McManus had an exclusive chat with Variety’s Stuart Levine about a range of subjects, including the slate of events that make up the CBS sports calendar, the dilemma of increasingly expensive rights fees, the important of Tiger Woods to ratings and whether Major League Baseball might ever return to the network.
McManus: “To be honest, I’m very happy with our lineup of programming. It covers 12 months a year and we’ve got some of the highest profile and highest-rated events on the calendar. If I just took them in order, obviously our NFL package has been tremendously successful. We’re doing the Super Bowl next February in New Orleans and our college football with the SEC — even though we only do one game a week — has been the highest-rated college football package the last couple of years. College basketball and the NCAA basketball tournament speaks for itself. We’re dominant in the area of golf; the only network with two major championships — Masters and the PGA — and the best PGA tour schedule. And on top of that, we have U.S. Open (in tennis). That ends the first weekend of football, which times out perfectly. I couldn’t be happier with our lineup of events. What I’m particularly pleased with is that all of them are responsible and good financial deals that make money for the CBS Corporation.”
Variety: Do you feel you got the NFL at a fair price?
McManus: “I think when you look at the value the NFL delivers to a television network — not just in terms of programming but in terms of the promotional value — you understand how important it is to bring a huge audience to CBS for almost six months a year. I think it was a very fair deal for both CBS and for NFL. And as important as the NFL is to CBS, Leslie Moonves would not have done the deal if it didn’t make sense for the corporation from a financial standpoint.”
Variety: Even though you’re paying about a $1 billion per season, are you making a profit on the NFL?
McManus: Yes, when we did the first deal back in 1998, we obviously paid a premium for the NFL. We made money every year on the deal back then, and we’ve made money on the NFL every year since then. People like Dick (Ebersol, chieftan NBC Sports at the time) were surprised that we thought the NFL was worth what it was back in 1998, but we had a plan and we had an aggressive revenue target and we pretty much hit that target every single year. It’s been a good deal financially for us, but more importantly it has brought the most important programming a network can have to CBS.
McManus: “Well, the primary audience for the foreseeable future is going to be on network television. That’s where the value is. That’s where the revenue is. Somebody said to me the other day, and I think this is correct, that the Super Bowl audience has increased seven years in a row, which gave me kind of an uncomfortable feeling in the pit of my stomach thinking. At some point you’re going to get a game that is less than stellar. … Also, all the other forms of media — whether it be social media or streaming of the game — certainly adds attention and viewership, but the biggest concern we have, the highest priority we have, is in that broadcast on CBS.”
McManus: “I can’t predict how well Tiger is going to play in the future, but the Tiger factor is still very much in play. You saw it at Pebble Beach this year, where in the final round he lost to Phil Mickelson. He didn’t win the tournament and he didn’t play well in that final round, but the rating was almost double the previous year. There’s no question that when Tiger is on the leader board, there is an enormous ratings bump. Having said that, in the most recent PGA tour deal we did, we did not assume that Tiger was going to be as dominant as he has been in the past. We did a very conservative projection on ratings. If Tiger finds his groove and plays a number of PGA tour events, that’s all upside for us, but when you look at Rory McIlroy or Luke Donald, and put Phil Mickelson in that group, there is still an awful lot of really appealing golfers on the PGA tour, but the Tiger factor is still very much in play.”
McManus: “Unfortunately, I’ve kind of gotten used to it. I think the game needs some top-flight men and women from America. Obviously that helps build the audience. Having said that, this is in many ways a golden era for tennis. You’ve got the big three men — Federer, Nadal and Djokovic — and look at the kind of tennis the three of them have provided recently. It’s a terrific time for tennis, but I’d be lying if I didn’t say I’m rooting for an American to emerge as someone who can fit into that group.”
Variety: Were you surprised that ESPN got the rights to Wimbledon and it had been on NBC for so long?
McManus: “Yeah, I was, quite frankly, a little surprised. I have great respect for what ESPN does. They’re a remarkably successful franchise. Having said that, I still believe firmly that there are some events that serve the public better being on network television, and I would put the Super Bowl, the Masters, and a lot of other events in that category. ESPN was successful in convincing the All England Club — just like it did with the R&A a number years before for the British Open — that they could achieve the audience desired and the presence in the U.S. that they desired by being in ESPN. I applaud them for convincing the All England Club of that, and I wish them luck. When a franchise has been on a network for that long, as Wimbledon had been on NBC, it’s always surprising to see it go elsewhere, but this is a business, and the people at the All England Club thought that their business was better served by being on ESPN. I imagine they made the right decision for themselves at the right time. I was personally a little disappointed because Wimbledon was one of the events I was very involved in both at NBC and at IMG. I think I went to 10 or 11 Wimbledons in a row and enjoyed the event, have great affection for the event. I’m a traditionalist and had it stayed on NBC I would have been perfectly satisfied, but things change, priorities change and the business has changed.”
McManus: “We were not involved in the bidding for either of those two events. The Olympics, in many ways, has become synonymous with NBC. They’ve done a terrific job in wrapping the Olympics around NBC, and wrapping NBC around the Olympics. I think it was a critical event for them to keep. I think it’s probably worth a lot more money to NBC and Comcast then it would be to any other network just because of the way they’ve integrated it so well into their business. I think they went over to Lausanne, Switzerland, and had every intention of not coming home unless they had the event. They paid what they thought was a fair price. Just because that’s a fair price for Comcast and the right number for Comcast, however, doesn’t mean it’s the right number for CBS or ESPN or anyone else. When an event is that important, you figure out a way to keep it on your network, and that’s exactly what NBC did. The Olympics don’t fit into our programming schedule well. When you’re as dominant as CBS is in primetime, the Olympics are less valuable for us. With respect to World Cup soccer, I would like to think that in five or six years when the CBS Sports Network is fully distributed across America, that might be an event that we would have interest in. The World Cup, to a large extent, is a network and cable package, and right now the presence that we have with our sports cable network probably eliminated us from the competition this time around.
