Best Of Talking TV: Scripps Sports Looks To Edge Out RSNs For Rights

As sports betting fever continues to grip the U.S, The E.W. Scripps Co. can’t stop laying its own bets on over-the-air. In December, the company announced the formation of a new unit, Scripps Sports, that will look to leverage its OTA Ion networks (the nation’s fifth largest) to start picking off leagues and teams from regional sports networks as their contracts begin to expire there.

In this Talking TV conversation, Brian Lawlor, a veteran Scripps executive and new head of the division, explains the company’s plan to lure sports franchises with the prospect of 100% local reach via broadcast versus the dwindling audience RSNs face with cord cutting and audience belt-tightening.

Episode transcript below, edited for clarity.

Michael Depp: Last month, the E.W. Scripps Company announced it’s launching a new sports division. The aim is that Scripps will look to leverage its local market depth and national broadcast reach for partnerships with sports leagues, conferences and teams.

I’m Michael Depp, editor of TVNewsCheck, and this is Talking TV, the podcast that brings you smart conversations about the business of broadcasting. Today, that conversation is with Brian Lawlor, a veteran Scripps executive who’s now president of the new Scripps Sports division. We’ll be discussing just what this is going to look like and the thinking behind it. We’ll be right back.

Welcome, Brian Lawlor, to Talking TV.

Brian Lawlor: Michael, good to see you. Happy holidays.

Happy holidays to you, Brian. I must confess that after reading several stories about the launch of this division, I’m still unclear as to what it’s going to look like for viewers. So, what exactly are you planning to do here? Can you spell out the plan?

Yeah, I think it’s pretty simple. I think, you know, Scripps, is, you know, a long-time broadcaster with a pretty significant portfolio on the local side. We’re on 61 stations in 41 markets. On the network side, we have eight or nine national networks, the largest of which is Ion. And we believe that linear television is the most significant distribution platform for sports, and sports is the most powerful driver of linear viewing. Ninety-five of the top 100 shows on television this year were live sporting events. We see the decline of sports viewing as a result of being on the regional sports networks. And as a result of that, we think bringing sports rights back to linear television broadcast over the air is sort of a savior to teams and leagues.

And so, we’ve been talking to teams and leagues pretty regularly now over the last year. And as many of their rights begin to come up, they’re all assessing their current situation. And, you know, we see an opportunity and a moment in time right now to plant the flag and say, you know, let’s bring some of these sports rights back where 100% of the households in a market can see local sports teams.

So, we’re going to become pretty aggressive in trying to acquire sports rights, either in local markets where we can partner with an NBA team, a major league baseball team, the NHL team, which right now is limited by its reach on the regional sports networks, or we have the national platform of Ion, and we acquired that during the pandemic. It’s the fifth largest broadcast network in America behind ABC, NBC, CBS and Fox. Clearly, all of them have significant investment in sports. And, you know, we have the same reach as they do and quite frankly, a unique proposition to localize. And so, I think you’ll see us on a league level focused on trying to acquire rights for Ion and on a local level trying to acquire sports rights for our broadcast stations.

OK, so Ion — let’s just look at that part of it then for a second. Obviously, it’s a very important part of the strategy. So, you’re not going to rebrand these stations as Scripps Sports on air.

We are not.

Just looking to get more sports on the Ion stations across the country.

Yeah, think of like a TBS or a TNT where there’s entertainment or procedural genres, but they also have some live sports, marquee sports on certain nights or on certain times of the year. We think of Ion as similar to that.

What’s the timeline for this? I know you’ve been working on this for, I think, the better part of the last year, correct?

Ever since we acquired Ion during the pandemic, we’ve done sort of a portfolio review of everything we have inside of our company, and we have this unique new massive asset in Ion. And, you know, we’ve done some strategic analysis of how do we think we can grow this and increase its reach and obviously its profitability. One of the areas that we look at are sports.

