Pac-12 Considering 12p EST Kick-Offs, Weighing Exposure & TV Revenue vs. Gate Attendance


Pac-12 Commissioner Larry Scott told reporters at the conference’s media day gathering (on 7.25) that he would “like to see one or two games this season” kick off at 12p EST. The games, which would be played on campus (i.e. not at neutral site locations), would give the conference the opportunity to increase viewership in the Eastern Time Zone; Scott said that the conference’s existing late-night time slots – and the resulting lack of exposure – have been a source of “a lot of frustration” amongst Pac-12 coaches and fans, who believe an ‘East Coast bias’ exists to their detriment. The Pac-12 commissioner will need a few athletic directors to buy-in to the idea, the conference has said it will not force a school to play in the morning time slot.

Howie Long-Short: The Pac-12’s (P12) failure to place a team in the College Football Playoff the last two seasons has increased the pressure on Larry Scott to position the conference for a return to the four-team tournament. One former College Football Playoff Committee member acknowledged that teams on the west coast playing late at night “get overlooked”, so re-scheduling games for times when a larger percentage of the population (and the Committee) is awake sounds logical – but it doesn’t solve the P12’s core issue; member institutions are fishing from a smaller pond. A lack of exposure isn’t keeping Pac-12 schools from making the CFP, their inability to field teams capable of finishing with less than two losses is.

Earlier start times would theoretically appeal to a greater percentage of fans in the Eastern Time Zone and despite the competition from the SEC, B1G and ACC, could also potentially result in a increased viewership; remember, games scheduled at noon EST benefit from the reach of broadcast television vs. the smaller pay-TV universe watching late night games. Former senior Fox Sports programming & strategy executive turned industry consultant Patrick Crakes said “the total gross viewers pool in the late window across ESPN, FS1 and P12N is 1.5 million to 2.5 million. A top-level interconference matchup at 12 EST could draw 3 million – but it would probably have to include one of the Los Angeles teams.

The P12 would be making the move to appease alumni and media members on the East Coast, but former CBS Sports President Neal Pilson doesn’t believe that a 12p EST start will crush ratings in the Mountain and Pacific Time Zones. He reminds that the “folks out West are used to early starts. The NFL starts games at 10a PST on Sundays.

CollegeFootballTalk’s Bryan Fischer reported that schools located in the Mountain Time Zone would be “chief candidates” to test out the viability of a morning kickoff. That makes sense. The conference should figure out if 10a is feasible before it looks to make 9a work.

Ratings aside, Pilson believes that creating inventory for the 12p EST time slot makes a lot of sense from a media rights standpoint. He said, “ultimately the value of the remaining Pac-12 game inventory rises if its teams are getting regular exposure at 12p EST and inevitably Scott will be able to command more money from their current partners – or another network will bid for the conference’s games playing in that window.” He’s right and with 12p EST far more valuable than late nights, rights fees for those games should increase. The conference’s current Tier-1 rights holders – ESPN/ABC and Fox (which wants to put a marquee game in the timeslot) – are likely to have interest, but keep an eye on Turner/AT&T; the company is said to desperately want to acquire more premium sports rights.

Pac-12 fans have complained for years about hosting too many night games, but morning kickoffs likely weren’t what they had in mind. One former Big-12 (B12) athletic director was “certain that it’s going to be hard for schools to pull a live audience at 9a on a Saturday.” He speaks from experience. B12 schools in the Central Time Zone often host 11a local-time kickoffs and “nobody likes it – and that’s two hours later [than what the P12 is proposing].”

That same source was as concerned with the revenue that would be lost with a 9a kickoff as he was with the absence of a raucous home crowd. With ticketing revenues remaining “an important part of athletic department proceeds” and schools having just 6 or 7 home games to monetize, the thought of willingly foregoing revenues would seem like “a tough sell for athletic directors already up against the budget.”

Fan Marino: Proponents of Scott’s idea point to schools like Arizona, that practice in the early morning before temperatures get too hot in the desert, and claim that kicking off at 12p EST wouldn’t have a negative impact on a student athlete’s routine – or on the team’s on-field performance. The former CFP Committee member we spoke to disagrees. He said, “home field advantage is exacerbated with an unusual game-time, particularly when the home team is playing a team that traveled several hours the day before” (which is often the case). As for the athlete’s well-being, Wazzu Coach Mike Leach said that his players would have to rise at 4:30a to follow their existing pre-game routine for a 9a kickoff. I have a difficult time imaging athletes lacking sleep – even at 20 years old – are going to perform to the best of their abilities.

