John Kosner Appeared on the “Fueling the Future of Fan Engagement” Panel at Sportradar’s Connec+ Event in NYC

Listen in on this great panel discussion that covers opportunities in fan engagement with the use of #AI

Moderated by Mike McCarthy of Front Office Sports, the panel featured John Kosner of Kosner Media, Matthew Graham of Tennis Channel, and Ty Barnes of Sportradar.

John Kosner Spoke with Mike McCarthy of Front Office Sports About NBC’s Innovations at the 2024 Paris Summer Olympics

Original Article: Front Office Sports, by Mike McCarthy, August 3rd, 2024

Only three years after the Tokyo Games’ poor showing as the least-watched prime-time Olympics on record, NBCUniversal’s coverage of the 2024 Paris Games is posting high marks.

The opening Sunday of competition drew NFL-like TV numbers, averaging 41.5 million viewers across various NBC platforms. (That nearly equaled the 42 million viewers who tuned in to watch the NFL’s most-watched regular-season game last year—the Cowboys vs. Commanders—on Thanksgiving weekend.) Through Thursday, NBC’s prime-time coverage was averaging 34 million viewers across all platforms, up 79% from Tokyo. 

Mark Lazarus, chairman of NBCUniversal, hasn’t seen so much enthusiasm from Olympic viewers and spectators since London in 2012. “Clearly, the Olympics are back,” he said on a conference call Thursday.

The rebound in Olympic viewership vindicates NBCUniversal’s decision in 2014 to fork over $7.75 billion to the International Olympic Committee for U.S. media rights to six Games through 2032. It’s sweet satisfaction for Olympic sponsors and marketers, who’ve committed a record $1.25 billion to advertise during the Paris Games. More than 70% of NBC’s Paris advertisers are new, according to the network, with a half-billion dollars in revenue coming from first-time sponsors.

NBC’s arresting visuals of the City of Light and the medal-winning heroics of U.S. athletes are just two of the factors driving NBC’s Olympic rebound. This week, Front Office Sports asked business experts and NBC insiders why the Olympic rings are posting gold-plated ratings again.

Dream Setting

The picturesque TV appeal of Paris can’t be overstated. As Gertrude Stein said, “America is my country, and Paris is my hometown.” U.S. viewers are captivated by the famous sights of the Palace of Versailles, Eiffel Tower, Seine river, and Arc de Triomphe. Event sites including the Eiffel Tower Stadium, hosting beach volleyball, may perhaps be the coolest venues ever.

“Undoubtedly, Paris provides a stunning backdrop for the Games on television,” sports media consultant Jim Williams tells FOS. “The decision to host events at historic sites rather than traditional venues adds significant allure.” 

As one NBC executive noted to FOS, Paris and 2012 host London are two of the world’s most popular tourist destinations. Americans who’ve never been to those cities want to go; those who have been want to return. It’s no accident that these host cities have drawn two of the largest U.S. TV audiences. Paris’s six-hour time-zone difference to Eastern time is also much more convenient for U.S. viewers than Beijing’s (12 hours) and Tokyo’s (13 hours).

“Lost in the fog of three consecutive Asian Olympics, two impacted by COVID-19, these Olympics are in Paris with its glorious locations and excited live crowds. It looks and feels Olympian,” says John Kosner, former ESPN executive turned founder of Kosner Media.

Coverage Like Never Before

NBC has taken a more “innovative” approach this year, according to Kosner. 

Peacock’s whip-around highlight show, Gold Zone, is the breakout star of early Olympics coverage. NBC wisely hired the master of the format—NFL RedZone host Scott Hanson—to lead the coverage. The streaming hit is fast-moving, funny, and compelling, focusing on the highest-stakes moments. As Hanson told FOS this week: “We will trim the fat off everything and bring you the best of the best in a one-stop [shop] on Peacock for Gold Zone. That will lend itself to a very fun viewing experience.”

Hanson and fellow hosts Andrew Siciliano, Jac Collinsworth, and Matt Iseman whip viewers in and out of “gold medal alerts” 10 hours a day. The boisterous Hanson got so excited over one event, he cut his hand banging it on his TV desk. 

Its appeal is only spreading. The number of accounts watching Gold Zone doubled between its Saturday debut and Tuesday’s coverage. As of Thursday, NBC had piled up eight billion streaming minutes and counting, with plenty of events still to go, Lazarus said.

“NBC has brought a slick, modern, high-gloss production to the 2024 Games in Paris,” says Kosner. “They’ve been genuinely innovative, launching Gold Zone and the [AI-generated] Al Michaels highlights as two examples. They have improved the discovery and viewing experience on Peacock.”

The IOC’s scheduling of high-profile events has also lined up perfectly with U.S. viewing windows, giving NBC big opportunities for their audiences. For example, the Team USA men’s basketball game versus Serbia with Nikola Jokić aired mid-Sunday.

Compelling Weekday Lineups

Alongside innovative coverage, there are simply lots more opportunities to watch live events on TV. 

Forget the old days when NBCUniversal used to hold back TV coverage of the biggest events for prime time. For the first time, virtually all events are being televised live in the afternoon, then replayed in prime time, noted Rick Cordella, president of NBC Sports on a conference call Thursday. This “Paris Prime” strategy is delivering a one-two punch, generating big numbers, Cordella said—and daytime broadcasts aren’t cannibalizing the prime-time audience.   

On Tuesday afternoon, a staggering 12.7 million live viewers watched Simone Biles (at top) lead the U.S. women’s gymnastic team to gold on NBC and Peacock, according to Sports Media Watch. The U.S. women’s basketball team’s opening win over Japan on Monday afternoon averaged 3 million viewers on USA Network and Peacock. That was more than any men’s or women’s basketball game in Tokyo, excluding the gold medal games.

As Kosner says: “They have taken the logic of the NFL’s late Sunday afternoon window, which is considered prime time by advertisers, and used that model every day to supplement actual prime time with late-afternoon live coverage. That’s a fairly ingenious way to tackle the Paris time-zone issues.”

Rival sports TV networks are taking note. As Fox programming guru Michael Mulvihill asked on X: “Is the door opening for more sports on weekday afternoons?” Plenty of workers covertly streaming big Olympic moments at their desks indicate maybe yes.

Abundance of Superstar Athletes

NBC executives tell FOS that the better Team USA performs, the better the ratings. Viewers are tuning in at all times of day for the big stars, including Biles, LeBron James, and Katie Ledecky. And many of them are snagging medals left and right.

But there are also the perennial viral breakouts, including rugby sensation Ilona Maher (above), and bespectacled pommel horse specialist Stephen Nedoroscik who factor in. As the U.S. continues to perform better than they did in Tokyo, great results are rocketing non-household names into meme dominance and turning their competitions into can’t-miss events for NBCUniversal.

“I believe the number-one reason [for the Olympic comeback] are the American Olympic stars,” says sports TV ratings expert Douglas Pucci of Awful Announcing. “There are many more to watch at these Olympics compared to Tokyo three years ago. The fact that this is the first normal Olympics post-COVID-19, with spectators filling the stands cheering on the athletes, and no disqualifications because of COVID, is a benefit.”

Yearlong Marketing Blitz

Olympic sports marketing expert Rob Prazmark, founder of 21 Sports & Entertainment Marketing Group, tells FOS his “number-one reason” for the rebound is NBCUniversal’s savvy decision to start marketing the Paris Games more than a year ago. 

Going back to CBS Sports’ coverage of the 1960 Rome Olympics—the first Games fully covered on TV—this has never happened, according to Prazmark. “Historically, the Olympic network in the U.S. and worldwide counted on sponsors to promote the Games a year in advance. That does not happen in today’s environment because of all of the clutter in sports marketing.” He says he doffs his cap to NBCUniversal chairman Mark Lazarus and NBC Olympics president Gary Zenkel in “bucking the historical trend.”

Meanwhile, NBC studded its programming and marketing efforts with famous faces, including Snoop Dogg, Peyton Manning, Emily in Paris star Lily Collins, Megan Thee Stallion, and Call Her Daddy podcast host Alex Cooper. The strategy has attracted new and younger viewers, according to NBC viewer research.  

Now, what does this gold-medal showing for NBCUniversal mean for the future? The Olympics are coming back to the U.S. with the 2028 Summer Games in Los Angeles and the 2034 Winter Games in Salt Lake City. Paris is setting the tone for future U.S. ratings success that could parallel this year’s numbers, or even exceed them. 

“We Americans love the Games on U.S. soil,” says Prazmark. “In 1984, everyone thought [the L.A. Summer Olympics] would be a ratings flop, but it was a blockbuster without the Soviet Union. I suspect that the Russians will be back in 2028—and it will be an amazing drama.”

The NBA’s New Media Deals — First of the Next: John Kosner’s Latest SBJ Column with Ed Desser

Original Article: Sports Business Journal, by John Kosner and Ed Desser, July 29th, 2024

We weren’t surprised that the NBA got “those deals!” — almost triple its current agreements — not when there’s:

1. Competition. This was the NBA’s first true competitive bidding since 2002, when ABC/ESPN grabbed NBC’s lead package. And, for the first time, there was bidding interest in streaming rights, too. This dynamic played out with the new entrants:

   • Comcast/NBC will offer the NBA much broader exposure by moving two weeknight games, and substantial playoffs, to NBC broadcast while also using the NBA to drive its Peacock streaming service; and, Comcast’s crucial mother lode, high-speed data business. For Comcast, more sports streaming equals more data demand, and higher-priced broadband packages. Look for additional 4K, sub-second latency, and real-time wagering — all for a price. Comcast can potentially help offset some of its new $2.5 billion annual NBA rights commitment with an adjustment in the subscriber fees it pays for an apparently NBA-less TNT, while making NBC and Peacock more valuable to both distributors and subscribers.

