Duke University Alumni Magazine


Photo: Ian Spanier

The president of CBS Sports played high stakes when he retook possession of football. That game plan, and some new plays, could assist CBS in reclaiming its spot as the premier sports network.

ast year, CBS Sports president Sean McManus '71 wagered $4 billion of his network's money to buy the rights to broadcast professional football on Sunday afternoons from 1998 until 2006. It was a high-profile, high-pressure turn at the roulette wheel: If the ball landed on black--or rather, in the black, meaning that CBS recoups its $500-million- per-year investment--then McManus would be hailed as a hero. If not, well, entertainment executives, like Westinghouse (which owns CBS) CEO Mel Karmazin, are not well-known for their forgiveness. As Bill Carter of The New York Times wrote last September, "Forget all those quarterbacks surrounded by 300-pound charging linemen: When the NFL season starts this Sunday, the real pressure will be on the execs who call the plays at CBS. And they don't get to wear helmets."

I first spoke with McManus a few days before the 1998 football season was about to begin. Hired to run CBS Sports in 1996, he was pleased to have reacquired the rights to pro football, which CBS had lost to FOX in 1993. "I'm not sure the network would survive without football," he said. "If we hadn't gotten the NFL, CBS would have had no shot whatsoever at reclaiming its spot as the premier sports network."

Indeed, when FOX in 1993 lured the NFC rights away from CBS with a brash bid, Dan Rather's Tiffany network was crushed. "Morale was horrible here," said McManus. "It was absolutely devastating. The image of our affiliates [the local stations] went down; we lost twelve important affiliates to FOX. CBS went into a tailspin." Indeed, despite the addition of David Letterman, CBS was viewed as a network for older folks. Three years later, CBS shuffled executives and hired McManus.

There's no doubt that the AFC games are a valuable property. But did he pay too much? The sum was more than double what NBC had been paying for the same rights last year, but McManus insisted that the decision was a good one. "We'd accept a deal that meant losing $50 million per year"--that is, one that netted only $450 million per year in ad revenues against the $500 million rights fee. Why? The art of assigning a value to professional sports has undergone a cataclysmic change over the last decade. Back then, the value of a sports league--whether basketball, baseball, or football--was fairly easy to calculate: How much ad time could you sell, and at what price? Now the formula is more speculative: How much revenue can you derive from pregame and post-game broadcasts, and how much can you shake out of your local affiliates? Then there are tougher numbers to decide. How much, for example, is it worth for the opportunity to promote prime-time shows? NBC did a lot to showcase Friends and Seinfeld using the NBA.

Even with all of the potential synergy, NBC Sports President Dick Ebersol, who wouldn't match McManus's bid, called the $4-billion deal unconscionable. "CBS is practicing a form of mathematics with which none of my professors was familiar--because they didn't have enough beads in their abacus," he has said. He predicted huge losses for CBS and layoffs of 200 to 300 people. Indeed, CBS did lay off 180 employees soon after striking the AFC deal, though CBS denied the cuts were related to the football contract.

In a sense, this was a game of musical chairs. The NFL offered three packages--the AFC, NFC, and Monday Night Football--to four networks (ABC, NBC, CBS, and FOX). McManus wasn't going to be the one without a seat. And now that the first season is over, did McManus' gamble pay off? Beyond his wildest dreams. The $500-million deal itself was a winner. Rather than losing $50 million, the network claims to have earned $50 million. But more importantly, CBS regained the top spot in prime time.

I spoke with McManus again in February, and he was rightly triumphant. "The NFL on CBS worked extremely well for the shows we promoted during broadcasts, like Everybody Loves Raymond, Walker Texas Ranger, and 60 Minutes II," he says. "The general perception is now that we have the strongest year-round sports schedule."

He expected nothing less. After all, he grew up with a seat at the sports table. His father is Jim McKay, the legendary ABC sports announcer. As a child, Sean saw the television business first-hand. By age twelve, he was an ABC gofer, and he spent his teenage years in TV trucks. In 1968, he watched Lee Trevino win the U.S. Open; in 1972, he was in Munich, watching his father ad-lib as the news of the terrible attack on Israeli Olympic athletes unfolded.

McKay, now seventy-six, has said of his son: "You're proud of yourself, but then you say, 'Doggone it. It's that little kid that has grown up and had amazing success at a reasonably young age.' The odds were so much against it." McKay, who's called Sean "my best male friend...since he was a kid," was constantly critiqued by his son. Now McManus gets to use those critical skills on his own commentators, who include Greg Gumbel, Phil Simms, and Lou Holtz.

At Duke, he wrote for The Chronicle and avidly followed Duke basketball. "This was the Gene Banks era," he points out. He was an English and history double major, but he knew all along he wanted to become a producer of TV sports. "I could have made a lot on Wall Street," he says, "but upon graduation I took a job as a production assistant at ABC making $12,300 a year. I passed up a lot of money. In the end it all balanced out."

