Note: This analysis is based upon data taken from Variety Intelligence Platform’s “Sports’ New TV Formula” special report, available exclusively for subscribers.
The announcement that NBCU’s marquee sports network NBCSN would close at the end of 2021 took the industry by surprise.
Based on average primetime audiences, NBCSN was the second-biggest cable sports net in 2020, although it trailed ESPN by a factor of over 6.
Parent NBCU is relaunching gaming channel G4 later in 2021, so NBCSN’s closure isn’t a case of channel consolidation, even if NBCSN was one of the smaller primetime networks within NBCU’s portfolio. NBCU is also not getting out of the sports network business, with Golf Channel and Olympic Channel remaining on air.
Instead, NBCSN is being sacrificed to boost both linear TV and streaming. NBCU’s cable crown jewel USA is slated to see sports become a permanent fixture as a belated attempt is made to shore it up as a destination network with live sports, pro wrestling and originals in primetime each night.
Streamer Peacock will also benefit from this. Since its outset, Peacock has relied on demand for smaller sports that have a dedicated audience to grow the subscription side, with marquee Premier League match-ups moved from NBC and NBCSN to behind the paywall.
Peacock is continuing this experiment with its absorption of WWE Network’s 1 million or so domestic subscribers into Peacock Premium on March 18. VIP strongly anticipates a large proportion of NHL fixtures to be available exclusively on Peacock Premium to further boost subscriptions, should NBCU retain the rights.
NBCU currently shares the weakest of metrics as an indicator of Peacock’s growth. Peacock only reports the total number of people who have signed up for its free or paid tiers since July’s launch. Despite including a large number of free-tier-only users (or even just people who signed up, used it once and then never came back), the figure is constantly confused by both analysts and the public as being a subscriber-only count, when this is far from the truth.
Adding more sports with dedicated fans to the paid tier should ultimately boost subscriber numbers to a level NBCU feels comfortable sharing, instead of the current ridiculous smoke-and-mirrors approach.
The decision could also reflect NBCU’s uncertainty around retaining the marquee sports on NBCSN, with the anticipated NFL rights increase for “Sunday Night Football” leaving less money for maintaining other sports packages. NBCU’s NHL rights expire this at the end of this season, with ESPN already agreeing a 7 year deal for 100 games a season across Disney-owned platforms and four Stanley Cups in this period, after NBC Sports declined to bid on renewing the current package in its entirety.
Premier League soccer rights for NBC, NBCSN and Peacock are up in 2022, and NBC Sport’s NASCAR package expires in 2023. Losing one of these three sports in their entirety would see NBCSN schedules somewhat bare, so NBCU acted preemptively, creating a solution that could thrive with just one or two of its current key sports.
NBCSN’s closure points to a future where there are fewer cable sports networks on TV. In two or three years’ time, there is a strong likelihood that a few of CBS Sports Network, Fox Soccer Plus, Fox Sports 2 and some of ESPN’s myriad networks will be folded into streaming platforms. The inevitable transmutation from linear TV to digital streaming is well underway.