Developing: Changes At Top of Rogers Sportsnet

Developing: Changes At Top of Rogers Sportsnet

by TSM: Multiple sources tell me this morning that Scott Moore will be leaving Rogers Sportsnet at the end of October. Moore is the President of Sportsnet & NHL at Rogers Media Inc. More details as they come …

 

Quick Updates

 

Rick Brace (ex-Bell, current Rogers Media president) takes over on an interim basis. From the press release:

 

“After leading Sportsnet to No. 1 as the top sports media brand in the country, Scott leaves behind a strong legacy.” – Rick Brace

 

Moore has issued a statement via twitter:

 

 

David Shoalts of The Globe & Mail just wrote a book about the big Rogers NHL rights deal. He is the closest thing we have to a sports media columnist at any of the major outlets. He is tweeting up a storm right now:

 

 

Some Sportsnet folks have chimed in, including Arash Madani, whose career has blossomed under Moore:

 

 

We will update as new information comes in.

 

Reactions

 

Mike: The ratings were down in the first two years of the HNIC deal and that cost the company a lot of money due to promises made to advertisers projecting a 20% boost in viewers. Lots of people also lost their jobs. (Last summer Moore told the Globe that he expected a “40 to 50 per cent” increase in ad rates in 2018.)

 

Many of the big changes ushered in to HNIC for 2014 have been undone or changed again. With the start of hockey coming this week it’s very hard not to connect the timing of this departure with those facts. Here are some representative tweets from 2016 when the first wave of course changes were made.

 

 

Another interesting thing to watch is whether there will be a change in philosophy with a new Sportsnet president. Recall how Moore decided to describe the network’s coverage of the NHL:

 

“We’re taking what I call a ‘Stars First’ editorial philosophy. Talk less about the business of the game, and more about great stars and great storytelling. […] I tell our editorial team that we’re partners with the league. Not cheerleaders, but partners. For the last number of years, particularly in Canada, the business of hockey took center stage. Now we have a long runway of labor peace in the league. Far less franchise issues. The game is in good shape, the balance of the game is terrific, the game on the ice looks great. I don’t think dedicating a segment every Saturday to talk about business is something that the fans want to here. We did consumer research: they’re tired of it. They want to talk about the breakout and the penalty kill and the power play, and why Alexander Ovechkin hasn’t won a Stanley Cup yet.” – Scott Moore

 

As I wrote recently re: the memo on Jays coverage, Moore has had plenty of opportunities to frame the discourse around Sportsnet’s journalistic strategy. He often talked up the relationship with league partners rather than leading with the need for trust with the audience.

 

Another thing to note is that there is a lot of equivocation around the battle between TSN and SN. Many press releases boast about being “#1 brand” but this is essentially a made-up metric that combines some meaningful measurables and some fake ones. For example, both networks talk about the number of retweets or minutes of video watched online. That doesn’t count for anything objective.

 

The only places we know there is genuine data that leads to advertising dollars are TV and to a much lesser extent radio. SN beat TSN on TV in years when the Jays were in the playoffs. We can slice that into Quarters and argue about it in more detail. But the reality is that the HNIC deal has not brought the ratings windfall expected … yet. It will be very interesting to see if the renewed interest in the Leafs is a tide that lifts all boats, or if this firmly establishes SN as the #1 cable brand.

COMMENTS

WORDPRESS: 32
  • comment-avatar

    I hope it’s true.

    The need for new blood at SN starts at the top.

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    Mario 2 months ago

    Not really surprised he was given a bad hand from the beginning when they got the NHL rights. Just wondering if his hands were tied from the start.

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    Justin 2 months ago

    Lots of questionable decisions with Moore at the helm.

    -Replacing Maclean with Strombo only to revert back
    -Cutting down Coach’s Corner from 7 to 5 minutes only to revert back
    -Replacing Joe Bowen as Leafs PxP
    -Phasing out Bob Cole
    -Those old stupid segments with analysts in suits holding hockey equipment acting out plays
    -Letting go of Tim Thompson and his unbelievable montages

    He’s done some good things too, such as Hometown Hockey and elevating the talented Jeff Marek and David Amber to larger roles. And Sportsnet’s hockey coverage on their website is quite in depth (and far superior to the joke that is tsn.ca). But overall, it seems that HNIC has gone sideways at best since Moore took over.

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    Mario 2 months ago

    Wonder were they will be looking. Internally if there is anyone really qualified?

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    Good effin’ riddance.

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    I can’t be the only one to wonder if there are lots of nervous on-air talent within both Sportsnet and the Fan now that Moore can no longer protect or shield his buddies.

