UPDATE: COO Chase Carey says not to worry about speculation that he’s preparing to leave. “Rupert and I have an understanding and a new agreement,” he told analysts in a conference call. “We just haven’t gotten it on paper yet.”
PREVIOUS, 1:08 PM: Shares are up about 4% in postmarket trading after Fox reported that the Super Bowl helped to score an additional $338M at the TV business — enabling the company to beat expectations for the first three months of 2013, an otherwise mixed quarter. Rupert Murdoch‘s entertainment operation generated $1.07B in net income, -63% vs the period last year, on revenues of $8.22B, +11.8%. The top line exceeded forecasts for $7.99B. Adjusted earnings at 47 cents a share also beat predictions for 35 cents.
Related: Super Bowl Scores With Record 111.5 Million Viewers
The dominant Cable Network Programming unit’s revenues increased 11.5% to $3.15B — slightly less than analysts anticipated — with cash flow +10% to $1.18B. The business benefited from an 11% increase in the cash it collects from cable and satellite companies, and an 8% increase in domestic ads. But it also had higher expenses to launch Fox Sports 1 and FXX. At the Fox broadcast operation revenues with the Super Bowl were +27.1% to $1.59B, higher than the consensus forecast, with cash flow +31.5% to $288M. Ad sales were up 30%, although Fox says that it also suffered from “lower general entertainment ratings, led by declines at American Idol.” Filmed Entertainment suffered from comparisons with early 2013 which included A Good Day To Die Hard, Parental Guidance, and Life Of Pi and as it absorbed costs, but didn’t collect revenues, for Rio 2 which was released in April. Revenues fell 2.9% to $2.28B although cash flow increased 6% to $354M from sales of streaming rights to Amazon of TV shows including The Americans and 24. Read More »
Going on three months after the ballyhooed launch of Fox Sports 1, Fox Sports has solidified its management team. David Nathanson has been upped to the newly created post of General Manager and COO at Fox Sports 1 and Fox Sports 2, and Bill Wanger has added Content Strategy to his title as EVP Programming and Research at Fox Sports. Three others also are moving up. Here’s the release:
Related: Want To Buy An Ad During The Super Bowl? Too Late, Says Fox
Los Angeles – In a reorganization of FOX Sports’ executive management structure, veteran executives David Nathanson and Bill Wanger have assumed new responsibilities, effective immediately. Nathanson has been appointed General Manager & Chief Operating Officer, FOX Sports 1 and FOX Sports 2, a newly created position, while Wanger, FOX Sports’ Executive Vice President, Programming & Research is now Executive Vice President, Programming, Research & Content Strategy. The announcement was made today by FOX Sports President, Chief Operating Officer & Executive Producer Eric Shanks, to whom both Nathanson and Wanger report.
Reporting to Nathanson, as the senior management team guiding both national sports channels, are 19-year FOX Sports veterans Scott Ackerson, who becomes Executive Vice President, News; George Greenberg, whose title is now Executive Vice President, Content Integration & Presentation; and Michael Bloom, who remains FOX Sports’ Senior Vice President, Original Programming.
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No gain without pain, I guess — and Fox‘s investments in services including FXX and Fox Sports 1 pinched in the quarter that ended September 30. The company just reported net income of $1.26B, -43.8% vs the same period last year, on revenues of $7.06B, +17.6%. The revenue number was well ahead of the $6.8B that analysts anticipated. But the bottom line, at 33 cents a share, was two cents lower than the consensus forecast. The disparity between revenue and profit is clearest at the Cable Network Programming unit, where sales were +12.3% to $2.8B while cash flow fell 2.4% to $991M. Domestic affiliate fees were +10% while ad sales here were +6%, despite a drop at Fox News, which was helped last year by the presidential campaign. Still, expenses rose 22%, the company says, with two-thirds of the increase going toward the new channels. Filmed Entertainment also had a mixed quarter, with revenues +9.5% to $2.1B while cash flow fell 24.3% to $328M. As studios typically say in these situations, Fox attributes the profit fall to “difficult comparisons” with last year, which included Ice Age: Continental Drift. The revenue increase was helped by syndication of Modern Family and Netflix payments for the first two seasons of New Girl. The broadcast TV unit held its own as retransmission consent fees doubled — outweighing weak ad sales from lower ratings including at X Factor, and the loss of … Read More »
A big step up for Randy Freer, who’s considered one of the most influential execs in TV sports. He’ll continue to oversee sports at Fox but with “a broad strategic and operational role across FNG” including Fox Broadcasting, reporting to FNG CEO Peter Rice, the company says. Freer seems to have a halo from the launch of Fox Sports 1 in August. Rice praised Freer’s “impressive skills as both an operator and builder of businesses” and said he’ll be “a key partner for me in overseeing and driving continued growth of our global channels business which spans nearly 400 channels in 200 countries.” Execs who’ll now report to Freer include Michael Biard, President of Distribution at Fox Networks; Toby Byrne, President of National Ad Sales at Fox Broadcasting Company, Fox Sports Media Group; Lou LaTorre, President of Advertising Sales at Fox Cable Entertainment Networks, Fox Hispanic Media Group; and Kyle Sherman, EVP Home Team Sports. FNG finance & business development, corporate communications, legal and human resources functions will report jointly to Rice and Freer.
