New Fox sports network to debut in August
NEW YORK — For anyone who thinks TV is already saturated with sports of every stripe, stay tuned.
Here comes Fox with an in-your-face challenge to ESPN — a 24-hour sports cable network called Fox Sports 1, set to launch Aug. 17.
"ESPN, quite frankly, is a machine," Fox Sports executive vice president Bill Wanger said Tuesday in announcing the venture. "They have very consistent ratings, obviously huge revenue. We're coming in trying to take on the establishment. It's no different than Fox News or Fox Broadcasting back in the '80s. We're going to have to scratch and claw our way all the way to the top."
To do that, Fox executives are confident they have enough live events, with rights to college basketball and football, NASCAR, soccer and UFC fights. In its first year, the new network will broadcast nearly 5,000 hours of competition and news.
Fox owns rights to many Big 12, Pac-12 and Conference USA basketball and football games. Its soccer deals include UEFA Champions League and the men's and women's World Cups from 2015-22.
Starting in 2014, FS1 will start broadcasting Major League Baseball games, including part of the postseason. It will show some NASCAR Sprint Cup Series races as early as 2015, with other NASCAR events on the air from the startup.
"We believe we've amassed enough live events and can package and put programming around it where we can have scale," Fox Sports co-President Randy Freer said. "We can have significance. We can be a major player in the market."
However, unlike ESPN's lineup, there's no NBA, no SEC football, no ACC basketball and, the biggest attraction of all, no NFL games. On that last point, Wanger was quick to add: "Yet."
Still to be determined is whether the NFL sells some Thursday night games separately from its NFL Network package. If it does, everyone will try to buy a piece of the action.
That will be the case for any rights deals that come along; there aren't many, with long-term pacts now the norm. NBC and CBS already have their own cable sports networks, and Turner is also a factor. Fox Sports co-President Eric Shanks mentioned the NBA, Big Ten and U.S. Open tennis as appealing properties whose contracts expire in the next several years.
FS1 has two main challenges, he said. One is producing enough alluring live events to draw viewers, and he thinks the network is already in good shape to do that. The other is inertia: Fans accustomed to tuning to ESPN must be persuaded to switch to a different network.
"People need to over time feel like there's a channel number in their head that they can go to as an alternative to one of the more powerful sports channels out there," he said.
Will they watch nightly highlights on something other than "SportsCenter" ? FS1 will try to find out with its own news show, which will look more like Fox's NFL pregame coverage than ESPN's cornerstone program.
"We like our position," ESPN spokesman Josh Krulewitz said. "We have always had vigorous competition so there is really nothing substantially new here. Others are, however, beginning to recognize what we have long known: The power of live sports, especially in light of technological advances, is substantial and brings tremendous value in today's entertainment landscape."
ESPN has eight cable networks that combine for almost 30,000 hours of live coverage.
FS1 will be converted from Speed TV, a motorsports network, and will be available in 90 million homes, compared with almost 99 million for ESPN and ESPN2.
And in what might seem odd for a company known for drawing a young audience, Regis Philbin will host a weekday sports talk show for the new network. The 81-year-old Philbin jokingly pretended to be hard of hearing when questions came up about this at the press conference.
Wanger noted that "Live! With Regis and Kelly" did well in younger demographics before Philbin left that show in late 2011.
"Regis has appeal from young to old," Wanger said. "That's why we want him."
Fox plans to use its "double box" format for showing commercials during live action for sports events. Kicking off the coverage on Aug. 17 will be NASCAR Camping World Truck Series race from Michigan and a UFC event in prime time.
Fox executives had talked about potentially launching a sports network for years. As DVRs made live events even more valuable, the timing was right once the company was able to line up enough broadcast rights. And not having a cable sports partner could hurt the main Fox network in negotiations, Freer said. Fox has used cable channel FX in the past to show some sports.
The network wasn't ready to announce its deal with the new basketball conference formed by breakaway Big East schools, but Fox's executives were happy to talk up the ratings draw the league will provide. Freer called it an "iconic basketball brand" that will immediately be one of the top hoops conferences in the country.
"They're very historic, high-profile teams. The Georgetowns of the world and so on, St. John's, Villanova etc.," Wanger said. "It would be a coup if that deal did happen."
Fox is airing the 2014 Super Bowl in the New York area, a valuable opportunity to promote the new network. Its 22 regional channels will also offer regular chances to direct viewers to FS1.
A report by RBC Capital Markets analyst David Banks says that while FS1 may not match ESPN right away, it can still thrive without doing so. Banks writes that a "modestly successful" venture would more than quadruple Fox's monthly subscriber fees from what Speed received and increase ad revenue from $90 million to $460 million.
"It's going to take us a while, and we're aware of this fact," Fox Sports Chairman David Hill said. "We're not expecting to knock ESPN off in the first week or two. ... It's going to be a solid slog."