America's Cup- Television deals, details and conflict revealed

by Richard Gladwell on 9 May 2013
A spat between two America’s Cup team bosses at a fundraising dinner has led to details of the America’s Cup television coverage being revealed to Sail-World.

Following an exchange between Emirates Team New Zealand’s Grant Dalton and his counterpart in Oracle Team USA, Russell Coutts, speculation had been rife as to exactly what television coverage would be shown in the USA and internationally.

For countries like New Zealand which had been used to a diet of live TV coverage from the start of Round Robins through to the end of the America’s Cup Match, the prospect of not having any live TV coverage until the Louis Vuitton Cup Finals was a daunting one.

After Dalton had needled Coutts at the start of a Question and Answer session at the dinner, Coutts rounded up, saying that he needed to get his facts right, and that there would be TV images available from the start of the Round Robin.

That prompted a 'Yes, but...' response from Television New Zealand, the first broadcaster to sign for broadcast rights for the America’s Cup Regatta. TVNZ has been broadcasting the America’s Cup on a free to air basis for over 27 years, with the event pulling huge audiences estimated at 25% of the population of New Zealand for the opening race of the 2000 and 2003 America’s Cups, sailed in Auckland.

TVNZ claimed that the live television feed that Coutts had used to undermine Dalton’s claims , consisted of just a single camera in a helicopter, and further camera based on a boat. Both cameras were state of the art, capable of producing high quality images. But no commentary would be provided, and TVNZ insinuated that two cameras alone are not sufficient to produce a prime-time quality TV broadcast to their standards.

Stephen Barclay, CEO of America’s Cup Events Authority, said there was an additional helicopter based camera in place for the initial coverage – being for the LiveLine graphics used on the course and umpiring.

Boat or land based cameras would be at each end of the course, as it is near impossible to film the AC72’s from one chase boat due to the speed of the wingsailed catamarans to be used in the America’s Cup regatta.

There would be a fourth roving camera in the fans ashore to give some reaction to the racing. ‘What is correct is that there will be no microphones or cameras on the boats. There will be no finished broadcast product from the host broadcaster as has been the case in the ACWS,’ Barclay explained. 'That finished product will start on August 6, when the Semi-Finals start.'

'If TVNZ want to run the early races, they can grab the same footage that the local station here in San Francisco are using. They can show it live, make their own show, cut their own highlights show or use our news feed.'

The real time graphics developed by New Zealand’s Animation Research Ltd (ARL) which were pioneered in the 1992 America’s Cup and used in every event since, would be available and will also provide back- up if the LiveLine helicopter cannot fly due to fog.

Another very experienced America’s Cup TV producer spoken to by Sail-World confirmed that it would be possible for a broadcaster wish to run live coverage, using those basic resources and providing its own commentary. Such a broadcast would be similar to coverage run during the Louis Vuitton Trophy series, organized by Louis Vuitton in the America’s Cup hiatus in the 2007-2010 period. However he expressed surprise that there would be no audio from the boats - which adds colour to the images, as well as providing vital information for the commentators.

For ONE News' Martin Tasker's take on the evening and television issue http://tvnz.co.nz/sailing-news/war-words-spices-up-america-s-cup-video-5427685!click_here

Free to Air from Day 1

Barclay told Sail-World that one broadcaster in San Francisco would be pumping out a free to air broadcast of all racing from the first day of the regatta. But it would use the spectator commentators - Andy Green (UK) and Tucker Thompson (USA) for the commentary.

That commentary will be 'spectator focused rather than television commentary focused, a little more fun and fan centric', Barclay added.

'If we want to appeal to the general sports people around the world, then we have to make sure our product is well presented. It is our opinion that the product will not be presented well in July, no matter what the level of broadcast, because there is nothing on the line', he said. 'We run the risk of viewers switching off before the LV Finals and Match'. A reference to the fact that because there are only three Challengers in the Louis Vuitton Cup, instead of the usual dozen or so, there will be no boats eliminated until the Semi-Finals.

Barclay is not entirely incorrect in his assertion that there is nothing on the line in the Qualifying Round

To avoid the Round Robin or Qualifying Round being a dead rubber from the outset, organisers decreed that the winner of the Qualifying round will have the choice of sailing in the semi-Final or going straight through to the Finals. That puts a small but significant edge into the regatta as teams offset the risks of sustaining serious boat damage, against gaining valuable racing time against the bottom placed boat.

