In NASCAR blogs and forums throughout the Internet one of the key themes that fans often turn their attention to is not the quality of the race, as much as the quality of the race broadcast. If you’ve read the reader comments at the end of many of our articles, you’ve probably noticed a fairly consistant theme there also, specifically, the number and timing of commercial breaks. Thursday, I sat down with ESPN’s Vice President of Motorsports, Rich Feinberg, and talked about the broadcaster’s policies and commitment to you, the race fan. What came out of this discussion was that broadcasting is not only a media that delivers the excitement of NASCAR racing to fans that would otherwise not have any way to see them, but also that first and foremost, broadcasting is a business. In order for ESPN to justify their expenditure to carry NASCAR races, they have to be able to make enough revenue to cover their expenses and still make some money.
In order to understand how that part of the business works, you need to know that before the race can get to your 46″ high def, there are two kinds of costs that have be paid for. First, there are the broadcast rights fees that ESPN must first pay to NASCAR to be allowed to broadcast races so that NASCAR can pay their bills in Daytona, and if you’ve seen the reported dollars that ESPN paid, you’ll have to agree, that’s a big nut right there. Then, there are the production costs that go into bringing the actual race broadcast to the fans. These production costs range from the equipment that is at the track, the technology that it developed to bring new innovation into the sport, and the money required to employ enough people to make the race broadcast feasible. ESPN employs the services of over 250 on a race weekend to bring the race telecast to the fans. They have to not only pay those people for their time and effort, but they must transport and house them during a given race weekend.
The revenue that is used to offset those production costs and rights fees comes from both the advertisement income that is created by selling commercial time during the broadcast and also affiliate revenue that comes from the cable and satellite providers that license ESPN for their services. A fact that isn’t well publicized is that NASCAR limits the number of commercials that a broadcast company is allowed to air during a telecast, so ESPN is limited to that commercial time allotment and they use that allowed time to block out their commercial schedule during the race.
When the commercial breaks for a race weekend is planned out, the production team looks at both the size of the track and the average lap times both under green and caution. Those times are used to determine the length of the commercial blocks that will be broadcast during the race. At tracks like Daytona and Talladega, commercials are run in two-and-a-half to three-minute blocks, while a track like Bristol, where lap times are considerably shorter, the blocks are only one-and-a-half to two minutes in length. Knowing the amount of time that can be spent in commercial, the blocks are allocated out across the length of the broadcast and the commercials to fill those timeslots are planned out using both viewer habits and past races at that track.
The viewership of NASCAR races isn’t constant throughout the race. It acutally grows throughout the duration of the event with the smallest audiences occuring at the beginning of the race, and then immediately following the checkered flag. As the race continues from the drop of the green flag, the audience grows at a consistent rate, reaching its maximum point around the final 20 laps of the event. If ESPN had the option to make race fans completely happy, they’d run the commercials all in the first third of the race and go commercial free from there on out. It simply isn’t an option, so they try and plan it out as best they can to show the maximum amount of race action because naturally, advertisers want to have their commercials viewed by the most people possible for the amount of money they are spending. In order to charge the maximum amount that they possibly can to try and achieve the highest possible return, ESPN must air commercials at the beginning and the end of the race to equalize the average viewing audience and be able to receive the highest possible price for those commercials.
As a race progresses, the time that commercials air is determined on the fly based on the activity on the track. There are people in the production truck, utilizing different technologies to try and anticipate the caution flags, the fuel windows, and the duration of the caution flags to try and decide when blocks of commercials are aired. When a caution flag is in effect, ESPN attempts to show the pitstops during that caution, and then air commercials before the race goes back to green. With the help of NASCAR race control the production team tries their best to determine how long a given caution period is going to take and time out the commercials to return to action before the green flag flies. The odds of them catching the green on the superspeedways is far greater than on short tracks simply because they can let the commercial run to completion before coming back for the green when they are informed of one lap to go. At a track like Martinsville, if they are informed of one lap to go, there is only a window of 25-30 seconds before the race is going to go back to green. If ESPN breaks out of a commercial before it is completed, they have to rerun the entire commercial at a later point in the race, in addition to the commercials planned for that later point. As soon as they miss a commercial, it throws off the rest of the allocation of commercials, and the air time for racing has to be reduced to make up for it.
Just like the teams in NASCAR, ESPN can look at historical data on races and anticipate, with some accuracy, how many cautions will fly during a race and attempts to plan commercials around that time. Like investments though, past performance is not always indicative of future results. Planning on five cautions in the first 100 laps of a race, that ultimately runs green, can throw off the entire production plan. If the production team tries to wait for a caution that doesn’t happen, they eat into the air time that can be shown later in the race because they have to make up those commercials at some point in time to earn the necessary revenue to make the production feasible.
One thing became abundantly clear in talking with the people who work on the ESPN broadcasts. The people that are running the show and making the decisions are race fans. Not just casual fans, but passionate fans who love the sport. They hate missing restarts as much as the fans at home hate not seeing them. Unfortunately, the whole process is ultimately a business, and they have to make sure they achieve the proper revenue to justify their expenditures. Could the system be tweaked to make it better, there is no doubt. Over the next few weeks this writer intends to do some charting of caution flags and commercial times and see if he can come up with a strategy that might be possible to try and help out the folks at ESPN to make it more of a rarity to miss restarts than the norm. In the meantime, rest assured, the folks behind the scenes really do try their very best to make it back to the track to try and see the green flag fly at the end of caution periods.