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Edition: U.S. Article Save Email Print Reprints Most Popular Most Shared Nasdaq names stocks with cancelled trades 12:14am EDT Americans "bombarded" with cancer sources: report 06 May 2010 UPDATE 3-US stock plunge raises alarm on algo trading 06 May 2010 REFILE-US to announce Mexico trucking plan soon-LaHood 06 May 2010 Stock plunge raises alarm on algo trading | Video 06 May 2010 Crime riles Arizonans bent on immigration crackdown 06 May 2010 Stocks battered, pound bruised as fears persist 2:59am EDT Containment chamber expected as oil spill hits land | Video 3:24am EDT Kim committed to denuclearisation: report 06 May 2010 Gulf spill will "forever" change drilling-BP exec 06 May 2010 Freshway Foods recalls romaine lettuce 06 May 2010 REFILE-US to announce Mexico trucking plan soon-LaHood 06 May 2010 Stock plunge raises alarm on algo trading | Video 06 May 2010 Americans "bombarded" with cancer sources: report 06 May 2010 Nasdaq names stocks with cancelled trades 12:14am EDT Facebook privacy snafu exposed user chats 06 May 2010 Police barred from penis enlargement 23 Apr 2010 Stocks battered, pound bruised as fears persist 2:59am EDT Kim committed to denuclearisation: report 06 May 2010 BP turns to Twitter, Facebook on spill information 06 May 2010 Networks unlikely to profit from World Cup Paul J. Gough Thu May 6, 2010 11:58pm EDT Related News FACTBOX-Political risks to watch in S.Africa Tue, May 4 2010 SABMiller, AB InBev brewing favorites for World Cup Wed, Apr 28 2010 NEW YORK (Hollywood Reporter) - As the World Cup ads say, one game changes everything. Entertainment | Television | Media ESPN is counting on that maxim to justify its biggest marketing blitz to date for a single event, hoping to prove that soccer has reached critical mass in the United States -- a mass worthy of the monthlong global sports extravaganza. Meanwhile, Univision, with a long track record covering soccer as Spanish-language U.S. rightsholder for the World Cup, already knows it's true. It will use the event, taking place in South Africa from June 11 to July 11, to make further inroads with marketers who might not have opened their wallets for the broadcaster in the past and generally still pay lower ad rates than do the network's English-language peers. Both networks say ad revenue around the World Cup has been brisk. But rights fees also are up, and both networks are going all out in terms of production, coverage and marketing. "We embrace this as a mega-event, not just as a sporting event," says Alina Falcon, president of news and sports at Univision. "It is our biggest commitment yet in terms of resources." ESPN is investing more money on promoting the World Cup than it has for any other sporting event in the channel's 30-year history. Although the rightsholders don't disclose spending budgets, they might end up making little or no profit, which is not unheard of: NBC lost $223 million on the Winter Olympics. Still, both are betting on continued growth of the U.S. soccer market, which has benefited from more exposure to content than ever before thanks to foreign league coverage on TV and online. The U.S. fan base is rabid and has helped make the country one of the biggest buyers of tickets, according to the U.S. Soccer Federation. "It's the world's most important sport on its largest stage," says Scott Guglielmino, vp programing at ESPN. "You put into that nationalism, people pulling for their country or the country where they have an interest. You play that over a month, and it's a completely unique story." Soccer is the world's most popular sport -- only the Summer Olympics rival it in terms of global TV audience -- but it is somewhat less of a spectator sport in the U.S. Soccer lacks the financial and ratings punch of the NFL or Major League Baseball among non-Hispanics. However, Univision's soccer-crazed young Hispanic demographic has long provided big ratings. The network's World Cup numbers traditionally are much higher than ESPN/ABC's, with a 20 household rating for the 2006 final, a 19 in 2002 and a 26 in 1998, according to Nielsen Media Research. ABC earned a 5.7 household rating for the 1998 final on English-language TV; it fell to a 2.5 rating in 2002 before rising to a 7 in 2006. The lower ratings in 2002 can be tied to the tournament being held in South Korea and Japan, more than 12 hours ahead of the U.S. This year's event will be six hours ahead of New York, the same difference as for the 2006 World Cup in Germany. Univision