TV networks saw a 12% YOY increase in viewership during the first 3 weeks of the preseason, suggesting that regular season numbers would pick up from a disappointing 2016 season. But last Thursday night’s season opener between the Patriots and Chiefs drew a 14.6 rating, down from 16.5 last year; making it the least watched opener since 2009.
TuneIn has partnered with the NFL to provide fans worldwide with the home and away, national and Spanish radio broadcasts of all 32 NFL teams. JWS wanted to find out how if radio saw a similar uptick in preseason listeners and how the opener rated. TuneIn VP of Marketing, Scott Parker, provided some insight:
Scott Parker: “Year over year, our number of preseason listeners grew by 70%. This is indicative of all of the ways people are consuming NFL content, especially with the growing usage of streaming audio, in the preseason. We actually had success in a unique Preseason stunt featuring a joint Audiocast with the Patriots and Texans. We do see a correlation between Preseason and Regular season and saw record numbers for the season opener.”
Howie Long-Short: TuneIn isn’t public, but the company is backed by Comcast Ventures. CMCSA co-led a $50 million round in April 2017 to fund the buildout of TuneIn’s Premium Subscription service offerings.
Fan Marino: A recent ESPN (DIS) poll indicated that 68% of avid NFL fans live outside their favorite team’s home market. I’m not sure how ESPN defined avid, but that can’t be accurate. Americans live a median distance of 18 miles from where they grew up.
Nike’s (NKE) iconic Jordan Brand, which at one time instantly sold out weekly releases, has unexpectedly struggled over the last several quarters. As fashion has trended away from high-end basketball sneakers and towards low-tops that best fit with skinny jeans and joggers, the Jumpman Brand has struggled to adjust. Nike’s solution has been to increase the volume of Jordan sneaker releases; but with most pairs lacking high demand, many fail to sell out immediately, raising the possibility of long-term brand erosion.
Howie Long-Short: In January 2015, Jordan Brand made up 96% of the sneaker resale market. Adidas (ADDYY) had 1%. Adidas now has 45%. Considering the sneaker resale market is estimated to be valued at $1.2 billion, that’s a lot of Adidas shoes being bought (and resold) in place of Jordan’s.
Fan Marino: Morgan Stanley says that “Nike has lost its core sneaker enthusiast customer to Adidas.” As a sneaker head, I say that is a gross exaggeration. I recently bought a pair of Adidas EQT Support ADV. They are already on their way back to Adidas. They were a pain to put on, the wife hated the way they looked and I didn’t find them to be particularly comfortable.
Nike has a problem with its Jordan brand that was previously ‘unthinkable’
JWS published a story earlier this week discussing how the NFL has implemented the use of technology within the game of football. Premiership Rugby has also embraced the sports-tech revolution; with developments changing the way its coaches train players and analyze performance. Below are a few companies making an impact:
IMAX Corp. (IMAX) – Players utilize IMAX video booths to watch footage filmed from both “lamppost” cameras as well as drones. Video footage from training, matches and even individual player clips are available for viewing.
Catapult Group International Ltd. (ASX: CAT) – The OptimEye S5 GPS device is used by 10/12 Premiership rugby clubs. The handheld device is placed into a pouch on the back of each player’s shirt, processing thousands of performance related data points/second, including; distance, velocity and speed.
Vimeo (IAC) – Video application providing players secure access to private clips of training sessions.
Howie Long-Short: Vimeo is owned by InterActiveCorp (IAC), a media and internet company that owns 150+ brands including; Match Group (i.e. Tinder), HomeAdvisor and Dictionary.com. IAC recently posted Q2 earnings of $.74/share, easily beating estimates of $.50/share. The company posted revenues of $767.39 million in Q2 ’17, up 2.9% YOY.
Fan Marino: Rugby teams aren’t the only ones using the CAT OptimEye S5. Brazil’s 5x World Cup Championship International Soccer team, the defending NBA Champions (Golden State Warriors) and at least a dozen NFL teams, also use the GPS system to track player performance.
