NBC Sports Head Mark Lazarus Talks Super Bowl and How He Spent $15 Billion (Q&A)
On the eve of football's biggest night, the network exec reveals what it's like to shell out billions for rights, how Wimbledon will suffer on ESPN and why he brought back Dick Ebersol to help with the 2012 London games.
The son of a sports advertising executive at ABC, Mark Lazarus spent much of his Westchester, N.Y., childhood going to Yankees and Giants games. "We still have Giants season tickets in my family," he says. Of course, the Giants have made it to the Super Bowl, where on Feb. 5 in Indianapolis on NBC they will face the New England Patriots in a rematch of the 2008 championship that spoiled the Patriots' undefeated season in the final seconds. But Lazarus really is rooting for only one thing: "A very close game -- in overtime."
Ratings are why Lazarus, 48, and his bosses at Comcast Corp.'s NBCUniversal shelled out more than $15 billion on sports rights last year in wide-ranging deals that lock up the NHL, NFL, PGA Tour, Olympics and Spanish-language World Cup for years to come. NBC's Sunday Night Football finished the season as the No. 1 show on television in the key 18-to-49 demographic and averaged more than 20 million viewers per game. Lazarus says this summer's London Olympics already have booked more than $900 million in national ad dollars and are on pace to surpass Beijing's $1 billion haul, though it's too early to tell if the company ultimately will make back the $1.2 billion Lazarus' predecessor, Dick Ebersol, spent prior to the financial collapse of 2008. And the Super Bowl will bring in more than $250 million, with 30-second spots going for as much as $4 million.
Lazarus took over the division in May after the abrupt departure of Ebersol, who brought Lazarus to NBC to run the network's cable-sports assets. Though they are friends, they are in many ways opposites in temperament and style. Ebersol is a showman and skilled flesh-presser. Lazarus is understated and admittedly self-conscious about publicity. The married father of three (two teenagers and a 10-year-old) has begun to put his own stamp on the NBC Sports empire that Ebersol built, focusing on a multiplatform approach that includes a bold plan to turn the newly rebranded NBC Sports Network into a viable cable-sports competitor.
THE HOLLYWOOD REPORTER: This is your first Super Bowl. Are you nervous?
Mark Lazarus: I'm not because we have the finest NFL production group in television between [producer] Fred Gaudelli and [director] Drew Esocoff, who do the games, and Sam Flood, who produces the studio and the pregame [shows]. I think we are the most carefully prepared production unit in the business.
THR: NBC Sports Network will have 18 hours of Super Bowl-related programming, including a town hall with Bob Costas in Indianapolis. Jimmy Fallon will do Late Night there. There will be content on Telemundo, Bravo, Golf Channel. That's a lot of synergy.
Lazarus: It's all-encompassing. This has been embraced by the entire NBCUniversal family. So we really feel like we can help bring value to the whole company.
THR: Everyone assumes sports is a loss leader. But Ebersol always maintained that the NFL was profitable for NBC. Does Sunday Night Football make money?
Lazarus: In some cases, historically that's been accurate [that football loses money]. We don't believe that this deal, with all the enhancements we got [a Thanksgiving game, another divisional playoff game and three Super Bowls] and the longevity of it, that that will be the case.
THR: So you'll make back $8.5 billion in ad revenue on the new NFL deal?
Lazarus: Over the nine years, yes.
THR: Is the cost of these deals going to get passed on to cable and satellite customers?
Lazarus: I can't predict if a packaged-goods company is going to raise their prices because we charge more because our ratings are higher. But our [sports] ratings are as high as they've ever been, and we should be compensated for the value that we bring to marketers. And we are.
THR: The Olympics will be live on NBC Sports Network every day from 6 a.m. to 8 p.m. Are you looking for higher fees from cable operators for the channel?
Lazarus: Sure, we'd love to get more money for it. But our first job with NBC Sports Network is to continue to round out the distribution. We're in 76 or 77 million homes today with the goal of getting into 90 million homes. We have some operators that we're working on to be fully distributed as opposed to just well-distributed.
THR: Will you get there before the London Games?
Lazarus: We have 10 years of Olympic Games. This is a long race. This network has been Outdoor Life, to OLN, to Versus to now NBC Sports Network. I think people believe in what we're doing. But we still have to sing for our supper here.