The prospect of a repeat of the events of October 6, 2012 when Oracle Team USA's AC72 capsized in spectacular manner at the top of the race course, will also be fresh in viewers' minds, anticipating an encore. A salutary fact of media life is that carnage always rates, not matter what the medium. It's also guaranteed a spot at the top of the general news headlines.

Should they top the three strong Challenger fleet it is believed that Emirates Team New Zealand will opt to go straight through to the Finals, meaning that TVNZ would seriously consider not covering the Semi-Finals without 'their' boat competing. A similar situation would apply for Luna Rossa and Italian TV. No broadcaster has been signed for Sweden despite their boat being Challenger of Record.

'For the Semi-Finals of the Louis Vuitton Cup, the standard of the coverage will be similar to the America’s Cup World Series. For the Finals we will add a couple more cameras. For the America’s Cup itself we will add more helicopter cameras and more cameras on the boats. It will be quite an enhanced package from what we have seen to date.'

Barclay couldn’t give the exact numbers of cameras running for the Semi-Finals, but said there would be two cameras on each boat, plus microphones. For the Finals there will be an additional helicopter camera, plus two more cameras on each boat (total of four per boat). For the America’s Cup the coverage will be enhanced still further.

Challengers not being short-changed
Barclay repudiated the assertion that the Challengers were drawing the short straw on television coverage under this model, while in the 1992 to 2003 Louis Vuitton Cups, the Challengers largely controlled their own series (working co-operatively with the Defenders in 2000 and 2003).

'I absolutely disagree with that' he said. 'The level of television broadcast is many times greater than in the past. We have to ensure that the TV product achieves the goals that are articulated clearly in the Protocol, namely to optimize the sporting, commercial and media potential of the event.’

'The clash between Challenger Series sponsors and America’s Cup Match sponsors in the past devalued the overall package and it won’t go back to that model, no matter who wins the Cup.'

Barclay also dismisses the view that the Challengers are getting less television coverage, thanks to decisions taken by ACEA. ‘If TVNZ decides it doesn’t want to broadcast that is their issue. The local NBC station in San Francisco is broadcasting every race live and free to air.'

'Every single race', he repeats. 'They can only do that if we give them the feed. It is completely up to the local networks if they take the feed or not.'

Once the Louis Vuitton Cup Finals and Match itself get underway – being two races of 30 minutes duration each, with a 30 minute interval – ACEA is looking to put an Expert Panel group together to discuss the race just sailed, and preview the next. If that comes off, Barclay says that will be inserted into the Host Broadcaster feed as well.

'Tons' of broadcasters signed
When questioned on numbers of rights broadcasters that have been signed, Barclay’s quick answer is 'Tons!' and qualifies that by saying it would be easier to say which countries haven’t been signed.

Barclay then rattled through a list, which was counted off at 20, but he claimed that was well short of the total number. All the major sailing countries were on the list. In several of those territories, negotiations, or rights auctions, were underway between several broadcasters to provide the local coverage.

Most of those will be taking the racing live, meaning the full racing coverage, rather than just news highlights only. ‘We’re measuring our success based on live eyeballs – not news audiences which usually inflate TV viewership. On the West Coast of America, we fit very nicely with the European timeframes, the Australian and New Zealand timeframes and the East and west Coats of USA timeframes, and in Europe it is on at 9.00pm.'

'We are very happy with the way it is playing out,' he added.

'What we learned in 2012 in USA is that once people found our television show, and turned on, they didn’t turn off. That is what got the broadcasters excited. We have now gone from trying to sell a promise to selling a reality. We have broadcasters coming to us asking about the next America’s Cup, and we have no doubt that a rights fee in America is on offer.

'The ratings are one thing, but the data shows that once the audience turn on, they don’t turn off. That means that if the promotion is right, the audience could be quite big.'

He claims a live audience in the USA of around one million viewers for the ACWS Newport event and 700,000 for each of the San Francisco ACWS events, and that the audience grew as the broadcast progressed.

'The audience likes what it sees on television and so the last thing we want to do is reverse that trend'.

Work on 35th Protocol stalled

Six or eight months ago ACEA tried to get the teams involved in the America’s Cup World Series to agree on a framework for a similar series for the 35th America’s Cup, regardless as to who won the current event.