How GPS, drones, and apps are revolutionizing rugby
ESPN (DIS) has reached an agreement with boxing promotor Top Rank, that gives the network exclusive rights to air the promotions’ fights on their TV networks, the ESPN app, their DTC streaming service and on PPV. The partnership likely means the end of the long-standing PPV relationship between Top Rank and HBO (TWX). ESPN will air 18 Top Rank main events in the first year of the deal, with the first coming on September 22nd, featuring Oscar Valdez and Gilberto Ramirez. Financial terms of the deal have not been released, but the agreement is expected to run for 4 years.
Howie Long-Short: While financial terms haven’t been released, you can use the existing UFC/Fox Sports (FOXA) deal as a frame of reference. Fox Sports currently pays the UFC $115 million/year for its broadcast rights. It has been rumored that when the UFC/Fox Sports contract expires in 2018, the UFC will be seeking upwards of $450 million/year under the terms of a new deal.
Fan Marino: 2017 has shown if you put high quality fights on network/cable television, people will tune in. July’s Pacquiao/Jeff Horn fight did 4.4 million viewers, the most for a fight on cable television since 1995; while the March ‘17 Keith Thurman/Danny Garcia bout peaked at 5.1 million viewers, the most for a fight on network TV since 1998.
Top Rank signs exclusive four-year deal with ESPN
Draft, the daily fantasy sports application purchased by Paddy Power Betfair (LON: PPB) back in May, is making its push to compete with DFS market leaders DraftKings and FanDuel, as the NFL season gets ready to kick off this weekend. Instead of burning through cash on TV and radio ads, Draft’s strategy is to reach sports fans on social media, through their favorite athletes. Shaquille O’Neil is hosting a Week 1 head-to-head contest for his 14.6 million Twitter (TWTR) followers, while Chad Johnson, Michael Vick, Richard Sherman and Antonio Brown are also endorsing the DFS app.
Howie Long-Short: FanDuel and DraftKings have a huge lead in the DFS race, but those companies have spent the last year in the courtroom. Draft now has a market leading gaming operator backing it and a user acquisition strategy that makes sense. Expect Draft to become a household name.
Fan Marino: Athlete endorsements are great, but the best way for Draft to acquire users quickly is to promise them an even playing field (i.e. no sharks). During the first half of the 2015 MLB season, 1.3% of players paid 40% of the entry fees while winning 91% of the profits, on DraftKings & FanDuel. The casual player needs to believe they can win.
Floyd Mayweather, Shaq, Richard Sherman are all promoting the same daily fantasy app
The cost of attending an NFL game can range significantly from city to city, with resale market prices largely dependent on the quality of the teams playing. According to StubHub (EBAY), no team is more expensive to see live this season than the Cowboys. 5 of the 10 most coveted (i.e. expensive) games on the site include the Dallas football franchise, with Sunday Night’s game against the New York Giants listed as the single most expensive ticket of the season. The defending Super Bowl Champion New England Patriots and Green Bay Packers, with a national following, come in second and third on the list.
Howie Long-Short: The NFL’s exclusive ticketing partnership with Ticketmaster (LYV) expires in 2018. The league is convinced it can make more by retaining a cut of the sales profits than by selling partnership rights. One option moving forward, would be for the league to use an “open platform” that makes seats available through a variety of outside ticketing, e-commerce and social media platforms. SeatGeek has an “open platform” that several MLS teams have successfully used.
Fan Marino: You can find a ticket to every NY Jets home game for $37 or less, except for the N.E. ($100) and Miami ($47) games. For 5 out of 8 home games, you’ll pay more to park your car ($35) than to attend the actual game. Then again, the tailgate is certain to be more exciting than the action on the field.
Americas Team Cowboys tickets most in demand
Facebook (FB) has hired Bunim/Murray Productions (VIAB), the company behind “The Real World” and “Keeping Up with the Kardashians”, to create a new reality series for their redesigned Watch video tab. The show entitled “Ball in the Family”, will focus on LaVar Ball, the father of Lakers rookie Lonzo Ball, as he grooms his children for the NBA, builds his Big Baller Brand and helps his wife Tina recover from a stroke. The first 2 episodes are now available, with new episodes being released on Sunday’s at 10p, starting September 10th. Facebook is developing original content, so it can draw video advertising dollars that will drive future revenue growth.
