The Sporting Class: Is the NFL Killing the Golden Goose?

What do the tech titans of Silicon Valley and the old heads of traditional broadcast television have in common? Answer: they all need to kiss the ring of Roger Goodell. But will the NFL get too greedy in their continued pursuit of maximum return on their media rights? And why is Rupert Murdoch secretly meeting with Donald Trump? The Sporting Class — aka “Rich Guys OnlyFans” — returns… Read Vanity Fair's Roger Goodell's Hollywood Blitz: Why All the Other Moguls Have to Kiss the Ring https://www.vanityfair.com/culture/story/roger-goodells-hollywood-blitz?srsltid=AfmBOor3FiLr6nZz5fo_bkKywecgK7k3JoA_N1Ns5Xo0sCBv51QWK_R9 Read Wall Street Journal's Rupert Murdoch’s High-Stakes Blitz Against the NFL https://www.wsj.com/business/media/murdoch-nfl-television-fight-35aa3587 Subscribe to "Nothing Personal with David Samson" https://www.youtube.com/@npds Hosted on Acast. See acast.com/privacy https://acast.com/privacy for more information.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Pablo Torre?

  Welcome to Pablo Torre Finds Out. I am Pablo Torre and today, we're gonna find out what this sound is.

• 0:06Speaker 01

  The next time any of these leagues, any of these networks think about the fans, we'll be the first.

• 0:12Pablo Torre?

  Right after this ad.

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• 1:12Pablo Torre?

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• 1:54Pablo Torre?

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• 2:20Speaker 04

  Can I ring back?

• 2:22Pablo Torre?

  David brought this in, John. Have you seen this in person?

• 2:25Speaker 01

  I have not. I think these things are hideous. If I actually was fortunate enough to get one of them, I cannot imagine [bleep] wearing that.

• 2:32Pablo Torre?

  Can you describe it? For the audio audience, can you describe David Samson's World Series ring?

• 2:38Speaker 01

  It's precious because of what it takes to get one of these, and how rare they are. There is nothing elegant about this. There's nothing particularly sophisticated about this. This is a [bleep] marlin with a whole lot of inexpensive chip stones. Though I don't assume it's trivial, I assume it's an expensive ring. But would you wear such a thing? Were it... This is the most...

• 3:06Speaker 04

  Please don't put it on. Seriously, like, can I have it back, please?

• 3:10Speaker 01

  Oh, are you worried about my germs?

• 3:12Speaker 04

  I just would prefer you not to have it cross your knuckle.

• 3:16Speaker 01

  Because of the germs embedded in the wrinkles? Let's pass that around.

• 3:20Pablo Torre?

  I need to further describe this. It says, "World Champions." There is a golden marlin. There are many diamonds. The stitching, the red stitching, is also... Spoiler alert. What kind of stone?

• 3:31Speaker 04

  It's an emerald. There's a teal diamond in there as well.

• 3:34Pablo Torre?

  It says Sampson in giant letters, 2003. Prez?

• 3:39Speaker 04

  Prez?

• 3:39Pablo Torre?

  P-R-E-S, because...

• 3:41Speaker 01

  You can't get I-D-E-N-T in there? You're the prez?

• 3:47Speaker 01

  So is it an option to take a check instead of taking that ring?

• 3:52Speaker 04

  No.

• 3:52Speaker 01

  You don't wear that, do you?

• 3:54Speaker 04

  I do. I wear it from time to time. Certainly not every day, but I wear it to, you know, weddings, bar mitzvahs, speeches.

• 4:01Pablo Torre?

  If you hire David Samson at your bar mitzvah, he comes with this.

• 4:04Speaker 01

  Couldn't you make, like, a... A moil could use a version of that to perform the circumcision ceremony?

• 4:13Speaker 04

  You've never seen a newborn, quite obviously. And I've got a small finger.

• 4:18Speaker 01

  No, I noticed. I could...

• 4:21Pablo Torre?

  I feel like, much like John's imagined ceremony, I am gonna cut this short. Thank you.

• 4:27Speaker 01

  Yeah, better cut that off.

• 4:46Pablo Torre?

  In the world of sports business, the ring that everyone is chasing, of course, is more figurative. The ring happens to be NFL media rights. Was that a good segue?

• 4:59Speaker 04

  No.

• 5:01Pablo Torre?

  Let's go with it.

• 5:01Speaker 01

  It's a bit of a reach.

• 5:04Speaker 04

  I don't want you to rest on your Pulitzer laurels. I need your transitions to be sharp. I need you to be on time. All the things that concern me greatly.

• 5:11Pablo Torre?

  I got a better one. In the world of sports business, there is one ring that everyone must kiss.

• 5:17Speaker 01

  Better, much better.

• 5:19Pablo Torre?

  And it belongs to a man named Roger Goodell. The coverage, John, about Goodell at this moment in sports business history, in media rights history, is so comically different than what it was certainly when I was working at ESPN for you, when it was Roger Goodell, this punching bag. And now you have everybody. I mean, I will quote The Vanity Fair piece in which he is in a room full of all of the most powerful people at Rupert Murdoch's 95th birthday in March. And there is Jared Kushner, Ivanka Trump, Hugh Jackman, Michael Bloomberg, Tony Blair, Barry Diller, Andrew Lloyd Webber, Jerry Jones, Robert Kraft, all of these people.

• 6:04Pablo Torre?

  And the guy, of course, they're all strategizing around in this scene, according to this reporting, is Goodell. Because there is currently an inflection point in which the NFL is in something like, I would say, a financial conflict with suddenly the federal government, potentially, around the protections they have, around how they want to do business. So can you explain, John, what this story is actually about? As you have personally negotiated these deals before with Goodell?

