Affil deal to defray NFL costs
After weeks of intense negotiations, ABC and the net’s affiliate board of governors have drafted a new deal to help the net defray the cost of its pricey NFL package.
Under the two-year pact, affils will pay roughly $34 million a year to subsidize ABC’s “Monday Night Football” pricetag. (The net struck an eight-year license with the NFL in 1998 that comes to about $550 million annually.)
The affils’ previous three-year pact expired at the end of July, but both sides took extra time to craft a much more wide-ranging agreement this time around.
Pact must now be approved by at least 67% of the affiliate body.
“This was a complicated negotiation because of the comprehensive nature of it, but the fact that we were able to make a deal is significant for the network-affiliate relationship,” ABC Television Network president Alex Wallau said. “This was a way to address not just the specific issue of help with the NFL, but we were able to use that as a springboard to tackle other areas that needed to be addressed.”
Dealing with one such affiliate concern, the issue of “assignment,” ABC agreed for the first time to not alter its affiliation contract with a station if it’s sold.
In the past, when an ABC affiliate changed hands, the Alphabet web reserved the right to withdraw its affiliation with a station — hurting its value at the time of sale.
The Alphabet web also spelled out its policy regarding cross-promotion with other Disney-owned properties, such as ESPN and ABC Family. Under the new pact, ABC will be allowed to air a certain amount of promos for sibling channels that specifically advertise the day and time of a program.
Affils that don’t allow such “day and date” spots will be allowed to cover up those promos, however. Other issues such as music license fees were also addressed.
“Everyone has their own concerns, and we had to address all the things that were bothering different station groups,” Wallau said. “We weren’t able to give them everything they wanted on every issue, but we were able to comprehensively address every issue.”
Beyond the new concerns, ABC and affils kept other points from the original agreement, such as allowing the net to repurpose up to 25% of its primetime programming with no strings attached.
Stations also will continue to give back 10 spots during the Saturday morning “ABC Kids” block to the net in exchange for seven (down from eight) ad units in primetime. Affils will also continue to have financial participation in ABC’s SoapNet channel.
Groups represented on ABC’s affil board include Allbritton Communications, Belo Corp., Benedek Broadcasting, Cox Broadcasting, Hearst-Argyle Television, Raycom Media, Scripps Howard Broadcasting and others.
“The affiliates and ABC worked hard to find a common ground so we can move forward with this plan and the overall relationship,” said Cox’s Bruce Baker, the ABC affil board’s chairman. “The end result is intended to strengthen both ABC and the affiliates.”
2 years is enough
Both sides eventually agreed to stick with a two-year deal, even though four years remain on ABC’s NFL pact.
“Two years is as far out as you can go to predict and have some sense of what will happen, when the world is changing as fast as it is,” Wallau said. “Two is something neither side said no to.”
Separate from the pact announced Wednesday, Wallau said the affils had raised some questions regarding ABC’s talks to merge news operations with CNN.
“There were some stations that wanted to understand what was going on with CNN,” Wallau said. “They called, and we explained what we could, that there’s no deal, and so it’s hard to talk about what a deal would be.”