NBC Sports Network's Demise Wasn't Due to Too Much Sports on TV
It's not incredibly common to see a cable network to fold up shop -- especially when it's tied to a major network -- but that will be the case when NBC Sports Network is shut down by the end of 2021, per an announcement on Friday.
On paper, NBCSN could've been a competitor to the likes of ESPN, Fox Sports 1 and CBS Sports, but in actuality, the content was never really there. While ESPN and Fox have spent the last five years duking it out for the media rights of top-tier leagues and bringing in the best sports media talent, NBC's handled things much differently. They've prioritized a handful of "big" properties -- Sunday Night Football (the premier NFL TV holding at this point), Notre Dame football, the Olympics -- and then found passionate niche audiences elsewhere for nationally-relevant NHL games, Premier League soccer, motocross, some college basketball and then other Olympic sports.
Even on paper, that wouldn't look viable for any network long-term, and that was before the pandemic scuttled Olympic-centric programming (and the Olympics as a lucrative event last year), and Peacock popped up as a competitor within the NBCU family.
With so much of NBCU's TV revenues tied to linear right now, it makes it harder to both keep that large collection of networks afloat AND make streaming a viable option for both content and consumers. Something had to give. It wasn't going to be the new streaming service that's currently banking on "The Office" until the rest of the content strategy's figured out.
This also doesn't mean that NBCU's just walking away from linear, though. Far from it. USA Network wasn't always aimless, yet without any major sports rights or real prestige TV in recent years, it fell behind cable rivals. Now, without NBCSN, you'll see the best sports content go to USA (as noted by NBC already), with the "overflow" heading to Peacock. That was already the case for many Premier League games, and that concept potentially worked well enough to apply elsewhere.
So while NBC loses the carriage fee (around 50 cents per sub across nearly 80 million households), that was nowhere near what Fox was charging for FS1 (around $1 per). A USA Network bolstered with NHL, Premier League and some Olympic content now makes it a TNT alternative that is worth much more to NBCU's overall value -- and potentially allows for an increase in carriage fee per subscriber.
On the Peacock front, the main draw is just giving the streaming service more "live" events to air, which should boost the value of the ad-supported tier. Though there may not be many viewers subscribing solely for second-tier EPL games, motocross or lesser NHL games (assuming NBC doesn't lose a portion of hockey rights to ESPN during the upcoming negotiations), it's the sort of "nice to have" that keeps the service valuable for something more than comfort food reruns.
The concept of "too much sports" has been a hot one since the end of 2020, when viewership was down across all leagues while TVs were flooded with content (and mostly playoff content at that). And while the squeeze around sports on TV may have had something to do with the final decision to end NBCSN, there are much clearer signs that cable's overall competition for eyeballs and Peacock were bigger factors in making the move in a way that better positions NBCU for its future TV business.
