March certainly is madness for television sports. While ABC touts its pro basketball, golf heats up, and CBS waits greedily for college basketball's "March Madness" tournament to start, NBC is pleased with its own modest winter sports entry, the Arena Football League. Six weeks into the indoor football league's 22-week season, NBC is praising the new partnership.
"The plan was that this would grow slowly," says NBC Sports President Ken Schanzer. "There were doubters before the season, and people are coming back and saying it made sense."
Arena football makes sense for NBC because it's low-risk. While Arena Football's Nielsen marks—an average 1.5 rating so far—don't measure up to initial ratings for the failed XFL football league, the AFL isn't nearly the same roller coaster—financially or in ratings. NBC coughed up $30 million to $40 million to get the XFL running in 2001. After stellar early ratings, the XFL slipped to around a 2.0 by its end.
The Arena League, in contrast, is a proven commodity. The league is 17 years old and has a built-in small but loyal fan base. This season, to NBC's pleasure, attendance is up 25%. And NBC had predicted the games would rate between a 1.0 and 2.0, so viewing is on track.
Signs of the league's growing acceptance, Schanzer says, are written in the papers. USA Today, he notes, now prints a roundup of weekend games, and weekly Arena League rankings are printed in The New York Times'
sports section. "We're still waiting to see if ESPN will do highlights on SportsCenter."
The financial commitment to the AFL is very palatable. NBC doesn't pay for broadcast rights and shares revenue with the league. Under the two-year deal, NBC recoups a $10 million investment in production and promotion. The next $3 million in revenue goes to the AFL. After that, they split the revenue.
"It's an investment," says Schanzer. "This is going to grow, and, as it does, it will become more and more profitable."
In fact, NBC and the league have already regained the initial $13 million investment, according to Neal Pilson, former CBS Sports President and a consultant to the Arena League.
NBC is angling for cheaper but strategic sports properties like the AFL. The broadcaster once had marquee sports pro baseball, the National Football League and the National Basketball League but, in recent years, squawked at paying hundreds of millions of dollars to renew their deals.
Says Schanzer, "Would you like the sports? Sure, but not at these prices."
The only major sports league left on NBC is NASCAR. The network shares half of the auto racing league's season with Turner Broadcasting's TNT for about $400 million per year.
Both Arena Football and NASCAR, Schanzer says, are growth sports: "If we can expose it to enough people, it will build."
With so many mainstream and fringe sports offerings on television, though, it may be difficult to grow the AFL.
"There is a lot of fractionalization in sports," said Horizon Media's head of research Brad Adgate. "Look at all the startup sports networks." Cable channels are sprouting for sports from ranging from figure skating to tennis to football.
The Arena League is basking in its NBC exposure. Its previous TV deal was on ESPN, where games bounced around the schedule. NBC committed Sunday-afternoon slots and has upped production quality, particularly improving lighting and sound.
"We are very pleased with the attention and care that NBC has extended to the league," says Pilson. The Arena season runs through June 22 on NBC.