'It was difficult to get a consensus on that, so we pretty much retreated, from that position to the disappointment of the smaller teams.'

What is happening now is that the data and information is being assembled to be given to who ever wins the America’s Cup so that can be used to structure up a new protocol and plan for the next event. That will show the costs of the various ACWS events and surplus or loss, and also how they could be improved. 'For instance teams could have their own hospitality areas but share boat preparation, boat building, sail lofts and that sort of thing to reduce and share costs.' A parallel approach to that being taken by Volvo Ocean Race organizers for the 2014/15 race, to reduce costs of competing in that event.

'We want to also reduce the costs to a city, which would make Auckland viable, for instance.'

Barclay claims that at about a third of the nine America’s Cup World Series events 'washed their face' or covered their costs/turned a small surplus.

At the $5million event fee level, Barclay says the ACWS events were profitable, but says that they should be reducing the level of the fee and getting the Cities themselves to provide more in the way of services. ‘It is far easier for a City to provide things, than it is to write out cheques. Naples is the closest we came to a model for the future. Although there is still a lot more to do regarding cost reduction, sharing and the like, we did things in Naples that give us confidence these events can routinely run at a surplus.

Turning to the America’s Cup Regatta, and the free to air television coverage that will occur for the first time on 25 years, Barclay says that their contract with NBC provides for a minimum of 10 days and a maximum of 16 days coverage across the USA, in addition to the local channel showing every race live. The pan-American coverage will be via NBC Sports Network, except on the 7th and 8th of September when Races 1 through 4 of the America’s Cup Match will be broadcast on NBC network.

'The air time on each of those days is two hours for the Louis Vuitton Finals, and two and a half hours for the America’s Cup Match'.

'Every day of the Louis Vuitton Cup Finals and the Match will be live across America.'

ACEA forced to buy NBC time

Barclay is quite open about saying the ACEA bought the time on NBC, but won’t disclose the amount, except to say that it was ‘lots'.

Although he wasn’t with ACEA at the time (he was with the Oracle Team USA sailing team), he believes they made the right decision in buying time on NBC.

'They were trying to sell a promise', he says. ‘They were trying to sell a television product here in USA and it just didn’t resonate. (A reference to the race days lost in the 2003 and 2007 Louis Vuitton and America’s Cup Regattas.)

'The phrase used by one of the USA networks was 'Don’t try and sell me a white canvass on a blue background.'

'They had to do a deal that would guarantee airtime, so that the teams could go back have something to tell their sponsors.'

'The shoe is now on the other foot. Whoever wins the America’s Cup will be faced with the situation in USA where a lot of the broadcasters are setting up their own sports channel and there is a pretty active market developing for content. That is why we are getting the major players coming to us and wanting to talk about rights for the future. That is a nice position for the next winner.'

ACEA will be running a model where they defray the costs of buying the TV time by selling advertising within the slot which is revenue generating, and well as using the 'inventory' or commercially allocated time to honour commitments to event and team sponsors.

'There is more risk in the way that we are doing it. Absolutely more risk,' he adds.

(For the coverage outside USA, ACEA is running the normal model where an event organiser, like ACEA, sells broadcast rights to territorial broadcasters (covering a defined country or broadcast region). In turn the rights broadcasters offset that cost by selling advertising around the time slot. The approach taken by ACEA also gets around the issue in USA of having to guarantee a minimum size viewing audience to advertisers, or pay a penalty credit if the audience didn’t meet contracted levels.)

‘With other sports that have a proven product, you can get an auction going. We are still trying to grow our audience in USA to get back to the levels of Fremantle in 1987.

'If we get the ratings, then we can put the rights out, and get back a combination of money and promotion', Barclay concluded.

With America’s Cup Challengers close to appearing on the Endangered Species list, if they are not there already, there is a lot at stake for the Challengers, and potential Challengers for the 35th America’s Cup, over the viewership and ratings of the TV coverage internationally and in USA.

What is particularly disconcerting, is the lack of connect, between the event organisers and at least one of the three Challengers, and the most commercially orientated of the Class of 2013, together with the most experienced rights broadcaster.

© This report is copyright to Richard Gladwell and Sail-World.com and may not be republished without permission