Earlier this year, NBC Sports won the television rights for The British Open away from ESPN. It was an important move for both companies. For NBC, it was a much needed return to major championship golf after losing the US Open and other USGA Championships to Fox Sports. For ESPN, it represented something of an end of an era. Not only would ESPN be out of the Open Championship, it’s the last PGA Tour event where ESPN televised all four rounds.
That era will begin a year earlier than originally thought. After winning the rights beginning with the 2017 tournament, ESPN and NBC have struck a deal where the peacock will take the 2016 tournament as well. The move is perfect timing for NBC given their recent acquisition of David Feherty from CBS Sports.
NBC Sports Group will carry the British Open in 2016, a year earlier than planned.
Last week, NBC and Golf Channel finalized a deal with ESPN and the tournament’s operator, the R&A, to take over next year. NBC planned to tell its golf production team about the deal on Sunday, and an official announcement is planned this week.
The move comes a little more than a week after the BBC sold its own lame-duck year for next year’s British TV rights to Sky Sports. NBC executives pointed to that move as the opening ESPN and NBC needed to cut their own deal. In order to maintain consistency, the R&A would have been less likely to shift its U.S. rights a year early if the BBC, its main British rights holder, did not do it first, sources said.
NBC’s reported payout for the British Open is $50 million dollars per year, which is about double what ESPN was paying in rights fees. And that could be the motivation behind ESPN getting out of a lame duck year at the British Open. With the biggest story of the year at ESPN being slicing and dicing budgets, saving that extra $50 million or so is a much needed budgetary reprieve. SBJ even hints at the much-talked about next round of layoffs beginning next week:
NBC is paying ESPN an unknown fee for next year’s rights. Still, the decision to opt out of producing next year’s tournament is the latest in a series of cost-cutting moves coming out of Bristol. ESPN declined to bid for rights to NASCAR and the English Premier League. The company has parted ways with high-priced talent like Colin Cowherd, Keith Olbermann, Bill Simmons and Jason Whitlock. And sources expect a round of layoffs to come as early as next week.
Are we moving into an era where ESPN can no longer write blank checks to keep their near-monopoly over live sports rights? Much has been made about the upcoming layoffs and ESPN letting high-priced talent like the above four names walk. However, all of those people on the payroll are a pittance compared to ESPN’s true cost in rights fees. ESPN’s dominance over their competitors is centered in their dominance in holding live sports rights. If that warchest for live sports rights begins to dry up, it will be the biggest factor in FS1, NBCSN, and the rest of the field beginning to catch up with Bristol.