Azaleas, the Amen Corner, the green jacket. The Masters prides itself on being “a tradition unlike any other.” And it has a media rights deal to match. Since 1956 the tournament’s host, Augusta National, has had a series of one-year TV deals with CBS. According to former sportscaster Pat Summerall’s memoir, there is no written contract, just a handshake that comes with a long list of dos and don’ts: “We could not make any references to money or how much the prize was … we couldn’t talk about how one gets to be a member or refer to membership at all, and we couldn’t mention the brand of shoes or clothes a player was wearing.” Since 2008, ESPN has aired the first two days of the tournament under similar terms, at least as best as anyone on the outside can tell: Augusta and its broadcasters do not disclose their terms. “It’s all shrouded in mystery,” says Jim Andrews, vice president for content strategy at sponsorship consultant IEG.
Andrews does not have firsthand knowledge of the deals, but he hears the numbers that are passed around the industry. “Basically when they get together every summer and agree on a deal,” he says, “[CBS] says we need $15 to $20 million to cover our costs and maybe make a little bit of a profit.” Augusta then acts as a broker, arranging for the tournament’s three official sponsors—IBM, AT&T, and ExxonMobil—to cover those costs. “I’ve seen a ballpark that each of the sponsors are paying $5 to $6 million,” Andrews says. In return, those three get a combined four minutes of ads per hour, about half of the norm for a golf tournament, and an exclusive association with the most prestigious golf event in the country. (In 2003 and 2004 there were no televised ads at all, as Augusta sought to shield its sponsors from protests over the club’s refusal to admit women, a policy it reversed last year.) CBS doesn’t get to sell ad time on the open market. It broadcasts the tournament for the ratings boost it provides and that same rub of prestige. If CBS were to pay market price for the rights and then sell ads at full price, Andrews notes, it probably would make or lose about the same amount of money. Big sports events are often loss leaders for the network.
Augusta, on the other hand, is passing up tens of millions of dollars. Andrews estimates the club could get upwards of $30 million for the TV rights to the Masters—in the range of what NBC pays for the U.S. Open. It forgos that money because, thanks to high membership fees and ticket revenue, it doesn’t need it. And because it allows Augusta to call the shots, as when it blacklisted commentator Gary McCord for saying the greens appeared to be slicked with “bikini wax” and comparing the rough to “body bags” in 1994. “They operate completely differently than every other sponsored property in the world,” says Andrews.