After two years at ABC, he went to NBC, working the ladder to become the youngest vice president in network history. In 1987, he left to run IMG's TV division, negotiating rights deals for the Olympics, Wimbledon and the U.S. Open, and golf's British Open. It was the perfect preparation for his current job of buying sports; at IMG he sold them. Back then, he was still known in the business as McKay's son, but he says he didn't mind; their relationship remained close. In fact, in 1988 his father, who had started buying thoroughbred horses, won the Maryland Million with a steed named "Sean's Ferrari." As a child, Sean had lobbied for his folks to buy one, without success.

Now McManus has the money to buy his own Ferrari--and even an excuse, given the auto racing he broadcasts on CBS--but not the personality. In a sports-media world where rivals like NBC's Ebersol and ABC/ESPN's Steven Bornstein are huge personalities, McManus is low-key. He's not a philosopher, ruminating on the role of sports in a hero-starved society, but a businessman.

Any sports coach knows the ideal time to take over a once-proud franchise is when it's at its nadir; Rick Pitino, for example, left Kentucky at its peak and inherited the Boston Celtics after one of its worst-ever seasons. McManus, too, accepted the CBS job with the network mired in a slump. As one observer wrote, "The eye in the famed CBS logo needed Kleenex." When McManus was hired, the announcer Jim Nantz said, "It's given us more than just a pulse, but a reason to feel complete and whole again."

Things are better now. In addition to the AFC, CBS broadcasts the Final Four, the Masters, tennis' U.S. Open, college football, the Super Bowl every third year, and other events. McManus is considering acquiring baseball coverage. "The game is starting to regain the luster that it lost; it's healthier now than two years ago, and it will be even stronger in another two years." Baseball has its vulnerable points along with its strong points: "McGwire and Sosa brought interest to a much higher level than it would have been. The World Series is an excellent TV property. The playoffs are good. The regular season is problematic." CBS's golf coverage is solid, especially

with the emergence of Tiger Woods. "While I thought he'd win more major tournaments than he has between the 1997 Masters and now," McManus says, "he's still competitive in every event he plays, and will be a positive factor for twenty years." Naturally, McManus was beaming when Woods won a February tournament with an eagle on the eighteenth hole--this a week after an incredibly exciting Daytona 500, which earned the all-time highest ratings for that race.

Not only is CBS on a winning streak, but rival NBC has some threatened properties--like the Olympics. "If they don't purge the problem at the IOC and clean up the scandal," McManus says, "they risk very serious long-range damage. It's still a great property, but, at this time, I wouldn't risk it."

That's not to say that he won't: CBS's Karmazin has publicly mused about buying NBC outright. "I think it's very possible. If Disney can own ABC and ESPN and the Disney Channel, why should one company not own two networks?" McManus speculates. Asked whether that might affect the TV packages, which ultimately yield giant salaries for athletes, he replies, "As long as two parties aggressively bid for TV rights--and there would still be FOX and ABC--then it won't affect the prices." Still, the implications for NFL rights are daunting: If FOX had NFC games and ABC had Monday Night games, why would a CBS-owned NBC bid aggressively against CBS itself for the AFC package?

One of the less successful CBS Sports properties is men's tennis. "Pete Sampras' problem is he doesn't have a foil," McManus says. "Borg and Connors had McEnroe, Chrissie Evert had Martina Navratilova. For Sampras, no one else is out there, though Patrick Rafter might emerge as that person." So, if professional sports so depend on personalities, how does McManus bid on TV rights without knowing who, five years down the road, will emerge? "You try to do a worst-case scenario and make your bid based on that," he explains. "If a Venus Williams or Anna Kournikova or Tiger comes along, that's just a plus."

McManus says he thinks the biggest problem in team sports is that there's no consistency in the cast of players. They move around. "One week you're rooting for Bobby Bonilla playing for the Orioles, then the Marlins, now the Dodgers, not to mention the Pirates and Yankees. I don't see it stopping, but it's one of most dangerous trends in sports right now. I can't do anything about it;

it would be presumptuous of me to raise it with team owners. Fortunately from a TV standpoint, especially with the NFL, it hasn't dramatically affected ratings. But it has dramatically affected interest in some sports, particularly baseball."

There isn't a single major sports property that at this point he feels is overvalued, he says. "True, from a programming standpoint, certain properties don't make sense--the NBA, we physically can't accommodate it with our college basketball commitment." Actually, college hoops or not, he did, in fact, vie for the NBA. In an ingenious but failed tactical maneuver, he tried to get NBA Commissioner David Stern to split the TV rights between two networks, like football does with its Sunday afternoon games, thus wresting half of the league from NBC. He says now, "With Michael Jordan gone, it's still a very viable property, but everyone admits it will not be what it was. The lingering image problems from the strike will be felt for a few more years. Given the choice between college basketball or the pros, I'd take college, definitely." McManus plans to continue aggressively courting his rivals' big events. From the Kentucky Derby to the Indy 500, "there isn't a major property we won't take a look at." That's because, as the network TV audience fragments--lost to cable, Direct TV, and the Internet--it's the big events that make the networks viable.

