Despite fears that the proposed purchase of NetStar Communications by CTV would give the broadcaster too much control over ad rates for sports programming, some in the media buying community see the potential for savings and more targeted marketing opportunities if the deal goes through.
If it does, the deal will result in CTV having control over Sportsnet, a service broadcasting in four regions, in addition to NetStar’s The Sports Network (TSN) – which, together with Quebec counterpart Reseau des sports (RDS), provides national reach.
It is this regional/national combination in market coverage that appeals to Theresa Treutler, vice-president, broadcast investment director of Toronto-based media management company Starcom.
Treutler believes that shared ownership of the two networks will allow them to complement rather than duplicate each other’s programming strategies.
‘TSN could be the carrier for all nationally relevant sports and Sportsnet could serve local taste and local marketing needs,’ says Treutler.
‘From a marketing standpoint, that’s a nice mix if you can recognize [Canada’s] regional differences. It’s an important factor to consider – and why shouldn’t it be when we get into television negotiation and laying down our television support?’
Treutler says she looks forward to the day when sports programming is better delineated across the broadcast environment so that properties like the NBA, for example, aren’t split across several networks.
Ann Boden, president of OMD Canada, sees the CTV/Netstar agreement as a potential new avenue for saving ad dollars.
She suggests that less competition could result in a decline in the exorbitant fees paid to sports franchises for broadcasting rights.
‘If there’s not a lot of people in the bidding, then they’re not going to be as expensive. I’m hoping those savings in costs will be passed along to the advertisers,’ says Boden.
‘We’re just hoping to be able to save our clients money. That’s the way it should be for most people. ‘
Howver, David Chung, president of MaxxMedia, says lack of competition is not in the best interest of the media buying community because one company controls the programming and the prices.
He says he’d like to believe the networks would pass any savings from the acquisition of sports properties on to advertisers but the only way he’ll know for certain is if the Canadian Radio-television and Telecommunications Commission gives the proposed buy its stamp of approval.
In its submission to the CRTC hearing into the purchase, the CBC, another major sports broadcaster, said that allowing the deal to go through would likely force it out of sports broadcasting, unless the CRTC set down stringent conditions of sale.
Meanwhile, Headline Sports, owned by Sportscope Television Network, is looking for the chance to become a viable independent alternative to CTV/NetStar. It has applied to the CRTC to amend its licence to allow it to broadcast live programming.
If the proposed takeover receives approval from the CRTC, CTV will acquire a 68% interest in NetStar and become the controlling shareholder in the communications company that owns the Discovery Channel in addition to TSN and RDS.
U.S. sports broadcaster ESPN, a subsidiary of The Walt Disney Company, will continue to be a minority shareholder, but it has no role in the operations and management of NetStar.
A CRTC decision is expected by March 2000.