Here’s the company’s release: Read More »
Listen to (and share) episode 48 of our audio podcast Deadline Big Media With David Lieberman. David talks with host David Bloom about Fox’s big bet on the pay-TV status quo with its heavily promoted Fox Sports 1 channel launch; a possibly game-changing deal in the making between Viacom and Sony Electronics; and that big “for sale” sign hanging around the metaphorical neck of troubled phone maker Blackberry.
Deadline Big Media, Episode 48 (MP3 format)
Deadline Big Media, Episode 48 (MP4a format) Read More »
UPDATE, 9:30 AM: I’m hearing that while DirecTV, Dish Network and Time Warner Cable will carry Fox Sports 1 programming this weekend, they don’t have new deals in place for the network. The distributors permitted Fox to upgrade Speed to FS1 as long as they don’t have to pay extra for the channel for now. Negotiations are still underway to reach more traditional carriage agreements. Fox says it doesn’t comment on the terms of its programming deals.
PREVIOUS, 6:44 AM: 21st Century Fox’s sports service has pulled off some late-game heroics. Fox Sports 1 will launch on Saturday with a full lineup of carriage partners the company says this morning — indicating that it has inked last-minute deals with Time Warner Cable and satcasters DirecTV and Dish Network. “We are thrilled that virtually all pay-television customers across America will have access to FOX Sports 1,” says Fox Networks’ distribution President Mike Hopkins. “This network launch is a major milestone for Fox and will alter the sports television landscape. We are grateful to our distribution partners for making this all possible.” DirecTV, Dish and Time Warner Cable combine for about 46M subscribers or about 54% of the industry total, but were unsigned until now. Fox says that with “every major distributor on board” Fox Sports 1 will be “the biggest sports cable network launch in history, and one of the largest network launches ever.” Fox reportedly asked distributors … Read More »
21st Century Fox’s sports service could launch this Saturday without three of the four largest pay TV distributors — which collectively have about 46M subscribers or about 54% of the industry total. Time Warner Cable, DirecTV, and Dish Network are still in discussions to carry Fox Sports 1, according to Sports Business Daily. If there’s no agreement by the end of this week, the distributors would offer a stripped-down version of Fox’s motorsports channel Speed, which is being converted to Fox Sports 1. The publication says that Fox wants distributors to pay a monthly fee of 80 cents per subscriber for Fox Sports 1, rising to $1.50 in a few years. Speed costs just 23 cents. Fox Sports Media co-President Randy Freer sounded confident about reaching carriage deals when he spoke last week to analysts about his plans. Fox Sports 1 “will be available in up to 90M homes at launch,” he told them. Execs also said that they expect the channel to become profitable in 2016.
Fox’s fledgling 24-hour national sports network today unveiled the full cast of commentators and analysts for its nightly rival to ESPN’s SportsCenter. Joining hosts Jay Onrait and Dan O’Toole on Fox Sports 1′s daily news program Fox Sports Live are former ESPN host Charissa Thompson, ex-NFL stars Donovan McNabb and Ephraim Salaam and NBA Hall of Famer Gary Payton. Already on that list was ex-tennis star Andy Roddick. “Whatever the story is, we’ll rise to the top. Regardless of what sport it comes from”, said executive producer Mike Hughes during an event to unveil the cast. The show debuts when the network launches August 17, replacing Speed Channel. It will air at 11 PM ET, with refreshed editions airing at midnight ET and 1 AM ET.
