Jon Litner on the Future of YES Network and Hitting the Market
By David Lieberman
LOS ANGELES (Variety.com) – YES Network president Jon Litner needs the TV home of the New York Yankees to score as he faces an unusual dealmaking doubleheader. The biggest of Fox’s 22 regional sports networks will go to Disney in the $71.3 billion bundle of entertainment assets Rupert Murdoch agreed in June to unload. The ESPN owner then will put the RSNs back on the block. Disney’s agreement to do so helped persuade Justice Department antitrust lawyers that the deal wouldn’t give the company too much power in TV sports.
It’s unclear how much the networks will fetch. Some believe the business has peaked in the era of cord-cutting. YES is one of the most expensive channels in New York, New Jersey, Connecticut and Pennsylvania, charging distributors an estimated $5.36 per subscriber per month. Still, dealmakers are salivating. YES should top the valuation of $3.8 billion, including $1.7 billion in debt, it had in 2014 when Fox raised its ownership stake to 80%. (The Yankees own the other 20% and are rumored to want the rest.)
Litner, 54, seems confident. YES’ household ratings are poised to hit their highest level since 2012, making this its 14th year in the last 16 as the nation’s most-watched RSN. Fans are energized by the Yankees’ young home-run hitters, including Aaron Judge, Giancarlo Stanton and Miguel Andújar.
Variety caught up with the network chief to learn his thoughts about the business.
Who deserves more credit for YES’ ratings surge — you or Yankees manager Aaron Boone?
Winning makes everyone look like a genius. But you have to put yourself in a position to capitalize on what you hope will be a magical season. That takes months of preparation.
How did you prepare?
We went to Major League Baseball and said we are going to have this immensely powerful lineup. What’s really interesting is to tap into some technology [MLB controls] that we didn’t have last year showing exit velocity — how hard these guys are hitting the ball — as well as how far. That’s part of the storyline.
What accounts for the 7% increase in women 25 to 54?
We didn’t have a strategy particularly around women. We had a strategy of trying to create a much more encompassing, fun, joyful, community-oriented experience. The second piece is that we work hard to invest and program around social-media platforms. They skew younger and draw in more women.
YES is going to be sold, but you don’t know to whom. Is there a category of buyer you’d prefer?
I don’t want to comment on the type of buyer. What I will say is that whoever does buy in or purchase YES will have a crown jewel. All of our key metrics, from audience delivery to digital-video consumption to sponsorship, are on the rise, and we are fully distributed across both legacy and the new digital distributors.
Two years ago Comcast temporarily dropped YES, saying that it was too expensive. Is it getting hard to raise fees?
There are obviously trends in the industry that we follow and understand. But we are built around an iconic franchise that is positioned to go on an incredible run over the next seven to 10 years based on the core of these young players. We’re in the largest media market in the country. We compare very well not just with other sports programming but all programming in the New York Designated Market Area.
The U.S. Supreme Court recently cleared the way for states to authorize sports betting. Will you take advantage of that?
We are somewhat in the epicenter of it. New York, Connecticut and Pennsylvania are moving down the road to legalize and license it; New Jersey is already there. We believe that sports betting will have, initially at least, a positive effect on regional sports networks both in ratings and revenue opportunities.
How long before you reveal your initiatives?
We’re in the early stages but leaning into it. We’re taking meetings to prepare ourselves.
So this isn’t a 2019 event?
I don’t see it just yet. Maybe on advertising, but I don’t see it yet on the content side.
