Is Fox pondering a national cable sports network?
News Corp.’s Fox is once again weighing the idea of starting a national cable sports channel to rival Walt Disney Co.’s ESPN juggernaut.
A Fox Sports spokesman declined to comment on the renewed speculation about a national sports channel, first reported by Bloomberg. But people familiar with the matter said there were no immediate plans for such a service and dismissed Bloomberg’s report that a new channel could be launched as soon as late 2012.
Fox has toyed with the idea of creating a national sports network for more than a decade. It owns 20 regional sports networks, including Fox Sports West and Prime Ticket in Los Angeles. Its Fox Broadcasting Co. has long-term deals for professional and college football, as well as baseball and NASCAR.
Given how lucrative its regional channels are, Fox and News Corp. executives have for the most part viewed a national network as a luxury item, not a necessity. And going after ESPN would not be cheap, even for an established brand such as Fox Sports. ESPN and its various spinoff channels have dominated the cable sports space and spend heavily to lock up rights. For example, ESPN is paying an average of almost $2 billion a season for “Monday Night Football.”
NBC’s new parent company, Comcast Corp., is also looking to compete more aggressively against ESPN with its NBC Sports Network. NBC has the rights to the Summer Olympics in London and will use the Games to boost awareness of its channel.
Sports teams and leagues would no doubt welcome another competitor to ESPN because it would mean one more bidder for rights, which could lead to even higher prices.
Consumers, however, may not have the same reaction. Cable sports channels are already among the most expensive sources of programming. ESPN, for example, costs cable and satellite operators more than $5 a month per subscriber, according to industry consulting firm SNL Kagan. (The USA Network channel, for comparison, costs just over 60 cents a month per subscriber.) Much of that cost is passed on to the consumer. If another channel emerges and drives bills even higher, there could be renewed calls that high-priced sports channels should be sold as separate packages instead of being bundled into basic cable service.
“At some point there may be a real move for a la carte programming,” warned David Carter, executive director of USC’s Sports Business Institute.
