Hurry-Up Offense: NFL's Plans to Speed Up Games May Impact Advertising

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Johnny Manziel head-butts a Microsoft Tablet after throwing an interception.
Johnny Manziel head-butts a Microsoft Tablet after throwing an interception. Credit: NFL via YouTube

The NFL is taking its ongoing primetime ratings crunch very seriously, and many of the ideas the league has been kicking around as it looks to reverse the slide are designed to shave a few minutes off the game clock. Trouble is, few of the proposals are likely to pass muster with the networks, and one is practically risible.

Speaking earlier this month to Andrew Ross Sorkin at the 2016 DealBook forum, NFL commissioner Roger Goodell said the league is eager to streamline the games, which on average clock in at around three hours and six minutes. "We want to take as much what we call 'dead time,' non-action, out of the game so that we can make the game more exciting," Mr. Goodell said, adding that the NFL may "look at ways to maybe take some commercialization out of the game."

Whatever such an effort may entail would have to be approved by the NFL's TV partners, which pay billions each year for the rights to carry the games. According to Mr. Goodell, the league would either push the broadcasters to sell fewer in-game ads or "maybe have the ads come in different ways than the traditional what-we-call 'pods.'"

"Unless there's some kind of quid pro quo, that's not going to happen," said one network insider, in response to Mr. Goodell's modest proposal. "Removing inventory from the games … is not a conversation that anyone [on the broadcast side] is eager to have."

Mr. Goodell's comments were made on the heels of a similar pronouncement by NFL exec VP of media Brian Rolapp. "We're looking very hard at the commercialization of the game," said Mr. Rolapp during the Nov. 9 keynote session at the National Association of Broadcasters Show in New York. "An NFL game can have close to 70 commercial units in a game. Um, can we do that better? And it's not just, do you take commercials out of the game and look to do something different, [but] do you actually spread out the commercial pods and do [that] different?"

While Mr. Rolapp did not give guidance on how many spots the NFL may look to eliminate or what forms the reconfigured commercial pods would assume, he said that the league is in open communication with the networks on the matter. "In a world where Netflix has no commercials and every consumer is conditioned to a 15-second preroll on YouTube, is there a better way to do commercials with our broadcast partners?" he said. "Those are conversations we have with them all the time."

One TV executive with skin in the game said that while informal chats with the league brass are not uncommon, the NFL has not made anything in the way of an official proposal about rejiggering the in-game ad loads.

Incidentally, Mr. Rolapp's assessment of the average number of units is a bit understated: Season-to-date, primetime NFL broadcasts have carried an average load of 81 spots per game, and that count doesn't include in-house network promos.

"This is a hypothetical, but say they want to take as much as 120 seconds [of ad time] out," the exec said. "How does that serve the viewers? How does that serve the advertisers? Is an ad here and there enough for the fans to even notice? Because the advertisers will notice -- they'll be paying more. You take supply out, and you're going to raise the price."

There are a number of reasons why the networks would push back on a bid to scale back the ad loads, and all of them have to do with matters of dollars and sense. When the NFL re-upped its rights deals five years ago, the average annual fee soared 63% compared to the previous contract. ESPN took the biggest hit, agreeing to a yearly payout of $1.9 billion, up 73% versus its earlier $1.1 billion fee, while CBS, NBC and Fox wrote deals within a range of $1.05 billion to $1.15 billion per annum. Excluding DirecTV's NFL Sunday Ticket premium and the "Thursday Night Football" package (more on that later), the current nine-year deal adds up to around $67 billion.

Fewer ads means higher prices
Advertising pays the freight for that not-inconsiderable investment, and any move to put the squeeze on the volume of commercials would only serve to further jack up the cost of buying in-game units. Such an approach would be even less viable given the dynamics of the TV ad market, wherein a decline in ratings (or, more to the point, sellable GRPs) results in pricier spots, provided demand is flat-to-up.

Squeeze the average in-game load by as little as 5% in a primetime NFL package facing down a 15% ratings decline, and marketers could find themselves paying on the order of $860,000 a pop for a 30-second unit in a regular-season broadcast.

While big draws like the Thanksgiving Day games can command rates that flirt with seven figures, inflated pricing for all NFL game tiers would only serve to dissuade marketers with less profligate budgets from investing in the occasional 30-second spot. (Think you've had your fill of Papa John's, Geico and Nationwide ads on Sunday afternoons? Wait 'til the likes of Yakult, Dollar Shave Club and Avocados From Mexico are priced out of the market.)

