <a href="http://www.bloomberg.com/news/2014-04-22/comcast-adds-cable-tv-customers-again-bucking-industry.html">$1.87 billion in the last quarter</a> and a <a href="http://www.bloomberg.com/news/2014-01-28/comcast-s-profit-increases-after-tv-subscribers-grow.html">$1.91 billion the previous quarter</a>. Plus, NBC just signed <a href="http://www.nytimes.com/2014/05/08/sports/olympics/nbc-extends-olympic-tv-deal-through-2032.html">a $7.75 billion deal to keep the Olympics through 2032</a>, as well as <a href="http://www.forbes.com/sites/kurtbadenhausen/2013/07/24/nbc-nabs-nascar-tv-rights-for-4-4-billion/">a 10-year, $4.2 billion deal with NASCAR</a>. Money for those two deals, though, comes from sources other than NBCSN. In order for stave off what would likely be a $200-million-per-year bid from ESPN and Fox for the Premier League, Comcast would have to change course and allow NBCSN to spend more than it makes — and if Comcast really wants to do that, it might as well go big and spend $2 billion per year to take the NBA away from ESPN in 2016.
NBC has attracted <a href="http://awfulannouncing.com/2014/epl-on-nbc-lifts-the-bar-higher-for-sports-coverage-in-america.html">lots of praise</a> and <a href="http://awfulannouncing.com/2014/epl-viewership-sets-several-american-records-for-2013-2014-season.html">impressive ratings</a> for its coverage of the Premier League this season, but unless Comcast loosens its purse strings on NBCSN, the network will have a difficult time keeping the U.S. TV rights to the Premier League when that TV deal is up for renewal next year. ESPN will do whatever it takes to keep Comcast from gaining any leverage in future carriage fee talks, and that includes leaving NBCSN with hockey, auto racing, and very little else.
But on the bright side, we’ll get to hear Ian Darke call Premier League games again in a few years.
Dave Warner writes about the rising cost of sports TV rights at <a href="http://www.whatyoupayforsports.com/">What You Pay For Sports</a>.

