Those Guys Have All the Fun - James Andrew Miller [74]
Yacht racing wasn’t the only big-ticket item for ESPN in 1987. As the NFL’s five-year, $2.1 billion contract with ABC, CBS, and NBC wound down in 1986, it was estimated that over the life of the contract, ABC, CBS, and NBC had lost a combined $75 million televising the games. Naturally, then, their first question was “Where do we go to sign up for more?” It’s not that the networks were masochistic; TV rights to NFL games were almost always a prize package no matter what, the prestige consistently outweighing the drawbacks. And yet, change was lurking around every corner. Multimillions in losses were starting to matter more than they usually did to network executives, who were being forced by evolving realities to learn the importance of parsimony across the board. Make no mistake: they wanted the NFL; they were just a bit reluctant to spend as freely as they had in the past.
For its part, the NFL now had an eye on the future of telecommunications—and an ear to all those prophets of profit who spoke of “the end of the three-network era”—and thus began to see wisdom in perhaps placing some of its inventory on cable. For ESPN, this created an opportunity filled with considerations not only practical but also somewhat mystical. The NFL had always been the network’s big dream. Despite the fact that it was now steadily growing, ESPN could never be considered top tier without an NFL presence.
In the spring of 1987, it looked as though ESPN might finally have a chance.
It would not be easy; ESPN was up against the broadcast networks, the pay-cable giant HBO, and basic cable channels such as Ted Turner’s “SuperStation” WTBS. There was the USA Network, an initially sports-intensive channel known as Madison Square Garden Network when it signed on in 1977, which then became USA Network two years later, the same year ESPN went on the air. In addition to these individual contenders, a consortium of cable system operators had banded together to negotiate as the Cable Football Network—its sole goal being the acquisition of an NFL package for cable.
BILL GRIMES:
Steve had been spending a lot of time with Val Pinchbeck, who was the number two guy at the NFL under Pete Rozelle. Val called and asked if I was going to the Super Bowl, this was ’87, and I told him yes. He said that Mr. Rozelle and Art Modell, the owner of the Browns, would like to meet with me. So I went to the Bel-Air Hotel, where they had this massive suite, and it was just the three of us. They said, “As you know, we’re going to add a fourth network to our next television contract, and we’ve talked to HBO and Turner. We know you guys have talked to Val, and we want to hear more about ESPN.” So I gave him my ESPN pitch, including that we were in more homes than HBO. They were concerned about our commercials, so we talked about that. At the end, they said, “We don’t know the guys at CapCities very well, but what do you guys think you could pay?” I forget the numbers they mentioned at that time, but they said ABC was paying X, and asked if we could pay Y. I said I didn’t know but I could find out quickly.
I called Dan Burke, the CEO of CapCities, at home and explained what Rozelle and Modell had told me, including that we could get the Sunday-night package and you guys would get the renewal of Mondays on ABC. Then Burke says to me, “Why are you talking to those guys directly? Where are the ABC guys on this?” He said he wanted it to be a team thing.
HERB GRANATH:
Don’t forget, in those days we in the cable world were second-class citizens. We would say to the cable operators, “Hey, if you want to be big-time, if you want to compete with the big boys, the NFL is the name of the game. We can’t afford it on our own, but if you all put your money where your mouth is, we can go and buy an NFL package.” So our plan was, buy the rights, and whatever those rights cost, charge that back to the cable operators. It became about convincing the operators that they had to pay us for those rights.
ROGER WERNER:
We had rolled all the affiliation deals over. The