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Obligation to Cut Down on Debt Load Has AT&T Exploring Sale of RSNs


AT&T is reportedly exploring the sale of the four regional sports networks (AT&T SportsNet Pittsburgh, AT&T SportsNet Rocky Mountain, AT&T SportsNet Southwest and Root Sports Northwest) that it acquired in its $85 billion takeover of Time Warner, Inc. The company has struggled to assimilate the well-established WarnerMedia assets into its portfolio and could use the cash that the RSNs would fetch to acquire additional live broadcast rights or pay down debt; the telecom giant is more than $180 billion in the red and CEO Randall Stephenson is intent on eliminating $8 billion in liabilities before the end of 2019. Bloomberg reported that AT&T is yet to start “a formal process to sell the networks and there are no guarantees a deal will be announced.”

Howie Long-Short: AT&T is considering dumping the four RSNs because they simply don’t fit with Turner Sports’ sales strategy any longer. Octagon SVP (global media rights consulting division) Dan Cohen explained that “the RSNs control local broadcast rights, which makes them difficult to bundle with national broadband, national mobile and national pay-TV packages.” AT&T’s digital approach to the RSNs – limiting viewership to those using the company’s streaming service – also conflicts with today’s “be everywhere, all the time” mentality. Cohen said that “while limiting carriage makes sense as a method of driving MVPD subscriptions, its counter-intuitive to how millennials and Gen-Z’s want to consume content” – on the digital distribution platform of their choice.

Should AT&T decide to sell the lot of RSNs, they’re likely only going to fetch upwards of $1 billion. The inclusion of some less desirable markets (see: Rocky Mountain, PNW, Pittsburgh), the pending expiration of several T-1 media rights agreements (and the anticipated increase in price to retain those rights) and a limited pool of potential buyers have all contributed to the networks’ depressed valuation. The Pirates, Rockies and Jazz (3 of the 8 big four teams that have local broadcast deals with AT&T) are all either currently re-negotiating terms, or will be soon with agreements expiring no later than 2020-2021.

While it’s unclear how AT&T would spend proceeds from a sale of the four RSNs, Chris Lencheski (a private equity executive, a former Comcast-Spectacor executive and the CEO of Winning Streak Sports) believes that the company has an obligation to “their board and the people who trade the paper, to take what is effectively free capital from the sale and cut down on their debt load.” Lencheski reasons that the losses of David Levy and Richard Plepler also make it less likely that the company would pursue the few highly desirable properties (think: NFL Sunday Ticket) that are coming available as the prior mentioned execs had a great “lens” to the “narrative” to sell the leagues, viewers and their respective advertiser bases.

JohnWallStreet readers have been aware that AT&T’s lot of RSNs were on the market since we noted in Early Entrants Vol. XI (June 24) that Sinclair Broadcast Group (SBGI) was “desperately trying to buy” the cable channels. While that remains the case – the company has a bridge loan in place with J.P. Morgan so that it can close – Cohen says that he’s not sure SBGI is a shoe-in to take down the lot. “If the Sinclair-Disney deal goes through, they’re going to be sitting on 23 RSNs. The DOJ could certainly oppose their pursuit of four more.”

Lencheski – who was the first to peg Sinclair as the most likely landing spot for the Fox RSNs back within JWS’ Nov. 19th newsletter – doesn’t even think AT&T’s assets are worth Sinclair’s trouble. He said, “the company is in the driver’s seat on a transaction that would reshape the live sports broadcasting space. Why jeopardize that upside to buy four small [relative to market size] RSNs?

SBJ’s John Ourand noted in his weekly media column that Comcast would be another logical acquirer. The company already owns 8 RSNs (+ a stake in SNY) and the four AT&T networks all reside in Comcast cable markets. Acquisition of the lot would position Comcast behind only Sinclair Broadcast Group in an industry where scale is everything. It’s unclear if Liberty Media Corp. – another bidder for the lot of Fox RSNs – would pursue these channels. The BIG3 group is unlikely to get involved in the bidding unless the Fox lot were to hit the market once again (i.e. DOJ rejects the SBGI deal).