   • Amazon is mirroring NBC’s NFL/NBA calendar, and brings the league more subscribers today than cable. And it may also move to replace or complement Diamond Sports (and other RSNs) as the hub for local NBA team broadcasts, further enhancing Prime Video’s position as a sports destination.

2. More being sold. The NBA is adding a third partner for the first time in 40 years (the NFL now has seven) by selling Amazon or WBD one or two nights, In-Season and Play-In Tournaments, Digital League Pass, streaming, and international rights, provided the NBA can ultimately deliver the accepted deal, which may be legally contested by WBD.

3. The 11-year term. The 2.9x increase is massive, but remember, we’re talking about a total 20-year span from when the NBA’s current deals started and the new ones end. The 2025-26 season will be the NBA’s first major annual rights jump in nine years, and that adjustment was the first quantum increase since 1998, 26 years ago. Deal-over-deal, this fittingly represents about an 11% CAGR, partially a result of the need by challengers to overwhelm incumbent TNT’s matching rights.

4. The ascendancy of streaming. The NBA has what streamers want — unique, branded, exclusive, and popular programming for eight months of the year, with its biggest and most-watched prime-time, postseason games occurring outside football season. A true churn-buster! It’s crucial to Disney’s streaming platforms, Amazon, and Peacock. In a subscription world, months of content matter! Plus:

5. Advertising ... for all. The NBA is a major advertising business that attracts a consistently sizable, engaged audience that watches live on specific dates and times — increasingly, the only content advertisers will pay a premium for. This is important for ABC/ESPN, NBC, and TNT. Perfect timing for Amazon, too, which recently introduced ads for all Prime subscribers who don’t elect to pay more, plus there is no opt-out for live, in-game sports ads!

6. The young demos. The NBA is among the biggest social media sports — its stars are on a first-name basis with young audiences globally, on YouTube, Instagram, and TikTok, where streamers recruit viewers. The NBA is hip, culturally relevant, and skews young, unlike most all linear TV entertainment and news programming. The NBA’s regular-season ratings have maintained, while linear entertainment’s have collapsed. Indeed, the analyst Doug Shapiro makes the point: The most valuable sports rights are gaining at the expense of entertainment content spending.

The outlook

The NBA is the last in the current cycle to finally add an all-digital package. But we also see these NBA deals as the “first of the next” wave, as cable has now crested (e.g., no games for NBC’s USA Network or apparently TNT). Meanwhile, the regional sports business is also challenged:

• NBA regular-season games will now be featured in prime time every night on NBC/Peacock, ABC, ESPN, and Prime Video. This is both a massive exposure boost for the league and a management challenge for everyone. Fans complain today that the games are hard to find. For this to work well, the NBA and its players will have to make these games even more compelling, and the NBA must work with its partners to balance new inventory across (at least) three major sales organizations, while making the viewing experience more seamless. Can you say: “NBA App?” In the NBA’s regular season, amazing things happen every night, but it’s hard to predict in which games. Flexibility will be important, as is the broadcasters’ willingness to show the best games, not just the biggest markets. Going forward, Oklahoma City and San Antonio are rising.

• The NBA has established a 12-month content calendar with the rise of the WNBA and Summer League. USA Basketball might have snubbed Caitlin Clark (for now), but new partner NBC can be expected to spotlight the NBA and WNBA Dream Teams at the Paris, Los Angeles, and Brisbane Olympics.

• We expect that this lineup will soon come with a next-gen TV world feed, inspired by COVID “bubble” learnings.

• Our increasingly fragmented media world rewards strong, centrally managed enterprises. The NBA has long been a well-run originator of many of sports’ best practices. That track record matters, too. Relationships are critical, but it’s the people (think Ted Turner, Dick Ebersol, and Mark Lazarus), not just companies, that count.

• Finally, whither “Inside the NBA,” one of the best TV shows in sports history — also one of the most valuable non-live-game properties in sports media? Could it move? Might Charles Barkley unretire? Quoting Marv Albert on both: “Yes!”

Our former boss, the visionary David Stern, deserves credit for setting the league on this path decades ago, helping make today’s reset possible 4 1/2 years after his death. These new deals with Disney, Comcast/NBC, and Amazon firmly establish the NBA as the No. 2 U.S. sports media property, only behind the NFL. Is an NFL rights re-opener in five years now inevitable?

---

Ed Desser is president of consultancy Desser Sports Media Inc. (www.desser.tv). John Kosner is president of consultancy Kosner Media (www.kosnermedia.com). Together they developed league TV strategy and ran the NBA’s media operations in the ’80s and ’90s. Ed negotiated every national TV deal during his tenure from 1982-2005. John participated in most of those negotiations, first at the NBA, and then at ESPN through the current deal.

John Kosner Spoke with Alex Silverman of The Sports Business Journal about The Dallas Stars New Free Streaming Service

Original Article: Sports Business Journal, by Mollie Cahillane, July 8th, 2024

SBJ Media: Sports will be ‘critical’ for Skydance-Paramount

Happy post-holiday weekend! If anyone expected any sort of summer slowdown in sports media, they would be mistaken. But that means it's a good night to roll out the first official SBJ Media with Mollie Cahillane -- and many more to come! I’ll be taking over SBJ’s media newsletter responsibilities full-time, and I can’t wait to bring news, analysis and insights to SBJ's incredible audience.

With Paramount and Skydance (finally) agreeing on a deal, let's get into it. ...

Sports likely to remain a 'cornerstone' of merged Paramount-Skydance

While there are a number of questions surrounding assets in a proposed Skydance-Paramount merger, the future of sports at the company won't be one of them.

Jeff Shell, the former NBCUniversal chair who is expected to be the new Paramount president, during a call with investors on Monday used words like "critical" and "cornerstone" when describing what sports will mean to the company's future. “When you look at the CBS Sports portfolio, it is really pretty formidable,” Shell said. “So while we’re going to be managing the cash flow of the business, sports is the foundation of our business."

Shell lauded the leadership of David Berson, who recently took over for Sean McManus as president of CBS Sports. He also alluded to CBS continuing to be a player for sports rights as those come up. "If there’s compelling rights in the future that we think can bolster us, we are a buyer, probably, rather than a seller.”

Some rights within Paramount's portfolio include a wide array of soccer assets, like the NWSL, UEFA Champions League, USL, Concacaf World Cup qualifiers and Serie A (for now). The company also has the Masters, PGA Tour golf, PGA Championship, Professional Bull Riders, Big Ten, Mountain West and Army-Navy game, among others.

But the biggest CBS property partner remains the NFL, whose rights may be coming up sooner than some expected. CBS and many other networks are in the middle of deals that originally were intended to go through 2033. However, many suspect the NFL will exercise an opt-out clause in its deals with Amazon, CBS, Fox and NBC after the 2029 season (as well as ESPN in 2030) in order to get more value out in the market.

Would Skydance balk at such an ask? Not likely. Skydance is now deeply intertwined with the NFL, part of a 2022 deal that also saw the league's 32 Equity investment fund make a sizeable investment into Skydance Sports, which began ideating on scripted TV, movies, game shows, cooking and travel shows, anime and other animation works and foreign-language productions for The Shield.

That has already bore fruit with various projects, including an upcoming Jerry Jones documentary that went to Netflix for $50 million and a Chiefs-branded feature film that will air on Hallmark this holiday season. David Ellison, CEO of Skydance, said that the merger will create an “incredibly compelling” offer for NFL fans and build a new “robust, interactive” vertical within Paramount.

Shell also expects to continue leaning heavily into the reach of broadcast TV. "We thought broadcast would decline along with cable five years ago. That just simply hasn't happened," he said. "Broadcast is declining much, much more slowly than cable is, making broadcast relatively a lot stronger.”

Another reason to be bullish on sports within a Skydance-run Paramount is Gerry Cardinale's RedBird Capital, which is a major financial backer for Skydance. Cardinale is deeply committed to sports, backing efforts like the UFL, SpringHill Entertainment and YES Network (along with his ownership of Serie A club AC Milan).

The Paramount-Skydance deal is expected to close in September 2025, pending regulatory approval, or if Paramount finds a better deal (in which case it would pay a $400 million breakup fee to Skydance).

Experts point to exposure, tech as concerns for Stars’ new local media plan

The Stars are taking their local broadcast rights into uncharted territory, creating a new ad-supported streaming platform called Victory+ that will be the primary home of all in-market telecasts. Today's news sparked discussion about whether the Stars' model makes sense -- and if other sports properties may follow suit.

The most notable element of the model is that, as of now, there is no linear TV distribution to complement the free streams. Stars President and CEO Brad Alberts said the team is exploring the possibility of bringing a “small package” of games to an over-the-air network, but that's not a sure thing.

Octagon EVP/Media Rights Advisory Dan Cohen, who advises teams and investors in the RSN space, called the Stars’ shift to ad-supported streaming a “bold move," but he expects growing pains associated with leaving linear TV altogether (except for nationally televised games). 

“I hesitate to say this will be a quick commercial success given sponsor visibility challenges with a growth platform vs. an established [albeit challenged] linear channel,” Cohen told SBJ. “I would strongly urge the Stars to carve out a package of local OTA [games] to help balance the reach and exposure concerns I have for this approach in the short term.”

That sort of model would be reflective of MLS, which has a primary media deal with AppleTV+, but also a simulcast deal carved out for Fox Sports.

Will the tech work? Will the money come?