THR: Is there still a concern at the company that airing the Olympics live will undercut primetime tune-in?
Lazarus: Yes, and some things we'll put live on cable networks, and some things we'll just stream online. It's London -- it will be the middle of the night. Everything [in primetime] will be packaged. There's not a whole lot going on unless the pub crawl is a new swim stroke. And we'll still protect some of the big sports; we'll do what we can to not cannibalize the audience. [Big events] may just be streamed [live] and not cached.
THR: You brought Ebersol on as a senior adviser for the Olympics and football. What exactly does he do?
Lazarus: His production skills, talent and relationships in football and the Olympics are unparalleled. So it's good for our product. And [NBCUniversal CEO] Steve Burke and I have talked a lot about this: With this change, the one thing that can't change is the quality of our product. Dick's eyes and ears are a good sounding board for me. There are still things as a mentor and teacher that he had to offer to some of the senior people here. For me personally, there are things he had to offer in terms of how to approach a game, how we might schedule certain events. There are things that he's learned over 25 years of experience with the Olympics that are valuable to me as someone who has never been in this role before. I don't want to pretend that just because I have this job, I know everything. For him, I think it gives him … listen, he left abruptly, I think the company owes him some proper closure and to let him spend time with the products he helped bring here and loved so dearly, particularly the NFL and the Olympics.
THR: So he'll be in London. Will he have his infamous bedroom built at the International Broadcast Center or will you all be in the hotel together?
Lazarus: No. (Laughs.) We'll all be in the hotel together.
THR: Where do you think your philosophies diverge?
Lazarus: I come from a more rigid business background than he did. He's art and I'm commerce. My job is to do the best we can mixing art and commerce.
THR: So when Burke and Comcast chairman Brian Roberts were publicly talking about the need to exercise financial restraint in the run-up to Olympic bidding, was that all just a big head fake?
Lazarus: No, that happened. Those discussions are real, and they happen every day. It's part of our DNA around here now. But we also know that you have to make investments in quality product to grow the business. So there is a balance. Some things we didn't do. We didn't win the Pac-12 when we could have made a bid that would have won it. We went to a point that we thought made sense for our company and after that it didn't. Wimbledon, while we enjoyed our relationship there, they wanted us to do certain things that we weren't willing to do.
THR: They wanted more than you were willing to pay?
Lazarus: Yeah, they took money from another guy [ESPN], and I think tennis fans will probably suffer. The Wimbledon finals will not be on broadcast television. There will be a group of people who want to watch the finals and won't be able to. And I think ultimately, Wimbledon will wish they had been on broadcast television.
THR: Did you always know you wanted a career in sports media?
Lazarus: One of my first jobs was national television buyer for Miller beer. And so I got to talk all day about sports -- because we [sold] mostly sports for Miller Lite -- money and beer. And as a kid out of college that was a pretty good trio for me.
How to Spend $15 Billion in One Year:
Lazarus admits that spending so much of the company's money is "intimidating." "It starts to add up after a little while," he says. "But we're going to make sure [we deliver] everything promised and more. We're going to behave like it's our money."
APRIL: The NHL deal turned out to be Ebersol's swan song at the bargaining table for NBC. And the $2 billion, nine-year deal preserves key content for the still-nascent NBC Sports Network.
JUNE: Lazarus' first deal as chairman of NBC Sports Group was a whopper: $4.38 billion for four Olympics -- which have aired on NBC since 2000 -- keeping the Games on the network through 2020.
AUGUST: NBC signed a three-year, $30 million deal with Major League Soccer, which, beginning this season, will return regular-season games to English-language broadcast TV for the first time since 2008.
SEPTEMBER: NBC and CBS each renewed their contracts in new nine-year deals that also will keep the PGA on NBC's Golf Channel. The deals will net the PGA close to $3 billion.
OCTOBER: NBCUniversal's Telemundo outbid incumbent Univision for U.S. Spanish-language rights to FIFA World Cup soccer in an eight-year, $600 million deal that commences in 2015.
DECEMBER: The nine-year, $8.5 billion NFL deal ($950 million a year) keeps Sunday Night Football at NBC through 2022 and gives it three Super Bowls, up from two. "That's a big boost to our bottom line," says Lazarus.
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