Magazine article Variety

Breaking Point for Sports Rights Fees?

Magazine article Variety

Breaking Point for Sports Rights Fees?

Article excerpt

BIG MEDIA IS PAYING HEFTY SUMS to run games from the NFL, the NBA and more - all in the hopes of keeping large masses tuning in to their TV screens. But could the gambit instead drive crowds away?

No one believes American television viewers are plotting to turn off football, but the latest big-time sports alliance - the NBA last week renewed deals with Walt Disney's ESPN and Time Warner's Turner for what some believe to be as much as $24 billion over nine years - has spurred armchair economists to fret over whether consumers' wallets can accommodate the rising programming fees that cable and satellite distributors will eventually have to pass on to subscribers.

"Access to sports will come at a higher and higher price," said Lawrence Wenner, a professor at Loyola Marymount U., who studies sports management and sociology. "That's unfortunate, (since) many fans seem to think they have a 'bill of rights' to free sports through television. "But certainly there is no constitutional guarantee to sports. And big-time sports have long been big business, and governed by the logic of marketplace forces."

That was quite apparent when Turner and Walt Disney agreed to pony up what looks to be about three times what they were paying for NBA games. Estimates from Morgan Stanley analyst Ben Swinburne have T\irner paying the NBA around $1.26 billion a year, and Disney forking over roughly $1.41 billion per annum, turning what was once a combined fee of about $930 million a year to approximately $2.7 billion.

The cost of rights for other sports has similarly skyrocketed. Swinburne sees CBS and Turner each paying $386 million a year for NCAA March Madness games; Fox paying $1. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.