Veteran media consultants John Kosner and Ed Desser each stressed the importance of ensuring that A Parent Media Co., the Stars’ tech partner on Victory+, is well-equipped to provide fans with a high-quality viewing experience (see the D.C. United-FloSports deal from 2019 as an example of what could go awry). “The technology is not trivial,” Desser said. “One has to really be sure that you put the necessary resources behind the app development, the infrastructure, quality control, testing load management. Don't assume this stuff is all so routine that it can't be a problem.” 

While APMC’s prior experience largely involves serving on-demand content, APMC President and CEO Neil Gruninger expressed confidence in the company’s ability to stream live games. “We don't have the problem that the Super Bowls of the world do, because that's 100 million people at once,” Gruninger said. “We're solving the local problem with 100,000 people watching at once. That is completely different.”

Perhaps the biggest question is whether ad revenue alone without a subscription fee can come close to generating the revenue the Stars earned under their previous deal with Diamond Sports Group that saw games air on its Bally Sports Southwest RSN. The Fort Worth Star-Telegram reported the team was being paid $25 million annually under that agreement, which had one year left before it was mutually terminated in bankruptcy court last week.  

“It's kind of hard to see, at least initially, how the numbers are going to add up if your source of revenue is advertising sales against these live streaming games,” Kosner said. 

Alberts said the financial modeling conducted by the team and APMC suggests the team won’t take a hit financially as a result of the move, but he acknowledged there’s risk associated with moving to a new model. “It'll be almost an experiment to see how this all goes,” Alberts said. “Do we meet expectations, do we exceed expectations, or do we miss those? And if we miss, we'll have to understand why and then come back in the second year, make improvements and see if we can improve on the business.”

NFL Media continues thinning the herd with latest podcast move

NFL Media continues to perform a significant offseason overhaul to its content and talent ranks. The latest move hit the popular “Around the NFL” podcast, which will cease to exist in its current form. Two of the pod’s three co-hosts -- Dan Hanzus and Marc Sessler -- are also no longer with the NFL. The third co-host, Gregg Rosenthal, will stick around to launch a new weekly podcast -- “NFL Daily" -- featuring appearances from well-known talent like ESPN’s Mina Kimes and The Athletic’s Jourdan Rodrigue.

That started back in early March when NFL Network’s flagship morning show, “Good Morning Football,” saw its production shipped from N.Y. to L.A. That move would go on to impact several members of the show. Jason McCourty is out, Kyle Brandt is staying on the East Coast for a hybrid role and Peter Schrager has yet to announce his plans (Jamie Erdahl is headed west to stay with the show). 

Then later in the spring, NFL Net axed “NFL Total Access” after 21 years, followed by high-profile exits/non-renewals for talent like Melissa Stark, Andrew Siciliano, Will Selva and James Palmer.

Sources tell SBJ that the latest moves were part of the league’s normal offseason planning process. Nevertheless, the moves are the latest in some high-profile belt-tightening for NFL Media -- moves that sources told my colleague Ben Fischer are simply being dictated by the need to cut costs (vs. getting NFL Media in better shape for a potential equity swap deal with someone like Disney). Those sources also told Fischer that the financial return of programming on NFL Net -- beyond live games -- is simply not justifying high production costs.

Fewer original shows. Less marquee talent. Even fewer games these days (hello Netflix package!).

As the future of cable TV continues to look less and less secure, NFL Network is certainly feeling that pinch. The league is putting internal efforts into platforms like NFL+ and also making external pushes on original content plays with the likes of “Quarterback” and “Receiver” for Netflix or “Bye Bye Barry” and “Kelce” for Prime Video (not to mention tie-ups with content outfits like Skydance and Omaha Productions).

Speed reads

• Messi-mania was bigger for Univision than Fox during the Copa America quarterfinals on July 4. Argentina's win over Ecuador in penalty kicks drew 2.7 million viewers on Univision/TUDN, while Fox drew 1.87 million for the match (which was the best Copa semifinal without the U.S. on record for English-language TV). Check out more on how Copa America is performing in tomorrow's SBJ Daily.

• "Banana Ball" got a prime-time ESPN slot on Friday night, with the Savannah Bananas and Firefighters drawing 259,000 viewers, notes my colleague Austin Karp. How does that compare to some recent Friday night ESPN programming in that slot? ESPN had the NHL Draft two Fridays ago, drawing 502,000 viewers. Three weeks ago, it was Pro Fighters League with 226,000. But the Bananas game also wasn't exclusive, as YouTube aired the game for free for fans.

• Threads, the Meta-owned text-based social network, just celebrated its first anniversary, and Threads chief Adam Mosseri said he would like to see the platform "make progress and go even deeper on key verticals." Mosseri: "I would like to gain on NBA Twitter. I would like to see more in the world of European football."

John Kosner Spoke with Eric Prisbell of On3 About NFL’s “Manifest Destiny” Strategy Impacting The College Football Playoff

Original Article: On3, by Eric Prisbell, June 26th, 2024

Still six months away, it’s time to circle Dec. 21 on your calendars.

With a College Football Playoff opening-round tripleheader on tap, you’ll have a front-row seat for the newly expanded 12-team event as well as another showdown that figures to be a lopsided affair: the emerging winter battle for eyeballs between the CFP and the NFL.

As thriving college football – fresh off its most-watched season across all networks – stages its inaugural expanded tournament, it carries the unenviable burden of trying to schedule against the NFL. And it comes at a time when Roger Goodell has shown no hesitation in flexing the league’s considerable muscle to demolish everything in its programming path.

“The NFL has a manifest destiny media strategy,” John Kosner, who led digital media at ESPN from 2003-2017 and is president of media consulting firm Kosner Media, told On3. The CFP’s task in scheduling against the NFL, he said, is “super challenging” but “this is the world going forward.”

Can College Football Playoffs compete against NFL?

As other leagues have learned, viewership battles with the NFL are almost always one-sided, with Goodell’s behemoth demonstrating it is the proverbial hammer while all other sports play the role of the nail. Last year, 93 of America’s top 100 most-watched broadcasts were NFL games.

“Everybody moves to get out of the way of the NFL,” Neal Pilson, who served two stints as CBS Sports president in the 1980s and ’90s, told On3. “The colleges made the choice to go to a larger playoff, and in so doing were well aware that they may end up competing with NFL football … 

“It is business [by the NFL]. It’s not a strategy to drive anyone out of business. ‘Oh, the NFL is walking all over us.’ No, they are just looking for dates. If you happen to be scheduled on that date, you either move or you compete.”

The NFL lobbied the CFP to avoid staging all three games on Saturday, Dec. 21, according to Puck, and instead play two games on Friday (Dec. 20) and two on Saturday. The CFP chose otherwise. 

So, there will be one opening-round CFP game that Friday and Saturday evening, both broadcast on ABC/ESPN. The two Saturday afternoon CFP games will be televised on TNT, going directly up against two marquee NFL games – the Houston Texans-Kansas City Chiefs and the Pittsburgh Steelers-Baltimore Ravens – on network TV, NBC and Fox, respectively.

Not a normal strategy

Jon Lewis, owner of SportsMedia Watch, told Pac-12 insider Jon Wilner, “The decision to put two games opposite the College Football Playoff on NBC and Fox – that’s not normal.”

The NFL’s strategy is certainly not unique to the CFP. It is sucking up more oxygen in the sporting world throughout the fall and winter – and it is doing so because of the nation’s enormous appetite for its product.

The NFL last year began playing on Black Friday, which opposes a traditional college football window on the Friday after Thanksgiving. 

It is increasingly encroaching into Christmas Day – even on a Wednesday this coming December – creating a threat for the NBA, which long considered the day its own. And if an 18-game NFL schedule is our destiny – it is widely viewed as an inevitability – the Super Bowl could eventually impact NBA All-Star Weekend and the Daytona 500.

This December, the curtain will rise on the expanded CFP with much fanfare. But the challenge of scheduling against the NFL, now and in the future, remains formidable.

College football could start the bulk of its season one week earlier with a full Week Zero slate but otherwise doesn’t have a ton of wiggle room. And the NFL will steamroll anything in its programming path in its quest for eyeballs – even if that means stepping on the sport that supplies its future employees.

“I think that the NFL has its own strategy, and it is moving forward with that,” Kosner said. “And everybody else is going to have to move.”

John Kosner Spoke with Lucia Moses of Business Insider About How Sports Rights Will Impact Entertainment Spending

Original Article: Business Insider, by Lucia Moses, June 18th, 2024

The cost of sports content is soaring — and it could mean big cuts in Hollywood budgets

• Media companies are vying for NBA rights that are crucial for audience retention despite high costs.

• Tech giants like Apple and Amazon have joined the sports rights tussle, escalating competition.

• Entertainment spending could decline by as much as 8% by 2023 to fund sports, per one estimate.

Sports has increasingly become the star of the show for big TV companies, and its ascent is sending a shiver down Hollywood's spine.

The TV giants have recently been battling for NBA broadcasting rights, a fight that has spotlighted how important sports content has become to keeping audiences despite its ever-soaring costs.

But the land grab for sports — with billions of dollars being spent — could have dire consequences for a shaky Hollywood ecosystem.

"The growing relative importance of sports is another looming problem for an already-struggling Hollywood," wrote Doug Shapiro, a senior advisor at BCG and former strategy head at Turner Broadcasting System.

Sports media rights have never been more expensive, but media companies keep paying up. Why? They need sports to keep their declining TV businesses afloat and grow their streaming services.

At the same time, tech companies like Apple, Google, and Amazon have been gobbling up media rights, expanding the market for sports content.