• 6:35Speaker 01

  Well, I would, first of all, suggest Roger Goodell was never a punching bag. He's always had quite a bit of power. It happens that in the existential transformation of media from analog to digital, that sports has become the most valuable content that there is. And the NFL is the most valuable sports content. So I don't know if it's kissing a ring or punching a bag. It is, I want to get close to the people who will enable me to have some portion of this content that is the most valuable content in the world.

• 7:14Speaker 01

  And the NFL is in an advantageous position that they have way more bidders for that content than they do have that content. Right? Other leagues have more content, less bidders. So you, of course, I guess it's a version of kissing a ring. You have to be nice to the guy who controls that. And that's all that's happening, right? I mean, I don't think it's any particular transformation of him as a human being or even a transformation of the NFL. They've been sort of the top of the heap. It's just everybody has realized in the last few years that the most valuable content in all of media is sports.

• 7:52Speaker 04

  To me, it's been that way for even longer. Because when Fox first bid for the rights to the NFC, Fox used it as a loss leader to introduce their primetime lineup, like with The Simpsons, et cetera.

• 8:05Speaker 01

  Right.

• 8:06Speaker 04

  And that they wanted to use the NFL for that. And that was the beginning of additional competition that has now obviously transformed with the streamers, which is why you bring up the Murdoch party. And what fascinates me is what Murdoch is trying to do is to put his thumb on Goodell a little bit, trying to find a way to get rid of the Sports Broadcasting Act of 1961, trying to get rid of the exemption that exists because he doesn't want to be outbid. He doesn't want to lose the NFL because of what it means to his public company and earnings per share. So I don't think, I'm surprised they were at the birthday party. It's a very...

• 8:42Pablo Torre?

  Well, this is why I want to establish Goodell's sort of... Premacy in these rooms because the 1961 Sports Broadcasting Act, which protects the ability of the NFL to sell these things together, right? As a league as opposed to individual teams, John.

• 8:58Speaker 01

  Let's stop there for a minute. Can you explain to me how anybody believes that taking the antitrust exemption away from the NFL would result in consumers benefiting?

• 9:13Speaker 04

  The answer is it would not, but that's-

• 9:14Speaker 01

  It would be worse.

• 9:15Speaker 04

  That's, well, much like the streamers, if you look at what you've always said from the beginning is for customers, all of these options for streaming has made it worse. Because now everyone, instead of just cable, has to have 14 different platforms in order to watch NFL games every day of the week. So it's never been about the consumer.

• 9:34Speaker 01

  But so Rupert Murdoch going to Donald Trump and saying, "You ought to look at this antitrust because consumers are getting screwed." But it's not, if the Cowboys had their own individual team rights, they'd sell them for as much money as they could, and the Giants would sell them for as much money as they could, and the 49ers would sell as much money, and consumers would pay more. So it is not a solution to any problem to get rid of the antitrust exemption, is it?

• 10:01Speaker 04

  And no, because, and what Roger Goodell would tell you is that it's not good for anyone, for the Cowboys, Giants, and Niners to go out and sell on their own, because they can't exist without the other teams.

• 10:11Speaker 01

  Right.

• 10:11Speaker 04

  Which is why there's a schedule, which is why there's a league. In Major League Baseball, there used to be a large component of local revenue, which was teams going out and selling on their own. And look what it's done. It has quashed franchise values. It has caused huge labor economic issues inside the game. And they're trying to go to the NFL model, just like Adam Silver did the same damn thing, where it was very micro and local, and he's trying to make it very national. So none of this should be surprising to either the consumers or to DC.

• 10:43Pablo Torre?

  But can we just establish that what Rupert Murdoch is doing here is he is- Signifying something very fascinating, which is, he's the little guy. Fox is the little guy among all these bidders now.

• 10:56Speaker 01

  They're the little guy because they have always denigrated. Remember, David Hill famously said, "The internet's like a library." It really won't matter.

• 11:05Pablo Torre?

  The former head of Fox Sports.

• 11:06Speaker 01

  Former head of Fox Sports. Fox sold, at a high, by the way, very smartly, Fox sold all their digital assets mostly to Disney. Right? So they exited and said, "We're gonna make as much money as possible on the old, traditional media legacy." And Roger is in the process of increasing the prices, potentially, to where nobody can afford to buy NFL packages, except Amazon, Netflix.

• 11:36Pablo Torre?

  YouTube.

• 11:37Speaker 01

  YouTube, et cetera. CBS has already got the most problem, but they've already been to them, and they're in a position where they can't give up the NFL. So they're gonna pay and set the market at a some 35% to 50% increase over the recently negotiated deals.

• 11:56Pablo Torre?

  And that's why Rupert Murdoch is going to the White House to say, "Hey, think of how more..." I mean, again, it's funny. The external messaging around this secret meeting has been, "This is because we are fighting for the consumers." Of course, what he's doing is trying to scare the NFL into having something like the status quo remain possible, preferable even, as they consider, "We're gonna blow up all these deals because of the streamers."

• 12:25Speaker 04

  I didn't take it that way. I didn't say, I didn't take it as though they're trying to scare the NFL. I took it as though what they're trying to do is level the playing field as best as they can. They wouldn't be the sole beneficiary of Washington DC involvement. It would really accrue to the benefit of all of the mainstream media companies who do business with the NFL. He can't just do something in DC that helps Fox.

