Phil Mickelson talked about the future of LIV Golf TV.
Getty Images
Welcome back to another extended edition of the Hot Mic Newsletter, A weekly GOLF post covering all things golf from me, James Colgan. The subject of this week’s newsletter is Phil Mickelson’s comments about the LIV TV rights negotiations. As always, if you’d like to be the first to receive exclusive information like this directly from me, click link here to subscribe to our for free send a newsletter. But first, we return to Troon, where there is … brewing.
After two short years and very few reports of bleak ratings, LIV Golf and The CW are preparing to switch channels.
That’s the latest according to LIV star Phil Mickelson, who slipped up during a press conference previewing the league’s championship in Chicago that the league is committed to a new way to broadcast in 2025 and beyond.
“After all, television and viewers in sports, especially golf, are changing. So old school media and the way we’ve done it, being online and so on, is not the way of the future. It’s going to be digital, more broadcast,” Mickelson said Wednesday, referring to the division’s current deal with TV network partner The CW. “The new partner, because the new partner, whoever it is after this year, I think will be very focused and focused there because of the opportunities that will open up. But I am not part of those television contracts.”
Sources at LIV confirmed that the league is “exploring partnership opportunities” with current and new broadcast partners in the US and abroad, as it has done in each of the previous seasons.
Mickelson, however, indicated that the league could look to move away from the TV rights altogether. That would be, to put it mildly, a major shift in the modern sports media economy.
“I know they’re in the midst of discussions about audience relations and partnerships that will happen next year,” Mickelson said. “I’m not part of that, so I don’t have good information about you. I just know that the old school model is not where LIV Golf is headed. The future is not going anywhere, and we don’t want to get stuck in the mess.”
THE BASICS
LIV owns the rights to its broadcasts. It can sell those rights to anyone it chooses, and will usually demand a “rights fee” in return. The royalties can range from a few to a few million a billion dollars per year, depending on the size and reliability of your audience, the size and interest of your advertisers, and your total number of hours on air.
LIV is currently partnered with The CW, although that deal originally included a share of money instead of rights money. It is expected to expire at the end of the 2024 season. Until Mickelson’s comments earlier this week, no one from LIV has publicly commented on the league’s future broadcasting rights.
HISTORY
LIV and The CW have inked a media rights deal through early 2023 after a lengthy negotiation period that did not provide the league with a sports media partner with a good track record in sports. At the time, the deal was seen as a bridge deal for both sides: a chance for LIV to show off its commercials after a season of streaming on YouTube to the “big fish” of sports TV, and an opportunity for a changing network like the CW to enter the sports scene with a big splash. . The deal was widely reported as a two-year trial, but it’s not known if the contract includes time or price escalations based on league performance, as other sports rights agreements do.
The next two seasons were trying for both LIV and the network, a period highlighted by terrible TV ratings and an interesting conflict with the CW’s programming department over the network’s decision to pull LIV off the air. Programmatically, LIV radios have it he looked that’s fine (the league controls TV production), but both sides have seen weaknesses in establishing and retaining sports audiences. The latest telecast was watched by less than 200,000 average viewers, according to Nielsen, which is more in line with cable news than broadcast sports.
THE WORLD
The sports and media rights landscape changes every 15 minutes, but it has undergone two tectonic changes since LIV signed its deal with The CW. Those changes were historic deals for the NFL and NBA, which promised the league nearly $200 billion to franchise owners over the next decade. The deals cemented the status of sports TV in the long term along clear lines: ESPN, NBC and Amazon have the rights in both major languages; big-time players like Netflix, CBS, YouTubeTV and Fox own the rights to one of the leagues; and others such as Warner Bros. Discovery and Apple, own the rights to both.
Notably, that list of franchisees now includes both networks again broadcasters for the first time, a long-rumored switch that furthers the transition from cable to broadcast. At the same time, new sports broadcasters like Venu – a joint venture from Fox, Disney and Warner Bros. Discovery – hit the road hoping to pick up pieces of the sports rights business.
For LIV, competitive change holds a lot of weight. The number of sharks willing to fight for LIV rights has increased, and the sharks who didn’t join the NBA/NFL rights feeding frenzy are raking in new sports companies.
LIV could be re-entering the market hoping to succeed where it failed back in ’23, hoping to pick off one of the losers of the NFL/NBA rights with increased rights fees and access to a less dedicated sports audience. The league can again take the approach, as Phil suggested, of finding a broadcast partner first. A streaming-only (or multi-broadcast) deal would potentially generate (relatively) large rights revenue over the league’s CW deal, and would also target the league to its smaller target audience.
THE PROBLEM
LIV needs to demonstrate any semblance of a profitable business structure before it can make a lucrative deal with a broadcaster or broadcast network. It has managed to land some big stars and a few new sponsors, but without a loyal audience and a solid advertising structure built around the audience, it’s hard to see any broadcast partner (broadcaster or otherwise) lining up to sign a big-money deal. Another smaller, revenue-sharing deal might make more sense, but the league would clearly prefer to receive rights money for its broadcasts.
As for who might be interested, Mickelson’s suggestion that linear TV is old news is not entirely true. The big money in sports television is still in line, which is why the NFL and NBA are lined up to sign big, long-term deals with the series’ broadcast partners. There may be big money and a future in sports broadcasting, but we’re still far from the tipping point that Mickelson suggested has already happened. If LIV were to sign with a broadcast-only business, both parties would be taking a huge risk.
THAT’S what it said…
Broadcasting it does seems to be more in line with LIV’s broadcasting ethos. LIV is very focused on bringing new audiences to golf, and it’s clear that the team didn’t follow The CW. In this series of rights negotiations, finding a partner that can bring the league to a legitimate audience of sports fans may be the most important sticking point.
And if that includes royalties, too? Well, that’s just gravy.
You can reach the author at james.colgan@golf.com.
Source link
