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Original Issue


It was a spectacular early morning in the desert when CBS executive Neal Pilson first expounded the Gospel According To Pilson. He spoke at a press conference at the Arizona Biltmore in Phoenix. Across from him was a wall of windows that looked out onto sun-dappled lawns. But his speech that morning, June 8, 1984, was anything but serene. What he told the assembled group of TV journalists was that the industry is in some difficulty and that he was about to propose a brave—and seemingly gloomy—new world.

And exactly what was the problem? Well, low ratings, for one. Take pro football. Down in 1983 and down again in 1984. During the regular '84 season, ABC was off 6%, CBS 16% and NBC 4% from 1983, which wasn't considered a good year. But pro football is only the tip of the iceberg. Over the past three years, since the banner season of '81, a kind of dry rot has set in for all major sports except pro basketball.

The trends over five years are unmistakable. Boxing is down 49% on the networks. College hoops are off 21%, bowling 27%, tennis 26%, and college football 17%. Baseball is off 20%, but that decrease could easily have been larger. The summer game actually went up 10% last year, but the rise was attributable to NBC's Game of the Week, which, for the first time, was without TV baseball competition on the local level.

The great march downward in the ratings has also affected the blue-chip events. From 1979 to '84, only the Super Bowl remained stable. The World Series, the NCAA basketball final, the four major New Year's Day bowls, the Indy 500, the Masters, the Derby, Wimbledon—every last one of them was down.

As a result, Pilson told major league sports last spring, the party will soon be over. No longer, he said, will the networks keep paying ever-increasing fees for sporting events. Oh, there may be moderate increases in the future. And the networks surely won't desert sports entirely. But teams should not sign blockbuster labor deals, stadium contracts or player salaries and expect the networks to keep paying the freight.

Pilson, executive vice-president of the CBS Broadcast Group and until last December the man in charge of CBS Sports, has been harping on this theme of late. For the leagues, players, owners, agents, conferences and universities, it's bad news ahead. For the fans, it's a mixed blessing. If the money spiral levels off, we'll read less about multimillion-dollar contracts, player strikes and lawsuits. But with less revenue, some of our leagues and teams may well go bottom up.

Before handing over sports to Peter Lund on Dec. 11, Pilson, 44, was the least senior of the three network sports chiefs and the one least wedded to the past. It's interesting that Pilson was the first to spell out how the double-edged problem of depressed ratings and ad revenues will inevitably be passed along to the leagues. NBC Sports president Arthur Watson was the first exec to complain about the overexposure of sports. "What has happened is really quite simple," he said. "Supply has quickly outstripped demand." Even Fred Pierce, president of ABC, chimed in, saying Olympic rights fees for Seoul in 1988 could go lower than once expected.

But it was Pilson who rang the fire bell. Why? "Oh, he's trying to get a cheap deal during the next NFL negotiations. He wants to keep the NFL for as little as he can," says Gene Upshaw, executive director of the NFL Players Association. "If I were in his position, I'd be saying the same things." In all candor, though, Pilson's pronouncements are not entirely crass. At stake here is the very heart of the sports-TV marriage.

Pilson's concern over rights fees probably began in the spring of '82. It was then that the three networks signed a five-year, $2 billion contract with the NFL—a 245% annual increase over the previous four-year deal. Subsequently, NBC and ABC anted up $1.1 billion over six years for major league baseball (an $810 million increase over the previous four-year contract). ABC bought the 1988 Winter Olympics for $309 million. Meanwhile, the so-called TV "beer wars" between Miller and Budweiser ended, and the ratings began their tumble.

To Pilson, the baseball and Olympic deals didn't make sense. Why pay so much more, Pilson asks, when there's no guarantee the audience will be greater? Higher fees mean higher rate cards, and sponsors already have been resisting. In 1984, for example, they were able to buy NFL ads at roughly two-thirds the price the network originally wanted.

There are other considerations. The networks feel they have reached their limit on the number of hours of sports they can air and the number of commercials they can plug in. Wall Street investment houses, whose friendship the networks covet, are growing wary of broadcast companies whose costs have been rising at more than 10% annually.

So, welcome to the Big Squeeze. "The spiral is going to come to an end, and if the players don't realize it, they're going to find out the hard way," Pilson says. "We have a very real concern that major sports packages will build their economic model for the future on ever-increasing rights fees. We don't want anyone in the sports business to wake up one morning and find out that's not the case."

