Comcast’s Xfinity is in contract negotiations with NASCAR to become title sponsor of the sport’s secondary series. The company’s broadband, TV and phone division is considering a five- to six-year deal valued at more than $100 million, according to a source familiar with the negotiations. The potential agreement would see Xfinity pay approximately $9 million in rights fees and $9 million in media and activation in its first year as title sponsor. Its annual spend would increase in subsequent years. Comcast declined to comment. In a statement, NASCAR said, ‘We anticipate NASCAR will soon be aligned with an outstanding brand that will help take this series to new heights, but out of respect for our current partner and the process, we will not comment on speculation about any potential replacements until there actually is one.’ Though discussions have moved into the contract phase and NASCAR executives have begun telling officials in the sport that a sponsorship is done, the deal still faces some obstacles. Fox Sports and Comcast-owned NBC Sports are slated to split television rights to the series from 2015 to 2024. Sources said that Fox, which did not respond to requests for comment, wants assurances that Comcast will spend equally on advertising across both of the series’ rights holders, Fox and NBC, and not favor its own company, NBC. NASCAR and Comcast are addressing other category issues as well. Provided those issues are resolved, the deal should close and be announced in the coming weeks.(Sports Business Daily)(8-18-2014)
UPDATE: Comcast and NASCAR plan to announce a 10-year sponsorship agreement next week that will turn the sport’s secondary circuit into the Xfinity Series. The deal, which is valued at close to $200M, is expected to be announced on Wednesday in Charlotte, according to sources. Comcast and NASCAR both declined to comment. The announcement follows several months of negotiations and represents a major achievement for NASCAR. The sanctioning body began looking for a title sponsor late last year after current sponsor Nationwide Insurance decided to discontinue its sponsorship. Comcast emerged as a viable replacement after the company’s sports TV group, NBC, signed a 10-year, $4.4B rights deal with NASCAR. As part of the deal, Comcast agreed to spend $10M marketing and promoting the sport. Its marketing team saw title sponsorship of NASCAR’s secondary series as a way to fulfill that obligation and also promote its cable TV, broadband and phone business unit, Xfinity. Comcast initially wanted a shorter-term deal and resisted NASCAR’s push for a 10-year agreement. However, in recent weeks, it decided to commit to 10 years to match the length of NBC’s broadcast deal. NASCAR was asking for $12-15M a year in rights fees, with media and activation commitments that would take the total value of a deal to more than $25M. A deal of that size would have been an increase from the approximately $10M in rights fees Nationwide spent for title sponsorship of the series. NASCAR was unable to find a replacement partner willing to pay more for a series that had seen its average TV viewership per race fall from 2.06 million in ’08, when Nationwide started its sponsorship to 1.7 million this season. Comcast approved a rights fee in ’15 of approximately $9M, with media and activation commitments that would take the total spend to more than $18M.(Sports Business Daily)