Fan Marino: It’s worth noting that Lencheski doesn’t believe AT&T will retain Sunday Ticket. He believes that ship has sailed, saying “they knew they weren’t going to win the rights again – otherwise they would have included it in their preps; plus they had access to what the package did numbers wise for DirecTV.” In other words, they know the new costs outweigh their upside with AT&T’s business model.

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WarnerMedia Sees Pro Wrestling as a Safe Investment


All Elite Wrestling (AEW) – the start-up promotion founded by Cody Rhodes and The Young Bucks (and backed by Tony Khan, son of Jags owner Shahid Khan) – has announced a broadcast agreement with WarnerMedia. TNT will televise AEW’s live weekly show and B/R Live will be its exclusive digital streaming provider. AEW’s flagship show on TNT won’t begin until this fall (when it becomes the 1st weekly wrestling program to air on the network since WCW Monday Nitro in ’01), but the promotion’s inaugural PPV event ‘Double or Nothing’ is slated for Saturday night (May 25th). Financial terms of the deal were not disclosed, though it’s been reported (on the Mat Men podcast) that “TNT is covering the [show’s] production costs and splitting advertising revenue with AEW.”

Howie Long-Short: As Dave Meltzer noted in his ‘Wrestling Observer Newsletter’, a “network paying for the production costs of a wrestling show is incredibly unusual in a rights-fee deal.” Attribute AEW’s advantageous deal to timing. Live sports programming is particularly attractive in today’s on-demand environment and the explosion of OTT streaming services has created the need for more content. The result has been a seller’s market for rights holders.

WarnerMedia was willing to invest in production for AEW – when they weren’t for the Alliance of American Football – because pro wrestling is a safe play relative to a spring football league. Harvey Schiller, who was the President of Turner Sports during the WWE/WCW Monday night ratings wars, explained that “there are a large number of dedicated wrestling fans out there that can’t get enough ‘sports entertainment’. A new promotion is always going to have a core audience that will watch it, read about it, buy merchandise etc. Wrestling is less like other sports and more like a successful movie franchise, where fans are always waiting for the next iteration to come out.”

AEW will find success on TNT if the quality of their show is “competitive with what the other promotions are putting onAs long as they build the characters and develop the storylines, people will watch.” That was the formula that WCW relied on to surpass WWE in the Monday night ratings wars and Schiller believes that if AEW is to have a similar impact on the industry “they’ll need a Macho Man, a Hulk Hogan and a few of the other guys [Kevin Nash, Scott Hall].” Khan’s promotion won’t have the N.W.O., but with a stable that includes Rhodes, The Young Bucks, Adam “Hangman” Page, Chris Jericho and Kenny Omega (considered by many to be the best wrestler in the world) they’re off to a good start.

AEW isn’t the only wrestling outfit with a national platform that’s trying to take market share from WWE, but having a weekly showcase on TNT is a bit different than one on AXS TV (see: NJPW) or Pop TV (see: Impact Wrestling); “an established brand in cable has a certain drive to it – especially when there’s desirable programming leading in.” A prime-time slot on TNT is also very different than having content air on an OTT service (think: WWE Network). “When a show is on established cable viewers will find it just rolling through the channel lineup, when it’s on a streaming service viewers need to seek it out.

Fan Marino: WarnerMedia did not disclose what night AEW’s weekly show would air, but it’s presumed to be Tuesdays; a night that WWE plans to vacate with SmackDown moving to Fridays. Schiller supports the idea of placing the show in SmackDown’s old timeslot, as opposed to initiating a 21st century ratings war. He said that a decision to go head-to-head with RAW or SmackDown! would be an “ego driven decision, not a revenue driven one. No matter what, when you’re up against a similar show you’re going to lose viewers; you’re not going to destroy WWE, that’s not going to happen.”

AEW isn’t going to destroy the WWE, but it’s going to do it’s best to stand out from them – promising fans “less scripted, soapy drama and more athleticism and real sports analytics.” Win-Loss records are going to become meaningful again, as will championship reigns. The promotion plans to crown its first world champion on Saturday night at ‘Double of Nothing’.

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“Economic Decisions” Driving Investments in Women’s Sports


Over the last 90 days, Barclays made the “single largest investment in British women’s sports” (a 3-year deal worth $13 million), Budweiser announced its “first-ever sponsorship of [a] women’s football” club (England’s national team) and AT&T became the 1st non-apparel company to put their logo on a WNBA uniform – evidence that “there is momentum right now around women in sport.”

