Yahoo Finance 'The true religion of America': Why one TV mogul is going all in on sports
As streaming has rocked the television industry, one media mogul has gone against the trend by spending big on live broadcast rights. In a recently released interview, he revealed the key advice from News Corp. (NWS) Founder Rupert Murdoch by way of Oracle (ORCL) Chairman Larry Ellison that led him to do it.
The gist: Go all in on sports.
Byron Allen, the chief executive of Entertainment Studios Inc., did just that, joining an ownership group that in August spent $9.6 billion to acquire 21 regional sports networks from 21st Century Fox (FOX), a former subsidiary of Murdoch’s News Corp.
On an episode of Yahoo Finance’s “Influencers with Andy Serwer,” a weekly interview series with leaders in business, politics, and entertainment, Allen recounted the conversation with Ellison in which Oracle’s chairman relayed the words of wisdom from Murdoch.
“Larry Ellison from Oracle was a neighbor of mine out in Malibu,” Allen recalls. “He and I would chat a little bit out on the beach. And one day, he was over at my house, and he said, I was with Rupert Murdoch earlier today, and I asked Rupert. I said, ‘Talk to me about television. How's the TV business?’”
“Rupert said to Larry Ellison, ‘Larry, I can tell you everything you need to know about television in 30 seconds. Do you have time?’” Allen continues. “And Rupert said to Larry, ‘One word: sports.’”
“‘It's the biggest thing ever,’” Allen recalls Murdoch having said to Ellison. “‘It's the true religion of America: sports. That's what we love, and we are religious about it. And it's a great business. It's a phenomenal business. And it will continue to be a great business.’”
Allen and other private equity partners teamed up with Sinclair Broadcast Group to acquire the 21 regional sports networks — an opportunity that came about after Disney (DIS) agreed to sell the properties as part of its merger with Fox, responding to antitrust concerns over the new entity’s potential ownership of both ESPN and the local stations.
“I believe we're going to be able to grow that business,” Allen says of his new stake in regional sports coverage.
‘We can put politics aside’
Allen came up as a comedian and still performs, but he turned to business 25 years ago when he launched Entertainment Studios Inc. Today, the production company counts nine TV networks to its name. Allen made headlines last year when he acquired the Weather Channel for $300 million.
In partnering with Sinclair Broadcast Group (SBGI) to take ownership of the sports networks, Allen is doing business with a company that has drawn criticism for a perceived conservative bias in its local news stations.
Asked whether Sinclair’s political bent concerns him, Allen says, “I don't let that get in the way. There's business and there's politics. And we can put politics aside.”
A prolific Democratic donor, Allen last year gave $20,000 to the Democratic Senatorial Campaign Committee, as well as donations totaling thousands to the campaigns of a number of Democratic Congressional candidates, among them Rep. Katie Hill (D-CA) who recently resigned from office after admitting to an inappropriate relationship with a campaign staffer.
A perceived conservative bias in Sinclair’s local news coverage goes back more than a decade. However, concerns reached a fever pitch in April, when Sinclair ran promotional videos on its then-193 local affiliates that cautioned viewers about the negative implications of “fake news,” echoing a talking point of Trump’s.
A viral supercut of the promotional segments, put together by Deadspin, showed local anchors nationwide saying the exact same remarks.
Allen says he separates business decisions from his personal political views.
“That is why America's great — our democracy. You have your opinion. I have mine. I may not agree with your opinion, Andy, but I will give up my life to defend your right to have it,” he adds.
Max Zahn is a reporter for Yahoo Finance. Find him on twitter @MaxZahn_.
Read more:
