Article: “The Great NFL Heist: How Fox Paid for and Changed Football Forever” Author: Bryan Curtis
Publication Date: December 13, 2018
As a 36-year-old football fan, I remember life before the NFC went to FOX. This is one of the many things that places me amongst the Xennial generation. There are things we have come to take for granted that didn’t exist prior to FOX getting the NFL package. One of the most jarring of those is noticed when you watch a classic sporting event in 1993 or earlier and notice that there are long stretches of gameplay where the score isn’t displayed. That innovation (brought over from SkySports) was known as FoxBox, and now we can’t live without it.
The story of how the NFL got to FOX like many things isn’t a simple story. Instead, it starts in steps, and who better to write an oral history about the process than the Ringer’s Bryan Curtis? This is a phenomenal read, and you’ll love it if you’re a media nerd (such as myself). I will highlight some of my favorite parts of this extensive piece.
What happened in 1993 was that the old-line networks were coming under increasing pressure. All three were run by cost-cutters: ABC by Capital Cities, NBC by General Electric, and CBS by theater mogul Larry Tisch. After the 1990–91 recession, the cost-cutters complained, almost in union, that their NFL deals were leaving them in the red. “No way I am going to lose money on the NFL,” Tisch thundered.
Under its previous deal, CBS had paid $265 million a year for the NFC. The network calculated that it could break even if it paid the NFL $250 million a year. So Tisch did something audacious: He told his executives to offer the NFL no more than that figure, which amounted to a $15 million pay cut. Neal Pilson, the president of CBS Sports, was in a bind: How could he appease his boss and keep the rights to the NFC?
One of the worst kept secrets in media is that television networks lose money on rights deals for major sports and sporting events. So why pay? These events tend to be rated highly and can be plugged full of advertisement for the given network’s weekly programming. When the NFL isn’t on the air “NBC, CBS, and Fox’s viewership is 45% lower among men ages 18 to 49, a coveted demographic for advertisers.” So despite this cost, it becomes a deal that these networks have to engage in. They can hope to get some money back through advertising but that is limited.
So let’s flashback to 1993. Each time contracts were up, the NFL practically had three networks bidding on their own individual deals. ABC had Monday Night Football, NBC had the AFC slate of games, and CBS had the NFC. Cable television wasn’t what it is today, and CBS didn’t feel like it should keep paying $265 million. This is a bold move especially when they held the more valuable package. The NFC package (at the time) had Dallas, New York, Philadelphia, San Francisco, Chicago, and Los Angeles amongst other major markets. So how could this go wrong?
To put it simply, Fox came in with a pitch that focused on how they could present the game. David Hill (head of Sky Sports) came in explaining how they would give the NFL more cameras, more sound, and an exciting presentation that would be promoted year-round. Despite all of these things, the NFL didn’t exactly want to work with Fox. Much of the reason was that Fox wasn’t what it is today:
Preston Padden, Fox Broadcasting president of network distribution: There were about 60 cities in the United States where there was no fourth TV station to become our affiliate. CBS was saying to the NFL, “If you move these rights to Fox, in these 60 cities there will be no free over-the-air broadcast of the NFL.” Mr. Murdoch said, “You got to come to this meeting with the NFL TV committee.” Mr. (Rupert) Murdoch did not tell me what he was going to say. We stand up in front of the TV committee, and he says, “Within 60 days, Preston will get a secondary affiliation with some TV station in every one of these 60 markets.” I just about wet my pants.
Where CBS, ABC, and NBC had existed for decades Fox had only existed for a handful of years. It wasn’t available everywhere, but what it lacked in coverage it made up for with creativity and Rupert Murdoch’s (seemingly bottomless) pockets. CBS believed they had the latitude to call shots with the NFL, and Murdoch saw landing the NFL as tantamount to buying a network. He was such a visionary that he saw that acquiring the NFC rights would legitimize Fox overnight.
There is a suspenseful package that details how a CBS exec attempted to get the bid up to (then) NFL Commissioner Paul Tagliabue’s asking price of $295 million. When CBS that number, the exec runs to tell the NFL the news only to find out that Fox bid $395 million. The number was told to CBS head Larry Tisch and he refused to match. This marked a huge change in the climate of sports rights as explained by Steve Bornstein:
Steve Bornstein, ESPN president: When the league took that package from CBS and Tisch and sent it to Rupert and Chase at Fox, it changed the dynamic for the next 30 years. In the past, all the content that you were buying from the NFL or the NBA or Major League Baseball, the broadcaster had to maintain a profit on it. Now, you could rationalize that that’s how you build a network and get attention.
Realizing how big of a blow this was CBS tried to get a reel together to present the NFL to get the AFC package from NBC. What they learned was not only did NBC sign a $217 million deal that sealed them the rights to the AFC they would also get two Super Bowls over the duration of the deal.
Tagliabue: CBS came back the next day and said, “We’d like to go after the AFC package.” I had to tell them, “If you’re the loser on the first round, you don’t have a second round, even if we think we can get more in a second round. We’re not going to do that.” That was explicitly understood by both networks.
Just like that, it was over for CBS’ almost 40-year relationship with the NFL. What had to make it leave a sourer taste in their mouths is that this was all of their own doing. The NFL didn’t really want to move to Fox, but CBS overplayed their hand not realizing how eager Fox was to land the league. CBS didn’t stay out of the game long though as they went to outbid NBC for the ABC rights the next time the TV contracts were up.
The process of how the NFL landed on Fox is what interested me the most, but the entire article is fascinating. It gives a behind the scenes look on how the Fox courted John Madden, put together its studio show, and approached filling the rest of their announce teams. There are also insights from Jerry Jones who (along with Pat Bowlen) were the new power brokers who worked with Paul Tagliabue to not be so accommodating to the networks.
What we know is the relationship between Fox and NFL has been a mutually beneficial one. Fox became a legitimate network and has allowed Rupert Murdoch to extend his influence to start other networks (including Fox News). With the help of the Fox deal not only were the owners made richer, but so were the players. The NFL became a year-round product in a way that no other domestic sports league is.
What makes this article so important is that we are on the precipice of what could be another great change in sports broadcasting deals. In the past four years, the NFL has tested the waters by having games be streamed via Yahoo!, Twitter, and now Amazon Prime Video. Similar to how the broadcasts giants didn’t think the NFL would consider Fox, there is the thought that they wouldn’t risk taking their programming off of TV to go streaming. The NFL will go where the money is, but how long will networks have the money to stay in the game? That is the question we will have to wait to see the answer.