Posts for 'PGA'

I’m pleased to present the 505th edition of the VideoNuze podcast, with my weekly partner Colin Dixon of nScreenMedia.

First up this week we discuss the PGA Tour’s $6.3 billion, nine-year rights deal announced this week with CBS, NBC/Golf Channel and ESPN+. The deal will reportedly generate $700 million in fees, up 75% from the current deal’s $400 million. Anyone looking to me to explain how the PGA managed to get this increase, despite so many factors that should have given the TV networks leverage, is going to be disappointed. I just don’t get it, but as a golf fan, it’s still lots of fun to talk about.

One thing is for certain - with the bulk of the new money going to the Tour’s players, the 2020s are going to be a very good period for them. As is to give a sneak preview, when this weekend’s PLAYERS Championship was cancelled after round 1 yesterday, half the purse of $15 million was divided evenly among the field of 144 players. So each player got $52,083, irrespective of how they played in round one. So if average round lasts 4 hours then they earned $13,020 per hour. Or if they shot par 72 they received $723 per shot (including gimme putts). Life is good.

ESPN+ popped up as the streaming partner in the new PGA deal, which provided a good opportunity for Colin to explain the remarkable turnaround Disney has effected with the network. ESPN is now in 98.1 million U.S. homes vs. 98.5 million in 2013. After dipping to 89.7 million in 2017, ESPN successfully negotiated its way onto all major virtual pay-TV operators’ lineups (8.9 million). And it cleverly bundled ESPN+ with Disney+ and Hulu (another 7.5 million) creating significant DTC optionality down the road.  

Reviewing the new PGA deal and ESPN’s bounce back, we believe executives for both entities deserve to be on the Mount Olympus of media negotiators.


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Sorry VideoNuze readers, my head is spinning again, and this week it’s not just because of the stock market’s wild swings or the drama around the coronavirus. Rather, it’s because yesterday morning, while waiting in the doctor’s office, I read the Wall Street Journal article “Golf’s PGA Tour Gets Big Boost in TV, Streaming Rights.” The article described how ViacomCBS, Comcast and Disney are going to pay the PGA Tour over $700 million per year, up from the current $400 million per year, in a new nine-year media rights deal.

That means the total value of the deal would be $6.3 billion. Add that to the 12-year, $2 billion international rights deal the PGA announced with Discovery in June, 2018 and that’s $8.3 billion in TV money coming to the PGA over the next decade - a good chunk of which will go to its players. 

The deal essentially means leaving the status quo of CBS, NBC and Golf Channel handling live and weekend coverage, with ESPN+ taking over streaming from the PGA itself, which has worked with NBC Sports Gold and Amazon Prime. ESPN+ will provide 4,000 hours of streaming coverage per year across 36 PGA tournaments.

I realize that the PGA striking a lucrative media rights deal may not mean that much to many VideoNuze readers. But to me it does, at both a personal and professional level. I am a golf fan; I’ve been watching golf on TV and playing the game since I was 12 years old. For 99.99% of the world, watching golf on TV is akin to watching paint dry. Even for golf fans it is something that is hard to do without multi-tasking (e.g. sending emails, texts, etc.).

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Discovery has signed a 12-year, $2 billion deal with the PGA Tour for global multi-platform live rights in 220 markets outside the U.S. for all PGA Tour properties. The deal provides access to 150 tournaments per year (2,000 live hours) including high-profile events such as The PLAYERS Championship, the FedExCup Playoffs and the Presidents Cup (though I believe it excludes other marquee events such as the U.S. Open, the Open Championship, the PGA Championship and the Ryder Cup which are outside the PGA Tour’s purview).

While Discovery will broadcast the tournaments on its various international cable and broadcast TV networks, the big potential upside in the deal is the new dedicated PGA Tour-branded OTT streaming service Discovery plans to build. The unnamed service, which will launch next year, will be another high-profile test of OTT’s ability to deliver direct-to-consumer benefits to super-fans as well as create incremental revenues.

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