is paying about $155 million for this year's tournament, compared with ESPN's $100 million for 2010 and 2014. Univision received about $110 million in incremental World Cup-related revenue in 2006 -- an estimated $170 million during the tournament's time frame -- after paying about $100 million for rights. After production and marketing costs, however, that slight profit all but vanished, making it a break-even business. This year, the World Cup likely will bring in about $100 million in incremental revenue, Univision CFO Andrew Hobson said Thursday, which would mean a loss when looking at direct Cup financials. For its part, Univision is bullish about this year's tournament. "We are performing above expectations, and the demand for the World Cup is strong," ad-sales president David Lawenda says. Lawenda adds that general market advertisers are discovering that the World Cup is a major avenue to reaching the growing Hispanic demo. Anheuser-Busch, Coca-Cola, McDonald's and Walmart are among those spending big, many with soccer-themed ads, much as they would for the Super Bowl or Academy Awards. ESPN wants to bring soccer to a wider audience -- not only soccer aficionados but also casual sports fans who crave big, emotional marquee events. The network's promotions in many cases are targeting the latter group. It also is targeting foreign-born U.S. residents with posters featuring caricatures of national teams in an effort to reach, for example, ethnic Greeks in Queens, or Italians and Germans in big cities. The World Cup won't have much in the way of challenges for a sports fan's attention. There are no Olympics, the NFL season is months away, and basketball and hockey nearly will be over by the time the action begins. Only baseball's All-Star Game on July 13 is nearby. "The World Cup pretty much has the stage to itself this summer," says Sam Sussman, senior vp and director at Chicago-based ad buyer Starcom Worldwide. Other factors are conspiring to make the event a more attractive sell to English-speaking sports fans: The U.S. team is guaranteed three games and maybe more as it has a chance to move beyond the group stage with England, its opening-match opponent June 12. Sussman believes that the South African locale -- where it will be winter -- also will help. Cooler conditions could promote scoring, which American fans like. Data on ad rates are tightly held by Univision and ESPN, and marketers typically don't buy single spots. Instead, they often make commitments to soccer governing body FIFA that include jersey or boot sponsorship for national teams, in-game and in-stadium signage and TV ads. Adidas had a $200 million deal in 2006 that made it the official supplier of game balls and title sponsor of an MVP trophy. Such arrangements make the World Cup hard to compare with, say, the Super Bowl, for which average spot prices typically are publicized. Industry folks are keeping a particularly close eye on ESPN to see whether this year's World Cup reaps hoped-for benefits. Miller Tabak analyst David Joyce says the event still could be a loss business for ESPN and ABC, but "it helps broaden their brand to get customers to identify the World Cup more with ESPN. "I expect them to be increasingly competitive in their bidding for future World Cups as ESPN has been expanding its programing into European markets, and (showing the Cup and other soccer events in even more countries) would be a key rights win to help grab market share," he says. Entertainment Television Media © Copyright 2010 Thomson Reuters Editorial Editions: Africa Arabic Argentina Brazil Canada China France Germany India Italy Japan Latin America Mexico Russia Spain United Kingdom United States Reuters Contact Us Advertise With Us Help Journalism Handbook Archive Site Index Video Index Analyst Research Mobile Newsletters RSS Podcasts Widgets Your View Labs Thomson Reuters Copyright Disclaimer Privacy Professional Products Professional Products Support Financial Products About Thomson Reuters Careers Online Products Acquisitions Monthly Buyouts Venture Capital Journal International Financing Review Project Finance International PEhub.com PE Week Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com, video, mobile, and interactive television platforms. Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests. NYSE and AMEX quotes delayed by at least 20 minutes. Nasdaq delayed by at least 15 minutes. For a complete list of exchanges and delays, please click here.

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