And so, we have begun having some conversations with leagues about the unique asset of an over the air broadcast network. And, you know, that’s what really makes Ion unique is while it is a national network and it has national distribution on cable and satellite, it’s actually different than many others in that it’s actually local licenses and local towers in every market. We have a 100% reach, 96% reach of the U.S. with Ion fully distributed on cable, on satellite, it’s on FAST and then it’s over the air.

What makes Ion unique and very different than the networks is we own the majority of affiliates and control all of the programing. And so right now, you know, all the programing, all the commercials, everything looks the same across the country. But because of the uniqueness of having local towers and licenses in every market, we can localize Ion, which means, you know, if we were to acquire sports rights for a given league and we said to that league, hey, you know, why don’t you align every Saturday night, we’ll do a Saturday night game of the week on Ion.

And if you could have all your teams playing at 7:30, we could literally localize every market with their home team games. I’m based here in Cincinnati, right, so Cincinnati had a professional team and whatever league it was, every week we could feed them the Cincinnati game, and then Nashville could always get a Nashville game and Kansas City could always get the Kansas City game. And then for places that didn’t have local teams, we could regionalize games or even have a national game.

But obviously you could roll all that up, sell it together, cume it and have a big national audience with sponsors targeted for the market. So, we think we have a really unique asset there. You know, ESPN can’t do what we just described. If they have a game, the entire country sees the same game. And so, the ability for us to have a relationship with a league but be able to localize that in every market really, I think is a unique proposition.

Let’s talk about the conversations that you’re having with the leagues. Are we just talking about the big professional leagues or how much will college play into this potentially?

You know I think college will play into it. With Ion, we’re not going to turn it into a sports network. We know what it is. And so, you know, I think there’ll be two or three franchises that make sense for it. We’ll be very selective about what makes sense and understanding that it’s a national network. Many of the colleges or conferences are more local or regionalized. So, I think we’ll look at opportunities, but we recognize that we do have a strong national network with the ability to localize it. And I think we’ll be really targeted with what are the right franchises for air.

What about more niche sports? I mean, might we see pickleball on Scripps Sports?

I think time will tell. Pickleball is an interesting one because of its growing popularity. But don’t just think that we’re going to be all about niche. When you have a big national network like we do, I expect that we’ll be in conversations with, I don’t know about the NFL, and of course their deals now run out 11 years, but I think some of the other significant leagues. I think we can be a pretty material solution for them.

Are you also planning concurrently to develop some centralized programing? I mean, might we see some things in the vein of ESPN Sportscenter, for instance?

I think down the road, that could be something we consider, Michael. I think first and foremost, what we’re interested in is using the immense reach that we have to really, you know, distribute a sports league or team, you know, across the country or fully through a market. And I think that’s our top priority. And then as we acquire rights and begin to distribute those, you know, I think we’d figure out what complementary programing would make sense alongside that.

As you know, Sinclair has had a rocky road with its RSNs, so did that sort of give you any pause or maybe, conversely, encouragement to make this tactical shift to go in this direction?

Yeah, look, I think that’s our opportunity. Their business model is cable and satellite distribution. And so, when many of the current teams that have deals with them signed their last contract five, seven, eight years ago in many markets they might have had 70% or 80% distribution through cable and satellite. The reality is in most markets today, that number is less than 50%.

And so, I sit here in Cincinnati. Fox Sports Ohio in Cincinnati is distributed to 46% of the households in Cincinnati. That means that for the Cincinnati Reds, more than half of their potential customers can’t see any of their games. That’s not a good business model if you’re a baseball team trying to build audience, build fan loyalty, sell the excitement of young players.

There are leagues and teams around the country that cable and satellite and the distribution of the regional sports networks and their local market is 30%. And so, again, you know, it’s really hard to get people excited about your team if 70% of your audience where your team is based can’t even see your games. There’s no searchability. You’re not flipping channels and you suddenly stumble on to them.