Of course, if the NFL were to give its network partners the green light on in-game integrations and the sort of sponsor enhancements familiar to fans of Major League Baseball, the NBA, NHL and/or college football, the ad load issue would practically sort itself out. For example, as Mr. Rolapp observed at the NAB Show, the NFL's replay review process is unnecessarily protracted. The referee spends an eternity under the hood, an interval that is then extended by the inevitable follow-up with the other zebras. So why not kill two birds and cut down on some of the dead air by having the league office make the final verdict in a segment that is exclusive to an individual sponsor? "The Call to New York, Brought to You by AT&T" or "Apple Watch: 90 Seconds to Judgment" would not only fetch a healthy premium (and an uncluttered window for the sponsor), but such an entitlement would also allow the presenting network to eliminate a few ad units without taking a financial hit.

And it's not as if this sort of thing hasn't been done before. Back in the early-1980s, NFL Films and ABC developed an innovative, quasi-interactive commercial execution that would be embraced by four different sponsors. First adopted by Mattel's Intellivision, the "You Make The Call" spots would reach their creative apotheosis with IBM. At some point during the third quarter of ABC's "Monday Night Football," the PC manufacturer would wrap the two halves of the "You Make the Call" creative (a question about a particularly knotty football play, followed in short order by the referee's verdict) around a 30-second ad for its PS/1. Consumer recall and awareness for the spots was through the roof.

"We would welcome the opportunity to let creativity flourish a little bit," said one insider. "And that sort of thing would probably be of great interest to the advertising community and the fans."

Which isn't to say that the NFL isn't justified in wanting to police its on-screen product. Its $400 million sweetheart deal with the Microsoft Surface Pro 4 has proven to be a comedy of errors, as broadcast crews have repeatedly referred to the device as an iPad. And the gizmos don't get a lot of love from NFL quarterbacks, either. In a regional game on Fox last year, Packers quarterback Aaron Rodgers flung his device in disgust after a costly interception; a few weeks later, the Browns' Johnny Manziel attempted to head-butt his Surface Pro after giving up a pick against the 49ers. While neither game aired in a national window, the clips gathered a head of steam on social media … and this was before Patriots coach Bill Belichick announced he was sidelining the product altogether. ("I'm done with tablets," he glowered, two weeks after he was spied pulling a Pete Townshend on his device during a 16-0 loss to Buffalo.)

While the NFL thinks up other ways to help speed up the games -- among some of the other ideas that are said to be kicking around the league's Park Avenue digs include shorter halftime breaks, the adoption of a 35-second play clock and the elimination of clock stoppage following an incomplete pass -- the superfluity issue isn't likely to be resolved to anyone's satisfaction. Recent reports that the NFL is considering doing away with "Thursday Night Football" have been shot down by the league, and with good reason -- like it or not, the additional primetime games justify NFL Network's carriage fee. It's a snake-devouring-its-own-tail scenario, but the Thursday night games exist primarily as a means to generate money for NFL Network. Were the package to be dropped or diminished, the channel would be in violation of its distribution agreements with cable and satellite TV operators. Not going to happen.

NFL Network's financials aside, the broadcast partners have no cause to see "Thursday Night Football" vanish, given the considerable ratings boost they see when they air the games. For example, NBC's inaugural "TNF" broadcast averaged 13.3 million viewers and a 4.2 rating among the adults 18-to-49 set, which is more than three times the 1.3 demo the network averages with its regular lineup of "The Good Place," "Superstore," "Chicago Med" and "The Blacklist."

When asked if the NFL may have spread itself too thin, Mr. Goodell told the DealBook crowd that the league is always evaluating the extent of its TV footprint. "We've moved very slowly with Thursday Night Football," he said. "We started with six games, and went to eight and 13 and 16, and we don't know what the right combination of that is. And that's why we're only doing short-term deals with [CBS] and this year with NBC. So what we try to do is find the right balance there.

"You know, the great thing about football is it's a very short season," Mr. Goodell said. "It's only 17 weeks and then playoffs, and every game counts, and that makes our inventory incredibly valuable. But you also have got to be careful of taking it and broadening it out and saturating the market with it, and that's something that we're very conscious of."

If any suite of games are on the chopping block, it's the crack-of-dawn trio of Sunday morning London broadcasts. "Those will be the first to go," predicted one network exec. "The early games are a waste of inventory that could be out to better use at one o'clock. I can't see them continuing in that time slot."

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