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MLB Broadcast Exec Tully Fields Offers for New Title Sponsorships-Starting With 'Home Run Derby'

Major League Baseball recently signed new eight-year TV
rights deals with Fox, ESPN and Turner that will bring in more than $12 billion
dollars through the duration of the contracts. While it is not mandated in
the new rights deals that the 15 official MLB sponsors advertise in those
telecasts, most do.

The current MLB official sponsors list reads like a what's
what of sports advertising: Anheuser-Busch (came aboard as a sponsor in 1980);
Bank of America (2004); Bayer (2008); Firestone (2010); Frito-Lay (2006);
Gatorade (1990); General Motors (2005); Holiday Inn (2006); MasterCard (1997);
Nike (1998); Pepsi (1997); Procter & Gamble (1939); Scotts (2010), SiriusXM
(2005); and Taco Bell (2004).

Chris Tully, MLB's executive VP, broadcast, oversees the
game telecasts and shoulder programming that MLB Productions produces for both
MLB TV rights-holders and other broadcast and cable networks that want to carry
MLB-related shows. Among that original programming is series such as Caught Looking, which premiered on NBC
Sports Network in August. The series gives viewers an inside look at specific
weekend MLB games as MLB Productions' cameras follow players, managers and
front-office personnel from the teams set to play.

While the off-season quiets down for baseball fans, Tully
keeps busy trying to find ways to get more MLB programming on the air, which
opens up opportunities for advertisers who are both official sponsors and those
who are not to market their products to the hard-to-reach male audience.

Here, Tully speaks about MLB programming and opportunities
for markers.

State Farm recently
dropped out as an MLB corporate sponsor and the title sponsor of the annual
Home Run Derby, which is televised on ESPN the night before the MLB All-Star Game
each summer. State Farm had sponsored the Derby since 2007 and prior to that,
Century 21 has sponsored it for seven years. How is the search for a new Derby
sponsor going?

We are actively looking for a successor to State Farm and we are talking to
advertisers who are our official sponsors and also to those who aren't. Any
advertiser interested can contact us. Next summer the All-Star Game will be
held in New York so there will be a sizable platform for the new title sponsor.

How are advertising
sales divided up between the TV rights-holders and MLB?

The TV network partners sell the in-game advertising but MLB can sell the
presenting sponsorship rights to the major event telecasts. For example, we
have signed a deal with Anheuser-Busch to be the presenting sponsor of the
opening week of the 2013 season, but the in-game commercials will be sold by
the networks. ESPN has the opening day and opening night games.

Is MLB trying to
sell more presenting sponsorships than it has in the past?

We also sold a presenting sponsorship for the two new Wild Card playoff
games this past season to Anheuser-Busch and we feel we are just putting our
toe in the water as far as presenting sponsorship sales go.

How much
programming is MLB Productions providing to the network partners and to MLB

We have a great working relationship with our TV partners and also with
other networks and have been on a roll the past few years in the amount of
ancillary programming we are producing for television. We work hand in glove
with MLB Network and have produced programming for them including series like Prime 9, My MLB Life and Baseball's
to name a few. We also have been producing shows for ESPN for about
six years now and we have a clause in the new TV rights agreement with ESPN
that continues that process. This past season, MLB Productions created a new
series called MLB Player Poll that
aired on Fox each Saturday afternoon before its weekly MLB game, which was
presented by Pepsi. For the non-commercial networks, MLB has also produced
programming like Derek Jeter 3K, a
one-time special for HBO in which MLB Productions cameras followed Jeter in his
quest for 3000 hits, and The Franchise
on Showtime, that offers an inside look at an MLB team each season.

How does the show
production for ESPN work?

We produce about six or seven hours of programming each year for ESPN and
we sell the advertising on that programming, mostly to our official sponsors.

How does MLB
determine what kind of programming to produce?

In some instances, we have an idea and approach the networks and many times
they have an idea and come to us. In the case of Caught Looking, NBC approached us. If it's a network's idea, we
will produce it for them and get paid a production fee and they will sell the
commercial inventory.

MLB for several
years now has encouraged its official sponsors to produce TV commercials that
appear during the games so that they have baseball themes. How has that worked

It is not something we mandate but just suggested and we have a number of
our sponsors who just want to have a closer relationship with the fans. We make
our creative teams available to help them tailor their commercials to baseball.
And it's nice to see those tie-ins to the game. Some sponsorships include both
commercials with baseball themes and event sponsorships. Pepsi sponsors the Pepsi Max Field of Dreams Game,
runs Pepsi Max commercials and sponsored a contest in which fans voted for
the retired players who they wanted to see play in the game as well as a sweepstakes
where the fan winners actually played in the game.

In the new TV
contracts, did MLB give the TV networks some new digital rights?

Yes. All the networks were looking for TV Everywhere rights moving forward
and we granted those rights to them. And if new technology is developed before
the end of the deal in 2021, there is wording in the contract to deal with this
so we don't have to rework the deals or start from scratch. It is our intent to
have our fans see the games wherever and whenever they want to watch them.

Fox added a
schedule of Saturday night primetime MLB telecasts this season and plans
to continue that going forward. Is that written into the new rights deal with

Yes. We love Saturday night baseball in primetime television and we had
been discussing Fox moving some games there for several years and now it is a
reality. Fox had eight games on Saturday in primetime this past season and we
hope to have more in 2013.

Is there language
in the new TV rights deal that will provide more games if Fox decides to start
a separate all-sports national network?

Our new deal with Fox does have a clause in it that will migrate a certain
number of games beyond the ones currently provided for on Fox broadcast network
to a new national network if and when they decide to launch it.