The NBA is close to sealing a $76 billion, 11-year rights contract that would be 2.5 times the amount of its last one, The Wall Street Journal reported. Comcast's NBC, Disney's ESPN, Amazon, and Warner Bros. Discovery are in contention. But the biggest contracts have gone to the NFL, whose $110 billion, 11-year media deal of 2021 was nearly double its previous deal. S&P estimated the value of US sports rights has doubled in 10 years. And as media companies, their businesses already wobbly — take Warner Bros. Discovery, with a staggering $43 billion in debt — consider how they're going to fund sports, they could look no further than their entertainment budgets, which encompass TV shows like dramas and comedies. Those budgets are four times as big as sports, according to Shapiro.

A shift of budgets from sports to entertainment is already playing out in some places.

NBC parent Comcast is expected to cut programming costs to help pay for NBA rights, the Journal reported. Viewers have since learned NBC's "Late Night With Seth Meyers" will lose its house band.

NetMix also seems to be thinking of its new NFL deal as a replacement for mid-budget movies. When asked about the cost of the deal at a MoffettNathanson conference in May, senior NetMix exec Spencer Wang said he would characterize each game as "roughly the size of one of our medium-sized original films." NetMix already has been releasing fewer shows, and its former film chief recently laid out a plan to make fewer original movies.

The number of TV shows across the industry has been declining since the 2022 end of the Peak TV era. The rise of sports could accelerate that downward trend.

How sports content became so valuable

It may seem counterintuitive that media companies have to pay more for sports media rights, given their traditional TV audiences are shrinking as more people cut the cord.

But sports programming continues to draw huge, live audiences on a predictable schedule. Ninety-three of the 100 most-watched programs in 2023 were sports. And 13 of the last Super Bowls got more than 100 million viewers, with this year's game attracting a record 123.7 million, according to Nielsen.

With sports betting now legal in most states, people's interest in live sports could continue to grow. A Variety report showed that sports gamblers watch sports more than usual when they're betting on them, especially NFL fans (67%).

The live nature of sports makes it a must-buy for advertisers with time-sensitive product launches like cars or movies they need to promote. It's why primetime ad rates for sports can be as much as 25% higher than entertainment, said David Levy, former Turner Networks president and now co-CEO of Horizon Sports & Experiences.

"No one records sports and watches it the next day — it's still appointment viewing," Levy said. "And advertisers find that very attractive."

'Who's paying for all this?'

As sports content has become a sure thing, TV shows and movies look increasingly risky.

Entertainment viewing has shifted to streaming on demand, where it's lost some of its watercooler effect. Streaming has created relatively few new franchises, which are valuable for their built-in audiences. Established ones like Disney's Marvel and Star Wars have been running dry lately.

"What these companies are trying to tap into is existing fandom," said Jonathan Miller, a veteran media executive and chief executive of Integrated Media Co., which invests in digital media. "As the Hollywood franchises have become fatigued, sports has not. The fans find you. So it's about fandom and franchises you can bet on."

It's not game over after the NBA, either. Media companies have been aggressively pursuing other secondary sports to maintain their value to distributors and advertisers, as Warner Bros. Discovery recently did by picking up some college football games.

Sports' prominence was noticeable in the parade of athletes at the Cannes Lions advertising conference, as well as at the recent upfronts, the annual TV ad showcase where sellers from Amazon to WBD made their pitches to advertisers.

All this has dire implications for entertainment budgets, which media companies have already been trimming after overspending to build streaming businesses.

"Who's paying for all this? The other side of the house," the ubiquitous media and ad industry consultant Michael Kassan said. "All you have to do is go to the upfront and it's sports and news, sports and news."

Shapiro predicted sports could increase to represent more than 40% of total industry content spend by 2030, double the 20% it represented in 2023, while entertainment spending could decline as much as 8% a year in that same period. Gen AI tools could reduce Hollywood production costs, freeing up more money for sports, he wrote.

"Sports spending is absolutely coming at the expense of film and TV," fretted a creative-side figure at an entertainment company who was granted anonymity to speak candidly about internal divisions.

Power is shifting to the sports side of the house

The rising importance of sports also portends a power shift at media companies, where sports has traditionally been treated dismissively, with primetime slots given to entertainment, news, and other shows. To some, the shift is overdue. Levy said that during his time at Turner, sports was under 4% of programming hours at TNT and TBS but contributed 20% of the revenue.

"Sports was punching above their weight," he said.

Relationships with the top people in sports will likely be a bigger factor in leadership at media companies moving forward. Mark Lazarus, NBCUniversal Media Group's recently named chairman, came out of a sports background. NBC, which is looking to take WBD's NBA rights, has done the most of the broadcasters to elevate sports like the Olympics and the Premier League, sports media consultants John Kosner and Ed Desser recently wrote.

Sports can't solve all media companies' problems, though. They can only rent sports rights, which limits their ability to monetize them. It's one reason NetMix has downplayed the idea of getting into live sports (though in addition to the NFL, it's doing deals for sports-adjacent entertainment like WWE as it looks to build its ads tier).

Sports doesn't get repeat viewing the way entertainment does. Viewers want a mix of content, not just sports. And media companies have to bear in mind that live sports is significantly less popular with Gen Z than the population overall.

WBD CEO David Zaslav took heat for saying in 2022 that "we don't have to have the NBA" in anticipation of upcoming contract talks. He later walked back the comment, but it raised a larger question all media companies face: How much sports do they actually need to keep audiences and advertisers hooked?

"At the end of the day, all these streamers and platforms have to keep putting new stuff on screens, and sports isn't going to solve the need for 75% of viewership," said Alex Iosilevich, cofounder of Alignment Growth, a media, entertainment, and gaming investment firm

With Streamers Circling & Reduced Cable Penetration, A New Sports Playbook for Broadcast Network TV: John Kosner’s Latest SBJ Column with Ed Desser

Original Article: Sports Business Journal, by John Kosner and Ed Desser, May 27th, 2024

We started our careers in the early 1980s, a time of “shelf space” scarcity, with just three national commercial broadcast networks. Each carried some major league sports, almost exclusively on weekend afternoons, with only occasional prime-time coverage of crown jewel events such as the World Series, Super Bowl and Olympics. The 1981 NBA Finals were shown late-night, on tape delay! Fox would launch in 1986. ESPN and cable TV were in their infancy, neither well-distributed nor considered a proper host for major events. John held a programming position at CBS, which was the broadcast home of the then-struggling NBA, where Ed worked as head of broadcasting.

Like today, sports content deals then revolved around TV dollars and exposure, but sports divisions were dismissively considered the toy department in their own shops — a less profitable, distant priority behind what mattered: prime-time entertainment, national and local news and daytime soap operas. Led by the NFL, sports ultimately forged such a strong connection with viewers that it dominated all other programming. In 2023, 96 of the top 100 TV programs were sports. This performance also has been aided by Nielsen’s inclusion of out-of-home viewing, which disproportionately favors live games. Exempting sports, network average prime-time adult 18-49 ratings are now down to under a half a ratings point each.

We are advocates for best practices, constantly searching for incremental sports media value. With streamers circling and reduced cable penetration, it’s time to rethink the playbook for network TV sports:

• With the exception of NFL (and some events on lesser-viewed Friday/Saturday nights), broadcast sports continues to air mostly noon-6 p.m. on weekend afternoons (9 a.m.-3 p.m. Pacific), still “protecting” local/network news, access shows like “Jeopardy,” and of course, prime-time entertainment programs, with few non-playoff sports on weeknights. Any financial analysis of sports in prime time requires consideration of entertainment programming’s “preemptive impact.”

• Sports properties are valued by viewership and must look to maximize that. On the second and third Sundays of the NBA Playoffs, ABC aired a spectacular 47-point performance from Jalen Brunson and then a Game 7 between Cleveland and Orlando at 1 p.m. ET (10 a.m. PT), just as spring weather beckoned everyone outside. Last Sunday’s Knicks-Pacers Game 7 finished around 6 p.m. ET, when we believe it should have started, providing no lead-in for TNT’s Wolves-Nuggets Game 7. Those games had the most national appeal of anything on ABC’s schedule and would have drawn 50%-100% larger audiences had they been at 5:30 or 8 p.m. ET.  NBA ratings were down 12% for the first two rounds.  Exposure matters — especially to showcase emerging teams and stars to larger audiences.  The 5:30 p.m. ET weekend time period has not been used since NBC lost NBA rights 22 years ago. Putting NBA Playoffs in that slot would have also given ABC’s “American Idol” an enormous lead-in.

• We made the same point recently about ABC airing Caitlin Clark’s record NCAA women’s basketball championship game at 3 p.m. ET, not in prime time. The men’s championship also misses an opportunity by starting on Thursday afternoon, and has no Sunday CBS prime-time windows, still “protecting” what was once the top prime-time show franchise in a bygone television era, “60 Minutes” (though still among CBS’s highest-rated). Meanwhile, ABC aired the NFL Draft on a Thursday night, helping it draw 12.1 million viewers.

• In 2019, when Fox sold its studio and announced a recasting of its broadcast network around sports and events — NFL (at the time) on Thursday, WWE on Friday, and college football on Saturday night — it nevertheless hired a new entertainment programming executive. Why, when Fox programmed just nine remaining weekly prime-time entertainment hours (versus 22 for the other networks)? Instead, it could have easily filled those hours with sports it owned, including MLB and college basketball. Most broadcast networks continue to operate on what we believe is ’80s-dated inertia, before widespread cable, VCRs or streaming, when they collectively held a 90% prime-time audience share!