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    The three bigwigs who orchestrated the NHL are all gone within after only a third of it has been completed. They may suggest they want new challenges. I say they screwed up royally and were given the heave-ho.

    If the NHL deal is making Rogers money hand over first, these guys would be swimming in massive bonuses. That’s not the case, and they’re all gone.

    For those with a better understanding, feel free to tell me if I’m wrong.

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    Reggie 2 months ago

    First Thing 1 is gone, now Thing 2. Guess we have to put Dr. Seuss (aka Bob McCowan) in charge of the whole deal-io.

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    Mike V 2 months ago

    I’ll just leave this here before the armchair analysts all chine in and suggest you start at page 173 of the pdf. Despite the conventional wisdom, Rogers is making a profit from the NHL deal and a lot of it.
    Also, much like the the NFL, looking at ratings on HNIC in isolation means you have to ignore the absolute carnage in the non-sports television landscape where ratings in target demos have dropped 10%+ each year for the past 4 to 5 years now and PVR viewing means no ads are seen so no money made. Like Anthony Crupi of Ad-Age likes to say, sports are now basically keeping the lights on at broadcast networks.

    Moore is by no means a beloved figure (what TV exec is?) but hard to say he didn’t accomplish his job.

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    @Mike V – the only ones who are not armchair analysts are the people at Rogers who approved the $5.2B deal and their judgments about opportunity costs and expected profits. Sportsnet’s ad rates when the deal was first announced provide some insights into the financial modelling that went into this but even that is sketchy.

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    one of the most interesting quotes from Moore was him saying that 66-68% of SN’s revenues come from subscriber fees. I wonder what TSN’s number is? Either way, both are highly vulnerable to cord-cutting trends much more than ratings fluctuations (ad dollars).

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    Mike V 2 months ago

    According to the CRTC financials I linked to, last year TSN made 342mm in subscriber revenue so 70% of total. Another interesting thing to note is this has been increasing at roughly 5% annually as the per subscriber monthly fee increases has been far outstripping subscriber losses.

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    “Despite the conventional wisdom, Rogers is making a profit from the NHL deal and a lot of it.”
    Is this actually published anywhere in Rogers financial statements that the parent company is making a net profit on the whole thing all summed up together? It’s easy for PR to say they make a huge profit when they can bury expenses using with inter-company agreements billing expensses to other divisions or only make vague comments that “Sportsnet revenue is up” which doesn’t really mean anything at the big picture level.

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    In his original article when the news broke, Shoalts quoted Moore today as saying he felt comfortable leaving at this point ‘because ratings are in a good place with Winnipeg and Toronto contending for the Cup’ (paraphrasing, Shoalts removed that quote in the longer article posted later). By saying that, Moore is basically blaming past ratings woes solely on the moribund performance of Canadian teams while at the same time discrediting any claims by his successor for being responsible for the higher ratings.. Nice parting shot. If they remove Kypreos, nothing has changed on HNIC since Sportsnet took over. 

    Shoalts changed it in the full article with his own summary ‘Now, on the eve of the fifth season of the deal, both the Leafs and the Winnipeg Jets are serious contenders for the Stanley Cup. The Calgary Flames are also much improved and the Edmonton Oilers are expected to have a better season as well, which bodes well for the number of viewers.’ 

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    thanks Mike V.

    For additional context, in 2011 TSN earned $147M in subscriber fees. Two years later the same number of subscribers earned them $279M in fees. Those are crazy increases. Now they are up to $342M despite subscriber losses. What is going on? I guess cable bills are going up and the profits are rolling uphill to the specialty channels? Something about this seems very unsustainable.

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    @yaz – There were 5 Canadian teams in the 2014-15 playoffs (Year 1). Ratings went down that year from the year before. Moore can’t have it both ways.

    Regardless of this particular debate there is a larger one regarding comparing ratings over time. With cord-cutting, streaming, PVR/timeshifting, multiple screens, etc. ratings simply don’t mean the same thing they used to. Trying to find someone interesting to interview on this topic. So much of the knowledge around ratings is based on outdated technological and social assumptions.

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    Gary M 2 months ago

    Also, a lot of young people are passing on sports for stuff like video games. Rogers may have bought 12 years of NHL hockey near the very peak of sports rights.

    A long Leafs playoff run will of course be an enormous life saver if it happens. But Rogers is pretty vulnerable if a recession hits. Not a lot of cash on that balance sheet.

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    Gary M 2 months ago

    Reading Mike V’s pdf, it looks like ad revenue went massively higher after the Leafs got good and they didn’t even have deep playoff runs, so again…the Leafs could fix this.

