Monday Night Football switching to ESPN?

[Nick]

Disney May Switch N.F.L. Shows
By RICHARD SANDOMIR
Published: April 7, 2005

The National Football League usually announces its gaudy television deals in one cymbal-crashing day.

Last Nov. 8, it completed deals with CBS and Fox to renew their Sunday afternoon packages through 2011. The total value was $8 billion. At the same time, the league increased its annual take from DirecTV by 75 percent when they extended their deal for $3.5 billion over five years.

Since then, nothing has happened - no Monday night or Sunday night deals, nothing on a possible late-season, eight-game Thursday-Saturday night slate.

Right now, the league is biding its time with the slow-to-decide Disney, which chose not to renew its ABC and ESPN deals when CBS and Fox completed their pacts, and is undergoing a shift in chief executive to Robert A. Iger from Michael D. Eisner.

Disney's uncertainty is realistic: ABC has lost about $150 million annually on a "Monday Night Football" deal that pays the league $550 million a year. Disney may have erred in deferring a deal, because the N.F.L.'s demands go up, not down.

But if ABC pulls out, does Iger want one of his first major decisions to be the network's parting with "Monday Night" after 35 years? Or will he risk being castigated for continuing to pay a fee that is guaranteed to maintain hefty losses?

The rampant speculation is that in talks with the league, Disney wants to shift ABC to Sunday night and ESPN to Monday night, giving its cable behemoth the marquee property it craves, a prime-time game on a day with no other games.

For this, it appears that ESPN, because of revenues it gets from advertisers and subscribers, is willing to pay $900 million or even $1 billion annually through 2011.

ABC would like to snare Sunday night for as little as $450 million, which might displease the league, which hasn't reduced what it charges to a network since a small rollback in 1993. But if ESPN's bid keeps rising, the league might not be so hasty to dismiss ABC's lowball offer; it shouldn't care how the Disney money is allocated.

At $1.45 billion a year, Disney would pay 26 percent more than it pays now.

One factor that Iger must consider is whether it is worth replacing ABC's "Desperate Housewives"-led Sunday night schedule to accommodate football for six more years. The ladies of Wisteria Lane star in the No. 4-ranked prime-time show this year, the new "Grey's Anatomy" is No. 12 and "Extreme Makeover" is No. 22.

"Monday Night" ranks ninth.

By losing oodles of cash, ABC might have inadvertently created a bargaining chip as a bulwark against the pressure to pay an increase of 25 percent or 30 percent, as CBS and Fox have.

"Monday Night" is financially diminished. A prime-time game on broadcast TV is not the magnet it was, on Monday or Sunday night, the latter after a day of afternoon football. So if ABC can't afford the overpriced package, why would it be any more valuable to others who know the financials?

The league has floated the notion of Fox and CBS splitting Sunday nights if ESPN takes over on Mondays. So far, the idea is still wafting about; but if Fox and CBS are willing, why would they want anything but discounted deals after paying a lot more to keep what they have in the afternoons. NBC, another Sunday night floatee, never does anything without a guarantee that it will not lose a cent. So if no one else wants to pay more than ABC, why drop ABC?

The notion of shifting "Monday Night" to ESPN rankles Al Michaels, its announcer since 1986 whose role, and John Madden's, might be imperiled if ABC does not continue with the N.F.L.

"Why put it on a sports cable network that says, 'Sports fans, this is heaven,' and the rest of you, 'Whatever,' " Michaels said from Los Angeles. "Our research says if people watch one game a week, it's 'Monday Night Football.' Women watch it. If I'm the N.F.L., I want the broadest audience."

If Disney puts $1 billion behind moving "Monday Night" to ESPN, it makes sense that it would demand protection against an established cable network, like TNT or USA, grabbing the proposed Thursday-Saturday package. That would open the door to putting games on the NFL Network, which would vastly increase its cable distribution and let it charge subscribers and advertisers considerably more.

The money wouldn't be guaranteed, as it is in a straight-rights fee, but the future profits, and the equity it builds, should satisfy the league. Whether the NFL Network morphs into an all-sports channel, in combination with News Corporation, the parent of Fox, or Comcast, depends on how much Commissioner Paul Tagliabue's suggestions in February about such a possibility constituted a real strategy or leverage to squeeze more money out of ESPN.