Why NBC Sports Will Lose the Premier League in 2016

Why NBC Sports Will Lose the Premier League in 2016 - World Soccer Talk

<a href="http:\/\/epltalk.com/2013/04/24/why-nbc-wants-you-to-subscribe-to-cable-to-watch-the-premier-league/nbc-sports-logo-2/" rel="attachment wp-att-70861"></a><div><figure class="image"><a href="http:\/\/epltalk.com/2013/04/24/why-nbc-wants-you-to-subscribe-to-cable-to-watch-the-premier-league/nbc-sports-logo-2/" rel="attachment wp-att-70861"><img loading="lazy" class="alignnone size-large wp-image-70861" title="nbc-sports-logo" src="https:\/\/ds-images.bolavip.com/news/image?src=https:\/\/images.worldsoccertalk.com/webp/WST_20130424_WST_70860_nbc-sports-logo-600x450.webp&amp;width=600&amp;height=450" alt="" width="600" height="450" srcset="https:\/\/worldsoccertalk.cms.futbolsitesnetwork.com/wp-content/uploads/sites/6/2013/04/nbc-sports-logo-600x450.png 600w, https:\/\/worldsoccertalk.cms.futbolsitesnetwork.com/wp-content/uploads/sites/6/2013/04/nbc-sports-logo-150x112.png 150w, https:\/\/worldsoccertalk.cms.futbolsitesnetwork.com/wp-content/uploads/sites/6/2013/04/nbc-sports-logo-300x225.png 300w, https:\/\/worldsoccertalk.cms.futbolsitesnetwork.com/wp-content/uploads/sites/6/2013/04/nbc-sports-logo.png 800w" sizes="(max-width: 600px) 100vw, 600px"></a></figure></div>
Philip Badger’s plea to NBC Sports Network to <a href="http:\/\/epltalk.com/2013/04/24/dear-nbc-take-my-money-for-nbc-sports-live-extra-please/">let Premier League fans pay for NBC Sports Live Extra</a> separately covers a few of the reasons why the online service will be available only to cable subscribers, but it ignores some key facets of cable TV economics that play a role in NBC’s decision.
As Philip mentioned, NBCUniversal is owned by Comcast, and Comcast is a cable company, and gee, why would Comcast ever want to give you a reason not to subscribe to cable? On the other hand, while Comcast is the largest cable company in the U.S., it only has 22.3 million cable subscribers, or roughly 30% of the market share for cable TV. That 30% share does not include the 37 million or so people who have satellite dishes, or the rising number of people ditching cable in favor of fiber TV services from AT&amp;T and Verizon.
Still, Comcast-owned NBCU has a stake in all those subscribers, and not just for sports. That’s one key reason why NBCSN is only offering its online service to cable subscribers: NBC wants you to pay for all its other cable channels, too.
Those channels include:
<ul>
<li>USA Network ($0.55/month)</li>
<li>CNBC ($0.29/month)</li>
<li>SyFy ($0.21/month)</li>
<li>E! ($0.20/month)</li>
<li>Bravo ($0.19/month)</li>
<li>MSNBC ($0.16/month)</li>
</ul>
Those six channels account for <a href="http:\/\/consumerist.com/2010/03/09/list-of-subscriber-fees-shows-what-you-pay-for-channels-you-hate/" target="_blank" rel="noopener">$1.60 of your monthly cable bill</a>. If all of those channels reach the same 80 million homes as NBCSN, NBC collects an additional $1.53 billion in subscriber fee revenue. That $10 million or so that <a href="http:\/\/www.foxsoccer2go.com/?WT.mc_id=AFF_EPLTALK" target="_blank" rel="noopener">FOX Soccer 2Go</a> collects is a pittance in comparison.
Also, if you live in Philadelphia, Chicago, San Fran, Houston, D.C., Baltimore, or any part of New England, you’ll be chipping in for the Comcast SportsNet channel in that area. Regional Sports Networks account for at least $2.50 of your monthly cable bill. Some RSNs can cost up to $4/month.
This is just one form of bundling in the pay TV ecosystem, and it’s largely a result of media consolidation. Five corporations control the rights to nearly all the sports you see on U.S. television: CBS, Comcast, Disney, News Corporation, and Time Warner. These same five companies also own a huge portion of the channels on your pay TV service. Bundling all those channels together allows these corporations to collect revenue for all sorts of news, sports, and entertainment programming. The end result, though, is that customers end up paying for dozens of channels they don’t watch.
In addition, individual channels can serve as bundles, too, especially for sports. This explains why News Corp. is launching FOX Sports 1. By moving high-cost properties like the UEFA Champions League, NASCAR racing, and UFC from three niche channels (FOX Soccer, Speed Network, and Fuel TV) that collect less than $0.60/month combined to one general sports channel that’s expected to command at least $0.90/month, FOX Sports can not only shift the costs of those contracts off to consumers, but it can also collect enough money to pay for more high-value properties like Major League Baseball, and top college conferences like the Big East, Big 12, and Pac-12 — not to mention the FIFA World Cup and other major international soccer events, starting in 2015.
NBCSN works much the same way. At $0.31/month in 80 million homes, NBCSN collects $298 million per year. The NHL currently accounts for $200 million of that, and MLS accounts for $10 million. That leaves $88 million in subscriber fees — enough to cover the $83.3 million that NBC will pay the Premier League for the next three seasons. In order to cover those costs with its online-only service, NBC would have to find 278,000 EPL fans in the U.S. willing to pay $300/year for it. Considering that FOX couldn’t find roughly more than 60,000 people willing to pay $15/month, that plan probably won’t work.
Also, having such a high-value property also allows NBCSN to demand a higher subscriber fee and get cable and satellite services to offer the channel to more subscribers, thus increasing the channel’s revenue. Since Comcast owns the channel, extracting a few more pennies per month from 22.3 million subscribers shouldn’t be too big a hassle. In addition, everyone who gets NBCSN likely gets all those other NBCU-owned channels, meaning more money for Comcast.
This is how the pay TV game works, and since cord-cutting is not yet a serious threat to sports networks, it’s not going to change anytime soon. “TV Everywhere” services like NBC Sports Live Extra are designed specifically to keep customers attached to cable, because that’s where the money is for these corporations. On the bright side, if you do end up subscribing to cable, you can get just about all the soccer you’ll ever want. You’ll just have to decide if that’s enough to make you pay for all that other stuff you’ll never watch.
Dave Warner is a former soccer writer for the AOL sports blog Fanhouse and the founder <a href="http:\/\/www.whatyoupayforsports.com/" target="_blank" rel="noopener">What You Pay For Sports</a>, a website that explores the relationship between sports and television and shows consumers how their cable and satellite bills subsidize major pro and college sports.

NBC Wants You To Subscribe To Cable To Watch Premier League - World Soccer Talk

NBC Wants You To Subscribe To Cable To Watch Premier League

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Why NBC Sports Will Lose the Premier League in 2016

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NBC Wants You To Subscribe To Cable To Watch Premier League