McManus: “I think it is a long process and Leslie Moonves has been very patient. The distribution is growing at a very good pace. The programming is not as high profile as I would like it to be. The addition of Jim Rome will give us a daily relevant presence on the network and some of the other programming we have acquired, like Major League Lacrosse, is growing. We are trying to approach it from a very responsible standpoint financially. Right now we are not in the market for $100 million rights fees but right now we should not be. We want to build it. We want to distribute it. The programming will continue to get better and better. The No. 1 priority right now of our sports division is to take advantage of the great events that we have and integrate CBS Sports Network into those events. You will see a round-the-clock presence at the Super Bowl for the CBS Sports Network and I think you will see some presence at the Masters and Final Four this year. We are doing a much better job and are going to be much more aggressive in associating these events with CBS Sports Network. I feel good about where the network is. I think it will be competitive in the sports cable landscape and right now it has got exactly the kind of high-profile programming that makes sense for it.”
Variety: Those kind of sports networks really need to rely on the live programming because, while I think getting Jim is a great coup for your guys, studio shows on ESPN is so dominant. So it would seem live events are what is going to make CBS Sports Network, and NBC Sports Network, more viable.
McManus: “I think that is a very good observation. In the end it is, maybe, the live events that draw an audience to a two-year-old network. Jim Rome is a bit of an aberration because he does have the 2 million radio listeners every day, and almost 800,000 people are following him on Twitter. He makes a lot of news and to have that kind of presence everyday on the network is important to us and a first step in building the kind of presence ESPN has ever afternoon with “Around the Horn” and “Pardon the Interruption.” Even though those shows don’t have the kind of presence that live sports do, they still play a very important role in making the network a destination, whether it is Tuesday afternoon or Saturday afternoon. You are right what will ultimately distinguish our network is the high-quality live events. “
McManus: “I think we would certainly take a look at it. Again, I would go back to what Leslie Moonves has done with CBS in primetime. The World Series is a great event, but you have to ask yourself whether it is worth pre-empting the most successful primetime lineup in the business with the World Series. That is a different equation for us than it would be for NBC and the other networks just because of the success we are having in primetime. We will take a look at it, but we are not actively pursuing any baseball presence at the moment.
Variety: Fox has that dilemma every year. If you have a World Series with either the Yankees or the Red Sox, it would be a great ratings draw, but if you have the Colorado Rockies versus the Detroit Tigers, it’s a different scenario.
McManus: “If Major League Baseball would guarantee us that either the Yankees or the Red Sox were in the World Series every year, our interest would increase significantly.”
Variety: Does the prospect of a college football national playoff interest you from a television prospective?
McManus: “It certainly could depending on the price. The BCS championship has gotten to a price right now where it works for ESPN. At that level I’m not sure it works for CBS. If the format was attractive enough, certainly we would analyze it to see if it fit into our plans. Right now, though, the SEC package — culminating in the SEC championship game — is just so successful for CBS, I wouldn’t want to do anything in the area of college football that might make it less of a good deal for the corporation.”
McManus: “In some ways it was surprisingly successful. The fact that a game on TruTV looked exactly the same, and had the same quality of production, as the game on CBS is a tribute to the team that worked on this. I think the rating exceeded even our optimistic projections. The advertisers were also incredibly satisfied. The goal now is to keep our feet to the fire and keep the pressure on because the bar has been set so high.. We need to continue to do the job that we have done in terms of production, sales, marketing, interactive and promotion. We did a very sophisticated and expansive survey after the tournament last year and 91% of the people who we surveyed said they like this format better than the previous format. If you would tell one of the candidates vying for the presidency they would get a 91% approval rating, I would think they would believe they have done a really good job.”
Variety: People that have never watched TruTV were watching TruTv for the first time, and I think it helped them brand their network. And, of course, it helped you because all the games were available.
McManus: “I was one of the more skeptical ones. I was having some issues concerning whether the fans looking to find their game would know if it was on TruTV, CBS or TNT. That, apparently, was not a factor. We got almost no complaints and all the announcers and production teams were guiding people to the best game wherever it was. It was very successful and we made the decision from Day One that every step we took would be taken with what was best for the viewer as our guiding direction. That really paid off and viewers really appreciated it. They love the tournament and we were able to take an event that was already successful and make it more successful.”
Variety: It must have been overwhelming when you were running both the news and sports divisions at CBS. Now that you are back just in sports, does it feel like a better fit now?
McManus: “Definitely. I enjoyed very much my years at CBS News and am proud of what we accomplished, but those were two very big job and two very complicated jobs. I think for me to be able to focus just on sports right now is best for CBS Sports and best for CBS News. The amount of attention and the amount of effort required to run both those divisions — especially as the media world is getting more and more complicated — probably required two separate executives. Having said that, I cherish what I did at CBS News and have enormous respect for what they are doing right now. I think they are moving the news division further and further in the right direction. It was a great learning experience, but right now I am doing what I was meant to do, which is run CBS Sports as a full-time job.