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Why Fox is pulling the plug on the SPEED Channel

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On: Mon, Aug 12, 2013 at 3:49PM | By: Teddy Field


Why Fox is pulling the plug on the SPEED Channel

There's no business like show business—and occasionally, it can be brutal. Just ask the 100+ employees at the Speed Channel. On Saturday morning, August 17th, the Speed Channel will switchover to become a multi-sport channel called Fox Sports 1—A move that saddens many in the automotive and motorsports communities. 

The car-themed network was actually profitable, and quite popular among 80 million U.S. cable subscribers. But to remain competitive against ESPN, Speed's owner; the Fox Network, needs to increase the revenue coming from its sports division. So they decided that it would be more profitable to turn Speed into a 24-hr multi-sport channel, along the same lines as ESPN2.

In 1995, a little network called Speedvision began streaming into 3.2 million homes. ESPN's former president Roger Werner, was known for developing profitable cable properties. He had no trouble convincing COX, Comcast, and ATT to invest in his new motorsport network, which targeted men between the ages of 18-49. Programming centered on all things motorized, from motorcycles to race cars. And naturally, the little car channel was an instant hit.

“That original channel was the most successful consumer product that I’ve ever been associated with in 40 years of being in the packaged goods and media business,” Werner said in an interview. “That product resonated with its target audience like nothing else I’ve ever seen. It was immediately demanded by the target audience. We literally lit up phone banks and generated tremendous press and tremendous interest.”

Speedvision, along with Werner's other cable venture OLN, made a profit in 2001 with over $100 million in combined revenue. Fox meanwhile, had just signed a 6-year deal to broadcast NASCAR races, and they were looking to expand their audience in order to maximize the NASCAR ad revenue. In late 2001, Werner & Fox struck a $1.4 billion dollar deal for the two cable networks, which made them the most profitable cable startups in history. Fox then changed Speedvision's name to Speed, and increased its NASCAR related programming. The little motorsports channel is now available to over 80 million homes, and generates between $0.19-$0.25 in revenue per cable subscriber.

Sports programming is typically watched “in real-time”, which means that viewers will actually sit there and watch the commercials, instead of hitting fast-forward on their DVR. Some sports networks command as much as $5 per cable subscriber, which from a business perspective, makes the Speed channel's revenue look quite small. Fox is hoping that its new multi-sport FS1 network will bring in around $1 per head, which will enable the Fox Sports brand to better compete against ESPN. Gearheads however, will have to find another source for their automotive programming, because only a handful of Speed shows will carry over to the new network. The Barrett-Jackson collector car auctions will air on Fox Sports 1, along with NASCAR Race Day, NASCAR Victory Lane, NASCAR RaceHub, and an assortment of racing action.

That means we'll have to say goodbye to Stacey David's Gearz and all of his motivational mechanic-ing, Dennis Gage and his impossibly large mustache on My Classic Car, all of the title-swapping action on Pinks, the in-depth SPEED Test Drives, Car Crazy and the ever-smiling Barry McGuire, The harrowing tales on Dangerous Drives, The hilarious reruns of Pimp My Ride, and of course, all of the beautiful ladies that have made the Speed channel so interesting to watch.

R.I.P. SPEED Channel


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Comments

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stanley earl | 6:20PM (Mon, Aug 26, 2013)

Fox network are idiots! The speed channel is to hotrods what CMT is to county music!



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