CBS affiliates were upset last week when some of the network's coverage of the men's NCAA basketball tourney went over to ESPN while CBS turned to the war in Iraq. The reason: ESPN demanded its usual exclusivity in return for airing the games.
What also irritated Bob Lee, chairman of the CBS affiliates, was that CBS's war coverage ran a ticker sending basketball viewers to ESPN, while ESPN ran a ticker sending war viewers to ABC.
"I think it would have been in the public interest had cable not demanded exclusivity for this," he said. "A number of stations were prepared to do multicasting on their digital channels or make deals with third parties to carry the game."
CBS sources said the network had to give ESPN exclusivity to get the deal done. Otherwise, the games might not have been aired at all, CBS's most expensive option.
CBS reportedly paid $480 million to the NCAA for this year's rights to air the basketball tournament, part of an 11-year, $6 billion deal. If any of the games do not air, CBS loses the advertising revenue but still must pay the license fees.
No money changed hands to accomplish the deal, said CBS Television President Leslie Moonves. CBS kept its advertising earnings, while ESPN claimed promotional time and any local ad avails.
Sending the games over to ESPN, which covers about 80% of the country, means CBS is likely to lose money on those games because ESPN's ratings are lower than CBS's and many viewers were likely watching war coverage. But getting games to 80% of the country guarantees higher ratings for CBS than if affiliates had been left on their own.
Lee said CBS estimated that stations with third-party agreements only would have covered 18% of the country. Covering 80% means CBS still is likely to owe make-goods to some advertisers but the damage will be lessened. It is also to CBS's advantage if all preempting comes early in the tournament, because those games are less watched, making that advertising less expensive.
"Maybe the best option would have been 18% plus 80%, had cable not asserted exclusivity," Lee said. But that wasn't one of CBS's options.
"We have affiliate partnerships of our own that we need to be mindful of and pay attention to," said ESPN spokesman Josh Krulewitz.
Over the weekend, when ESPN has less airtime to offer, CBS planned to air games on Viacom-owned TNN and TV Land if necessary. They were less desirable because ESPN can air five tournament feeds at once: four regional and one whiparound that covers all games being played at that time.
CBS affiliates could air games in high-definition on their digital feed regardless of whether they were on ESPN. Last Thursday, the games reverted to CBS at 7 p.m. ET, causing the stations to miss only three windows.