• 12:49Speaker 01

  Essentially, the NFL is very rapaciously, though appropriately...

• 12:56Speaker 01

  Selling less and less to more and more, right? I mean, CBS and Fox used to basically own the afternoon. Nobody else got any of those games. And they'll split those packages into two. And you'll be having to flip back and forth on your television. I guess you don't do this anymore.

• 13:13Speaker 04

  It's a fantastic plan.

• 13:14Pablo Torre?

  Making the dial motion.

• 13:15Speaker 04

  By Roger Goodell, so I don't, I have no issue. I don't think Rupert Murdoch has an issue with what Roger Goodell is doing.

• 13:21Speaker 01

  Rupert would do the same damn thing.

• 13:22Speaker 04

  A hundred percent.

• 13:23Pablo Torre?

  Well, that's the comedy of this, right? Is that like, how do we fight this? Let's get the government involved because there is no other move. The gravity of money is self-evidently a law that will prevail.

• 13:37Speaker 01

  And by the way, I will only quibble with one comment, which is anything that Trump would do for Fox would have to extend to CBS and I assume Disney. And he has a practice of helping individual companies. I don't think he'd see any conflict or any ethical issue with going, I'm going to help Rupert. He'd probably help CBS. I doubt he'd help Disney.

• 14:02Pablo Torre?

  Yeah.

• 14:02Speaker 04

  I don't see a scenario where the executive branch has the ability to undo the sports broadcast in act of 1961, though you'll argue that it doesn't matter.

• 14:10Speaker 01

  It doesn't matter.

• 14:11Pablo Torre?

  Well, it's the Justice Department that would get dragged in. Brendan Carr, by the way, has, this is the chair of the FCC, has been saying, John, Americans are frustrated when they sit down and can't find the game they want to watch. The feeling only grows worse when they realize they might need to sign up for another streaming service.

• 14:24Speaker 01

  Brendan Carr doesn't even have an opinion. He's going, Trump, what do you want me to do? I'll say whatever. I don't think Brendan Carr gives a shit about anything other than pleasing Trump, as far as I can tell.

• 14:36Speaker 04

  There are people who don't like doing anything but pleasing their boss. That does exist in this world.

• 14:42Speaker 01

  I never experienced any of that.

• 14:44Speaker 04

  Really? That's, you lived in a company where that was the goal of the people under you.

• 14:48Pablo Torre?

  Well, I want to ask.

• 14:48Speaker 04

  Was to please you.

• 14:49Pablo Torre?

  I want to ask John about being the president of ESPN and negotiating with Goodell. So I want to understand, there is all of the financial might we've outlined that the NFL enjoys as the most valuable media property left in America. What was it like to negotiate against them?

• 15:09Speaker 01

  Well, um, I would regard them as among my least successful negotiations. And in fact, I was, it's the only negotiation I was ever taken off of.

• 15:18Pablo Torre?

  Oh.

• 15:19Speaker 01

  Bob Iger and George Bodenheimer at one point decided that they needed to finish the NFL negotiation, uh, because they weren't sure that I was up for it.

• 15:29Pablo Torre?

  Why were you taken off the negotiation?

• 15:34Speaker 01

  I think, um, you'd have to ask somebody other than me. And by the way, I was sort of having fun. Um, we were down to the negotiation of whether we'd get a Super Bowl and whether or not, what, uh, sort of wild card playoff games we'd get.

• 15:53Speaker 04

  It's not uncommon for a chairman of a company to come in and act as though it's like the commissioners coming into the collective bargain agreements at the last minute.

• 16:01Pablo Torre?

  All the closers coming in from the bullpen?

• 16:03Speaker 04

  That's really what it is. It's the closer and you had to have the deal.

• 16:07Pablo Torre?

  Get the lefty out of here.

• 16:08Speaker 04

  I guarantee that Skipper had the deal in position to be closed and there weren't a issues list 50 pages long when they took John off, is my guess.

• 16:18Speaker 01

  ESPN and the NFL have always had an appropriate tension because ESPN is the only major sports media company that is also in the sports news business.

• 16:32Pablo Torre?

  That's really important is that you actually did, when you were running the company, protect the news with a degree of personal investment that was rare.

• 16:43Speaker 01

  And I have to say, if I have to guess why, uh, and they didn't have to give me any reason, but I had to guess why is when Roger, and this is, this is figurative, not literal, is sitting across the table looking at me, among the many things he sees, some of which he likes, some of which he doesn't, is that's the guy that's going after my league about CTE. That's the guy whose company is questioning whether or not we had a secret deal to fine some offensive lineman. And, um, uh, so I, that would be my guess is that tension might impair the relationships at the end and, and they were more charming than me.

• 17:24Speaker 04

  It's very common. It really is. Like, I wouldn't, it, it, it sounds like a really cool story, like, oh, Skipper gets replaced in ESPN and NFL negotiations.

• 17:33Pablo Torre?

  We're gonna, we're gonna aggregate that.

• 17:34Speaker 04

  Yeah, I'm sure you will.

• 17:35Pablo Torre?

  We're gonna make a headline out of it.

• 17:36Speaker 04

  Um, sorry, John, I tried for you.

• 17:38Speaker 01

  With the NFL, what I will say is, as negotiating for ESPN, I generally had a great leverage advantage with the distributors. I often had a great leverage advantage with the leagues. Uh, in the case of the NFL, we did not have negotiating leverage with the league. We did not.

• 18:01Speaker 04

  Why not?