    But here’s the problem with the story in the pdf if I read it right. They are not claiming (paying?) the 5.2 billion in equal annual instalments. 33% of the contract’s time has elapsed but they’ve only swallowed 16% of the cost so far. Continued ‘profitability’ means the revenue has to grow. What if it doesn’t grow? What if it declines? I think ESPN could probably weigh in on that issue.

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    Original Mitch 2 months ago

    Ken Reid and many others have to be shaking in their boots. 

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    Insider 2 months ago

    Folks – many here and elsewhere are lambasting Moore & Rogers for the financials involved with the NHL deal. But don’t FOR A SECOND think that Bell wouldn’t have done the same thing if they weren’t caught flat footed the week end the deal went down. While some of his decisions are questionable (see Strombo – although perhaps that was more a Pelley and Cutler decision??), Moore helped steer Sportsnet from a perennial 2nd player to a leader in the market. At day’s end the NHL deal provides Sportsnet with exclusive, meaningful content – particularly important in this era of the interweb and infinite choice – and has helped buoy the subscriber fees (cash flow) that the Media division and larger Corporate behemoth desire.
    As for replacements, let the speculation begin. P. King? M. Cosentino? D. Errington? Other friends of Mr. Brace?

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    @Original Mitch…we can only hope!

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    Original Mitch 2 months ago

    @insider

    TSN would have overspent, fired classic Canadian talent, plunge in ratings for multi years despite 5 Canadian teams in post season, do an about face and revert, hire washed up PxP (Romanuk for example) that nobody liked, spend millions and millions on a set, brag about it to the public amidst job cuts, eliminate popular segments like After Hours only to bring it back after audience demanded it, completely ignore instagram until you were wayyyy behind, blame (lol) poor Canadian teams on ratings, miss a live major nhl press conference because you were IN THE WRONG ROOM!!! which resulted in bosses getting the axe, completely ignore serious and important issues like CTE related incidents? and the list goes on and on.

    I don’t think so.

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    @Mike V,

    Let me first say that I know very little about the media business. Given that admission, the Sportsnet financials provided to the CRTC look incomplete to me. I am not accusing Rogers of improper disclosure; I am sure that they prepared the statements in accordance with CRTC rules. I just wonder if these financials are prepared on a basis other than under generally accepted accounting principles. Accordingly, is this financial information sufficient enough for us to conclude that Rogers has profited from the NHL rights deal?

    In order to understand the data, I have made some assumptions.

    First, I have assumed that all years reported are for the one-year ended August 31. I assumed that because the report states that the 2017 data is for the year-ended August 31.

    Second, I have assumed that the NHL rights fee is paid just prior to the start of the NHL season. Therefore, the payment reflected in the 2017 statements was made in October 2016. The 2016 statements reflect the payment made in October 2015. So on and so on.

    Third, I used the initial media reports of the deal to construct the payment schedule. According to the reports, there was a $150 million payment up front, which I assume was in November 2013, and then the payments started at $300 million and escalated annually such that the final year’s payment was $500 million. Therefore, I calculated the payment in 2014 was $300 million, $318 million in 2015, and $337 million in 2016. Therefore, a total of $1.105 billion in NHL rights fees was paid in respect of the four-years ended August 31, 2017.

    Fourth, I assumed that the NHL rights fee are included in Programming and Production costs. I assumed this because this expense is the only one that exceeds $100 million annually.

    The problem is that Programming and Production expenses over the same period were $1.281 billion. That leaves only $176 million in non-rights fee costs ($1.281 billion less $1.105 billion). Given that the Programming and Production costs in 2013 were $165 million, $176 million over four years seems very low.

    I also wonder how much of the jump in National advertising revenues in 2016 and 2017 can be attributed to the Blue Jays playoff runs in 2015 and 2016.

    In summary, I’m not sure if the CRTC data tells us whether or not Rogers has profited from the NHL rights deal.

    In any event, thanks for the link to the CRTC information.

  • comment-avatar
    Mike V 2 months ago

    The thing with the rights cost that often gets overlooked is TVA Sports is paying roughly 25% of the cost for the French rights – they are also the low hanging fruit for anyone who does want to criticize parts of the deal (93mm in pre-tax losses over the last three years according to that same document. WOOF! Maybe they make it back in sub increases but that’s a big hole with the Habs now stinking). Then there’s whatever value – be it 2%?, 4%? – Rogers would put on controlling GameCentre and CentreIce, which would not be included in the Sportsnet network financials at the CRTC.