Howie Long-Short: Barclays, Budweiser and AT&T are among a growing list of companies pumping dollars into women’s sports. Former WNBPA director Pam Wheeler suspects the increased interest on the brand side has to do with the increased visibility of the women’s game over the last few years (think: introduction of OTT services) – as recently as ’14 just “3.2% of all broadcast time” was dedicated to female athletics. Wheeler said “the talent level is there, so once companies start to see the skill-sets that the players have their interest in investing in them grows. It’s logical that brands want to align with elite athletes.” League exposure is about to “nearly double.” The WNBA just announced a new multi-year deal with CBS Sports that will see the cable sports network broadcast 40 regular games/season.

Brands have historically ignored female pro sports teams. In fact, GumGum found that between ’11-’13 just .04% of all sports sponsorship investments made were in women’s sports despite the barrier for entry (see: costs) being far lower. While shockingly low, the figure does make some sense – at least here in the U.S. When Wheeler first joined the WNBPA in ’98 “everybody who was aware of the league was my age or older [so, sponsors didn’t have the ability to reach the desirable 18-34 demo]. My 12-year-old daughter has never lived in a world without professional women’s basketball, so the fan demographics have become far more appealing to an advertiser.” Of course, females aren’t the only individuals who watch women’s sports; according to Nielsen, 84% of all sports fans have an interest in watching the ladies play. It does need to be noted that the number of women’s sponsorship deals has climbed +47% since ’13.

Studies have shown that girls who participate in sports are “less likely to become pregnant, have greater self-confidence and self-esteem” so there is certainly a component of these brands doing well by doing good, but while one can appreciate what female sports brings on a “social level”, Barclays, Budweiser and AT&T are in the business of generating returns for shareholders; and it’s the “big live crowds (see: attendance for female sports in U.K is +38% YoY since ‘13) and viewing figures (see: final of ’18 U.S. Open outdrew the men) [that are] feeding their [investment] interest.” Wheeler says that sponsorship pacts being signed today are being made as the result of “economic decisions, as opposed to emotional connections.” That’s an important differentiator because “in order for women’s sports to succeed, the public (think: fans, sponsors, broadcasters etc.) must recognize them as businesses that require economic support to survive.”  It’s worth mentioning that female participation in sport is at an all-time high; 3.3 million girls are playing in U.S.

Fan Marino: While investments have been made in leagues and teams, brands have yet to put big money behind female athletes in team sports. However, looking at the evolution of women’s sports it’s likely that day is not far off. Wheeler believes that within the “next few years” it would be “attainable for a female basketball player to make $1 million without having to play overseas.”

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Hulu Building Live Sports Strategy Around Interactivity and Personalization


Hulu’s “No Sellout” advertising campaign – featuring Damian Lillard, Joel Embiid and Giannis Antetokounmpo – plays off consumer cynicism towards influencer marketing campaigns (thanks: Fyre Festival) to draw attention to the service’s live sports content. In the humorous spots worth watching (hit the links in the player names), the NBA stars offer up some refreshing “honesty” – they’re only promoting the corporate message “Hulu has live sports” because they’re being paid. The campaign, designed to poke fun at brands using paid influencers in advertisements disguised as organic content – and the influencers who act as if that is not the case – has resonated with a consumer well aware that “athletes are getting paid a lot of money to endorse these products.”

Howie Long-Short: The pursuit of live sports programming gets away from the Hulu’s core “on-demand” mission, but the game window is only 3 hours long and fans follow their teams 24 hours/day. Wayne Sieve, EVP of Thuuz Sports believes that “there’s all kinds of shoulder programming – with a shelf-life – that would be relevant to the passionate fan and supplement any live rights that they might have; and the on-demand portion of Hulu is built to service that content”.

Live sports rights are expensive and there’s “enormous competition for that 3-hour window”, so Hulu won’t be pursuing the “network feed” of games; instead, their plan is to serve up “alternative broadcasts.” The company’s sports strategy will place an emphasis on interactivity and personalization. Subscribers will be able to “choose between stats-heavy broadcast overlays or a stripped-down display”; they’ll also be able to record and watch later (for the next gen. of fans who won’t watch 2.5 hour broadcasts) and catch games on mobile devices.