• 18:02Speaker 01

  One, they didn't like our news coverage. Two, there's plenty of bidders, so somebody else would step in. Three, ESPN, I meant to make this point before, you were talking about Fox basically built their business and their network business on the NFL. So did ESPN. ESPN was a fairly small cable operator until they got a full season of the NFL and went to the distributors and exacted, because we had leverage, a very big price for having a full game of the NFL. The only, by the way, at the time, it was the only games that you had to pay for theoretically, were the games on ESPN. So, it's not, not a bad thing. I, I want to go back to Murdoch sat with the President of the United States and asked

• 18:44Speaker 01

  him to do something which wouldn't solve the problem, wouldn't accrue to him, so it's just a, it's a, it's not a good solution to the problem. I also want to make the point, people are talking about Goodell, uh, will he kill the golden goose? I do think there's a danger scenario here, and that is, I'm gonna make an assertion, I'll be interested to see, I don't know what the books look like at NBC or CBS, but everybody's losing money on their NFL deal. It's a lost leader. So what Roger is going to tempt fate with here, he's been very good at this, is the delta between how much money an NFL package brings in the door and what you pay us is gonna get bigger. That's what's gonna happen.

• 19:29Speaker 01

  CBS is not generating $2 billion worth of advertising. And their package is going to go up to three billion. So at some point, and Roger is pushing the deals out further because he knows the traditional media companies are only going to get less powerful and less wealthy. And he is going to make it. He's, he's very cleverly brought gradually all the streamers in, the big tech companies, because they can afford to pay four billion, five billion. By the way, it's the exact equivalent of Adam and Roger letting the equity firms in.

• 20:04Speaker 04

  Adam Silver.

• 20:04Speaker 01

  Yeah, because the teams are getting too expensive. Roger knows that he's getting so expensive that the tech companies are going to outbid the next round. But he should be careful. He didn't have to be careful because it'll be the next commissioner, not him. So it's not going to be on him. Because the next commissioner is going to deal with the fact that these big tech companies have more leverage over you and they don't need your product as much as the traditional broadcasters do. The NFL is at this position right now because these traditional media companies cannot exist without an NFL package. If the delta gets to be billions of dollars, they will have to decide to exist without it. They'll decline faster. Cable TV will decline faster.

• 20:48Speaker 01

  And the only people who will be able to afford the NFL's packages will be great, big trillion dollar market cap companies. But they are also tough, mean companies.

• 21:00Speaker 04

  Oh, yeah.

• 21:01Speaker 01

  Netflix negotiated with us over the per diem cost of our production crew on an inexpensive documentary. They will not. They're going to look, Roger, whoever is the next commissioner is going to be sitting across the table. Somebody's going to go, if I don't have your, if I don't have your rights, I'm okay because I'm still going to sell a ton of Apple phones. And if I don't have the NFL, I'll be okay.

• 21:25Speaker 04

  They walked away from Warner Brothers Discovery. To your point.

• 21:29Speaker 01

  Yeah.

• 21:30Speaker 04

  Netflix walked away because it was no longer the right value proposition. And what NFL has already done is they're taking certain games. They don't want to be a bidder for a full package, which will cause Goodell to split the packages even more when there are more companies doing what Netflix did. But you said something and I can't believe you didn't pick up on it. You said that you had competition.

• 21:49Speaker 01

  I might not have given him time to pick up on it.

• 21:51Speaker 04

  Well, that's okay. It's you. It was great. But did you hear him say that there was a bunch of competition when he was negotiating for ESPN? Did you? Did you hear him say that? What? There's competition now, too.

• 22:02Speaker 01

  Uh huh.

• 22:03Speaker 04

  Everyone always thinks that with the streamers that all of a sudden there's way more competition for stuff and that's killing different sides of negotiation. Back in the day, in your day, in my day, there was plenty of competition.

• 22:15Speaker 01

  I didn't say there was a competition.

• 22:16Speaker 04

  And it causes you to act in a certain way that at some point becomes irrational. And the question is, what's that point? There's always a point, whether it's 1980, 1990, 2030, or 2040. Every negotiation is either side looking and saying, how far can I go? That's all Roger Goodell and the next commissioner. How far can I go before everybody says no? And then I'll retract.

• 22:39Pablo Torre?

  But this is what's so interesting, right? So the longer deals that he's trying to lock the networks into, right? If the networks act as they have historically, which is to say, yes, we need this so desperately, more desperately than any tech company on the planet. So let's lock it in as long as we can. It's, it is very funny to imagine like Roger Goodell extracting as much as he can from people who will pay the most until they can no longer pay anymore, until the blood is drained from the body. And then he will turn to the other people. And at that point, that's when sports, I think, get scary, right? The point at which the tech companies are the ones remaining.

• 23:20Pablo Torre?

  And suddenly the big green arrow of growth does not go up into the right anymore. Like to me, this is not just about the NFL's value. This is about sports.

• 23:32Speaker 04

  It's also about technology. It's about both sides of the equation. And the key thing to look for in these agreements and the only thing that matters, and I know on your side it did too, is the opt outs. That is so critical because if you're a tech company, you would like to, in theory, lock in. You'd like to lock in and just have cost certainty. And what Roger Goodell wants is the ability, one way. He doesn't want to give it, he doesn't want to give it out to his partners. He wants to have the opt-out. Think about the way he's using the sword right now. He's in a possibility where there's a delta between what he's getting now and what he could get. So use the sword, opt-out, and he wants to even do it three years earlier. A new deal without an opt-out would be a very interesting thing.

