With the clock running on the grace period started when regional sports network operator Diamond Sports Group skipped a payment on its debt, “the phone has already been ringing off the hook” at Scripps Sports, according to E.W. Scripps CEO Adam Symson.
“I gotta say as we sit here today witnessing the implosion of the RSN business model . . . Scripps Sports has been getting a very warm reception in the marketplace,” Symson said on Scripps’s fourth-quarter earnings call Friday.
Unlike RSNs, which mainly reach the shirking number of subscribers to cable, satellite and telcos, Symson said Scripps can reach viewers over the air, on pay TV and connected TV.
“Our ubiquitous over-the-air pay-TV and connected-TV reach through Ion and the Scripps Networks has immense appeal for leagues looking to build new and consistent franchise viewing events across the national footprint,” Symson said.
Scripps set up Scripps Sports as a new unit in December
Also: Scripps Sees Opportunity in 'Broken' RSN Business
“We see the right live sports as an unparalleled opportunity to drive the value of our linear television streams even higher,” Symson said. LIve sports has been proven as drawing the latest audiences to linear TV. It also attracts more advertising dollars per programming hour, he said.
“Live sports will draw young new audiences to our brand as fervent fans employ digital antennas to watch their favorite local team for free again,” Symson added.
Scripps has talked about being able to replace an RSN in markets where it had a duopoly, with the station that does not have a Big Four network affiliate airing games and other team programming.
Symson added that because Scripps also owns Ion, which is broadcast but doesn’t have local feeds, a league could find a home on Ion nationally, or a team could reach local fans through Ion in a single market.
“The interesting thing about Ion is we not only control all of the programming decisions, we also control all of the affiliates,” Symson said. “And so we have the ability to bring sports onto our platform on the weekends, in prime, what every way we think makes sense for both the league’s benefit and for our benefit.”
He noted that in many markets, “we have a tremendous amount of distribution real estate and that gives us tremendous optionality.”
Symson said sports still need the kind of distribution broadcast offers in order to create value in the form of sports betting, ticket sales, merchandise sale and direct-to-consumer subscriptions.
“That’s exactly why we’re getting such a good reception in the marketplace because the leagues realize that going to a direct-to-consumer-only strategy isn’t necessarily going to serve them well over the long haul,” Symson said.
With pay TV declines, the RSN model simply doesn’t work, Symson argues. “There just not enough subs to sustain the kind of revenue that the teams have gotten in the past,” he said. “What we’re bringing to the market is a new model that the leagues and the teams can get behind because they understand it’s about balancing both the revenue that they bring in as well as reach.”
Going back to the future and putting sports on free TV is a winning idea, Symson said.
“It's in everybody's best interest, including the American people and the fans, that we don't allow live sports to become a pure D-to-C product,” he said. “It won't work for the economics of the leagues, It won't work for the economics of the teams and it definitely won't work for the economics of the American people.” ■
