Fox may be biggest World Series loser
Profit loss looms over network despite high game week ratings
Published: Monday, October 27, 2003
Updated: Wednesday, January 9, 2013 18:01
While many critics said this year's World Series would be a rout, Fox looked to profit after receiving high ratings for the first few games. More people than initially expected tuned in to watch the Florida Marlins surprise the New York Yankees.
Using the Nielsen Ratings, Fox said that Game 1 of the Series, during which the Marlins stunned the Yanks to a 3-2 victory in the Bronx, drew nearly 11 million viewers. This number equates to about 10.9 on the Nielsen Ratings scale, where one rating point is equal to about 1,084,000 million viewers. According to Fox, World Series viewer-ship is up nearly 16 percent from last year.
The first game of the World Series between the Yankees and the Marlins had a rating of 26.7 in New York and 36.6 in Miami, while cities such as Los Angeles, Chicago, and Philadelphia also had substantially high ratings. Yet it was not just a first-game fluke.
The second game of the World Series drew a 12.6 percent rating, according to Reuters; the Yankees 6-1 victory had 14 percent more people tuning in to watch the game than in 2001, the last time the Yankees were in the World Series. Ratings averaged about 33.9 in Miami and 26.9 in New York for the first two games. Overall, the postseason has shown a 37 percent increase in viewers this year.
Many people do not realize how much goes into analyzing network ratings. Fox profits not by how many people actually watch the Series, but the advertisements that are shown on their network during the commercial breaks. If more people watch the game, then more people will see the commercials during the breaks. Therefore, more companies will want to give advertisements, meaning more money goes to Fox as more people tune in to watch the game. In the end, Fox profits if more companies put more commercials on its network because Fox can charge higher rates.
Even though the results reveal high ratings in terms of viewers, some analysts believe that Fox will remain in the red. Fox Sports president Ed Goren explained to CNN Money, "Big-time sport on free over-the-air TV is one thing, but, nevertheless, we're all facing the situation that the cost of product is still an issue." Even if there is a game 7 of the World Series, Goren said Fox will still not make enough money to get out of deficit. According to Goren, Fox would need a "nine-game series" to get out of this financial situation. Fox has a six-year contract with baseball, which includes regular season games, the All-Star game held in July, and postseason games.
Fox does not make much profit from these advertisements, despite strong ratings for early postseason games, because airtime for commercials is sold long before the ratings come out.
According to CNN Money, Goren stated that the ad time for the first five games of the World Series was "essentially" sold out, with a price of nearly $325,000 for a 30-second time spot. It was tougher for Fox to sell ad time for Games 6 and 7 until it was clear that they would be necessary. Goren also told CNN that he was not worried about low ratings even after the sentimental favorites, the Cubs and the Red Sox, did not make it to the Series after devastating losses.
"You just hope for volume. If we get a Game 6 or 7, things will build naturally," Goren told CNN.
But there is a chance that Goren might be mistaken in his confident hopes of high ratings for the latter part of the Series. The watching habits of Boston College students make a case for Fox's losses and a chance of lower ratings for the World Series. Location may account for some of the negative feedback since the University is located so close to Boston.
"I watched all of the ALCS and I'm a Mets fan. I think I watched one out today and the top of the ninth in Game 1. I really don't care," said Rocco Sainato, CSOM '07.
"Without the Sox playing, there's not much point in watching it," said Chris Mullen, A&S '04.
But all is not lost for Goren's argument. BC students who are diehard Yankees fans watched every game of the Series faithfully.
"I watched every game of both the ALCS and the World Series," said Ann Marie Accomando, LSOE '07.
While Fox had ratings that were double that of most of its competing networks, many wonder whether or not the World Series will get Fox back into the black; the more pessimistic analysts believe that this scenario is quite unlikely.