It remains TBD if there is a consumer that is willing to pay for a data/insights driven broadcast, but even if there’s not Wayne sees Hulu’s addition – as well as Amazon, Facebook, DAZN etc. – to the sports broadcasting landscape as a win for fans. “The linear broadcast networks have gotten lazy. The exclusive rights deals signed before streaming became prevalent meant they didn’t have to work very hard to retain the viewer. New competition forces those with broadcast rights to make their product more compelling. They now need to provide a value proposition to the viewer greater than what can be obtained from another platform.” It’s also a win for the leagues. “As the number of bidders increases, so too does the price of their broadcast packages.”

Hulu’s (25 million domestic subs) decision to supplement its on-demand programming with live television runs contrary to Netflix’s (58 million domestic subs, 81 million international) stated strategy. While it currently serves as a differentiator between the 2 services, Sieve is expecting competitors – including Netflix – to eventually follow the company’s lead. “If you’re in the content business, you have to pursue sports programming; and if you’re going to do sports, then you have to do them live. It’s only a matter of time until everyone with this type of VOD entertainment experience offers live programming.”

Speaking of “everyone”, Hulu is owned by The Walt Disney Co. (60%), Comcast/NBCUniversal (30%) and AT&T/Warner Media (10%). Each of those companies has plans to launch their own streaming service and Disney already has ESPN+ for sports content. It will be worth watching if Hulu “rides the coattails of their parents to acquire sports rights because they can’t compete on a dollar for dollar basis with a company like Amazon.”

Fan Marino: Getting back to the commercials for a second, Howie wrote in Monday’s newsletter that “the U.S. consumer had wised up to the pay-to-wear sponsorship model, realizing that celebrities/athletes will endorse whatever they are paid to wear.” The commercial makes light of a problem that brands are encountering (which is why they’re looking outside of sports), but a Mavrck survey of over 1,000 influencers found that consumer distrust is warranted; 40% of influencers admitted to failing to follow guidelines for proper disclosure.

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Early Entrants: Vol. VI – NFL Leaning In To Amazon’s Pitch


Early Entrantsa bi-weekly series of sports business “rumblings” before the news breaks.

NFL Leaning In To Amazon’s Pitch

The NFL appears ready to split its out of market broadcast rights package between a satellite provider (DirecTV) and an online streaming service. Commissioner Roger Goodell recently told Bloomberg that the league plans to deliver its NFL Sunday Ticket “on several different platforms.” While it’s reasonable to assume DirectTV Now would be the front-runner to acquire the streaming rights, multiple sources tell JohnWallStreet that the NFL “is leaning in to Amazon’s pitch.” Prime Video can provide the league with the widest reach (relative to DirecTV Now, DAZN) and the NFL sees value in the e-commerce giant’s ability to facilitate merchandise and ticket sales.

Turner Sports Can’t Get Enough of the AAF

Back on March 5th, Turner Sports announced that TNT would exclusively televise 2 additional regular season Alliance of American Football games – they’d initially agreed to place just a single regular season game and one playoff game on the cable network (B/R Live carries 1 game/week). But the AT&T/WarnerMedia subsidiary was pleased with viewership for its March 9th contest – it was the 2nd most watched show on the network that day – and sources tell JohnWallStreet that the company is looking to add additional broadcasts as the league’s season winds down (3 regular season, 2 post-season games remain). It’s worth mentioning that CBS has also decided to move 2 games from the CBS Sports Network to the CBS broadcast network; a regular season contest on April 6th and one of the Conference Championship games on April 27th.

Digital-Only Service Set to Buy Linear Network

There are rumors floating that DAZN is “set to buy” Fox Sports (Brazil), an acquisition that would accelerate the company’s rise in the country given the “premium rights” that would come along with it. The purchase would certainly run contrary to the company’s digital-only strategy, but in a market where TV is the preferred viewing platform and digital consumption remains an afterthought (particularly relative to the U.S. or Japan) it makes sense.

Vivid Seats Sniffing Around StubHub Acquisition

We mentioned in Early Entrants Vol. V that eBay was exploring the sale or spinoff of StubHub. Questions surrounding inclusion of the company’s foreign offices (via Ticketbis) had insiders doubting within the last week whether the company would move forward with the split, but we’re hearing separation of the 2 companies is now considered “almost a near certainty”; the “eBay elite” have tired of the fluctuations caused by StubHub in their quarterly earnings reports. Vivid Seats is said to be sniffing around a potential acquisition.