Related: Wall Street Predicts News Corp Will Score With Fox Sports 1
Is Keith Olbermann’s latest TV renaissance about to take him back to Bristol? The lightning-rod veteran of sports and political shows is in “serious discussions” with Disney-owned ESPN for a late-night talker on sister outlet ESPN2, according to the New York Daily News. The paper stresses that no decision has been made and that talks are “very fluid,” but even the notion of Olbermann-to-ESPN has eyebrows arched around the industry — especially with the launch of News Corp’s high-profile potential rival sports net just a month away. Fox Sports 1 has been staffing up for its August 17 debut, prepping shows with Regis Philbin and Mike Tyson, among others, so Olbermann would be quite a coup for the Worldwide Leader, which is coming off a wince-inducing 32% Q2 ratings drop for its flagship network and 12% for ESPN2. Olbermann is resuscitating his post-Current TV career with a Major League Baseball postseason studio show on TBS. That is the former MSNBC host’s first television gig since his very public split with Current, which Al Gore since has sold to Al Jazeera. Olbermann worked at ESPN from 1992-97 before exiting — as has become is TV M.O. — amid controversy. He also had a three-year stint at Fox Sports Net and Fox, working the 2000 World Series for the latter.
Related: … Read More »
Is the Worldwide Leader looking over its shoulder? Two months after laying off hundreds of staffers and five weeks before the launch of Fox’s rival sports network, ESPN saw its second-quarter ratings plunge compared with last year. Sports Business Daily reports that the Disney-owned sports behemoth saw a 32% ratings dive for the April-to-June period versus the same period in 2012. The discrepancy is due in part to the network’s rotten luck with a little-watched NBA Western Conference Finals — the San Antonio Spurs’ sweep/beatdown of the Memphis Grizzlies — compared with its airing of the thrilling 2012 Eastern Conference Finals, in which the Miami Heat beat the Boston Celtics in seven games. But the bad news gets worse: ESPN also posted its lowest total-day numbers since the George W. Bush administration, down 20% to an average of 715K viewers on a 24-hour basis. The depressed numbers come despite record viewership for The Masters in April and near-record tune-in for the NBA Draft. But Credit Suisse analyst Michael Senno is upbeat about ESPN going forward; he reiterated his “outperform” recommendation for Disney shares this week and raised his target price for the stock by $1 to $74. Football will be a salve for the recent burns in the late summer and fall, when ESPN starts airing NCAA games and NFL Monday Night Football. But before that, on August 17, … Read More »
News Corp‘s new 24-hour national sports network launches August 17 with plans to become the main rival to Disney’s ESPN. Fox Sports 1 has revealed it will be making its biggest marketing push yet beginning with a 90-second ad to air during Fox’s coverage of baseball’s All-Star Game on July 13. The network has enlisted major names to star in the commercial, according to USA Today, including NASCAR drivers Jeff Gordon and Kasey Kahne, NFL players Joe Flacco and Patrick Willis, baseball’s Bryce Harper, U.S. women’s soccer star Alex Morgan, Mike Tyson and coaches like USC’s Lane Kiffin. Fox has enlisted David Fincher’s Jeff Cronenweth as cinematographer and music video director Joseph Kahn to helm, the paper said. Pics from the Gordon-Kahne shoot are cropping up the network’s Twitter feed, with more than 150 crew members on that Concord, NC set alone. “In every way there is to quantify this, it’s the biggest (commercial) we’ve ever done”, Fox Sports marketing boss Robert Gottlieb told USA Today. “We want to make a big splash with this. This is the cherry on the cake”.
Newly retired tennis pro Andy Roddick will co-host Fox Sports Live, the network’s flagship news and highlights show, when Fox Sports 1 launches August 17. He joins Jay Onrait and Dan O’Toole, the Canadian duo previously announced as the primary highlight team for the show, which will be the News Corp-owned network’s equivalent and rival to ESPN’s SportsCenter. Roddick is no stranger to the spotlight, having been the U.S.’ top male tennis player for years before being slowed down by injuries and age — he won a slew of titles but only one major, the 2003 U.S. Open, before he retired after the U.S. Open last August at age 30. On the media front, he hosted Saturday Night Live in 2003 and co-hosted a nationally syndicated Fox Sports Radio show last year — the guy knows his sports. Sports Illustrated has already reported that Charissa Thompson, co-host of ESPN’s SportsNation, will also join the team as a co-host.
