How can BYU make money off any of the 200 sports broadcasts the university plans to air in the coming year?
Isn't it tough for a PBS-type TV station to make dough without asking for contributions on one of those fundraising programs?
A solution to this challenge took place quietly this week when BYUtv and the university signed a contract with IMG, a third party that already sells signage in LaVell Edwards Stadium, the Marriott Center and produces game programs not only at BYU but 200 of the country's major universities.
BYU is on the "cutting edge" of this new kind of television, and the University of Texas and its Longhorn Network is right behind. Both have taken different paths to "monetize" their programming, according to Peter Pilling, conference vice president of IMG College.
BYU will collect money for "brand association" from clients like NuSkin, Zions Bank, Deseret Federal and Vivint. These clients will pay for "mention ad spots" that are restricted from airing what folks in the business label a "call to action." This means the commercial can't include anything that begs to call a phone number, go someplace for a sale or pricing announcements.
The Longhorn Network, on the other hand, is a subscription-based product. If Texas fans want that programming, they'll have the pay-for-view option. BYU has decided not to pursue that kind of model because "exposure" on available platforms is the ultimate goal.
According to BYUtv managing director Derek Marquis, BYU Broadcasting and IMG will partner to create sponsorship packages that includes signage and mentions during live and rebroadcast games, weekly sports magazine series "True Blue" and "BYU Legends," and recently announced countdown and post-game shows with Dave McCann and Alema Harrington.
BYU hopes to "monetize" aspects of its online products such as a new website, BYUtvsports.com, iPhone and iPad apps, Roku streaming devices and other digital products.
Some have suggested that because BYUtv is classified as a "religious channel," it cannot have sponsors or air so many sports, as the channel will begin to look like a "sports network.”
Says Marquis: "First of all, BYUtv is not classified as a religious channel by any of the 600-plus cable networks or satellite companies carrying us. On Dish and DirecTV, the channel is positioned on what is called the Educational Set-Aside tier. Part of our charter is to 'reveal the campus,' and one of the greatest ways we have to do that is through the university's athletic contests.
"Additionally, some have speculated that BYUtv cannot ‘monetize’ its broadcasts. The reality, however, is that the FCC actually requires that noncommercial channels like BYUtv (the same is true for PBS channels) publicly disclose to viewers in the form of on-air announcements all companies that sponsor on-air programs. These are the underwriting announcements people have become used to seeing. "
Marquis said there are some underwriting announcements that BYUtv can't do on air that might be seen in a traditional commercial. "For example, you won't see calls to action or pricing information for products or services. The restrictions are actually only in place by the FCC for our satellite and over-the-air carriage. These restrictions don't apply to what we might do on cable or online. BYUtv's cable carriage, however, mirrors our satellite and over-the-air broadcasts, so we'll probably keep what we do with sponsors the same on those platforms. Online, however, you'll likely see some more traditional advertising. And our online offerings with our new byutvsports.com website and our various apps will be incredible."
BYU doesn’t underestimate the value of “brand” mentions for sponsors. “Our clients really want to have their name identified with BYU,” said Pilling. “They are excited.”
Added Marquis: “It is interesting that many of the bigger regional and national companies are actually finding better success with image spots as opposed to hard sell-type spots. As such, many of the spots we're now seeing on commercial channels actually follow the FCC guidelines for noncommercial education channels as well. It'll be fun to have some of these same companies as well as local companies with the same mindset now sponsoring the sports-related programs on BYUtv.”
Pilling, who also works with the general manager of the Texas Longhorn Network, praised BYU's innovation with BYUtv and called the ESPN partnership "huge" as the Cougars venture independently in football. "They can drive their own destiny."
Marquis is satisfied in joining with IMG. "We are excited to be partnering with IMG College. Just as ESPN is the worldwide leader in sports, IMG is the worldwide leader in college athletic marketing, representing over 200 of the nation's top collegiate properties. It will be great to be able to combine our talents to create sponsorship opportunities for companies as excited as we are about supporting BYU athletics."
So, how much money a year will all this mean?
The contracts with NuSkin and others are concrete and accountable, minus IMG's fee. But there are a lot of intangibles yet to be realized. Some industry experts say a conservative starting point estimate would be between $1 to $2 million per year — but that is an estimate. BYU doesn't release that kind of information, and the product is ultimately built for exposure, not making money.
The Texas Longhorn Network, however, is going after the gold. The subscription-based sports on that channel could haul in a lot of coin. A figure tossed around on ESPN's charge per subscriber is approximately $4 a month on a typical cable or dish bill with 110 million subscribers.
In reality, TLN will likely get about 25 cents per subscriber to begin, and its reach will be limited to scattering of regional cable networks in and near Texas. Since BYUtv is already on both dish systems, Comcast Cable and many other basic platforms nationally, the exposure is impressive. If TLN gets 250,000 subscribers for a start, that would be considered good. In terms of exposure, BYUtv will blow that out of the water. Having ten 2011 games on ESPN extends the saturation of BYU football.
To give you an idea of what the TLN is up against, consider ESPN is the No. 1 in subscriptions — by price and buyers. Next is Fox Sports Net at about $2.37 per sub. The NFL network gets 75 cents per subscriber; Versus is 26 cents and the Mtn. is 20 cents per subscriber.
If BYU was in it for the money, they'd go the TLN route and make BYU fans do the pay-per-view dance.
But, for now and for the immediate future, BYU will take the other route and hope the TV set count in North and South America and other parts of the world will give the exposure BYU wants.
Dick Harmon, Deseret News sports columnist, can be found on Twitter as Harmonwrites and can be contacted at [email protected]