To their credit (and sports’ benefit), NBC is more aggressive. Its use of the Olympic rings to brand the network has set the standard for sports/TV integration. The Kentucky Derby post time was traditionally 5:40 p.m. ET. Earlier this month, NBC aired the 150th running at 7:02 p.m. ET, drawing 20.1 million viewers. The originators of “Breakfast at Wimbledon,” NBC has established weekend morning network coverage of the Premier League, helping to elevate international football. Look for the NFL to program weekly Sunday games from Europe, 9:30 a.m.-1 p.m. ET, by the end of the decade. Should NBC reclaim the NBA from Warner Bros. Discovery, it would mark the first time a major cable package migrated back to broadcast. It won’t be the last.

It’s not that NBC faces any issues different from its competitors, but it does think differently, highly valuing the power of live sports. When NBC pioneered the early weekend evening 5:30-8 p.m. ET NBA window (home to many classic Michael Jordan and Kobe Bryant games), it helped address potential preemptions by offering its local stations a highly rated and sellable news insert at halftime (similar to what the NFL has done in its late Sunday afternoon window).

The alchemy of sports media deals always involves reach and revenue. As traditional pay-TV subscribers shrink, broadcast networks with theoretical 100% reach are even more in vogue for rights holders. Sports dominated the 2024 upfronts — even for Netflix. It’s perfect timing for new network thinking, delivering the best games to the biggest audiences.

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Ed Desser is president of consultancy Desser Sports Media Inc. (www.desser.tv). John Kosner is president of consultancy Kosner Media (www.kosnermedia.com). Together they developed league TV strategy and ran the NBA’s media operations in the ’80s and ’90s.

John Kosner Spoke with Mike McCarthy of Front Office Sports About Netflix’s NFL Deal

Original Article: Front Office Sports, by Mike McCarthy, May 15th, 2024

NFL-Netflix Deal Could Set Stage for Mother of All Cash Grabs

• The league could opt out early of current rights deals—and charge more money.

• The NFL can opt out of its current media deals after seven years.

The NFL’s landmark Netflix deal puts the chess pieces in place for what could be the league’s biggest business gambit of all: opting out early of its current media-rights deals that will pay a combined $110 billion through 2033. That would likely force desperate legacy media partners such as CBS, Fox, NBC, and Disney’s ESPN to pony up even more in rights fees to keep their only must-have programming from being gobbled up by giant streamers like Netflix, Amazon Prime Video, and Google’s YouTube. 

Here’s how the mother of all cash grabs could work. The NFL’s current cycle of media-rights deals, signed in 2021, runs from the ’23 season through the ’33 season. But ProFootballTalk reported that all of the deals—repeat, all of them—can be terminated by the NFL after seven years. That means the NFL could throw all of its TV/streaming rights up for grabs after the ’30 season.

With the NFL conjuring new rights deals for Netflix’s Christmas Day doubleheader and Amazon’s Black Friday game out of thin air, would anybody bet against the league exercising those opt-out clauses? Especially when virtually every TV network and streamer spent this week touting their NFL programming to ad buyers during upfront week. 

When it comes to media-rights deals, the NFL is “diabolical,” tweeted Andrew Brandt, the former Packers executive turned executive director of the Moorad Center for the Study of Sports Law at Villanova University. Brandt laid out how the league horned in on the NBA’s longstanding Christmas dominance and is now bringing in Netflix over current rights partners for at least four valuable Christmas Day games that arguably should have gone to one of them. 

“I have no doubt that the NFL will opt out,” Brandt told me Wednesday. “What seemed like home runs for the NFL a couple of years ago now seem like bargains for the networks.”

The opt-opt clauses in its media deals were designed to give the NFL flexibility as it aims for an 18-game regular season and possible game windows, PFT noted back in 2021. But they also give the NFL the contractual freedom to do what it does best: Set up a bidding war for its expensive media packages. With NFL games accounting for 93 of the top 100 most-watched TV shows in ’23, incumbent rights partners will either have to play ball or risk living in the wilderness without live NFL games.

“For the NFL, it is always about having more bidders than packages,” John Kosner, the former ESPN executive turned media consultant, told Front Office Sports in an email. “Should that be the reality in 2029—likely!—I would expect the NFL to opt out of its current media agreements.”

From a strategic standpoint, the NFL’s Netflix deal is a boon for both partners. The league has now assembled a virtual murderers’ row of deep-pocketed media partners that include the four biggest broadcast entities (ABC/ESPN, CBS, Fox, and NBC) and three biggest streamers (Netflix, Amazon, and YouTube). No wonder the league wants to sell off its NFL Media operations: It has seven media partners clamoring to produce its games and studio programming.

For Netflix, the world’s biggest, most successful streamer with 260 million customers, it’s the beginning of its long-awaited move into live sports rights. There’s no trophy more valuable than NFL game rights. This could open the door for Netflix to bid on other major sports leagues, as well as continue its move into sports documentaries via Peyton Manning’s Omaha Productions, which will follow up the Quarterback docuseries with Receiver this summer.

There are still questions about Netflix’s agreement to stream an NFL doubleheader this Christmas Day and at least one yuletide game in 2025 and ’26. How much will Netflix pay the NFL? They won’t say. But figure at least $50 million to $100 million per game. Who will produce and call the games? Netflix wouldn’t comment on that either on Wednesday. 

Whatever the answers, there’s little doubt the NFL-Netflix deal is another “crossing the Rubicon” moment, says Kosner. From now on, legacy media companies will have to look over their shoulders for Netflix, as well as Amazon and YouTube. Things might never be the same.

“For a reported $150M, Netflix materially helps its evolving ad sales business, gains a tentpole on a holiday when all Americans are home, and challenges Amazon, Peacock, and Disney/ESPN+ for NFL streaming supremacy,” Kosner says. “[Netflix] also gets to gauge the impact that premium sports has on its platform. The prediction here: a much better investment for Netflix than its movies. And [it] sets the stage for many more and bigger sports rights investments by Netflix in the years to come.”

As for football fans and viewers, the future will entail more streaming services if they want access to all the games. As NFL reporter Albert Breer noted Wednesday, NFL games will stream this year on Netflix, Amazon Prime, Peacock, and ESPN+.

“There was a time when having an NFL Sunday Ticket and a cable subscription would get you access to every game. That time is over,” Breer wrote.

John Kosner Spoke with Ira Boudway of Bloomberg About the Caitlin Clark Effect for the WNBA

Original Article: Bloomberg, by Ira Boudway, May 10th, 2024

Ticket sales are way up, new TV deals are coming—and the players might actually start getting paid like pros.

On a Monday at the end of April, Caitlin Clark is on the practice court at Gainbridge Fieldhouse in Indianapolis. It’s her second day of training camp as a rookie with the Indiana Fever. During a scrimmage against a squad of male players, she dribbles up the floor, crosses over from her right hand to her left, steps back, and sinks a deep three. It’s a signature shot for Clark, one she made hundreds of times in her career at the University of Iowa, seen on SportsCenter highlights and in State Farm ads. Now the Fever, whose season begins on May 14 when the team opens on the road against the Connecticut Sun, expect it to become a fixture in the WNBA.

Clark is already the biggest thing to happen to the Fever. At the end of February, when she declared her intention to enter this year’s WNBA draft, the phone lines at the team’s ticket office began ringing immediately and didn’t stop for days. “Everybody was here all weekend long just answering phones,” says Todd Taylor, president and chief commercial officer at Pacers Sports & Entertainment, the ownership group for the Fever and the Indiana Pacers, the team’s NBA counterpart.

The Fever, who finished at the bottom of the Eastern Conference last year with a record of 13-27, won the rights to the first pick through the WNBA’s draft lottery in December. It was a foregone conclusion that the team would take Clark, who, in her four years as a Hawkeye, had become the all-time leading scorer in college basketball (men’s or women’s) and a national star unlike any before her.

After averaging 4,067 fans at Gainbridge Fieldhouse last year, second to last in the league, the Fever expect to be at or near a capacity crowd of 17,254 for each of their 20 home games this season. “We used to play in a barn with six fans,” NaLyssa Smith, a third-year forward, says after practice, referring to a stretch in 2021 when the team played at Indiana Farmers Coliseum on the state fairgrounds while the fieldhouse was undergoing renovations. “Now we’re going to be playing in sold-out arenas.”

On draft night in mid-April, a sellout crowd of 1,000 raucous fans showed up to watch Clark and the league’s other top soon-to-be rookies cross the stage and shake hands with Commissioner Cathy Engelbert at the Brooklyn Academy of Music in New York. Another 6,000 showed up at Gainbridge to watch on the big screen, part of an audience of more than 2.4 million who viewed it on ESPN—four times the previous record for a WNBA draft.

In Brooklyn, Clark sat in a white satin blazer and miniskirt from Prada, with her parents and two brothers seated with her at one of the 15 tables arrayed on stage—each with a purple tablecloth and a white-and-silver basketball centerpiece. When Engelbert announced the first pick, Clark told reporters afterward, the moment was no less gratifying for its lack of suspense. “When you’re kind of just sitting at a table waiting for your name to be called,” she said, “I think that really allows the emotions to feed you.”

This time around, the draft was more than a sorting of talent across the league’s 12 franchises; it was a formal kick-off for Clark’s professional career and a celebration of what promises to be a transformational season for the league. “Thank you to those who have been witness to the past 27 WNBA seasons,” Engelbert said during her opening remarks, “and welcome to all of you who will become WNBA fans from today on.”

Clark’s arrival comes at a key moment for the league. The WNBA is currently in talks over the TV rights for many of its games, with the remainder coming up for negotiation in the next 18 months. A new labor agreement with its players is also likely to be on the table during that span. If Clark thrives at the professional level—and if her millions of fans make the transition with her—it will change the math for everybody.