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Technical Issues Make “The Match” a Costly Experiment for Turner Sports

Turner Sports will refund the $19.99 paid to anyone who purchased “The Match” through their B/R Live app, after the company decided to make the PPV golf match between Tiger Woods and Phil Mickelson available to the public for free. Technical issues with the digital streaming service’s purchasing infrastructure forced AT&T’s media division to remove the paywall prior to the 1st hole, to ensure all paying customers would have access to the event. Comcast, Cox, Charter Spectrum, Verizon, Altice, DISH/Sling TV, U-Verse & DirecTV have all also agreed to issue refunds since the PPV event was available to many for free; there were no reported issues with any of the cable or satellite providers.

Howie Long-Short: What was supposed to be a showcase of AT&T’s ability to produce, activate and distribute a high-profile sporting event, turned into a costly experiment for Turner Sports. Nicholas Masafumi Watanabe (sports management professor at the University of South Carolina) had estimated that “The Match” would need 700,000 buys to break-even, it now appears Turner Sports will eat the entire +/- $14 million.

While costly, the decision to pull down the paywall and to ultimately issue refunds was a wise one. Turner turned a potential PR disaster into some positive publicity and the free access likely drew some viewers to the platform, that would not have otherwise downloaded the app (i.e. first time users).

Tech issues, that continue to mar the live streams of sporting events, highlight the sports fan’s need to retain a cable subscription. If you’re not willing to risk missing “the game”, traditional television remains the only option.

Golf has television’s oldest audience (average 64 years), so reimagining the game and using a new means of media distribution (see: streaming) to capture the younger demo was worth trying out; particularly for AT&T, as it seeks to carve its niche in the DTC streaming landscape following June’s $85 billion acquisition of Time Warner.

Fan Marino: On the course, “The Match” was a mixed bag (pun intended). While the playoff holes (played 18 2x, played make-shift 93 yard 20th hole 3x) generated some excitement, Charles Barkley (on broadcast team) acknowledged that viewers were “watching some really crappy golf”; the pair shot 69s on the par-72 course just days after Phil projected the winner would have to shoot a 63 or 64 to win. Mickelson won the event (and the $9 million prize) with a birdie on the 22nd hole; the $400K he won on side bets will be donated to charity.

Speaking of Barkley, it appears he’s corrected his infamously terrible swing; For The Win posted video of Sir Charles driving balls without his trademark hitch in the back-swing.

For those unaware, a series of messages ranging from comical (“is this 1999?”) to festive (“Happy Thanksgiving”), appeared in the airspace above Shadow Creek Golf Course on Friday afternoon. The OTT streaming service DAZN has since claimed responsibility for the stunt, calling it “retaliation” for Turner Sports overcharging for the PPV event. DAZN, which offers sports fans premium events on a low monthly subscription basis, insists “pay-per-view is a bad deal”; which made the PPV golf event an opportune time to promote the service (“Get DAZN For Free”) and their Dec. 15th fight between Canelo Alvarez and Rocky Fielding (see: “Canelo v Rocky = Free”).

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Production-Technology Showcase Disguised as Golf Match


Capital One’s The Match: Eldrick Woods v. Phil Mickelson will take place on Friday (11.23) at 3p EST. While the two will compete for $9 million, the showdown between “Tiger” and “Lefty” is as much a production-technology showcase as it is a golf match. Turner Sports plans to introduce “first-of-its-kind integrations centered on predictive data”, camera angles delivered by drone and live betting odds during a marquee sporting event for the first time (for U.S. viewers); TopTracer shot tracking (shows real-time trajectory, flight path) and Virtual Eye real-time animations will also be used during the broadcast. The PPV golf event is being sold for $19.99.

Howie Long-Short: You’ll notice AT&T (T) is the common thread throughout this deal; the company now owns (since its $85 billion acquisition of Time Warner in late ’16) Turner Sports (broadcasting the event), DirecTV, AT&T U-Verse and B/R Live (3 outlets selling the event), HBO (doing pre-fight promotion) and Bleacher Report (social, BTS coverage).