• 24:14Speaker 01

  Well, you're looking at me about opt-outs. I don't remember any opt-out deals. These are fairly new. I don't remember ESPN having opt-outs. We didn't ask for them, we didn't give them. I'm assuming they gave one to the NFL. But I don't think in baseball, we, we, the last deal was the first deal that had some opt-out.

• 24:30Speaker 04

  Yeah, that's, and you saw what happened.

• 24:32Speaker 01

  And who asked for it? Was that baseball or ESPN?

• 24:34Speaker 04

  It's, there's a question.

• 24:35Speaker 01

  That was ESPN, I think.

• 24:36Speaker 04

  There's people on ESPN who think ESPN asked to opt-out of the deal with baseball, and there's people on baseball who say baseball wanted to opt-out from ESPN.

• 24:42Speaker 01

  I suspect they'd both pass a lie detector test. Which doesn't mean it's true. It means they think it's true.

• 24:48Pablo Torre?

  You know how to clinch to pass the test, which is...

• 24:50Speaker 04

  And what baseball's trying to do is they're trying to figure out how to get streamers involved and split up the rights and the packages and get more national games. The question we have for consumers is, do you really mind having to look to see what channel a game is on to the point that you don't watch the game? And what we've learned is, no. People are watching the game, people are supporting the sport, even if they need to take an extra five seconds to look and see what channel the game's on.

• 25:24Pablo Torre?

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• 26:58Pablo Torre?

  The notion of the NFL having this domino effect for all of the rest of sports. I want to quote something from the Vanity Fair piece, which I was referencing before. They write, "The new deal may create an opportunity for new platforms looking to snap up other sporting rights as the older players are squeezed, at risk, Major League Baseball and Major League Soccer. With only so much money to go around, the NFL could suck out all the cash from sports rights." Which is to say, these networks only have so much. They're loss leaders, which I want to return to in a second, actually, as well. Just the idea that they're losing money to get all this stuff. But if they only have a zero-sum budget, and they're giving all of that to the NFL, is baseball worried?

• 27:43Speaker 04

  No, because there's so many opportunities on so many different platforms. If this were a world where there were three bidders total for every single bit of content, then everybody would be worried. But it's just not the case anymore. There is a huge market for what you would call secondary rights. And I hate to call baseball a secondary right, but I'm going to call everything secondary to NFL. But you can get very wealthy with huge franchise valuations by being second to the NFL. So MLB is not sitting around worried about that. They're worried about how they're going to get all of their rights of their individual teams to sell as a group, the way Roger Goodell already does.

• 28:23Speaker 04

  And I think that secretly Adam Silver thinks about that, too, much more so than worried that they won't have a home.

• 28:30Speaker 01

  I'll agree with you, while having a slight distinction. Baseball is a first tier right, right? College football, baseball, NBA, they're not going to suffer here. What's going to happen is what happened to F1. They'll call F1 and MLS. I happen to be very fond of the commissioner of MLS. I don't know the F1 guys. They had to go take a deal because there's so much pressure to increase the average annual value of a year. That Don was under so much pressure to deliver an increase. Fox and ESPN had been the bidders. Fox is not particularly soccer centric, and so they weren't going to bid. So he had to go get that big increase from Apple.

• 29:13Speaker 01

  It has a deleterious effect, which is fewer people watch Apple. So less people are watching MLS games. F1 moved over because they were getting 75 or 85 million dollars from ESPN. ESPN paid all that money to the NFL. They go, how are we going to save a billion dollars? Oh, we're not going to renew F1 or we're not going to give them a big increase. We're not going to renew MLS. So that's where the effect is. Those I would call, and I mean this in an appropriate way, silver medal is a great thing. MLS and F1 are second tier rights in the United States.

• 29:46Speaker 04

  I don't agree that the billion dollars, that that's the reason why Disney gave up F1. I think that they, and you just told us you didn't like doing this. But I believe now with analytics and there are actual ways to value content and to value properties. And they can come up with, your view was $1 more than what someone else is paying. And if I want something, I'm going to get it. That's its value. Now with analytics, they're coming up with, well, here's really what we're doing. We can certainly put some off on if people are going to get Peacock. We can say that can be part of the value here for NBC's bid. But there is a calculation and there's a breaking point. And I think what happened with Disney is they just, F1 had a different view of what they were worth.

• 30:30Speaker 04

  And Disney said, go ahead, go get it. It's not here.

• 30:33Speaker 01

  Didn't I say the same thing?

• 30:35Speaker 04

  Maybe.

• 30:37Pablo Torre?

  But look.

• 30:37Speaker 01

  I mean, look, it's just simple math. If you spend a billion dollars, you gotta, when CBS, because this is in a budget.

• 30:44Speaker 04

  They had the money to read, to renew F1, is all I'm saying. They just chose not to allocate it there. They're gonna allocate it not just to the NFL, though. They need other programming. They can't just have the NFL.

• 30:57Speaker 01

  I wasn't suggesting that, but you know, as somebody who ran a club, when an unexpected expense comes along, that comes off your bottom line. You have to find that money, or some portion of it. And you can't, it's like, uh, when you lay people off, you lay people off who make a lot of money. You don't lay people off who make a little bit of money. So you must lay off important things, right? They didn't, and you have to lay off things with big tickets, right? You gotta save a billion dollars. You don't wanna do it 23 million dollars a time. You gotta do it, they're paying 60, 70 million for MLS, they're paying 85 million? It's 150 million dollars.

• 31:37Speaker 04

  I'm just laughing because John, talking about layoffs, right? When we're in this business, in this show, he gets very angry when companies do cost-cutting measures or laying off people because he's become this sort of caricature of the left. And what I'm smiling about is that when he worked for The Man, which is Disney, this is exactly who he was.