Howie Long-Short: Facebook is coming for GOOGL’s YouTube. The company is offering to pay production costs, license and outright buy content from creators; while at least in some cases, guaranteeing ad revenue to publishers. Expect a lot of well-produced, high quality, in-demand content from the social network moving forward.
Fan Marino: LaVar recently announced that sale of the LaMelo BBB sneaker will take precedence over his NCAA eligibility. Lonzo better be a superstar or this whole house of cards is about to come tumbling down.
Facebook Lands Lonzo Ball and Basketball Family for Reality Show
Daktronics (DAKT), the electronic display supplier, reported a 52% increase in Q1 2018 earnings, with the company’s quarterly bottom line climbing from $5.54 million to $8.43 million YOY. Chairman Reece Kurtenbach attributed the growth to progress or completion on projects including; Mercedes Benz Stadium, Ford Field, Heinz Field and the University of Wisconsin. In total, 29 colleges and universities will use Daktronics LED video and messaging display technology this season, including the University of Texas, USC and Auburn University. Appalachian State, Cincinnati & WVU will unveil new main end zone displays.
Howie Long-Short: As the demand for electronic video display systems has grown, so too have DAKT revenues. Expect that trend to continue, as digital display systems have become an important source of revenue generation in addition to being used to enhance the fan experience
Fan Marino: If you watched the Alabama/FSU game last Saturday night, you likely noticed the massive “halo board” under the roof. The 360 degree, 62,000 square foot display was made by you guessed it… Daktronics.
Daktronics Inc. Reports 52% Increase In Q1 Earnings
The NBA and Take-Two Interactive (TTWO) will be launching an “NBA2K” esports league in the spring of 2018. Teams representing NBA organizations will be comprised of 5 digital athletes, each competing for contracts and endorsement deals in addition to the league championship. The idea is for the league to mirror the NBA as closely as possible, with players treating the season as a full-time job. 17 teams will compete in the inaugural season, though important details including; how to draft players, the set-up for broadcasting/streaming and the implementation of a salary cap are still to be worked out.
Howie Long-Short: Amazon (AMZN) owned Twitch publishes rankings reflecting esports games with the most viewers, hours watched etc. While “League of Legends” (HKG: 0700) drew 43 million viewers to their final, “NBA2K” drew less than 4,000 over the last week. The game also sits behind both “FIFA” (EA) and “Madden” (EA) in the viewership rankings. This partnership has a long way to go before it becomes a profitable venture.
Fan Marino: A big issue that is often overlooked when discussing a sports game as a viable esport, is that sports games are designed as a simulation. Since the games are meant to reflect real life as closely as possible, some players/teams are better than others. That causes a competitive balance problem. If you fix the stats to create parity, the game no longer provides a realistic simulation of the sport.
The NBA 2K League: What We Know So Far, And Can It Succeed As An Esport?
Just one week after ESPN (DIS) introduced “SportsCenter AM”, FS1 (FOXA) introduced its newest morning show, “First Things First”. The show pairs NFL Hall of Fame WR Chris Carter with Nick Wright and Jenna Wolfe, airing weekdays at 6:30 a.m., 30 minutes prior to its ESPN counterpart. The “First Things First” debut was particularly noteworthy for FS1, as it becomes the first ever NYC based show for the Los Angeles based network and the first time the network has had a presenting sponsor (PG) for a show’s launch. The 3-hour show gives FS1 11 hours of live daytime studio programming daily, as the network continues to move away from highlights and towards discussion/debate.
Howie Long-Short: FS1 has seen their show “Undisputed” with Skip Bayless and Shannon Sharpe grow 1,260% over the last year, to 137,000 viewers. The show actually beat SportsCenter in the 10a-Noon time slot for 2 consecutive weeks in August. Having a live lead-in is only going to help those numbers grow.
Fan Marino: Why did FS1 move “First Things First” to NYC? It’s simply not practical to produce a show that starts at 3 a.m. local time. Even if you could, it would be nearly impossible to book guests. Speaking of guests, moving to the East Coast gives the network access to a whole different group of potential on-set guests.
FS1 looks to establish NY, early-morning presence with ‘First Things First’