Comcast + NBC = Sports Juggernaut

Look out ABC/ESPN. If Comcast acquires NBC Universal from GE, it could become the dominant player in the cable-sports business

By Rick Horrow and Karla Swatek

1. What a Comcast Buyout of NBC would Mean for Sports

If Comcast's (CMCSA) high-profile bid to take control of General Electric's (GE) NBC Universal goes through, the new network could, seemingly overnight, present a true rival to Walt Disney (DIS) ABC/ESPN juggernaut for the hearts and minds of sports fans everywhere.

According to sources cited by The Wall Street Journal, Comcast and GE officials "see the creation of a combined sports business as a key benefit" of a merger of Comcast's cable channels with the NBC network and Universal's many other entertainment properties. At an industry conference in June, Comcast Programming Executive Jeff Shell stated that expanding the sports business at his cable networks was 'top of our list over the next five years.'" Owning sports and entertainment content has long been a part of the Comcast strategy; the company owns E! Entertainment, 11 regional sports networks, and other sports properties including Golf Channel and Versus (home of $ports Take program).

The new broadcast entity would combine the companies' rights to golf, hockey, and college football with NBC's rights to Sunday Night Football games through 2013 (for which it pays $600 million a year) and the Olympic Games through 2012 ($2 billion). Additionally, it would give NBC Sports a conduit to cable subscription revenues, such as the approximately $400 million that the Golf Channel and Versus currently enjoy. All told, cable-TV subscriptions accounted for more than $17.7 billion of revenue in the first half of 2008 alone. The company has 24 million cable customers (one out of five TV households), and 15.3 million high-speed Internet accounts.

Moreover, the strong platform the new entity would provide would likely give Comcast more leverage when negotiating carriage fees with ESPN. Comcast and other cable companies are paying approximately $5.8 billion to carry ESPN's seven domestic networks this year, according to the Journal.

Comcast better act fast—on Friday, it was rumored that Liberty Media (LMDIB) Chairman John Malone and News Corp. (NWS) Chief Executive Rupert Murdoch were said to be interested in the deal.

2. Rush, Flushed

Na na na na. Na na na na. Hey, hey, hey. Good-bye.

The group bidding to buy the St. Louis Rams, led by Real Salt Lake owner Dave Checketts, has severed ties with conservative talk-radio personality Rush Limbaugh, likely making the group more worthy in the eyes of NFL owners and officials and vaulting them close to the top of the list. Checketts issued his first public statement on the matter Thursday, saying: "It has become clear that [Limbaugh's] involvement in our group has become a complication and a distraction.…As such, we have decided to move forward without him."

A livid Limbaugh took to the airwaves on Friday—and followed up with an incendiary opinion piece in the The Wall Street Journal the next day—blaming the situation on ongoing attacks on political conservatism by the left. He claimed that he had warned Checketts about the "firestorm" that was likely to ensue when his participation was made public, but that Checketts had assured him he had "cleared [Limbaugh's] involvement with people at the highest levels.

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