• 31:56Pablo Torre?

  Yeah, I would say that "The Men" is less of a compelling title than "The Sporting Class." Guys who fired people, less compelling than "The Sporting Class" as well. But the notion of the accounting. David, you were gesturing towards there being modern analytics in ways that are trying to capture the true value of something in an era in which it's not just eyeballs and Nielsen boxes, which is what, of course, the previous era was. Don Garber basically publicly said, "I am retiring," at the Sloan Conference where we were also at. He was coming offstage right before we were there. David doing our whole Steve Ballmer episode. And it just reminded me that getting out of this game right now is much like coaching college football, totally understandable.

• 32:41Pablo Torre?

  It's a crazy world now in which the business, the numbers, the power is shifting. And in this case, I, I wonder, when you look at why Rupert Murdoch's and Fox are running to Donald Trump.

• 32:57Pablo Torre?

  Did government play a role, John, previous like this in your experience running ESPN, David, in your experience with sports? How does, is this move familiar or is this new?

• 33:08Speaker 04

  It's quite familiar. The president got involved in the work stoppage in the 90s in baseball. The, this is way before Trump, where there is a possibility that you will have to get presidential involvement or judicial involvement. Supreme Court Justice Sotomayor is much more well-known to baseball fans as her involvement in getting baseball going again than in her being a Supreme Court Justice. And so, again, we all act, and I, listen, forgetting where we are politically. We all act like what's going on now has never happened. It's unprecedented what's going on. And I just have a different view of it. And I'm not that old and my memory's not that good. But I have instances in my head in business where we were all doing these sorts of things long before the current administration was around.

• 33:52Speaker 01

  We didn't have many at my level. The most important political influence that Disney had to worry about was making sure that the trademark on Mickey Mouse didn't run out. And yeah, they spent a lot of time lobbying Congress to make sure Mickey Mouse didn't run out.

• 34:08Pablo Torre?

  It remind us why that was complicated.

• 34:10Speaker 01

  Scene but Willie is like 1926, 1929 or something. I think the copyright law in the United States was about 60 years at one point. It's more than 60, 75.

• 34:19Speaker 04

  Do you know how much money you spent in Tallahassee as a company?

• 34:22Speaker 01

  No.

• 34:22Speaker 04

  Yeah, quite a bit.

• 34:24Pablo Torre?

  Wait, why?

• 34:24Speaker 01

  Oh, no, no.

• 34:25Speaker 04

  It's not just in Washington DC. There's local politics, there's state politics that companies get involved with. And Disney, being in Orlando, would be involved in Florida state politics. They had a huge presence in Tallahassee. You're spending tons of money. You have a whole department of lobbies.

• 34:40Speaker 01

  I wasn't saying we weren't. At ESPN, we, the political issue we worried about was the FCC and whether or not our distribution practices would at some point come under scrutiny. And that was mostly what we were charging.

• 34:56Pablo Torre?

  Because you were the big bad wolf.

• 34:57Speaker 04

  Because they were getting paid per person for people who didn't watch ESPN. They-

• 35:02Pablo Torre?

  John's still laughing at it.

• 35:04Speaker 01

  Was there any?

• 35:04Pablo Torre?

  The glory of that model.

• 35:06Speaker 01

  Was anybody licensing their content to distributors and not getting paid for every customer?

• 35:12Speaker 04

  All of us were, all of you were.

• 35:14Speaker 01

  Okay, thank you.

• 35:14Speaker 04

  But, but I'm not saying that you were brilliant and the only one doing it. I'm saying that the model where you're sucking money out of people who are not getting any benefit to it. And now you have to go out to say in 2026, God forbid, people don't know what channel to go to or have to buy another streamer. Oy vey, that'd be terrible.

• 35:30Speaker 01

  And by the way, you are, are fostering a misunderstanding that lots of people use. Eighty percent of everybody who has cable television watches ESPN.

• 35:43Speaker 01

  You don't believe that?

• 35:44Speaker 04

  The rights, the leagues, SportsCenter, the ancillary programming?

• 35:48Speaker 01

  They watch something on ESPN. I mean, it's just, it's a-

• 35:52Speaker 04

  Is that a study you did?

• 35:54Speaker 01

  Yes.

• 35:55Speaker 04

  Okay, I can do a study too and get to 40%. You know that. Okay, but we'll go with it. Eighty percent of cable subscribers watch ESPN.

• 36:05Speaker 04

  Does that make you feel better? Is that why you say that?

• 36:07Speaker 01

  How many, what percentage of people watched MLB channel?

• 36:10Speaker 04

  Almost zero.

• 36:11Speaker 01

  Almost zero.

• 36:12Speaker 04

  But so what?

• 36:13Speaker 01

  And did you worry?

• 36:14Speaker 04

  No.

• 36:15Speaker 01

  Oh, okay, just checking.

• 36:18Speaker 04

  Once, once, by the way, once it's not out, once it's all out, then I worry.

• 36:22Speaker 01

  You basically asked, the question basically was, did you ever have something that might rise to the level of going to the President of the United States and asking for help? I didn't experience that in anything.

• 36:35Speaker 04

  Only because you have a relationship with any president.

• 36:37Speaker 01

  And the only thing-

• 36:40Speaker 04

  You would have, John.

• 36:40Speaker 01

  That I remember that rose to that was the Mickey Mouse thing.

