Rupert Murdoch - The Real Commissioner?
When Bowie Kuhn became Commissioner, critics whispered that he
wouldn’t sneeze without clearing it with Dodgers owner
Walter O’Malley. Thirty years later, a very different
Dodgers owner may enjoy similar power, for very different
reasons. The Dodgers are now part of Rupert Murdoch’s
empire -- and Murdoch has unprecedented control over Major League
Baseball’s television exposure.
Before 2001, MLB’s national television rights had been
divided between two networks for 21 of the past 25 seasons. NBC
shared the package with ABC from 1976-89 and again, as part of
“The Baseball Network,” in 1994-95. Then NBC shared
the postseason with Fox from 1996-2000. (See table.)
TABLE: MLB's Network TV Contracts
Late last year, Murdoch’s Fox Sports signed a six-year deal
locking up nearly all of MLB’s national TV and cable
rights. The flagship Fox network will carry every All-Star and
postseason game through 2006. The fX cable network airs Saturday
night games, and the Fox Family Channel airs Thursday night
games. During this period the only non-Fox national baseball
broadcasts will be ESPN’s Wednesday and Sunday night
|| Average annual value ($ millions)
|| NBC, ABC
|| NBC, ABC
|| NBC, ABC
|| NBC, ABC
|| n/a (revenue sharing, no rights fees)
|| NBC, FOX
|| $416.7 (includes 2 games/week on cable)
For all the talk of baseball’s ratings decline, Fox paid
$2.5 billion for this package, an increase of 44% over the
previous contracts signed five years before. The contract
protects MLB in the event of a labor dispute: if some of the
games are canceled by a strike or lockout, MLB still gets all its
money, but must compensate Fox with additional telecasts.
That may help the cable networks in case of a regular-season
stoppage, but it does nothing for the Fox TV network. 90% of the
contract’s value to Fox comes from the postseason, which
not only attracts large audiences, but also provides an
irreplaceable opportunity for the network to showcase its fall
schedule to people who don’t otherwise watch much TV.
(Remember all those “Boston Public” and “Dark
Angel” promos last year?) Behind the scenes, Fox will move
heaven and earth to prevent a labor stoppage from threatening the
And the concerns of the national Fox networks are nothing
compared to those of the local Fox broadcast and cable affiliates
which dominate local baseball coverage. Thanks to mergers and
acquisitions of local sports channels, Fox Sports now controls
the cable rights for 26 of the 30 major league teams – all
but the Red Sox, Padres and the two Canadian teams -- at a cost
of close to $300 million per year. Half of the major league teams
now sell both their broadcast TV and cable games to Fox. In all,
Fox’s local outlets air over two thousand baseball
telecasts per year.
What would they broadcast in the event of a strike or lockout?
Soccer? The WNBA? And if so, who would watch?
Live major league baseball is the backbone of every local sports
channel. MLB provides hundreds of hours of live programming each
summer, as well as countless hours of highlight shows, pre- and
postgame shows, weekly “magazines,” etc. And in the
summer, those channels don’t have a lot of alternatives. A
strike or lockout would leave dozens of Fox Sports affiliates
hemorrhaging red ink.
Over the next five years, the various components of Fox Sports
will pay MLB more than $4 billion in rights fees. A repeat of the
1994-95 meltdown would cost Fox well over $1 billion. But with a
seat at the owners’ meetings and a stranglehold on national
and local broadcasting, Fox Sports won’t let this happen
without a fight.
Copyright © 2001 Doug Pappas. All rights
Originally published in the August 2001 issue of Boston
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