There’s an interesting story out today at Sports Business Journal that talks about the PGA Tour considering opting out of its broadcast television deals with NBC and CBS early. While the contracts with the two networks for the PGA Tour season runs through the year 2021, the PGA Tour is examining whether or not they should exercise an opt-out clause that can put their rights on the market early after the 2018 season.
SBJ reports that the tour has not only had conversations with current rights holders NBC and CBS, but also ESPN (who would air tournaments on ABC) and Fox. Complicating matters somewhat is that the tour’s cable television deal with Golf Channel also goes through 2021 and does not contain a similar clause.
PGA Tour executives declined to comment on the talks, but several sources describe the meetings as informational — money was not discussed and deal negotiations did not start. But the meetings attracted the interest of the top executives in the networks’ sports departments.
ESPN President John Skipper and executive vice presidents Russell Wolff, John Kosner and Burke Magnus, meeting to discuss weekend tournament rights for ABC, hosted PGA Tour officials in Bristol, Conn. Fox Sports President Eric Shanks, NBC Sports Group Chairman Mark Lazarus and CBS Sports Chairman Sean McManus led meetings at their respective network offices.
The tour signed its CBS and NBC deals in 2011, not long after the tail end of Tiger Woods’ peak that produced record-high TV ratings for all tour network partners. Woods then had a resurgence, winning three PGA Tour events in 2012 and five in 2013, when he was named PGA Tour player of the year. He has not won a tour event since.
Is this something that would make sense for the PGA Tour? Is there potential to strike it rich if they go on the market early? Is there real interest from ABC or Fox that could drive any new deal up in terms of revenue for the tour?
Those are questions where the answers aren’t an immediate yes, which is why the PGA Tour would be wise to be very careful when it comes to any kind of renegotiation, or leaving NBC and/or CBS early.
The biggest factor in any new television deal is that the PGA Tour is adjusting to life without Tiger Woods. The sport isn’t the same television product as it was in the first decade of the 2000’s and the networks know this. The tour just isn’t going to be able to gain the same rights fees now that they would with a healthy and successful Tiger. PGA officials can sell the networks on the young guns and new top stars like McIlroy, Day, Spieth, Fowler, and others… but it’s not the same. Now, those players can build a good future for golf and have led to some ratings increases in spots after the sport seemingly bottomed out in the last 1-2 years, but in all likelihood we’re not talking about a transcendent future.
With all that in mind, it’s hard to see another network like ABC or Fox splashing the cash to gain PGA Tour rights at this particular moment.
The second factor is looking at the schedules of these various networks and the availability for Fox or ABC to even make a deal. With the season running basically from January-September, Fox is in a box thanks to their NASCAR schedule. Although they’ve moved some races to FS1 that’s still a lot of Sundays where there would be a conflict. Similarly, ABC often airs Sunday afternoon NBA action throughout the winter and early spring months, which again presents a conflict.
The final factor is this – CBS and NBC both do an excellent job broadcasting golf and have done so for years. We’ve all had to live through Fox’s presentation of the US Open the last two years and I don’t know of any serious golf fan that is clamoring for that network to get more coverage. And when it comes to ABC/ESPN, their lead golf broadcasters Mike Tirico and Paul Azinger just left for NBC and Fox respectively. With Bristol giving the British Open to NBC, they would basically have to start over from scratch with their coverage as CBS’s broadcasters lift a heavy load during their Masters coverage. The NBC and CBS golf teams aren’t just good when it comes to golf, you can compare them favorably to any broadcast crew regardless of sport.
With the money, the schedule, and the network coverage taken into account, all the signs point to the PGA Tour realizing that the grass isn’t always greener on the other side… at least for the moment. The real opportunity for the tour will come in 2021 when the cable rights come up for bidding again. If at that point ABC/ESPN or Fox/FS1 want to get back in the game, it might be worth it for the PGA Tour to listen as they could present package deals that could help lift the sport on cable and broadcast television. With networks like FS1 and NBCSN desperate for more live rights programming, they would be keen to grab hold of PGA Tour rights for Thursdays and Fridays that would present several hours worth of live sports each day, which would be worth its weight in gold for those networks.