Sean McManus, the longtime chairman of CBS Sports, recently retired from the position leading the Paramount Global subsidiary after attaining record-setting viewership of Super Bowl LVIII in February. The matchup between the Kansas City Chiefs and San Francisco 49ers ended in a thrilling overtime victory for the Chiefs and averaged an estimated 123.7 million viewers across all platforms, rendering it the most-watched television program of all time, according to Nielsen Media Research. McManus departed the company after subsequent broadcasts of the NCAA Division I Men’s Basketball Championship and The Masters Tournament. David Berson succeeded him in the leadership role, currently serving as the president and chief executive officer of the division.
McManus was named executive in residence within the Mark H. McCormack Department of Sport Management. The institution is located within the Isenberg School of Management at the University of Massachusetts Amherst, which offers programs for aspiring professionals in sports business. McManus was on hand at the university for a fireside chat, which was moderated by Puck sports correspondent and longtime journalist John Ourand.
Within their conversation, McManus reflected on the similarities between when he started at CBS Sports in 1996 to the present day, explaining the appeal of sports as being the most valuable programming within live television. Outside of an occasional news event, such as a presidential debate, he explained that sports is the only way to attract a live audience and articulated that it continues to become more dominant.
“I mentioned in a class today that 94 of the top 100 programs in all of television last year were NFL programs, 94 out of 100,” McManus said, “so if you have a broadcast network and you don’t have the NFL, you’re going to go out of business. It’s as simple as that.”
McManus was an instrumental part of CBS Sports reacquiring rights to the NFL despite the plausibility of such an outcome being perceived to be a longshot. CBS had dropped from the top-ranked network in prime-time television to No. 3 in the category, but he was able to convince the league to negotiate its AFC package of games. The company ended up paying $500 million per annum for NFL games within the AFC on Sundays, representing a 130% increase to what NBC had been paying the previous four years. Since that time, CBS has remained a broadcast partner with the NFL and broadcast nine Super Bowl championship games. Under its current 10-year media rights contract with the league, Paramount Global reportedly pays $2.1 billion per season.
McManus divulged that CBS Sports had previously televised NFL Christmas Day games for $35 million per contest and that the company had bid for this year’s slate of games as well. CBS and FOX, he explained, bid approximately $40 million per game, but the package ultimately went to Netflix for $100 million a game.
McManus referred to this rights fee as “pocket change” for the company, which attained $2.9 billion in third-quarter operating income (+52% YoY) and 30% operating margins on $9.82 billion of revenue. Netflix has been growing its advertising tier, recently reporting that it had 70 million subscribers nearly two years after its launch in 2022. As a whole, the platform has 282.7 million global subscribers and continues to experiment with sports content through documentaries, live events and other synergies.
“What’s changed a little bit is Netflix now is getting into the mix,” McManus said. “That’s bad news for the broadcast networks because their resources and their balance sheet is so much bigger than ABC, CBS, NBC, FOX. Apple has dipped its toe in the water with soccer. Amazon has bought Thursday Night Football, and they’ll pay whatever they need to pay.”
The fear for those at broadcast networks, McManus explained, was that Netflix and Amazon may eventually decide to bid on marquee packages, such as NFC games or Monday Night Football. Although he is not sure it is going to happen, he knows these companies understand the value of attracting that large of an audience. Yet he recognizes that Amazon pays the league approximately $1 billion per year for Thursday Night Football, whereas CBS and FOX had previously paid the league about $400 million to $450 million for the package while losing $75 million to $100 million annually. CBS ended up passing on the Thursday night rights, primarily because it had other NFL packages.
“If we didn’t have Sunday afternoon football, we would have made a huge effort to keep Thursday night,” Ourand said. “You have to have at least one package, else you’re kind of going out of business to be honest with you.”
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