I have been reading a lot about sports programming and its role in the cable industry. I will be writing a series of blogs that talk about different aspects of the sports programming business. For anybody that likes sports or anybody who thinks they are paying too much for cable this is pretty fascinating stuff.

The reason that sports programming is so important to the cable companies is that it is the only major source of programming that people still insist on watching live. Many cable broadcasters like ESPN and regional sports networks rebroadcast sporting events, but Nielsen reports that 96% of sports viewing is still done live. People are not interested in watching sports after everybody knows the winner.

Years ago before DVRs, TiVo and Netflix all programming was watched live. But that is no longer the case and a significant amount of TV viewing is done on a delayed basis. That matters to cable companies because the premium advertising revenues come from the live broadcast of a show with lower advertising (or often no advertising revenue) coming from subsequent airings. As an example, look at the numbers for the recent premiere episode of Fox’s top series Sleepy Hollow. A very impressive 10.1 million viewers watched it live when it was first aired. But another 5.2 million watched in on a delayed broadcast within the first 3 days. 2.8 million viewers have watched it on VOD after 4 days (a number that is still slowly growing). Finally, another 3.1 million viewers watched it on other platforms such as NetFlix. This means that the total viewers was 20.2 million, with only half of them watching it the day it was first aired. (And imbedded in that number are a significant number of millions who recorded the show on a DVR to watch later).

The percentage of delayed viewing varies widely by the type of content. Very popular shows like Sleepy Hollow actually have some of the higher percentages of same-day viewers and there is a lot of content where the majority of views are done on a delayed basis. Some shows, like the Daily Show on Comedy Central have promoted delayed viewing as a tactic to expand their appeal.

So the networks love sports programming because it’s a hook to get people watching them. And in the cable industry, eyeballs equates to advertising dollars. Advertisers like sports programming for several reasons. Perhaps primary is that it draws the younger male demographic in one of the few ways that advertisers can count on. But second is that it gets a lot of viewers. Let’s look at some of statistics.

The biggest draw on TV is always the Super Bowl. If you look back at the history of the most watched programs in TV history it is a mix of a few events like the last episode of Mash plus a big string of Super Bowls. In recent years the Super Bowl has gotten over 100 million viewers, which is off the charts for TV viewing.

And there are other sporting events that draw big audiences. If you look at TV events that draw over 30 million viewers in recent years you will find that it’s the Oscars, an occasional final episode of a popular TV series and sports events. To contrast this with only ten years ago, in 2004 less than half of the big drawing events were sports-related. So part of the story is not just that there are popular sporting events. Events like the Kentucky Derby, the Master’s golf tournament, the BCS football championship game or the NCAA basketball championship have always drawn well. But the number of big non-sporting events has dropped drastically due the number of people that now watch their entertainment on a delayed basis.

Of course, sports is not as predictable as the networks would like. There is a huge difference in ratings when the playoffs for football, baseball, basketball and even hockey involve teams from major US markets. For example, the current World Series is drawing over a 45% rating in Kansas City, as you would expect, but the series as a whole has a much lower rating than when the Yankees or some other major market team is involved.

But even with its unpredictability, sports programming is still the advertising king. It creates dozens of events each year that are will predictably have large numbers of viewers, and viewers of a demographic that is otherwise elusive. Sports is going to remain the darling of the broadcast world as long as the current broadcast model is in place.

Tomorrow: ESPN and a la carte programing.