Her rise at Iowa bears echoes from 45 years ago, when the rivalry between Magic Johnson, then at Michigan State University, and Larry Bird, then at Indiana State University, drew record-breaking viewership for college basketball. That audience followed the pair to the NBA, where they took up their rivalry with the Los Angeles Lakers and Boston Celtics, respectively, helping to lift the league to its current status as a multibillion-dollar business and home to some of the most famous athletes in the world. Johnson and Bird gave way to Michael Jordan, who gave way to Kobe Bryant and Shaquille O’Neal, who gave way to LeBron James and Steph Curry, and so on. “That’s what we have coming,” Engelbert says during an interview in the league’s Manhattan offices in March. “I really believe that.”

For the moment, Clark has no peer in the WNBA when it comes to star power. But the league is full of would-be rivals. Over 40 games this summer, the Fever will face some of the best players in the world—a cast of pros who will try to bump the celebrated rookie from the spotlight. Clark’s challenge will be to keep draining those deep threes. The league’s will be to showcase its other stars, turning Clark fans into WNBA fans.

CLARK’S IMPACT ON THE COLLEGE GAME IS HARD TO OVERSTATE. AS a Hawkeye, she played in the four most-watched games in the history of women’s college basketball. Iowa’s loss to the University of South Carolina in this year’s national championship game drew nearly 19 million viewers, outpacing the most-watched non-Clark game of all time by about 10 million—and topping this year’s men’s final.

“I don’t know that we’ve ever seen anything exactly like it,” says Michael Mulvihill, president of insights and analytics at Fox Corp., whose networks carried dozens of Iowa games during Clark’s career. At the beginning of her freshman year, an Iowa game on Fox’s Big Ten Network drew about 50,000 viewers. By the end of her senior year, in a game against Ohio State on Fox’s national broadcast station, 3.4 million viewers watched her break Pete Maravich’s 54-year-old scoring record. “We’re still trying to figure out, how exactly did that happen?” Mulvihill says. According to John Kosner, a sports media consultant and former executive with the NBA and ESPN, Clark belongs on a short list of athletes who can draw in casual fans by the millions. “In my lifetime,” he says, “that’s Muhammad Ali, Michael Jordan and Tiger Woods.”

In October, in an outdoor preseason exhibition at Iowa’s football stadium, more than 55,000 people watched Clark play, a record number for women’s basketball. Virtually everywhere the Hawkeyes played last season, they matched or set records, boosting their visitors’ attendance by an average of 150%, according to the Associated Press, while their home games consistently drew sellout crowds of nearly 15,000. “She’s building women’s basketball,” says Angela Ruggiero, co-founder of the market consultant Sports Innovation Lab, a four-time Olympic medalist with the US Women’s National Ice Hockey Team and a WNBA investor. “She’s building women’s sports. She’s so much bigger than just basketball.”

While the WNBA has seen strong growth in viewership and attendance since the pandemic—with women’s sports in general experiencing a boom in interest and investment—Clark’s Iowa numbers far outpace the league’s. Last year’s finals between the defending champion, the Las Vegas Aces, and the New York Liberty drew an average of 728,000 viewers per game, making it the most-watched in 20 years. Regular season attendance was the highest it’s been since 2018, at an average of 6,615 fans per game.

Women’s college basketball has a more than 100-year headstart on the WNBA. It enjoys spillover from the deeply ingrained allegiances and large followings of other college sports. Mulvihill at Fox Sports says his company’s networks plan to pivot from promoting Clark to other stars still in college such as JuJu Watkins of the University of Southern California and Paige Bueckers of the University of Connecticut. “If you just ask sports fans, ‘Have you ever heard of the USC Trojans? Have you ever heard of the Connecticut Huskies?’ Everybody has,” he says. “The WNBA has a challenge in front of them just in terms of establishing their brands to a general sports audience.”

In the final months of Clark’s senior season, the gap between the size of her Hawkeye following and the WNBA’s audience led to a public debate about whether she’d be better off staying in college another year. Clark had the option to do so, because the National Collegiate Athletic Association had granted an extra year of eligibility to athletes whose careers had been disrupted by the pandemic. Because the NCAA had also abolished its longstanding prohibition on athletes profiting from their name, image and likeness (NIL), Clark had assembled a multimillion-dollar portfolio of marketing deals with blue-chip brands including State Farm Insurance, Gatorade and Nike.

“I am probably speaking stupidity here when I say this,” Tony Kornheiser, co-host of the ESPN talk show Pardon the Interruption, said on air in January before suggesting that Clark stay at Iowa for another year “because of the pay cut she is going to have to take to go to the WNBA compared with the NIL money.”

The self-doubt was justified. Clark is, of course, free to sign marketing deals as a WNBA player and has only added to her off-the-court income since turning pro. In March, just a few days after she declared for the draft, the Indiana-based financial services company Gainbridge, which owns naming rights to the arena where the Fever and Pacers play, announced it had signed her for an undisclosed amount. A month later, Clark agreed to a new deal with Nike Inc. for $28 million over eight years, the biggest endorsement contract for a women’s basketball player.

The “pay cut” discourse got started because of Clark’s rookie salary with the Fever. According to the WNBA’s collective bargaining agreement (CBA) with its players, she’ll take home a base pay of $76,535 in her first year. As new fans turned their attention to the league, this figure—less than a hundredth of the $12.2 million salary of the first pick in the 2023 NBA draft, Victor Wembanyama—went viral and became a rallying cry for equal pay in women’s sports. “It’s time that we give our daughters the same opportunities as our sons and ensure women are paid what they deserve,” wrote President Joe Biden in a post on X the day after the draft.

“Look, it’s low,” says Engelbert of Clark’s base pay. “It’s low for a reason.” In 2020, when the WNBA entered the current agreement, she says, the league’s economics weren’t where they needed to be to pay more. That, she says, is changing.

THE WNBA HIRED ENGELBERT AS ITS FIRST COMMISSIONER IN 2019. (Though she was the first to get the title, Engelbert, like WNBA presidents before her, reports to the NBA commissioner.) As an undergraduate at Lehigh University, she captained the lacrosse and basketball teams. Before taking the WNBA job, she’d spent 33 years at Deloitte, where she rose to become the first female chief executive officer of a Big Four accounting firm. It was a “bit of a shock” to go from running a 100,000-person company to “a league of 144 players,” she says. The WNBA she inherited, she adds, needed a “total transformation.”

The NBA formed its sister league in 1996 to fill in summer broadcast and arena schedules. It began with eight teams the following year and, by 2000, had expanded to 16. Four teams folded within the next nine years. Over its first two decades, NBA Commissioner Adam Silver told the AP in 2018, the league operated at a modest loss of about $10 million per year. “It’s not a secret that we haven’t cracked the code on how to make money in women’s basketball,” Silver said.

Such losses are normal for a startup sports league. But while the WNBA was steadily increasing revenue and, more important, building the allegiances that are the lifeblood of professional sports, it wasn’t clear, at least to Silver, that the venture was sustainable. Engelbert was hired to make it so. Her first task: negotiate a new pay package with players.

In January 2020 the league struck an eight-year collective bargaining agreement. For the first time in WNBA history, the association boasted, average compensation would exceed six figures—a landmark that mainly underscored how low the baseline was. In the first season of the deal, the maximum salary was set at $215,000, up from $117,500 in the last year of the expiring deal. It’s this agreement’s rookie wage scale—established while Clark was a senior at Dowling Catholic High School in West Des Moines—that set her 2024 salary at a rate more fitting for an entry-level accountant than a once-in-a-generation basketball talent.

The 2020 CBA also created incentives for players to help the business grow. Every off-season, a handful of stars can make up to $250,000 each through marketing agreements with the league. Instead of going to play in Australia or Italy, as many players do to make extra money, they spend their fall and winter training in the US—and occasionally make promotional appearances for league sponsors such as CarMax, Deloitte and Google. (Phoenix Mercury star Brittney Griner was returning to Russia to play for club team UMMC Ekaterinburg when she was detained in Moscow in February 2022.) “It’s not a heavy lift to do a league marketing agreement,” Engelbert says, “but they can make some good money.” Between this program and a similar arrangement available from each franchise—plus salaries and a handful of performance incentives—top players can make as much as $500,000.

On top of that, if league revenue increases by 20% each year—using 2019 as the baseline—it triggers small payouts for all players. Pandemic disruptions, however, put that target out of reach. In 2020, the WNBA had $56.2 million in sales, according to internal documents reviewed by Bloomberg News—only an 8.5% growth rate.

Read more: Women’s Basketball Is Raking in More Cash Than Ever, But the Players Aren’t

Players have yet to receive payouts even four years later. Now, however, the incentive is basically moot; at the end of this season, players can abandon the agreement early, making 2025 its final year. Everything indicates they plan to do so. (The WNBA players’ union didn’t respond to requests for comment.)

Once the CBA was done, Engelbert went out to raise money. After a pandemic delay, the WNBA announced in early 2022 that it had brought in $75 million from a group including Michael Dell, Condoleezza Rice, Laurene Powell Jobs, Ruggiero and Nike. The deal valued the league and its teams at about $1 billion. Engelbert used the funds to go on a hiring spree, adding software engineers to revamp the league’s app and beefing up the marketing department. Clark’s arrival is perfectly timed. While she was making a name for herself at Iowa, Engelbert was laying the groundwork for the WNBA to better sell itself.

