Wednesday, two of mass media’s largest companies – Viacom, owners of Paramount Pictures and a slew of American cable networks, and CBS Broadcasting, whose corporate flagship is America’s No. 1 broadcast network in primetime – agreed to merge into a single company for the first time since CBS Corporation split from Viacom in 2005. The new media empire, valued at roughly $28 billion, aims to compete with the newly established titans of Disney (who recently fattened themselves with the entertainment assets of 21st Century Fox), WarnerMedia (AT&T plus Time Warner), and NBCUniversal (whose parent company is Comcast), along with Amazon, Google, and Netflix.
While the companies’ executives spoke of grand plans for their vast libraries of streaming content, the merger will also fortify them in another way – live sports.
CBS’s current lineup of events includes the NFL, March Madness, SEC football, and the Masters. To lose any one of those events would not only be a major blow to the prestige of the CBS Sports brand, but a potential blow to the rest of the lineup.
Despite the Eye’s long-time standing as America’s top network – which they’re sure to remind us of every night – CBS has not been as aggressive as their competitors from FOX, NBC, and the ESPN/ABC coalition in terms of bidding for sports rights. Their last major acquisition was the AFC package for the National Football League, which they snagged in 1998.
Instead, CBS has focused on retaining the rights they already have, many of which they have held onto for decades. The Masters have been a part of CBS Sports since 1956, the longest association between a major sporting event and a network. The NCAA Tournament has remained with CBS since 1982, and college football has aired in some form on the network since the 1950s.
But with the full company’s money behind them once again, and some major packages up for grabs, CBS Sports can afford to go for broke. The rights to the NHL, which they haven’t regularly broadcast since the 1960s, will expire at the end of the 2021-22 season, and for once, CBS can be a player in those negotiations. (Still, though, Fox and ESPN figure to be bigger suitors for the NHL. Executives for bothnetworks have told our site on the record that they intend to bid.)
What’s more, unlike at the beginning of the decade, they will have better cable and streaming options to work with. The lack of viable cable partners forced CBS to work with Turner to secure the rights to March Madness in 2010, which will leave them in the shotgun marriage on that event for the next twelve years. With the Viacom merger, however, CBS can conceivably place sporting events on the Paramount Network, which has had a history of hosting racing and arena football in its past as The Nashville Network. CBS Sports Network is in about 60 million homes whereas Paramount Network is in about 80 million.
At the very least, the Viacom/CBS merger should provide the capital to hang on to the NFL rights when those next come up for grabs in 2022. When CBS last lost the NFL after the 1993 season, the network fell to last place and lost many of their stations to FOX. Any price would be worth avoiding that episode again. The real rights package to keep an eye on will be CBS’s SEC package, which figures to have no shortage of suitors.
To be sure, CBS/Viacom at a $28 billion market cap is still much smaller than Disney ($243.5 billion), AT&T ($254.8 billion), and Comcast ($196.4 billion). If any of the FAANG (Facebook, Apple, Amazon, Netflix, Google) companies ever do really seriously make a run at live sports, that throws a whole other wrench into the plans.
Nevertheless, by virtue of being bigger and having better cable/streaming integration plans than the last rights cycle, CBS, with its robust broadcast network, is in a stronger position to claw in this realm than they were a month ago.