• 36:45Speaker 04

  At the highest level of Disney, above ESPN, there is interaction with the White House-

• 36:50Speaker 01

  Of course.

• 36:51Speaker 04

  All the time.

• 36:51Speaker 01

  We had a huge office.

• 36:52Speaker 04

  Under every White House. It's not that Murdoch was like, oh, I have a brilliant idea because Trump's Trump. And I'm trying not to defend Trump because it's so ridiculous to do and I won't do it. But to think that Murdoch is the first CEO, chairman, to go to the president for something is just not accurate. That's all I was trying to say.

• 37:09Speaker 01

  Nobody, you're, you're, you're countering an argument that nobody has made, including me.

• 37:14Speaker 04

  I feel like Pablo's making it.

• 37:16Pablo Torre?

  Well, what I'm raising the question of is what is new in this wild new era and what is old?

• 37:23Speaker 04

  The world is littered with politicians who get rich once they stop being politicians. The fact that politicians can maybe figure out how to get rich while being politicians is the natural next step to abuse of power.

• 37:35Pablo Torre?

  The question I have-

• 37:36Speaker 01

  I'm with you since you added towards the abuse of power.

• 37:39Speaker 04

  Well, it's always been that.

• 37:41Speaker 01

  I thought you were gonna end with "It's a natural next step for a capitalist."

• 37:45Pablo Torre?

  The thing, the thing that-

• 37:46Speaker 01

  Because they have a ro-

• 37:47Speaker 04

  I'm rational, John.

• 37:49Speaker 01

  They have an obligation to their shareholders to cheat and lie and steal.

• 37:52Speaker 04

  The problem with you is you think that anyone who disagrees with you is not rational, and I don't share that. I think you're very rational in what you say, even when it's wrong.

• 38:01Pablo Torre?

  The question around capitalism that I have, right? As we're talking about the Green Arrow, and we're looking ahead to a world in which Netflix, Google, Apple will remain, others will wither. The question I have is, what is going to be enough? So the NFL, for instance, right? Let's just-

• 38:20Speaker 01

  There's never enough.

• 38:22Speaker 04

  Never? I don't understand that question.

• 38:23Speaker 01

  The other component to the problem, Pablo, is the nature of leagues.

• 38:30Pablo Torre?

  This is what I'm getting at.

• 38:30Speaker 01

  They're not businesses run by a CEO, right? They are collectives, mostly with antitrust exemption, that has an administrative head who's given certain obligations and opportunities. But the owners will never, you dealt with this, the owners will never go, "Let's do so, let's take less money for some-"

• 38:53Speaker 04

  Nor will any CEO or owner of any business, anywhere. So you ask, "When does it stop?" It's like asking, "When does the stock market stop going up?" The answer is, if you are an investor for the long term, you are going to make money in the market. If you don't panic when there's a down, and sell low and buy high, which most morons do, if you just stay the course, you will make money. In sports ownership, asset value, homes, generally, you will get an increase in the value, and you don't stop that. NFL will have to keep finding more avenues for revenue, like every business.

• 39:29Pablo Torre?

  But this is, this is the thing I am getting at, though. Is that at a certain point, the desire for more- And the lack of reasonable competitors, while you're still striving for more and more and more, it becomes obviously unsustainable.

• 39:47Speaker 04

  No, because there's never a lack. They're gonna look different. Much like the competitors today look different than they were in the 70s and 80s and 90s. They look different, but there's competitors when John's there.

• 39:56Pablo Torre?

  Well, what's the end game? Because what I'm imagining right now is a world in which they are going to drain all the money out of the networks. Silicon Valley is gonna come along and they're gonna say, "We're not gonna pay as much." And the NFL is gonna react by saying, "Then we're gonna do this other next thing to make sure that we are still growing." What Robert Kraft is saying in his Vanity Fair piece is that he wants 18 games, two preseason games, 16 international games. So every team, every year, plays international game. They're a streaming audience, and that's cool. But there's gonna be more. They're gonna want more. And then the product, at some point, is gonna not be totally familiar to the people who love it. And then at that point, the question is, is the golden goose actually decapitated? And why did you do it? Because you wanted more.

• 40:39Speaker 04

  I've never seen that. I know the expression. Just like cutting off your nose to spite your face, I don't see a lot of noseless people walking around who don't have skin cancer. So I just, I understand the expression of killing the golden goose. I've just never seen that. So yes, the older we are, we are gonna age out of what the NFL cares about. The way we engage with the NFL, it'll be a different way for kids and grandkids and how they engage. So yes, the NFL could change how it distributes its product. They could go to 40 games. You just, you don't know what is gonna happen going forward. They could play twice a week. You could change a bunch of rules. It's hard to know, other than they want the asset value to keep going up.

• 41:17Pablo Torre?

  Right. I guess my naive but sincere question is, isn't there a way to keep growing? Or at the very least, keep your, uh, sort of like rate of return seemingly stable, maybe even slightly above flat? And...

• 41:34Pablo Torre?

  Be totally happy.

• 41:36Speaker 04

  Can you imagine Pablo Collier?

• 41:37Speaker 01

  He's channeling me now.

• 41:39Speaker 04

  Can you imagine going to a board meeting and meeting with your board and say, listen, I am a genius. I have a plan that will keep us flat.

• 41:47Pablo Torre?

  We are the number one property. Everybody is kissing our ring.

• 41:52Speaker 04

  You're not even gonna back me on that.

• 41:53Pablo Torre?

  We can do this forever. Just don't frack the earth underneath us such that poison is released, killing the entire sports ecosystem. That is genuinely my fear.

