Will the Final Four head to cable?
Networks are joining together to handle soaring sports programming fees. And Time Warner's Turner Broadcasting may get more games as a result.
Time Warner's (TWX) Turner Broadcasting cable networks, which broadcast the early rounds of March Madness, is discussing a deal with CBS in which it would broadcast the more popular later rounds and the national championship next year, according to The Wall Street Journal.
Talks are underway two years earlier than expected and would be a huge win for Time Warner, especially because the fees Turner charges to cable and satellite providers are expected to rise by double digits over the next three years.
The reason why is simple: money. Sports programming costs are skyrocketing. CBS and Turner signed a 14-year, $10.8 billion deal with the NCAA in 2010. That was a 41% increase over what CBS paid under its previous deal. By splitting the costs with Time Warner, CBS is able to avoid generating "sizable" losses on its tournament coverage, according to the paper. Kantar Media estimates that the tournament generated $1 billion in advertising revenue in 2012, an increase of 38%.
Sports programs are very attractive to media companies because they attract huge audiences that prefer to watch live. The NCAA tournament has averaged 9.7 million viewers per game this year, an 11% increase over last year, according to The Journal. Whether the viewership will decline if more games are shown on cable isn't clear.
The basketball tournament could join a growing list of sports events only available on cable, including "Monday Night Football" along with Major League Baseball's League Championship Series and college football's Bowl Championship Series. Given the costs associated with airing sports programs, it seems likely that more will leave free television.
--Jonathan Berr is long CBS. Follow him on Twitter @jdberr.
- Why more Americans are turning off the TV
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] The stock market continued its strong start to the week with a broad-based Tuesday rally that sent the S&P 500 higher by 0.5%. Nine of ten sectors registered gains while the benchmark index extended its week-to-date advance to 1.4%.
Equities received an opening boost from a pair of economic data points that crossed the wires this morning. An in-line CPI report suggested inflationary pressures remain contained, while a better than expected Housing Starts report ... More
More Market News
Excitement is growing about the company's new iPhone, expected this fall.
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'