THE BUSINESS AND POLITICS OF SPORTS
Do not expect too much in the way of comment from Major League Baseball Commissioner Bud Selig or National Football League Commissioner Roger Goodell or the numerous Major League Baseball, National Basketball Association, National Hockey League and Major League Soccer owners or NASCAR officials when it comes to the English Parliament's Culture, Media and Sport Committee report which concluded that Rupert Murdoch is unfit to run his News Corporation outfit.
Expect silence from Murdoch’s partners at Madison Square Garden, the Dolan family and from Phil Anschutz and his AEG marketing company. Murdoch’s partners probably are not overly concerned about Murdoch’s fitness to run a media empire. His Time Warner partnership probably will not suffer either. Murdoch’s FOX News Channel and Time Warner’s CNN may be cable TV rivals but the two companies make money on Harvey Levin’s TMZ program as Time Warner distributes the show and Murdoch places the program on his owned and operated FOX stations.
Media entanglements are not a problem in the United States.
Rupert Murdoch, as long as he makes money for sports owners, is fit.
Murdoch will not be charged with any crimes by the UK government committee, but he was excoriated by the liberal and labor party members of the Culture, Media and Sport committee. Conservatives committee members disagreed with their counterparts perhaps because Murdoch a few weeks back expressed dismay at the right wingers, conservatives and "toffs" who he thought were going after him.
Murdoch does not really have any ideology beyond identifying what audience might make him the most money.
In the mid-1990s, I had a chance to pitch a television show to David Hill who is now the Chairman and CEO of the Fox Sports Media Group. Hill had just arrived from Murdoch's UK-based Sky Sports and was gracious enough to listen to my pitch for a high brow sports business show and watch a demo.
Hill was impressed. "Evan, I like your work but my audience won't like it. They are white trash," he told me. My idea was not a money making opportunity for Hill, Murdoch or News Corp.
Murdoch and Hill did identify a money making opportunity a few years earlier. They decided getting the broadcast rights to games no matter what the cost to News Corp was a way to gain audience share and perhaps more importantly, a way to get into the ultimate United States good old boys, endowing sports owners.
In the United States, Rupert Murdoch is something of a hero to sports leagues and owners. And why not hail him as a conquering commander seeing that he has put billions upon billions of dollars into their pockets through various television deals. FOX has partial or outright ownership of nearly 20 cable TV sports regional networks, a piece of the collegiate sports Big Ten network and car racing channels.
But Murdoch also has received many benefits from his association with United States sports tycoons.
In 1993, he rolled the dice and spent billions and wrestled away National Football League TV rights from CBS. In getting the package, Murdoch became a major media player in the United States.
Before the NFL, Murdoch's FOX network, which is technically not a network but a syndication unit, was a weak collection of UHF stations with the exception of a few cities like New York, Washington, and Los Angeles. Before the NFL, FOX had a few shows that drew some attention, the It's Gary Shandling's Show, the Tracy Ullman Show and Married With Children. Out of the Ullman show came The Simpsons, Shandling's show originally ran on Showtime and then went to FOX. Ullman's show was canceled in 1990. FOX could not establish a late night talk show, the Joan Rivers experiment was a disaster and a 1993 Chevy Chase late night show as a bomb. Not much worked for Murdoch.
Neither Al Bundy nor Bart Simpson, as popular as the characters would become, could bolster FOX. Murdoch's team was buying TV stations and became the biggest owner of over-the-air stations in the United States but by 1993, it was still the fourth network in a three horse race for ratings behind CBS, NBC and ABC.
The NFL changed all of that. Actually, it was Jerry Jones, the owner of the Dallas Cowboys that put Murdoch on the map as Jones and Murdoch negotiated the TV deal that would change everything. The NFL had been prospering from TV rights fees since the 1961 Sports Broadcast Act which allowed the league commissioner, who is also the league's chief negotiator and lobbyist in all things NFL, to bundle the 14 member franchises into one entity in order to negotiate a TV deal. Three decades later, the NFL was a 30 franchise entity with four separate and distinct elements. CBS had the National Football Conference contests and paid slightly more money for the NFC than NBC did for American Football Conference games because the NFC had more major markets. ABC had Monday Night Football and ESPN and Turner Sports split a Sunday night package.
The NFL was being paid $3.6 billion over a four year period between 1990 and 1993.