The formula for a good product, Engelbert says, has three parts: household names, rivalries and games of consequence. Clark checks the first box. The upside of the women’s game is that schools still do much of the work of identifying, developing and promoting young talent. The WNBA doesn’t allow US players to enter the league before age 22, ensuring that most spend four years in college. “You don’t have to create the identities for the players,” says Taylor of Pacers Sports & Entertainment. “They’re already bringing them.” And their fans are especially devoted. “Women athletes drive engagement at very, very high levels,” says Lindsay Kagawa Colas, an agent for Griner and other WNBA stars at talent management agency Wasserman Media Group. “There is a stickiness to their fandom, to the way that people love them and follow them, that is unique to women’s sports.”

In the men’s game, the chances of someone having a record-breaking college career like Clark’s are increasingly slim. The NBA’s minimum age of 19 means many top players spend only a year in school, if they attend at all. Startup leagues such as OTE, founded in 2021 for players as young as 16, offer alternative paths to the NBA, and many top prospects come from Europe. For casual fans, this means that rookies often arrive out of nowhere. The projected top pick in June’s NBA draft is Alexandre Sarr, a 7-foot-1 Frenchman who plays in Australia.

For the rivalry piece, the WNBA is full of players ready to oblige. In Las Vegas, the league has a budding dynasty in the two-time defending champion Aces, who are led by A’ja Wilson, a center with flawless footwork. In their home opener on May 16, the Fever will face the New York Liberty, who lost to the Aces in last year’s finals, which has a cast of stars including sharpshooter Sabrina Ionescu and reigning league MVP Breanna Stewart. Once household names and rivalries are in place, games of consequence follow.

During this year’s March Madness women’s tournament, the WNBA ran ads featuring veteran players with the tagline “Welcome to the W.” In one, Dallas Wings guard Arike Ogunbowale recommends that rookies use a “No Shade” lotion for “guaranteed thicker skin.” In another, Stewart sits down to eat a bowl of “Rookie-O’s” cereal “packed with first round draft pick flavor.” The tongue-in-cheek spots, created with ad agency Wieden+Kennedy, were both an invitation for college fans to follow their favorite players to the WNBA and a warning to those players—a way to build anticipation for Clark’s arrival while turning the spotlight onto the league’s broader talent pool. “It can’t just be about Caitlin,” Engelbert says.

Still, the WNBA’s national TV schedule, announced just before the draft, is suddenly Fever heavy. Of the team’s 40 regular season games this year, 36 will air nationally, including two on ABC, two on CBS and five on ESPN. Last year, the team had one national TV game, with some games only available on its Facebook stream.

Even before setting foot on the court in a WNBA game, Clark has helped give the league leverage in its TV rights negotiations. The association currently pulls in about $60 million annually from Disney’s ESPN, Paramount Global’s CBS Sports, the Scripps-owned network Ion and Amazon’s Prime Video. Engelbert has said she hopes to double that revenue. That goal, says Daniel Cohen, a media rights consultant at Octagon Inc., would’ve been out of reach before Clark, but it’s now achievable. “The Caitlin Clark effect is real,” Cohen says. “She is a generational talent and could not have come at a better time for the W.”

In April, the WNBA extended its deals with Amazon.com Inc. and CBS through the end of the 2025 season, coinciding with the expiration of its agreements with Ion and, most importantly, ESPN. The majority of the WNBA’s TV revenue is derived from ESPN, which broadcasts 25 regular-season games along with the playoffs on its cable networks and ABC. ESPN acquired WNBA games as part of a nine-year, $12.6 billion deal with the NBA that began in 2016.

Both leagues are poised to renew their contracts with ESPN in an 11-year deal projected to generate about $2.6 billion annually, according to Bloomberg News, nearly doubling the NBA’s current annual revenue from the network. Additionally, the WNBA is involved in a new agreement between the NBA and Amazon, which will contribute $1.8 billion annually over 11 years to augment Amazon’s existing WNBA package. The WNBA’s share of both deals, neither of which is finalized, is reported to signify a significant increase in rights fees for the league, according to a source familiar with the negotiations.

Engelbert notes that the conversation surrounding women’s sports has evolved. Previously, broadcasters and corporate sponsors regarded the WNBA as a marketing expense—a means to earn goodwill by demonstrating support for gender equality. However, in recent years, they have come to perceive women’s sports as a legitimate entertainment asset offering the potential for a meaningful return on investment. Engelbert remarks, “When I came in, people were viewing women’s sports as a charity. We’re far from that.”

Any increase in TV revenue for the WNBA will enhance the leverage players possess at the bargaining table with the league. Player salaries typically lag behind. For instance, Michael Jordan's rookie salary in 1986 was $550,000. Even a decade later, amidst a dynasty with the Chicago Bulls, he earned only $3.9 million annually. However, due to Jordan’s influence in reshaping the NBA’s economics from a league generating revenue in the hundreds of millions of dollars to one with billions, even average players now earn tens of millions annually.

But even when compared to the historical standards of their male counterparts, WNBA players are considered underpaid. According to data compiled by sports economist Rodney Fort, during the 1972-73 NBA season, which was the league's 27th season, Kareem Abdul-Jabbar of the Milwaukee Bucks was the highest-paid player, earning $350,000. Adjusting for inflation, that amount would equate to about $2.6 million in today's currency. In contrast, the highest-paid WNBA player today earns only about $242,000 in salary. Former ice hockey player Ruggiero expresses hope for a future where gender becomes irrelevant in determining pay, emphasizing that the focus should be on who brings the best entertainment value.

Engelbert, whose primary responsibility is to safeguard the interests of the owners, has a long-term objective of increasing franchise values and expanding the league. In February 2023, the ownership of the Seattle Storm sold a minority stake in the team at a franchise valuation of $151 million, as reported by Sports Business Journal, nearly ten times the previous record for a WNBA team sale. Additionally, in October, according to Sportico, the NBA's Golden State Warriors paid a record $50 million expansion fee for a new WNBA team in San Francisco set to commence play in 2025. Engelbert highlights the inadequacy of being a league present in only 12 cities within a country of 330 million people, stating, "that’s not enough." She outlines her aim of expanding to 24 teams in the next decade.

EARLY RETURNS SUGGEST MANY OF CLARK’S FANS ARE, IN FACT, following her to the WNBA. Even after raising ticket prices twice in the past six months—once when they won the draft lottery and again when Clark said she was going pro—the Fever will soon have a waitlist, Taylor says, for season tickets in its lower bowl. The team used to remove about 800 seats behind one basket for Fever games to make room for a giant inflatable slide and other carnival games. The “Family Fun Zone” is gone now. The team needs the seats for paying customers.

The Aces and Washington Mystics have moved home games against the Fever to larger venues to account for the unusual demand—the Aces from their usual home at the 12,000-seat Michelob Ultra Arena to the 18,000-seat T-Mobile Arena and the Mystics from the 4,200-seat Entertainment & Sports Arena to the 20,000-seat Capital One Arena. Overall WNBA ticket sales are up 93% over last year at this time, according to online marketplace StubHub.

Clark’s fame is such that the league is scrapping its policy of having teams fly commercial between games, a hassle that Clark didn’t have to endure at Iowa. Video of Clark on the flight to Dallas for the Fever’s first preseason game against the Wings in early May became a news story, complete with footage of her by the baggage carousel and eyewitness testimony from a passenger in her row. Four days later, Engelbert said the WNBA would be moving to charter travel for players “as soon as we can get the planes in place.”

For those who’ve followed the league—and for the players who’ve helped build it—the attention that follows Clark feels both welcome and long overdue. “I, of course, feel elated and vindicated and energized,” Lindsay Gibbs, a reporter who has covered the WNBA and women’s sports for more than a decade, wrote in her Power Plays newsletter, “but I also feel angry that it didn’t happen sooner.” In a league in which many of the biggest stars and nearly 80% of players are people of color, there’s also the question of why it’s taken a White player to galvanize interest.

Colas at Wasserman points out that much of the media gushing over Clark has been ignoring the league for decades. “This wave that feels like it’s cresting has been building energy over many, many, many years,” she says.

However it happened, the wave is here. Clark has lifted nearly every measure of demand by an order of magnitude. She begins her WNBA career with unprecedented attention, sky-high expectations and proud veterans waiting to welcome her to the W. “Reality is coming,” Diana Taurasi, the WNBA’s all-time leading scorer, now entering her 20th season with the Phoenix Mercury, said on ESPN in April. “You look superhuman playing against 18-year-olds, but you’re going to come [play] with some grown women that have been playing professional basketball for a long time.”

Clark isn’t shying away. “There is kind of a target on our back,” she says after Fever practice in April. “That’s something you embrace and you love. You wouldn’t want it any other way.” The Fever lost that preseason game against the Wings at a sold-out College Park Center in Arlington, Texas, with Ogunbowale hitting the game-winning three, but Clark led her team with 21 points, including five threes—a promising start to her pro career. “Give her the ball, and let her do her thing,” Ruggiero says. “She wouldn’t be this popular if she wasn’t that good.” —With Randall Williams

John Kosner Spoke with Dan Kaplan of Awful Announcing About ESPN’s Signing of Jason Kelce

Original Article: Awful Announcing, by Daniel Kaplan, May 2nd, 2024

Jason Kelce signing shows no expense is too great for ESPN when it comes to the NFL

ESPN has spent tens of millions of dollars on Monday Night Football talent, even in an era of cost-cutting elsewhere.

First it was the eight-figure annual salaries for Troy Aikman and Joe Buck. Then there was the move of tabbing Scott Van Pelt to host the pregame show. Then the ManningCast added Bill Belichick as a regular guest. And now ESPN’s Monday Night Football has also won the scramble to snare Jason Kelce, the boisterous smiling former Philadelphia Eagles center and host with his brother Travis of a top rated podcast, New Heights.

