October Belongs to Fox

NBC, which has the Olympics locked up through 2008 but lost the NFL two years ago, is now out of the baseball business.

Beginning next season, major league baseball’s playoffs, World Series and All-Star game will be televised exclusively on Fox, which acquired those rights from 2001-06 with a $2.5-billion bid.

Baseball will announce its new six-year deal with Fox today.

The deal also includes regular-season games on Fox and cable channels Fox Sports Net and FX. A few early-round postseason games will probably also be televised on Fox’s cable entities.

ESPN, which made a deal in December to continue carrying regular-season games, will no longer be involved in the baseball postseason.

NBC and ESPN informed major league baseball Tuesday that they were declining to match Fox’s $2.5-billion offer. Ken Schanzer, president of NBC Sports, confirmed from Sydney that NBC was passing.

The deal ESPN made with baseball in December settled a dispute that involved Sunday night baseball telecasts in September, after the start of the NFL season. ESPN agreed to double the number of hours devoted to regular-season baseball to about 1,000 hours of games and studio shows.

But ESPN, which has averaged seven first-round games over the past four seasons, has opted to not be involved in the postseason after this season’s first round of playoff games.

NBC has the American League championship series this year, and Fox has the National League championship series and the World Series.

Baseball wanted to close the new deal before the end of the regular season this weekend.

Fox will pay roughly $417 million annually for baseball, which represents about a 45% jump from the $290 million the old deals with Fox, NBC and ESPN totaled.

Those old deals broke down to $120 million from Fox for Saturday games of the week, $47 million for regular-season games on Fox Sports Net and FX, $80 million from NBC, and $42 million for ESPN’s postseason package.

ESPN’s regular-season deal, which now averages $135 million a year, has always been considered separate.

The overall increase of Fox’s $2.5-billion package is well below what baseball was seeking. Aiming to capitalize on a recent trend in exponential hikes in TV rights deals, baseball was looking to triple what Fox was paying for baseball, and what NBC and ESPN were paying for postseason baseball.

In June, Fox rejected major league baseball’s demand that the network increase its yearly payments from $120 million to $360 million to continue to share the postseason, while NBC declined to boost its outlay from $80 million to $240 million.

Those decisions allowed baseball to try to sell its rights on the open market for the All-Star game, playoffs, World Series and Saturday game of the week.

But CBS and ABC weren’t interested in buying the rights at the prices baseball was offering.

The last time one broadcast network owned the full baseball package was 1990-93, when CBS lost hundreds of millions of dollars in a $1.057-billion deal, partly because of a steep decline in ratings and partly because of a national recession.

“I’m sure Fox believes if it is the only national carrier it can sell its commercials without having to face underpricing from a competitor,” former CBS Sports president Neal Pilson, who now has a consulting firm, told the Associated Press.

“It is a lot of baseball. Take it from someone who knows. It will force Fox to delay the start of its entertainment season every fall in order to cover the playoffs and the World Series, but I am sure they have taken that into account.

“Fox probably believes it has driven a good deal financially. It has kept its cost escalation at a very modest number.”

Fox’s deal indicates that a pattern of rising rights fees for sports will continue. Three years ago, the NBA, in a new four-year deal, got $1.75 billion from NBC and $890 million from Turner.

In 1998, CBS, Fox and the Walt Disney Co. (ABC and ESPN) agreed to contracts with the NFL totaling $17.6 billion over eight years.

Disney then signed a $600-million, five-year contract for ABC and ESPN to televise NHL games starting last season.

And in November, CBS held on to the NCAA basketball tournament with an $11-billion, six-year contract that goes into effect in 2003.