Sports: The Only Game on TV

Sports has once again saved TV’s bacon, serving as the medium’s enduring reach vehicle and supercharging the ad sales marketplace.

For millions of football fans, the prospect of enduring autumn without the National Football League paints a grim tableau. A Sunday afternoon devoid of the ritual and magic of pro football may be only slightly less discomfiting than having to watch John Madden eat an ear of corn on the cob — –and that sentiment holds true for the networks that carry NFL games as well.

The 2010-11 upfront got cooking as Fox, NBC, CBS and ESPN began writing orders for their NFL packages. Such was the rush for automakers and financial services companies to jump back into the sports TV pot that Fox wound up moving 80 percent of its Super Bowl inventory concurrently with its springtime deal-making. This was an unprecedented development, and further proof that the network television business lives and dies on the strength of top-tier sports.

Leaving aside for the moment the specter of a 2011 lockout, the current season has all the makings of a blockbuster. Prime-time ratings are booming, as NBC’s Sunday Night Football is averaging 21.8 million viewers through the first five weeks of the 2010-11 NFL campaign, marking the biggest turnout for nighttime football since 1996. Meanwhile, ESPN’s Monday Night Football is averaging 15.2 million viewers, even to date versus 2009.

It can be argued that football is the only thing keeping NBC afloat. The Oct. 10 telecast of Sunday Night Football was the week’s most-watched program in prime time, drawing 16.9 million live-plus-same-day viewers and notching a 6.7 rating among the 18-49 demo (8.84 million). Only one other NBC show finished in the top 20; The Office served up 6.95 million viewers and a 3.5 demo rating on the night of Oct. 7.  

ESPN is punishing the broadcast networks with its MNF juggernaut, drawing 17.3 million viewers and securing a 5.6 demo rating with its coverage of the Oct. 4 Eagles-49ers battle. On CBS, Hawaii Five-0 earned a 3.5 rating at 10 p.m., while NBC’s The Event pulled a 2.4 in the 9 p.m. slot. (ESPN sibling ABC is holding tough on Monday nights, as the most recent installment of Dancing With the Stars drew a 4.3.)

As there is very little NFL inventory left to go around — ESPN and NBC were all but sold out of their respective packages by late June, and only a handful of Fox’ $3 million Super Bowl 30-seconds remain available — advertisers have turned to the NBA offerings at TNT and ESPN.

Turner Sports is doing brisk business, crafting unique opportunities in and around its NBA on TNT telecasts with the likes of Hyundai, T-Mobile, Autotrader.com, Sprite, Kia Motors and the United States Marine Corps. The unit also landed new sponsors in Kelloggs, BP Amoco and Under Armour; moreover, Turner Sports has booked a number of first-timers on NBA TV, lining up deals for the league-owned network with Allstate, Arby’s, GameStop and Hanes.

“We’ve been doing this for 20 years now, and we are selling way ahead of schedule,” said Jon Diament, executive vp of ad sales and marketing, Turner Sports. “We’re pacing about 50 percent ahead of where we were this time last year, in terms of how much money we’ve already booked.”

Diament said an unusually active off-season trading period has helped prime the pump for the 2010-11 NBA season, and TNT should feel the impact of two of the bigger personnel moves when the Miami Heat square off against the Boston Celtics on opening night (Oct. 26).

“When people get their first real look at LeBron in a Heat uniform and Shaq over there in a Celtics jersey, that’s going to be amazing,” Diament said. “There’s so much excitement to tap into this season, and advertisers want to be part of that. Which is why so many of them are buying season-long packages.”

The NBA is gearing up to supplant Major League Baseball as the nation’s No. 2 sports organization, a surge reflected by TV ratings, if not gate receipts. The 2010 NBA Finals (Celtics-Lakers) averaged 18.1 million viewers on ABC, trailing the 2009 World Series battle between the Yankees and Phillies (19.3 million on Fox). That said, the NBA beat the MLB in the 18-49 demo, as the seven-game championship series earned a 7.3 rating to the six-game World Series’ 6.2.

ABC/ESPN pays an estimated $485 million per year for the rights to televise NBA games, slightly more than TNT’s investment ($445 million). Both contracts won’t expire until the ’15-16 season.

Along with the expanded reach afforded by big-time sports — in 2009, TNT’s NBA coverage averaged 1.87 million viewers 18-49, doubling the time-period average — clients enjoy the advantage of the live-viewing environment, which tends to aid in commercial retention. Last season, broadcast sporting events on average held onto 95 percent of their viewership during breaks, while sports commentary retained 99 percent.

As the NBA suits up for its 65th season, the NFL faces uncertainty about its own future. At risk for the league: some $3.8 billion in rights deals; the networks stand to lose $2.5 billion in regular-season ad revenue.

While there is no insurance clause to protect NFL partners in the event of a work stoppage, the biggest loser in a lockout scenario could be the league itself. “Mass exposure creates an annuity in perpetuity for these franchises,” said David Bank, managing director, global media and Internet research, RBC Capital Markets. “If you deprive fans of this content, you risk alienating them for good.”

In the event of a lockout, the networks won’t be on the hook for rights fees. But how to replace the irreplaceable? “God knows the scripted stuff isn’t going to do the trick,” said one national TV buyer. “The only way to make up those ratings points is with college football.”