Related: Wall Street Predicts News Corp Will Score With Fox Sports 1
I’ve been waiting to see if any analyst would slam News Corp’s decision to launch Fox Sports 1, the national general sports makeover for the company’s Speed channel. You can make a compelling case that the pay TV sports bubble is about to pop, especially if cable and satellite companies follow through on their threats to cut high-priced sports channels from the basic cable bundle. But the investment pros continue to bet that the current system will remain intact, and that Fox Sports 1 will be a winner. Several raised their target price for News Corp stock. The consensus view is that pay TV distributors will agree to pay about $1 a month for each subscriber — up from the the estimated 22 cents the company currently collects for Speed — raising affiliate revenues to $1.1B a year from $312M. News Corp will have several opportunities to push for higher rates: about 30% of its current pay TV deals expire by mid 2014, and another 40% will be due the following year, Barclays Equity research’s Anthony DiClemente notes. Read More »
Fox Sports 1 and boxing icon Mike Tyson today announced that their new series Being Mike Tyson will spearhead programming on the newly announced “national multi-sport network”. Tweeted @FoxSports: “The first big name to hit #FS1 this fall – @MikeTyson. The BEING: Mike Tyson series is now in production.” Earlier today NewsCorp COO Chase Carey described the Fox Sports 1 venture as a smart long term investment that could grow into “a multibillion dollar franchise” with its combination of licensed sports rights and original programming. The new network launches in August.
Related: Fox Sports 1 To Launch on August 17
News Corp’s COO assured investors this morning that the introduction later today of the Fox Sports 1 cable network is a smart long term strategy, even though it will result in losses for the next few years. The company will convert its Speed channel into a national, general sports channel and has to make a “manageable investment” while it tries to ”ramp up the rate” that cable and satellite companies pay for the existing service, Carey told the Deutsche Bank Media, Internet and Telecom conference. Pay TV distributors currently shell out about 22 cents per subscriber each month for Speed — and $5.54 for ESPN — research firm SNL Kagan estimates. In the end, Carey says the upgraded sports channel could become “a multibillion dollar franchise.” The service will be “a natural fit” since sports “has been a huge part of the growth of Fox for 15 years….It’s a place where we can bring expertise, synergies and for us is part of growing and adding a new dimension to our business.” Although sports rights are expensive, Fox can “navigate that” and capitalize on programming that’s “ever more valuable and more unique in a world that’s fragmented.” The “key” to the effort, he says, is to “not try to beat ESPN.” It will take advantage of … Read More »
The Fox Sports Media Group has an upfront presentation scheduled for this afternoon and is expected to use that platform to announce the launch of its first national cable sports network, Fox Sports 1. The all-sports network will go live in August, timed to the start of college football season and David Hill, the former head of the Fox Sports Media Group, has been brought in to oversee the creation and launch. Plans for the channel have been brewing for some time – News Corp. COO Chase Carey last month called it the “world’s worst kept secret” – but up to now details were scant including what sports the network would carry. According to The New York Times, Fox Sports 1 will have Nascar, Major League Baseball, college basketball and football, soccer (including the 2018 and 2022 World Cups) and UFC fights. Also, an in-studio show will be hosted by Regis Philbin who last week hinted at the prospect. Read More »
What News Corp COO Chase Carey recently called the “world’s worst kept secret” – Fox’s still-unannounced plans to turn its Speed channel into a national general sports network called Fox Sports 1 — just became a little less mysterious. In response to a question on CNBC about reports that he’ll host a show on the new service, Regis Philbin said “all I can tell you is this: There’ll be a major announcement coming out next Tuesday.” Well, what do you know? The Fox Sports Media Group has an upfront presentation scheduled for Tuesday afternoon. Anyone want to put odds on what Fox will announce? Sports Business Daily reported that Philbin was negotiating to lead a panel, much like Barbara Walters’ The View, that will focus on sports.
Nomura Equity Research’s Michael Nathanson does a nice job this morning of laying out the likely business arrangements for News Corp‘s still unannounced but widely expected plan to convert its Speed channel into a national network to be called Fox Sports 1, with Fuel to be rebranded as Fox Sports 2. Rupert Murdoch is betting on “what the company believes will be increasing value of live sports over the next couple of decades,” Nathanson says. Advertisers spent a record $13.3B on broadcast and cable sports last year, confident that viewers would watch them live — instead of recording the shows to zip past the commercials. News Corp’s sports initiatives also seem to make sense according to Nathanson’s calculations of pay TV fees: Speed and Fuel together collect about $300M a year. Under what the analyst calls his “blue sky scenario,” the company could see nearly $1.5B in additional revenue from cable and satellite companies (and, presumably, their customers) as Fox hikes their prices once the channels are rebranded. Read More »