Nfl Football Telecasts Case Study

This task force of broadcasting, finance, and marketing people helped legitimize projections and potential profitability from NFL football telecasts; this also served as a way to defend and justify the NFL’s asking price for its content, as well as enable the league to figure out its break-even price at which it would make sense to keep the content in-house. The research this task force conducted also allows the NFL to capitalize on trends and future projections, based on empirical data. The members of the owners television committee also helped determine the length of contract and distribution rights, etc. and when/whom to approach when negotiating contracts as to get the best price and highest probability of closing the deal, thereby limiting

More importantly, this demonstrated the sport’s growing popularity and cult following (particularly among young male). The NFL stood above other sports associations because it helped networks gain legitimacy, credibility, and stability, as illustrated by Fox Network’s bid to steal away the CBS package in 1993. These three letters not only connoted prestige and exclusivity but also contained strong metaphors in penetrating the American business culture. For example, with the introduction of its own NFL Network, the league maintained exclusive rights to unique content, a fantastic product that can generate greater future revenues. This also served as a means to dilute audience for certain networks, by giving them more options to choose from. The NFL also built this perception of scarcity, with the illusion that it has fewer rights packages compared to the number of networks bidding for them, which led to effective marketing of any programming that can be distributed in conjunction with selling football games, given football’s ability to promote non-sports related prime-time shows.

CBS’s CEO felt strong pressures to rejoin the NFL family since its ratings declined after missing out from 1994 to 1997. Given the level of excessive demand, the only way to stay with the competition was by also bidding at a higher level. However, both networks also had significant leverage to pull as well. Collectively, if CBS and NBC could convince other networks to forgo TV rights to NFL broadcasting, thereby reducing demand, this may force NFL to release more games for TV use. And since the NFL allocates much of the contract money to pay each team, teams could place significant pressure on NFL to lower prices and increase distribution rights in order to sustain the same salary level for the players. If teams were forced to individually negotiate with local or regional broadcasters, this would limit NFL’s popularity/views and bring more headaches to commissioners. The NFL also has the risk of overexposure due to the fact that NFL Sunday Ticket, a joint venture with NBC, was available to dish owners with the opportunity to view out-of-market games on Sunday afternoons. Again, this fragmentation of audiences, due to increased specialization of broadcasting and cable TV networks, would further limit the league’s ability to deliver unique content. Lastly, the NFL Network hasn’t been that successful with cable providers; only DirecTV carried this network, which severely hampers content