On January 18, 2011 the FCC and Department of Justice approved the merger of Comcast and NBC Universal. Eleven days later Comcast announced that it had officially taken control of NBC Universal from General Electric. Surely the long term effects of such a merger – between the largest cable/Internet provider with a major media and entertainment outlet – won’t be fully felt for many years.
What seems apparent is that consumers of sports television will eventually have a serious alternative to ESPN in nearly 20 years.
The recently formed NBC Sports Group, under the leadership of Chairman Dick Ebersol, will have the combined Comcast-NBCU assets as building blocks. Those building blocks include Versus, the Golf channel, Universal Sports, 14 regional sports networks (including CSN Washington) and NBC Sports.
Many sports fans are familiar with the relationship between the Yankees and its television network, the Yankees Entertainment and Sports network, or YES for short. In fact, many of the newer generation of sports owner dreams of one day operating his or her own media outlet. This is mainly an economic exercise in that a media outlet enables them to more fully capitalize off of the value of their sports franchise, while creating new revenue streams in the form of media advertising dollars.
The Yankees have used their media outlet – and the fact that they are in the largest media market – to generate a significant amount of revenue that they can invest back into the sports franchise, in the form of player and coaches salaries for example. It is also important to note that Major League Baseball does not have the same hard salary cap as the other major sports, and teams like the Yankees can spend more than other teams. But I digress.