Thus far, there's been one major test of Pilson's credo: college football. When the Supreme Court removed the NCAA's TV controls for this past season, the number of college games on the tube proliferated like soap operas. More viewers flipped on the set, but individual ratings plummeted. Naturally, rights payments did, too. Down, down they went, until they reached half of what they were the year before. CBS and ABC were delighted. They had lost $3.5 million each on college football in '83, but now were turning a profit because of the lowered rights fees, and they were no longer required by NCAA contract to provide regional telecasts. Advertisers loved the discounted rates. Only the colleges suffered.

The networks are like your mother. She found a dinner you liked to eat and fixed so much of it you got sick.
head coach, Pittsburgh Steelers

I used to watch every game on the networks. Then I got cable last September and began watching football on ESPN and some of the other cable outlets. After a few weeks of solid football weekends, I began to feel like Td swallowed a football. One game was right into another until I couldn't even tell which game I was watching. My wife would ask me who's playing and I couldn't tell her sometimes.
advertiser, Orange, Ohio

Just what are we seeing in the ratings decline? For one thing, we're seeing the proof of what should be called the Nielsen Law of TV Dynamics: the more hours, the lower the ratings.

To a certain extent, the networks themselves brought about the decline. According to Paul Kagan Associates, a cable-and network-TV research firm, the networks increased their sports programming from 979 hours in '73 to 1,596 hours in '83. Curiously, it was Pilson's own company, CBS, which led the charge, jacking up its hours from 270 to 585. (NBC's hours went from 358 to 526, ABC's from 352 to 485.) The increases have been especially large the last two years, rising 11% in '83 and another 20% in '84. These hours, remember, are only network hours. Never mind about the eye-popping increases racked up by each of the following: independent stations; superstations such as WTBS in Atlanta and WGN in Chicago; cable networks such as ESPN and USA; and scores of pay-TV services, from giants such as HBO to the fledgling Sports Time system in the Midwest.

Because of last season's college football explosion, there were as many as 15 college or pro games available in the San Francisco Bay area each weekend. Was it any wonder that Ed Phelan, a retired Bay Area delicatessen man, got tired? "I started the season watching them all," he says. "After a while there was a sameness, a sense of shapes and figures swimming before my eyes."

Despite the ailing ratings numbers, the slide didn't become alarming until the '83-84 college basketball season. A number of TV syndicators, those independent businessmen who buy up TV rights to leagues and then patch together their own networks, struck multimillion-dollar deals with college conferences. The result was a smorgasbord for the viewer. But something was wrong. Because of the glut, ads were going begging. Some syndicators were forced to return to the colleges and admit that they'd made a terrible mistake, that the money wasn't there, that the contracts had to be rewritten.

Of course, it's not all doomsday. A wise man once said that if most of heaven is covered with cloud, save a few small chinks of blue, make much of the blue. Here goes:

The '84 Super Bowl was the 11th-highest-rated telecast and the fifth-highest-rated Super Bowl. The Summer Olympics averaged a big 23.5 in prime time for two weeks. The Winter Olympics, however, averaged 18.2. If they had been a sitcom, they would have been canceled after the second night. The seventh game of the NBA finals pulled a 19.3—the highest NBA number ever.

Buried under all these stats is a message for the ad men, for the networks, and for you and me in our family rooms. You say you've been overdosing on trash sports such as Battle of the Network Giants or mixed-pairs bodybuilding? You've been mainlining bowling and anthology shows? The word from the advertisers is "watch 'em while you can." BBDO, the giant New York ad firm, has called for an elimination of gimmicky sports, an end to NFL preseason telecasts, and a one-network policy for college football and basketball.

Network execs seem to be getting the message. "What Pilson said about rights payments is really becoming a mind-set with other sports programmers," says Bill Grimes, president of ESPN, which like the USA Network, is off about 10% in the ratings. "The thinking is, if there is a reasonable limit here beyond which the advertisers are not going to go, then we'd better not make a real bad buy because we're liable to lose our jobs."

But that is just talk. What have the networks done so far that will change our viewing habits?

Well, ABC recently jettisoned Superstars, one of those gimmicky TV soufflés that had been around since 1975. Trouble is, NBC picked it up. ABC also lopped off its spring Pro Bowlers' Tour, shelved the venerable American Sportsman series and let go a number of production people (among them, one of its two main baseball directors and the producer of its Olympic "up-close-and-personal" shorts). The formerly sacrosanct Wide World Of Sports will be cut back from 90 minutes to an hour in May. Pilson said CBS Sports will reduce its programming by 3% in '85, dropping whole events in some cases and cutting back hours in others.