The predictive data viewers will see (think: shot probability) is being generated from an algorithm combining ShotLink Intelligence (i.e. archive with insight/analysis of every shot hit during tour play) with the unique characteristics of the course being played (Shadow Creek, Las Vegas).

You may recall the name TopTracer, as we wrote on the company’s decision to license its technology to traditional driving ranges; software that enables golfers to play virtual versions of the world’s premier golf courses, from the convenience of their neighborhood range. Topgolf Entertainment owns TopTracer, having acquired the company back in 2016 when it was still known as Protracer.

After each hole, MGM Resorts Race & Sports Books (in partnership with GVC Interactive Gaming) will update their proprietary feed to the live PPV broadcast with real-time odds and money lines. While in-game betting is going to be huge as sports betting becomes more widespread, don’t expect this event to move the needle for MGM (or any other sportsbook); only those located in NJ and NV will have the ability to act on the real-time odds displayed during the broadcast within the company’s mobile app. It’s worth noting that Shadow Creek Golf Course is an MGM Resorts International property.

Turner Sports (T) elected to forego traditional commercial spots during the PPV event to provide the audience (not accustomed to buying golf) with an optimal viewing experience, so just 3 premium brands will be marketed to viewers during the event; Capital One (title sponsor), AT&T (official wireless and data services partner) and Audi (official automotive sponsor) are all sponsoring integrations (think: drone coverage, 4K option) supposedly additive to the broadcast.

Fan Marino: Speaking of Topgolf, the company is expanding aggressively; looking to reach 50 markets by the end of 2018 as it prepares for a 2019 IPO. Executive chair Erik Anderson explained the company is “a candidate to go public for sure” because “like Starbucks, people connect with us.” Sure, Topgolf is popular, but like Starbucks? Who makes Topgolf a part of their everyday routine? Topgolf isn’t public, but Callaway Golf (ELY) owns +/-14% of the company.

Topgolf competitor Drive Shack is also making headlines, having announced NYC’s first golf entertainment complex is coming to Randall’s Island Park in 2020. The company currently has just a single location (Orlando), but 6 others are under construction. Unlike the market leader (Topgolf), Drive Shack is publicly traded on the NYSE under the symbol DS; shares are down -21% since the company reported a Q3 loss (-$15 million), while missing revenue estimates by +/- $1 million ($87 million), 2 weeks ago.

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NFL Exploring Exit from Sunday Ticket Pact with DirecTV


The NFL is exploring the possibility of exercising an exit clause in their pact with DirecTV, a move that would revoke the satellite provider’s exclusive rights to broadcast Sunday Ticket (i.e. all out of market games) at the completion of the 2019 season. The current contract (signed in ’14) calls for DirecTV to pay the league $1.5 million/year through ’22. If the league opts out of the current agreement, many believe it could package satellite rights with global streaming rights and continue to grow the revenue pie. Sunday Ticket has never had another home, DirecTV has held the NFL’s satellite rights since 1994.

Howie Long-Short: Should the NFL opt out of the existing agreement, it’s feasible a technology player like Google or Amazon could win the rights; Google previously bid on the rights to NFL Sunday Ticket. Considering neither company has satellite capabilities, if one of the tech giants were to acquire exclusive rights, it’s more than likely they would carve out the satellite broadcast rights and re-sell them.

NFL Sunday Ticket has always been exclusive to DirecTV because if it were to be more widely available, it would diminish the value of the games for the league’s cable and over-the-air television partners; of course, the NFL generates far more revenue from the likes of ESPN, CBS, FOX and NBC than they do from AT&T. Exclusivity hasn’t hurt DirecTV though, it’s helped turn the company into the largest pay-TV provider in the country (following AT&T acquisition, which was contingent upon the renewal of the NFL deal in ‘14).

DirecTV is a subsidiary of AT&T (T). As noted in yesterday’s piece on HBO, cord cutting and the shift to internet video had AT&T’s Entertainment division (see: DirecTV) reporting a -8% YoY revenue decline (to $11.7 billion) in Q2 ‘18.

Fan Marino: NFL television ratings were on an uptick again (at least compared to ’17) in Week 4, with 3 of the 4 Sunday time slots (CBS 1p, CBS 4p, NBC 8p) posting double-digit YoY increases. The time slot that did not experience a YoY rise in viewership (FOX 4p), still reported the best single-header rating of the season (11.7). Sunday’s ratings come on the heels of Thursday night’s highly competitive game between St. Louis and Minnesota, a contest that posted an 8% YoY increase (10.7 on FOX and a 19 on NFL Network).