Murdoch's fourth place network was desperate for a game changer and the NFL provided him with an opening. The NFL and Jones were knocked over by Murdoch's bid for the NFC games. Murdoch was willing to fork over $1.58 billion over four years to get the NFC package along with the Super Bowl. Murdoch had a syndication arm but no news division, no sports division, none of the apparatus that CBS, ABC and NBC had. Murdoch knew that the NFL deals with an old philosophy, cash on the barrel head gets serious consideration and because he blew CBS out of the water with his bid, the NFL and Jones knew they would be getting a new partner with a patchwork of big city VHF and small area UHF stations and both sides would have to make it work.
In December 1993, The NFL took the money. In retrospect, it was the right decision, but at the time it looked like just a money grab.
In early 1994, Murdoch started to prepare for the 1994 season by quickly established a sports department by giving Madden an enormous contact and hiring his sidekick Pat Summerall. Murdoch also took Madden's CBS support team and made John feel right at home. Madden would become the face of FOX sports and with the NFL in tow, Murdoch was able to steal VHF stations in Detroit and Milwaukee away from CBS. Murdoch had one of TV's crown jewels, the NFL, and FOX would now be in a position to become a serious player in American TV.
It can be suggested that the success of the NFL and Madden on FOX led to Murdoch to start the FOX News Channel. The over-the-air network, still technically a syndication arm, started producing hits like the X-Files along with Beverly Hills 90210, Melrose Place, In Living Color to go along with The Simpsons and Married With Children. Murdoch did not have blockbuster ratings, but the network was doing decent business, and he already had a satellite news network in Europe, so Murdoch turned to creating a United States cable TV news channel.
There are no what if questions. The NFL and Madden changed the fortunes of both Murdoch and Lawrence Tisch's CBS. In 1993, CBS completed the TV hat trick; it won daytime, prime time and late night ratings. David Letterman had just moved over to the network and things were looking good. But Tisch's CBS did not invest in cable TV, lost the NFL and Madden, football's top star both on and off the field, lost affiliates and would start a downward spiral. Murdoch's FOX Sports added the National Hockey League and Major League Baseball soon after the NFL deal. Eventually Murdoch would gain NASCAR and the Bowl Championship Series. On the cable TV side, Murdoch sort of has a national sports network, but that is not where Murdoch really has a sports foothold. Murdoch's regional sports cable networks are still strong despite being challenged by upstarts in the past few years. FOX either owns or has agreements with numerous cable regional sports networks, and there are college sports networks as well. There is also a partnership with The Big Ten Network.
Madden's signing with FOX after CBS lost the NFL rights in 1993 cannot be dismissed.
John Madden was a major part of the FOX promotion, so much so that at an NFL owners meeting at the Arizona Biltmore in Phoenix, John ended up by the master of ceremonies for the night's owners’ party after Murdoch departed. Madden left FOX after the February 2002 Super Bowl and joined ABC Monday Night Football's crew. John was no longer that valuable to Murdoch. Rupert built a viable network; he had built a strong regional sports cable network; he had his news channel and was finally an American citizen because non-American citizens could not own TV networks. But News Corp remained an Australian company and Murdoch decided to move the company to the United States.
After the relocation of the company headquarters, President Bill Clinton's Federal Communication Commission in 1995 allowed Murdoch to run FOX because it was "in the best interest of the public."
Clinton's FCC badly misjudged what was in the best interest of the public by allowing Murdoch to encamp in the United States.
Now that Murdoch has been censured by an English Parliament committee for wrong doing, it will be interesting to see if any sports owners run away from him or News Corp. The answer is probably not. News Corp has been enhanced by sports dealings in the United States and the owners look at their wallets before worrying about public perception. Besides watch a FOX football telecast, the camera seems always to be trained on an owner who seemingly lauds over the game like a modern day Caesar at a modern day Roman Coliseum.
For now, Murdoch may be unfit in the UK, but in the United States he continues his political and sports dominance unfettered. Over time that may change, but for now Rupert Murdoch still remains a significant political and sports force in the US.
Evan Weiner, the winner of the United States Sports Academy's 2010 Ronald Reagan Media Award, is an author, radio-TV commentator and speaker on "The Politics of Sports Business." His book, "The Business and Politics of Sports, Second Edition" is available at bickley.com and Amazon and featured on Google books.