Then there's hard evidence that TV rights payments already are leveling off. Since last June a number of bowl committees and golf tournaments have renewed their contracts with the networks or ESPN with clauses that protect the networks from lower than expected ratings. There have been reports that the Cotton Bowl took its first pay cut since Texas joined the Union. If this trend continues, something dire may happen. Everybody may start holding the line—leagues, teams, players and agents—and viewers may get their minds off the frivolous news and onto the sports news. Think of it: a sports page without a line about money.

Basically, somewhere out there, there is a societal change toward spectator sports. You can't single any one factor out, but you can state them all. And they are all negative charges, not positive charges.

I got with a group of friends who would gather around the television on Sunday afternoons and Monday nights. When we sort of drifted apart, I found the games didn't mean to me as much as the people. It's strange. I'm more interested in what happens in sports than before, but I'm not interested in seeing it happen.
computer salesman, San Diego

Three principal theories as to why network sports ratings are suffering are making the rounds. Surely you sympathized with that fellow with the shapes and forms swimming before his eyes? All right, that's glut. You have one of those cable systems with 38 channels, half of which seem to carry sports? Fine. That's viewing alternatives. You say you're the father of an 11-year-old who can't understand why Brian Sipe upped and left the Browns? Join the crowd. That's the mystique factor.


Cosell on football: "People who work for me, who've been in the sports business all their lives, say they can't watch it anymore, that the game is a bore, that it's a stereotype. The plethora of football games on the air has deleteriously affected the professional sport." (For us common folk, this means "overexposure has hurt the NFL.")

Football glut is one of those things that's self-evident; it's like eating too much over the holidays. "I'm sure the USFL [whose presence has meant that we've had football without a break now since August 1982] has affected our ratings some," says Houston Oiler quarterback Warren Moon. "I think people are just kind of footballed out by the time we come along." And it's not just football, of course. According to BBDO, the program category with the largest number of network telecasts in the last five years was weekend anthology shows. Anthologies ranked second to football in the number of network hours, ahead of both baseball and college basketball.

Ken Schanzer, executive vice-president of NBC Sports, is perhaps the leading advocate of the glut theory. The greater the number of games, he says, the less likely it is a fringe viewer will tune in to any one of them. "You may have greater interest on the part of those who watch, but what you're stepping on is the last pieces of your rating—somebody who will turn it on if it's not available elsewhere but may not turn it on if it's ever-present."

Here's some hard evidence in favor of the glut theory: The only major sport with reduced exposure on the networks in the last five years, the NBA, suddenly went up in the ratings (from an average of 6.2 in '80 to 7.6 in '83; it declined to 7.2 last year).


As far as Steve Leff is concerned, the vast number of options available to cable viewers is the culprit. Leff is executive vice-president and media director for Backer & Spielvogel, which has the Miller Beer account. "You'd have to be a piece of wood not to realize that if there are more choices, to some degree people are going to exercise that freedom of choice," he says. "The viewer now has 30 choices as opposed to three."

It used to be that the networks paid the freight but had all the viewers. Now a lot of the viewers are tuning in elsewhere. The trend showed up clearly in a Nielsen survey last November. The network affiliates' share (the percentage of TV sets actually in use) went down 4% for all TV viewing in 1984. The big gainers were cable-originated services, such as ESPN and USA, and the superstations.

Viewing alternatives include the video recorder. No one knows how many Monday Night Football fans, say, have been lost to the VCR, but rest assured this gadget eats away at sports ratings. Why watch just another game when you can pop in, say. Animal House? Dr. Raymond Kitziger, an orthopedic surgeon in New Orleans, says, "I consider myself a big football fan. However, I'd rather see Casablanca for the 32nd time than watch Cincinnati play Houston. I'd rather hear Bogart tell Bergman, 'The problems of three little people don't amount to a hill o' beans in this crazy world' than listen to a play-by-play man say it's third-and-long."

Evidence in favor of the viewing alternatives theory? Major league baseball, which prohibited its teams from putting games on independent stations, superstations or pay-TV outlets on Saturday afternoons last season, thereby giving NBC's Game of the Week exclusivity in its time frame, came back from a 5.8 in '83 to a 6.4 last season.