Wait, it’s 2018 and DirecTV satellite subscribers still can’t stream games shown on NFL Sunday Ticket? Under the terms of the existing deal, only college students and those able to prove the inability to place a dish on their home have access to NFLSundayTicket.TV. The NFL’s take it or leave it offering is the polar opposite of the NBA’s new fan friendly NBA League Pass.

If you’re considering buying NFL Sunday Ticket, but unable to afford the $293.94 subscription price (if you want Red Zone it’s $100 more) AND live in the Los Angeles, Phoenix, Boston, Philadelphia, San Antonio, Hartford or Louisville areas, consider DIRECTV Now (streaming service) as an alternative to the satellite service. For just $55/mo. you can now (i.e. it’s new, not a pun) get access to the league’s entire out-of-market schedule. If the package expands, one must think it’ll have as positive of an impact on DirecTV Now subscriptions as it did for the satellite provider in the 90s.

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HBO Throws in the Towel on Live Boxing Programming

HBO 200x200

HBO has announced it will drop live boxing from its programming calendar after 45 years and 1000+ fights, following its October 27 card (featuring Daniel Jacobs); declining ratings (their Sept. 8 card was the lowest rated in network history) and increased competition (both from within the sport and MMA) were catalysts in the network’s decision. HBO Sports VP Peter Nelson said, “this is not a subjective decision. Our audience research informs us that boxing is no longer a determinant factor for subscribing to HBO.” HBO Sports will continue to produce “unscripted series (think: The Shop), long-form documentary films (think: Andre the Giant), reality programming (think: Being Serena, Hard Knocks), sports journalism.”

Howie Long-Short: For all the increased exposure that DAZN and ESPN+ bring to the sport, DAZN’s entry into the U.S. market and ESPN’s introduction of the live streaming platform have significantly raised the costs associated with carrying fights. HBO decided it would rather spend on developing original programming (think: Game of Thrones), than compete with DAZN, ESPN+, Showtime and Fox Sports for fights; Nelson added, “from an entertainment POV, it’s not unique. There’s plenty of boxing out there.”

Boxing’s impact on HBO’s success as a network is undeniable. By the early 90’s, fights on the network were attracting 1/3 of the company’s +/- 15-million-person subscription base. That percentage declined to +/- 2% (820,000 of the company’s +/- 40 million subscribers) ’18, which explains why boxing is no longer a profitable endeavor for Home Box Office.

There’s no doubt that AT&T’s acquisition of Time Warner (HBO’s parent company) expedited the network’s decision to drop boxing, “once the merger went through, there was pressure on HBO to overhaul its model with a great focus on profits.”

Speaking of which, T issued its first earnings report (Q2) with the Time Warner properties under its umbrella. The WarnerMedia division (former Time Warner assets) reported a +7% YoY revenue increase to $7.8 billion (HBO “delivered strong subscriber revenue growth”), $1.1 billion of which was included in AT&T’s consolidated results; accounting for the 16 days between closing and the end of the quarter. The news wasn’t all positive though, cord cutting and the shift to internet video had AT&T’s Entertainment division (think: DirecTV) reporting a -8% YoY decline (to $11.7 billion). Earnings rose 15% YoY (to $.91/share), but the mixed results had share prices falling -4.5% on the news; they’ve since recovered and will open at $33.58 on Monday 10.1.

Fan Marino: HBO’s impact on the sport should not be underestimated. The premium cable network offered boxing a platform at a time when broadcast television was unwilling to assume the risk of carrying fights (see: ’82 death of Duk Koo Kim from injuries sustained during a nationally televised fight), but before PPV truly took off (’91); and the network remained the sport’s premier network through the 2000s.

While the network had been surpassed by Showtime in recent years, it had Canelo Alvarez/Gennady Golvkin II on HBO PPV on September 15th, which did 1.1 million buys. Those 2 fighters, the marquee names within the HBO stable, will become free-agents permitted to sign with another network (or streaming service).

Fun Fact: HBO’s first card (’73) concluded with George Foreman knocking out heavyweight champion Joe Frazier. Here’s the footage!

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