    Yes, absolutely the Jays muddy the ad waters to an extent. They’ll continue to going forward as their rates fall back to earth while the Leafs may surge during a playoff run.

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    Gary M 2 months ago

    Great point about TVA, Mike, thanks.

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    @Mike V,

    Thanks for the input regarding TVA. It does affect my computation but still raises questions about the figures. Per the CRTC document, TVA’s acquisition rights were approximately $70 million per year higher in 2015, 2016, and 2017 compared to 2014. Assuming this amount is the Rogers-TVA deal, then my non-rights fees costs increase from $176 million to $386 million. Averaged over the four years, that is $96.5 million per year, which is less than the $165 million in 2013. I don’t understand how these costs go down given the fact that Sportsnet was producing more NHL games post-2013 than they were in 2013.

    Also, per Rogers financial information, the Media division’s operating profits (in millions of dollars) were 161, 131, 172, 169, and 139 starting in 2013. Granted the Media division includes radio, television, magazines, and the Blue Jays. That being said, I don’t think we can conclude from the CRTC data and the Rogers information that Rogers is making a lot of profit from the Rogers-NHL deal.

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    Production costs are separate from rights costs. Published reports cite the figure of $100,000 per game for a full crew.

    At the end of Year 2 Moore said: ““I don’t think this season it would surprise anybody that we didn’t hit the revenue numbers that we would have liked.”

    Also this: ““Like any business, you want to show growth. … And that’s what the shareholders, and what my bosses, care about.”

  • comment-avatar

    The Rogers TV/media contract with the NHL may not have been a revenue generator in its first two years but it is a long term deal and it could well look like a real bargain in the last half of the agreement. $5.2B over 12 years buys Rogers thousands of hours of programming well into the next decade. Live sports is where the action is in broadcasting/legal streaming with the trend only accelerating in my view. If the Leafs turn out to be as competitive as expected, the deal will be better and better every year.

    Anybody willing to bet that the TV rights in the Next NHL deal will go for less money even in dollar adjusted terms?? Few, I’d guess. And who doesn’t think TSN will be lined up for the next contract? Rogers (not my TV provider anymore by the way but not because of sports content) made a very good deal for its NHL coverage.

    Where will Scott Moore go in his next career move? Stay in the Sportsnet family to replace Mark Shapyro when he goes to the Mets? Or will Scott take a leaf from the Keith Pelley playbook (Pelley is now CEO of the PGA European Tour) and make a bigger leap with NASCAR being an organization in desperate need of better management.

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    Gary M 2 months ago

    Bob, I’ll definitely make the bet that the next NHL deal will go for less money. I think the sports rights bubble has probably peaked.

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    I thought the goal was to win the rights and then cherry pick the best on air talent. TSN ruined that plan by signing their on air talent to extensions (who decided to be loyal and stay even with a reduced number of games). So, Strombo was plan b after they couldn’t poach Duthie or anyone else from TSN.

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    Big G 2 months ago

    I think the sale of the Blue Jays is on the table.

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    Second biggest middle finger to Podcast listeners I’ve seen is from today’s ( Oct. 12 ) PTS: ‘Bob is joined by Richard Deitsch, John Shannon and Stephen Brunt.’  Biggest middle finger was Oct. 11: ‘The Friday round table.’  Did they make Bob post the Pods himself? Or is it a jab at the preceding Good Show’s endless blathering description:

    ‘Former NHLer Matthew Barnaby has plenty to say about Toronto’s exceptional power play, why the Leafs early season success could be bad for William Nylander’s contract negotiations, how exciting NHL games have been so far, the differing views on Zach Hyman from an analytics perspective vs. the eyes test, and how high Morgan Rielly can fly (13:06); Donnovan Bennett & Thomas Dobby join Ben & JD for this week’s Terrible Ten (45:40); MLB broadcaster Dan Shulman is calling the NLCS and has plenty of thoughts heading into that series, and weighs in on Aaron Boone’s decision-making in the ALDS and the role of managers in today’s MLB (1:13:27); Hockey Night in Canada’s Ron MacLean takes a look at the offensive explosion around the league, how important it is for players to keep their egos in check, why it isn’t crazy to compare Auston Matthews with Connor McDavid, and gives thoughts on Nylander’s contract holdout (1:32:55); The Leafs are extremely hyped after their hot start but their real test will come with tough teams coming up in the next month (3:40); Dallas Stars defenceman talks about his move to the Dallas Stars and whether he thinks he got a fair shake to stick with the Maple Leafs (2:10:14).’

    The description for Good Show is longer than what a transcript would be. Hopefully someone reigns all the shows in and they develop a standard.