A new cable sports network
News Corp. unveils Fox Sports 1, which it hopes will eventually challenge Walt Disney Co.’s ESPN empire.
News Corp. has unveiled Fox Sports 1, a new national cable channel it hopes will eventually challenge Walt Disney Co.’s ESPN empire.
The ambitious, aggressive move is further evidence of the huge value of sports programming.
Scheduled to launch in mid-August, in almost 90 million homes, the channel’s initial lineup will include NASCAR, college football and basketball, ultimate fighting and soccer. Next year, Fox Sports 1 expects to add regular-season and post-season Major League Baseball to its lineup.
“We really feel we have the ammunition to launch a channel right out of the gate that will be substantial,” said Bill Wanger, a Fox Sports executive vice president. The channel was presented to advertisers at a Tuesday event in New York.
Wanger said Fox Sports is looking at rights to the National Basketball Assn. and is ready to pounce should the National Football League go forward with creating an additional package of games for cable.
In an era when viewers have hundreds of networks to choose from, and can use digital video recorders and video-on-demand as well as newer services such as Netf lix to watch TV on their terms, sports is seen as the one form of programming that can stand up to technology.
“Sports programming is one of the last media assets [predominantly] viewed on a live basis,” Goldman Sachs said in a recent report on the sports media landscape. That means it has greater value to advertisers, which place a premium on viewers watching live television versus recordings — where it is easy to skip commercials.
Although Fox Sports 1 isn’t scheduled to launch for almost six months, News Corp. already has a second channel — Fox Sports 2 — in the works. Wanger declined to comment on Fox Sports 2, but Goldman Sachs said News Corp. filed a trademark for Fox Sports 2 with the U.S. Patent and Trademark Office.
News Corp. is already a major player in sports. It owns almost two dozen regional sports networks, including Prime Ticket and Fox Sports West in Los Angeles, and its Fox network carries baseball and football.
But taking on ESPN won’t be easy. Besides having more than a 30-year head start and rights to just about every major sports property, it owns several channels and has deep enough pockets to withstand any bidding wars for sports properties.
“We like our position,” said ESPN Senior Vice President Chris LaPlaca. “We have always had vigorous competition, so there is really nothing substantially new here.”
Indeed, although ESPN won’t take Fox Sports 1 lightly, the outlets that will be more immediately concerned about News Corp.’s entry into the national cable television marketplace are Comcast’s NBC Sports Network and the CBS Sports Network, a unit of CBS Corp.
Neither NBC Sports Network nor CBS Sports Network has emerged as a real threat to ESPN. Fox Sports 1 is poised to become No. 2 when it flips the switch Aug. 17.
The college and professional sports worlds will be cheering the emergence of one and possibly two new national cable channels from News Corp., because that will mean increased competition for content and higher rights fees.
But for pay-TV subscribers, more sports channels typically means bigger monthly bills. The flagship ESPN channel is the most expensive cable network in the industry, costing distributors on average north of $5 a month per subscriber. Its various sister channels, including ESPN2, take in an additional $1.60 a month per subscriber.
To launch Fox Sports 1, News Corp. is rebranding its current Speed Channel, which will not return. Fox Sports 2 will probably take up real estate currently occupied by the company’s Fuel channel. Another channel, Fox Soccer, is also expected to go away and be born again as an entertainment network.