NEW YORK — CBS outbid ABC/ESPN and Fox for the rights to the NCAA Men’s Basketball Tournament Thursday, ponying up a staggering $6.2 billion to retain the annual March games for 11 years, beginning in 2003.
The National Collegiate Athletic Assn. will pocket more than double the amount of its current seven-year, $1.73-billion contract with CBS in the new deal. CBS Television president and CEO Leslie Moonves and CBS CEO Mel Karmazin got personally involved in the negotiations to make sure CBS wouldn’t lose the rights to the NCAA’s “March Madness.”
The new contract will ramp the yearly average up to about $564 million from the current $247 million, which is far more than even the most optimistic projections being bandied about in sports pages over the last few days.
The price ballooned, sources say, because ABC/ESPN and Fox kept upping the ante to snare one of the highest-rated sports packages in television. CBS felt constrained to top its competitors, at least in part because it lost the rights to NASCAR last week to NBC, Fox and Turner. CBS’s stock hit a 52-week high at the end of the day, climbing $1.25 a share to $55, likely in anticipation of the deal, which was announced after the markets closed.
The NCAA Basketball Tournament consists of 63 games in March. The field is whittled to the two games that make up the Final Four, played on a Saturday, and the Monday night primetime Championship Game.
“These are blockbuster events that we plan to promote across all of our platforms,” said Moonves, referring to the TV network, 160 owned radio stations, 16 owned TV stations and 120,000 billboards.
Moonves stressed that Tournament games will be “on free, over-the-air TV for the foreseeable future.” But in the Q&A with reporters, Sean McManus, president of CBS Sports, acknowledged that CBS also has cable rights to the tournament, so that “as the TV landscape evolves” CBS could sell some of the games to cable as a supplement to the broadcast coverage.
Although tournament ratings were down across the board for CBS in 1999, the championship game still harvested a whopping 17.2 Nielsen rating and 27 share, and the Final Four games averaged a muscular 10.0 rating.
Because so many of the games in the first four days of wall-to-wall coverage run concurrently, observers say it’s almost certain that CBS will sell early-round games to one or more cable networks. TNN: The Nashville Network is a logical partner because it’s owned by CBS, or, as Moonves put it, “TNN is part of the family.”
One source suggested Viacom’s Showtime may put in dibs to carry a few of the tournament games because it will soon also be a part of the family when Viacom and CBS merge early next year.
But CBS doesn’t rule out offering cable rights to the highest bidder, with overtures already reported by both ESPN and Fox Sports. In the 1980s, ESPN showed first round games.
ESPN and ESPN2 carry dozens of regular-season college-basketball games through contracts with a number of regional conferences and would be eager to extend that scheduling through the post-season.
And Fox Sports carries many college basketball games locally through its ownership of 23 regional sports networks.
Moonves and McManus said it’s too early to predict how CBS will take advantage of its Internet rights to NCAA basketball.
“This is the first sports deal in history to extend its reach to new media,” said Moonves. But in a few years, one source says, it’s inevitable that many people could end up watching the games on their personal computers if they can’t get to a TV set.