You know, there’s very little visibility for showcasing players and think about all the businesses. If your sponsors and partners can only showcase to 30% of the people, it’s going to have an impact on ticket sales, suite sales, merchandise, sports betting. All of those subcategories benefit from a team bringing their rights to broadcast over the air where they can reach 100% of the audience.

Well, how are there conversations that you’re having with the leagues and the teams going so far? They’re showing receptivity to this?

On a local level where the teams have their relationships with the RSNs, I think they’re very concerned about the future. And, you know, as teams in the next year or two years, their rights start to come up, they see what has happened over the last several years. They see the projections for what’s going to happen to cable or satellite in the next couple of years. And I think the conversations we’re having is they’re very concerned about that being their primary distribution platform.

And I would say the leagues are as well, and at the highest levels. We talked to some of these leagues, you know, being exclusively distributed on cable and satellite is limiting the visibility of those leagues. And they’re very concerned about what’s happening in the local levels where their teams are only viewed by 30 or 40% of all the households in a market.

Well, the Scripps faith in OTA is bottomless. Brian, I know that you’re a very big sports fan and a fellow Islanders fan, I must say. And so, this must be something of a dream job for you personally, isn’t it?

Yeah. Look, this was not how I thought I was going to end my career. As you know, Michael, I had been with Scripps almost 30 years. I’ve been running the local TV division for 14 years. As we wind down 2022, when I took over running the division, we had 10 stations in nine markets, and as I hand off 61 stations in 41 markets, I’m incredibly passionate about the power of local broadcasting. I’m proud of the local journalism we do, the way we serve communities.

And so, I guess I thought I would take that to the end. But I also recognize there’s a unique moment in time right now with sports. And as the company at the highest level was reviewing its portfolio and taking a look at its assets and identifying Ion as an opportunity.

On the local side, we acquire and negotiate a lot of local sports rights. Obviously, we have a lot of sports from ABC, NBC, CBS and Fox and our affiliates. But we also negotiate rights for Monday Night Football with Disney, with Amazon. We were able to do a big deal with Amazon for the local markets on Thursday nights there.

This year we were able to acquire the Big Sky Conference, which is a huge conference out West for us. We’ve got a big footprint in Montana and Idaho, and we were able to take that away from the regional sports network there. And so, you know, and then, you know, my prior history, I was the chairman of the NBC affiliate board at one point my career, the president of the ABC affiliate board.

And so, you know, I worked with the networks at the highest level as they were negotiating Olympic rights and NFL rights. And when Jimmy Pitaro became the president of ESPN a couple of weeks later, I was in there talking to him about starting to bring more rights back to ABC, which at that point there weren’t a ton. And then we were able to get the NFL draft over and we moved the ESPYs over to ABC and then we got more stars out of Saturday night’s NBA and now we’ve got a bunch of NFL games and now they’re in the rotation for the Super Bowl.

So, I’ve spent a lot of time talking sports and trying to help influence sports. And so, as this opportunity presented itself, it just sort of came together. It wasn’t something I ever pitched, but there came a point where I so actively involved in the development of our strategy and sharing that strategy with the board that [Scripps CEO] Adam [Symson] said, Look, we’re going to go all in on this. It seems like you’re the right guy to lead this. And I spent a couple weeks thinking about that and said, you know, I’m passionate about over-the-air broadcast and the power of reach and what we can do with it. And sports would be sort of fun. And I still get to do it with a company I love and I’m proud to work for. So, this is going to be fun.

Just make sure you get a good bit of hockey into that mix.

Absolutely.

All right. Well, Brian Lawlor, you’ve got a lot of work cut out for you. We will be following developments with at Scripps Sports with great interest. Thanks for talking to me today.

Good to see you, Michael. Thanks.

Thank you. Remember a new Talking TV episode comes out most Fridays. You can watch past episodes on TVNewsCheck.com and on our YouTube channel. Thanks for tuning in and we’ll see you next time.