Contract squabbles, player strikes, franchise moves in the dark of the night, booze, boycotts, marijuana, selfishness, cocaine, courtrooms. As Cosell said, they're all negatives, chipping away until the casual fan, at least, decides he has better things to do than watch games. Cowboy president and general manager Tex Schramm puts it this way: "It's almost a fact now that excellence is judged more by the size of a contract than by performance. That takes some of the glamour and mystique out."

Don Ohlmeyer, formerly executive producer of NBC Sports and now the head of his own production company, says the ratings are down because the fans are also down. "The players don't give the fans any reason to root for them anymore," he says. "It used to be that if the team won, terrific. In baseball now it's, 'If they don't pay me enough money, I'm leaving. I have no loyalty to you, little kid, even though it's you who comes and pays the three bucks that allows the club to pay my salary.' I think the fans are asking themselves, 'If they don't care about me, why should I care about them?' "

Mystique is my pet theory. I think expansion and what I call "quality inflation" also have turned viewers off. There are too many leagues, too many teams, too many players. How can you possibly remember it all. The record book has been watered down by longer seasons. Boxing has become a farce with "junior" this, "super" that and three "crowns" per weight level. Everything seems prepackaged nowadays, like mustard in little plastic pouches. Sure, glut and viewing alternatives hurt. But expansion and quality inflation and all the other bad vibes have affected my interest more.

Now mix in the drug headlines. "If I were Rozelle," says Leff, who places spots for one of the NFL's major advertisers, "I'd make every player in the league take a saliva test every hour of the day until I cleaned the drugs out of there." Says Rozelle, referring to drugs and all the other negatives: "People are used to reading this kind of bad news in other sections of the newspaper. When you see the same thing attributed to your favorite diversion, it's a turnoff."

There are still other theories for the downtrend. Kids watching MTV. Networks counter-programming big games with the likes of I Was a Teenage Werewolf Before I Left My Burning Bed And Found God. And not least, the fitness boom. "Heck, when I was a kid," John Madden told S.I.'s Lisa Twyman, "there were jocks, but there were also people interested in music, books and art—intellectuals, sophisticates. Some of them never worked up a sweat in their lives. Now everyone's active. People do more things. The alternatives are to watch a game, go play a game or just go outside. Watching is not in first place anymore. There are other things to do. There are these Jane Fonda exercise books and videos, people who eat quiche and sushi. We're losing out to that."

Boxing promoter Bob Arum has his own explanation: Network execs can't see beyond the Hudson River. "You can't have people who only read The New York Times or the Daily News program for an entire nation," he says. "I would venture to say that if one of the three networks moved its sports division to Dallas or St. Louis, the network ratings would go up because then they would have their finger on the pulse of the nation."

The next negotiation is going to be murder. For the first time I can remember the NFL is not going to be able to dictate terms.

I'm not convinced that everything is black and getting blacker. It's been my experience that few things happen to the extent that most people believe and fear.
advertiser, New York City

Let's dream for a moment. Say it's the year 2000. What will we see? A saner world, I think. We'll see enormous, thin, high-resolution TV screens. We'll see viewers sitting before computers or coding boxes, ordering up the particular games they want to watch. There will be a profusion of sporting events still flickering across the screen. But a degree of sanity will have been restored. The networks, which because of their reach will still carry the prestige events, will not be quite as powerful. The players will have adjusted. We will see neither rainbow nor pot o' gold, but pay-TV providing a steady income. The question, of course, is how to get to the year 2000 from 1985. That's where the sky gets gloomy. If Pilson and his network counterparts do start paying less, a lean period that could last a decade or more will be in the offing for leagues, conferences and players alike.

Upshaw says that if the networks ever started offering less, the players would "have to look to expand it. We'll go to pay-per-view and cable." But that view is woefully misinformed. The technology isn't here for pay-TV to come to the rescue. Pay-TV needs millions of complicated gadgets that will let viewers receive individual games for a price, but the electronics will take years to perfect. Sure, the NFL may dabble with basic cable networks, such as ESPN. But it won't find much money there.

How will the changes affect viewers?

In the short run, before financial problems start killing a team here and a team there, not very much. Say the networks and a few syndicators lop off more hours than expected. Independents, superstations and the cable services will still carry a ton of games.