• 42:04Speaker 04

  I'm sorry. I really, it's hard to be you.

• 42:07Speaker 01

  Well, you take a look at oil and gas. You think they spend it? They are literally going to destroy the world.

• 42:16Pablo Torre?

  That's what I'm saying!

• 42:17Speaker 01

  And is anybody gonna stop?

• 42:19Speaker 04

  But then the rights fees won't matter. Like, if the world blows up and the global-

• 42:23Pablo Torre?

  We're just racing, we're just racing-

• 42:24Speaker 04

  If that's what happens, then why, what are we even talking about? It's a game of musical chairs. You just don't wanna be holding the last chair.

• 42:30Pablo Torre?

  But this is it, right? So there is now talk of when is Roger Goodell gonna step down? Who is gonna be in charge? We just mentioned, Don Garber is leaving. How long is Adam Silver gonna do this job? It does feel like we are in a period of maximum extraction and the bill will come due for someone else.

• 42:51Speaker 01

  Well, or, or the world just goes somewhere else, right? Everybody who went to California in 1849, they, if you'd said to them, don't take all the gold out, just take his, just take half of the gold out.

• 43:04Speaker 04

  Leave the rest for the next group, if you don't mind.

• 43:07Speaker 01

  If you run through all the gold, people start using silver. Uh, they'll do something else. It's hard to remember, but the NFL, you remember the most important, what's called the greatest football game ever was the Baltimore Colts and who'd they beat?

• 43:22Speaker 04

  Is that Johnny Unitas? Is that back in that day?

• 43:25Speaker 01

  Yeah, 1958.

• 43:27Speaker 04

  The Giants?

• 43:28Speaker 01

  It was Giants. It was the Giants and the Colts, and I think some astonishing number of people watched. And it was the first time most people had seen football on television. Before that- You have to think back, that's only, what, 42 and 68 years ago, the NFL was not even a thing. Nobody cared, right? People cared about horse racing, boxing, college football.

• 43:50Pablo Torre?

  Baseball.

• 43:51Speaker 01

  And your worst problem is not that you'll kill the golden goose. It is that somebody will come along with a better goose that lays better eggs and take away your audience. They're not going to lose their audience because it's harder to find, because it costs more money to buy a couple of streaming services. They're going to lose their audience if people someday don't care.

• 44:13Pablo Torre?

  Yeah, the product is materially changed. If the product changes, if the goose is different.

• 44:18Speaker 04

  Do you think the product has changed because it's on more channels?

• 44:20Pablo Torre?

  I think we are running a risk when it comes to the NFL's great glory being manufactured scarcity of adding more and more games such that that incredible competitive advantage of owning parts of the calendar is cheapened and suddenly a lot like everything else.

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• 45:16Speaker 07

  State Fair food is getting smaller and pricier.

• 45:19Speaker 04

  We'll have room for fried cookies.

• 45:21Speaker 07

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• 46:17Pablo Torre?

  The thing I'm saying is it's not that fans, I think, are gonna revolt because they gotta go to these streaming services, although that is frustrating and annoying and more expensive, which are all real things we've talked about at length on this program before. I think the real concern is the way that this is evolving is not even considering whether this is good as a product. It's all about, oh, wait a minute, we can extract more right now.

• 46:42Speaker 01

  Well, I'll make a point I've made many times, and it's one David and I agree on. The next time any of these leagues, any of these networks, think about the fans, we'll be the first.

• 46:53Speaker 04

  I hate to just echo that, cuz it's so boring to close a show. There is no greater, more true statement than the fans never come up in a conversation. Never. And I'm sorry, but I've been in them, and so have you.

• 47:08Speaker 01

  Yes.

• 47:09Speaker 04

  Not one time.

• 47:11Pablo Torre?

  And this is why the actual true name of the sporting class is, of course, rich guys OnlyFans.

• 47:19Speaker 04

  I don't know what to tell you. I'm disappointed with today's show in so many ways.

• 47:22Pablo Torre?

  Why?

• 47:23Speaker 04

  Here's what I found out.

• 47:24Pablo Torre?

  I had a blast.

• 47:25Speaker 04

  That I find John, he's so entrenched. And I don't know if we're done with the show, but he's so entrenched in his position. I don't know if you can hear me. But he's very entrenched. And what he'll do is he'll manufacture an argument in order to bolster that entrenched position.

• 47:40Speaker 01

  Well, that's

• 47:41Speaker 04

  Almost to the point of being a rascal.

• 47:42Speaker 01

  That is unusual human behavior. And my friend to my right, you would suggest your views are not entrenched?

• 47:50Speaker 04

  I would suggest that I always learn from you every show. And I look at things differently by learning what you're saying was going on in your head when you're thinking and doing certain things.

• 47:58Pablo Torre?

  That's all. At some point, this show will end. I just want our audience to know, they will continue to argue.

• 48:04Speaker 01

  We're not arguing.

• 48:06Pablo Torre?

  We're not arguing about arguing.

• 48:08Speaker 01

  I get mad at people I argue with. I don't get mad at David.

• 48:22Pablo Torre?

  Pablo Torre Finds Out is produced by Walter Avaroma, Maxwell Carney, Ryan Cortez, Juan Galindo, Patrick Kim, Neely Lohman, Rob McCray, Matt Sullivan, Claire Taylor, and Chris Tumanello. Studio engineering by RG Systems, sound design by Andrew Bersick, digital strategy by Bailey Carlin and Andrew Northern, theme song as always by John Bravo.

• 48:43Pablo Torre?

  And we'll talk to you next time.

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