Will women's sports become a viable network TV package? "The WNBA is viable right now, propped up by the NBA. Women's tennis is as appealing if not more appealing than men's--there's Venus and Kournikova, plus the older guard of Steffi [Graf] and Monica [Seles]." Still, he says, men's sports will continue to dominate network TV, leaving little room for women's. "Nobody has yet proven that women will watch women's sports [in huge numbers]; advertisers aren't convinced that the way to reach women is through women's sports. Fifty percent of major league baseball watchers, for example, are women. A lot more women watch the World Series than the WNBA Finals."

One of the staples of the CBS Sports lineup is the NCAA tournament. "It has gotten bigger and better every year for the last fifteen years," McManus contends. "One advantage is single elimination. [Last year's Cinderella team] Valparaiso may not belong on the same court as other teams, but through sheer will and emotion and good fortune, it can manage to pull some upsets. A Coppin State, you never hear anything about them all year, and then suddenly they emerge on national television. It's so much more refreshing than pro basketball. Dave Gavitt [the former Big East Commissioner] once said that the NBA is about the name on the back of jersey, while college basketball is about the name on the front." A rivalry like Duke-UNC, he says, will be as great in ten years as it was ten years ago. "But right now the [once-storied rivalry of the] Boston Celtics versus the L.A. Lakers doesn't mean anything to the American people." What did he think of this year's Duke squad? "It's exciting for me personally, but it's also good for the network, because Duke is the most promotable team in the nation, a great draw."

While college basketball continues to have a certain sports purity, other sports have floundered. Baseball enjoyed its glorious home-run race between Mark McGwire and Sammy Sosa, one that seemed to re-ignite the passions of some erstwhile fans. But, overall, even Jim McKay has said that TV is getting "too smoothly packaged."

CBS seemed to fall into that trap during the 1998 Winter Olympics, where disappointing ratings were a black eye for McManus. In 1996, NBC's coverage of the Summer Games in Atlanta received enormous ratings but was criticized by some for its soap opera-style coverage, disproportionately featuring athlete profiles with violins playing in the background over of the events themselves. The strategy is essentially that the sports enthusiasts constitute a captive audience--they'll watch the Olympics no matter what--so why not appeal to some of the less die-hard potential viewers, especially women? Some sports purists were gleeful, then, that CBS's 1998 attempt to execute the same strategy failed.

McManus takes issue with that criticism. "We could have done a much better job," he says. "We'd make different decisions on how to produce it." While he points out that some of the problems--a lack of compelling story-lines, bad weather, the time delay from Japan--were beyond CBS's control, "we learned that we need the right people in place." Heads rolled. But the problem, he says, was not the story-telling style. "This approach wasn't invented two years ago, by NBC," he says. Sports coverage "has been moving toward personalizing the athlete since the 1964 Games, and at Mexico City in 1968." Legendary ABC producer Roone Arledge, McManus' father's boss in the 1960s, called it the "up-close-and-personal profile." Says McManus, "You show one before the race or the game. It's the same old formula, just repackaged."

And indeed, personalities do drive sports. "People watch TV to watch individuals. The NBA does as well as it does because the audience cares about Jordan or Pippen. Arledge said, 'It doesn't matter if you love or hate a guy, as long as it's one of those two emotions.' People hate Dennis Rodman, so they watch him. Nobody likes him, or at least no stable person likes him. It's why the Yankees are the highest-rated team--half love them and half hate them. It's the same with the Dallas Cowboys. They generate such strong feelings."

McManus has been a close observer of the business of sports for thirty-plus years. What's changed? "The technology," he muses. "You see and hear so much more of the game. Of course, the money involved, too. This is such a huge, huge business, a multi-billion-dollar business." From his standpoint, the corporate ownership of teams (Disney, FOX, Comcast, and Paramount are just a few) doesn't much affect the business. "It might press up rights fees, but otherwise we don't care who owns teams."

He seems pleased more with what's remained constant than with what's changed. "The most refreshing thing is that the people who are successful are the ones who care most about winning. The primary reason the Bulls won the last championship was Jordan's will to win. The last two minutes of Game 6, he scored his team's last eight points purely through will. He wasn't the best-conditioned athlete out there, not the most physically qualified--he just forced himself. The same with Sampras. That hasn't changed and never will."

Goldstein '91, a freelance writer, is the founder of a new school, the Media and Technology Charter High School (MATCH), which serves inner-city Boston students. His Internet address is Goldstein7@aol.com.

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