"The viewer will always have a great variety of programming," says NBA commissioner David Stern. "You've got college football and college basketball and the Major Indoor Soccer League and the NASL and the USFL. The North American Baseball League is expected to get started. There's road racing and Superstars and special events and marathons. All you're gonna have to do is learn how to find out where everything is—how to use your channel guide and addressable box."

How about the networks? How will they fare?

They're not exactly going to roll over and play dead. They are, and apparently always will be, the only TV outlets that reach all of the country. At its best, cable TV will reach 60% of the country's homes by 1991. "If we can manage our business properly, we can survive and be very healthy," Pilson says.

The networks of the future will focus on high-profile games of national interest. There will be a nice, pat division of responsibility, the networks taking the high road, the other TV outlets filling in on a regional basis. Although cable sports services have been chipping away at the networks' ratings of late, the networks don't believe they're working at cross purposes. Otherwise, ABC would not have purchased 80% of ESPN, and CBS would not have bought 50% of Sports Channel, a regional pay-TV outlet in New York and Boston.

One nightmare that won't come true, at least for a number of years, is the Super Bowl and World Series going to pay-TV. To keep promoting themselves among the fans, the NFL and major league baseball still want the masses to see the crown jewels, so they'll stay with the networks.

How will the syndicators and the advertisers adjust? Some syndicators already are sucking air. "I don't think they'll be able to survive," says Katz president Fred Botwinik, adding that his own company will be an exception. "It doesn't make sense for them to be paying the high rights fees and not getting the return." Conferences with huge syndication deals, take note. The ad men? They'll return to the networks like swallows to Capistrano, but only if the price is right. Network sports advertising was a $1.37 billion business in '83, according to CBS. This year, Chevrolet opted out of the Super Bowl rather than pay ABC's ad rate of $525,000 per half-minute. Chevrolet and Anheuser-Busch moved some ads away from the NFL toward prime-time programs such as Hill Street Blues. The networks remain the place where most of the guys who drink beer and drive pickup trucks happen to be. But the ad firm of Needham, Harper & Steers warns, "As male audiences continue to decline, advertisers and their agencies will look harder for alternative media sources."

In '84 an unprecedented number of NFL and major league baseball teams changed hands or were put on the market. Three NFL teams, San Diego, Denver and Dallas, were sold. Another, New Orleans, still has the For Sale sign up. All this in a league in which only one franchise, San Francisco, had been sold in the previous seven years. As for baseball, commissioner Peter Ueberroth says eight of the 26 teams are for sale. Have the owners read Pilson's gospel?

The players may grouse and grumble, but they will have no choice except to live with less. "It's the way the country is headed," Ohlmeyer says. "Chrysler and Ford and most major corporations in America have faced this issue. Sports has always been five or six years behind the country. Race, drugs and the union movement were issues in sports long after they were issues in the country. You'll see, the players will adjust. The only difference is that players are more concerned about the here and now. At Chrysler or Ford, the guy on the production line is planning to be there until he's 65."

The first test case since Pilson sounded his warning may well be the current baseball labor talks. The players are drooling over that $1.1 billion the owners got from NBC and ABC. But the owners now realize that network giveaways might not last forever. "I saw where [Marvin] Miller and [Donald] Fehr [the players' leaders] said major league teams made X number of dollars more in '84 than in '83," Ohlmeyer says. "They're missing the point. The point is that there may not be enough TV money out there in the future to cover the long-term contracts the teams are obligated to pay in the year 2005."

The NFL's next network contract will not begin until 1987, although its dollar value probably will be negotiated after the '85 season. Does Rozelle believe the golden era of increasing payments is over? "It could be true and it could not be," he says. "It all depends on what happens in the ratings. We'll have to improve."

Pilson, who says CBS is still making a profit with the NFL, allows that one of those "moderate" increases may yet be in store. Rozelle seems unusually willing to accept a modest boost. "Regardless of the circumstances, we can't take money that forces the networks automatically into the red," he says. "I don't think we've ever done that. This may be the closest. But we wouldn't try to hold them up for a deal if the ratings don't justify it."

As troubling as it seems, the ratings' slide may point toward a more hopeful future. Nobody enjoys a diet, but belt tightening is healthy after lots of years on the banquet circuit.

Who knows? Less may be more. With less money, leagues may junk their expansion plans and allow us to catch up with the players' names.



The jogging alternative.



Pulling the plug on regional telecasts.



The OD'd viewer.