“Jason has a chance to sort of be a breakthrough, especially if you imagine that at some point he’ll be paired with his brother,” said John Kosner, a media consultant. Travis Kelce has two years remaining on his recently reworked contract with the Kanas City Chiefs.

ESPN may be belt tightening in some areas but when it comes to MNF and everything before and after the game, no expense appears too high.

It wasn’t that long ago that critics savaged MNF for its talent (remember the ill-fated tenure of Jason Witten, and the mocked Booger Mobile) and for the quality of its games. No more. MNF may not exactly be leaving the other broadcasters in the rear view mirror–after all Tom Brady is scheduled to take over lead announcing duties at Fox; of course he might change his mind as he has done before – but the moves are certainly notable.

“I wonder whether this move (Kelce) by ESPN raises the pressure on some of the other broadcasters to do more to find other ways to innovate,” Kosner said. “Because they’re amassing at ESPN the best talent team. And this again, is the most popular sport in America.”

The other broadcasters have not all been quiet. CBS Sports made waves this week by going younger with its talent team, moving out Phil Simms and Boomer Esiason, and bringing in Matt Ryan to the studio show. Fox, again, is poised to add Brady as number one color commentator, and it has the long running number one ranked pregame show.

And ESPN after all is a different animal than its competitors. For one, ESPN fought for years for better games. Despite spending more in rights fees than any of the broadcasters, ESPN persistently had poor games. Paying through the nose for broadcast talent is seen in industry circles as a signal to the NFL, and advertisers, that ESPN is treating the NFL broadcast with utmost devotion and respect. And it has paid off by appearances. Since the new broadcast contracts that went into effect last season, ESPN’s games, which drew record ratings, were often blockbuster matchups. And the league even agreed to flex games to Monday night–it has not done so yet.

“ESPN wants the best games they can get and their schedule has gotten progressively better over the last few years, certainly since Jimmy Pitaro took over (ESPN),” Kosner said. “And, but I think that the real end game is to build viewership and tune in to other programming that they do around the NFL.”

Another reason for the all-in spend around MNF, unlike its competitors, ESPN has no non-sports businesses competing for resources. And the NFL is the biggest sport, so it is always going to invest in football.

“They got a lot more NFL programming hours than anybody else,” media consultant Patrick Crakes said. “They have to. Their return on investment could be diluted by that. So they don’t want that to happen. So they’re investing a lot.”

And Kosner said, “those networks are not really comparable to ESPN, because they’re not in the SportsCenter business. They’re not in the NFL Live business. And in certain cases, they haven’t added that much talent because they didn’t have to… none of them do the hours of content and programming.”

For those who snark the pregame shows, the announcers, the sideline reporters and so on don’t matter because fans just want the games, Crakes, and Kosner disagreed, arguing it is important the overall NFL product is presented as professionally and slickly as possible.

“They have to constantly think about how they’re presenting because their brand is largely dictated by it,” Crakes said. “When I was at Fox, even after we launched FS1, my consumer research group came back saying what had been being said forever: the entire brand of Fox Sports centered around the pregame show of the guys at the desk.”

Kosner didn’t disagree games are what fans value most, as evidenced by the rights fees paid to the NFL. “But from the standpoint of building a healthy network business, “ he added, “you would like to get people to tune in at all hours and sort of express their fandom that way.”

And the popular and rambunctious Kelce, who pounded beers in the parking lot and went shirtless at the Kansas City Chiefs-Buffalo Bills divisional round game in Buffalo, just might be must-watch TV.

John Kosner Spoke with Matthew Frank of The Ankler About Netflix’s Potential Interest in UFC Media Rights

Original Article: The Ankler, by Matthew Frank, April 20th, 2024

Last Saturday night during the UFC 300, TKO and Endeavor CEO Ari Emanuel had his usual ringside seat to the mixed-martial arts (MMA) spectacle. Right next to him, though, was a new friend to the octagon: Ted Sarandos. (Hat tip to David Spade of all people for capturing the Netflix co-CEO obstructing his view.)

Sarandos thanked UFC and its president Dana White on his Instagram Stories, but what he didn’t mention was that he may very well have been there to inspect the merchandise up close. (A UFC spokesperson declined to comment.) While sports media-rights watchers circle the NBA and its current negotiations, speculating what, if anything, Netflix may want for itself (the In Season Tournament? The Play-In games?), UFC’s media rights are only months away from being renegotiated. MMA is not only global like the NBA, but it’d be cheaper than pro basketball and much like UFC and WWE making sense within its parent company, TKO Holdings, ultimate fighting might also be a perfect pairing with Netflix’s just-acquired rights to stream WWE Raw starting next January. (Netflix did not respond to a request for comment.)

Also in January 2025, the UFC will start the process of determining its next rights deal (or deals). In 2018, UFC negotiated a $1.5 billion all-inclusive media rights deal with ESPN, which expires at the end of 2025. TKO president Mark Shapiro told investors in March that it is the company’s “preference to stay at Disney” — while just happening to add that three different platforms had already reached out about UFC switching services.

He also declared that the UFC had easily asserted its rank among the four major sports, up there with football, basketball and baseball and ahead of hockey.

“The ratings on ESPN and ESPN 2, apples-to-apples against the NHL, even including the playoffs, we dwarf them,” Shapiro said. “You put a Fight Night — not a pay-per-view, not a preliminary bout in front of the pay-per-view — a regular weekly Fight Night on ESPN does double-digit ratings.”

If Netflix is going to make the leap from sports entertainment to live sports, don’t be surprised if Sarandos is preparing for a double-leg takedown.

Netflix Whiplash

Over the years, Netflix has been adamant about its disinterest in live sports. As recently as last October, Sarandos said there was “no core change in our live sports strategy or licensing live sports.” He said Netflix could impact the sports business via bringing “value” to “the drama of sport.”

Since at least 2016, when the service debuted Last Chance U about football players at junior colleges likely playing their last-ever games, it has developed a niche in offering sports docuseries. It has gone on to cover everything from a hardluck Premier League club (Sunderland ‘Til I Die) to the vaunted Drive to Survive and Quarterback. These then led to Netflix’s made-for-TV sporting “events” — the Netflix Cup and Netflix Slam — a more manufactured drama, but ever so slowly Netflix was inching its way forward.

Then in January, about three months after Sarandos forswore that there’d be no live sports on the service, Netflix signed its 10-year, $5 billion deal with TKO-owned WWE to air Raw weekly. WWE may technically be “sports entertainment,” but to its rabid fans, wrestling is a sport. Netflix’s next move, announced in March, is a boxing exhibition featuring Jake Paul vs. Mike Tyson, a stunt which will likely draw a considerable amount of eyeballs when it streams live on July 20. “Judging from the early excitement around the Jake Paul-Mike Tyson fight,” Sarandos told investors on April 18 during the company’s earnings webcast, “there's going to be a lot of people waking up in the middle of the night all over the world to watch this fight in real time.”

He rhapsodized about the “magic” of “folks gathering around the TV together in the living room to watch something all at the same time,” expressing his belief in “these kind of eventized cultural moments.” (Never mind that Netflix’s on-demand binge model helped erode that for everything but live sports.) UFC fights, of course, are the epitome of that kind of event. And so much for your own personal algo and the find-your-own-adventure on Netflix in its new age, as “broad” becomes the new “prestige.”

That’s Advertainment

Why the sudden shift into more live sports? Netflix’s implementation of an ad tier — another idea that the company pooh-poohed for eons until it decided to launch one in late 2022. Year-round sporting events lend themselves to appointment viewing, which drives higher engagement and advertiser interest.

“That's where sports really shines, and I think that that kind of underpins some of the value that WWE will bring to Netflix,” says Geoff McQueen, managing director at LEK Consulting, a strategic consulting firm with a media and entertainment practice. “UFC [would] do something very similar.”

In particular, UFC gets at advertisers’ coveted 18-34 demographic. “Netflix is already the leader in terms of distribution. I believe [UFC] would help Netflix with retention,” says John Kosner, a former ESPN digital media executive who now runs his own consultancy, Kosner Media. “[It] would help them reach UFC's younger, male demo, which I'm sure is part of their target and not as easy to reach.”

Disney’s Shifting Sports Ambitions

As Disney CEO Bob Iger seeks to reset the company on surer footing (and secure his legacy) and ESPN Chairman Jimmy Pitaro (maybe) auditions to replace him, ESPN’s streaming ambitions as of late are in flux. In February, the company announced a joint venture with Fox and Warner Bros. Discovery for a streaming sports service coming in the fall of 2024. ESPN also announced the launch of a new flagship DTC service that will debut in fall 2025, featuring both the linear ESPN and ESPN+ offerings.

Both new services, but in particular the latter, raise questions about what ESPN’s new setup might look like and the role UFC might play. Although UFC appeared to give ESPN+ an early boost — the sport’s first live event on the platform in 2019 generated 568,000 new subscribers — ESPN+ is still so small that it is dumped into the “other” bucket of streaming services that command less than 0.8 percent of the audience according to Nielsen.

“If there's no ESPN+, then it raises the question of ‘Okay, well, what about the proprietary content that we acquired for ESPN+, whether it's UFC or La Liga, or Bundesliga, or NHL Center Ice or the PGA Tour Thursday/Friday?’” asks Kosner. “How does that stuff fit in?”

Additionally, Disney, whose market capitalization sits roughly where it did when it made its original deal with the UFC, is looking to re-up its media rights deal with the NBA this summer. ESPN currently splits the NBA with Warner Bros. Discovery for a collective $24 billion over nine seasons, a figure that only looks to surge upwards in the coming negotiations, even if Netflix isn’t a buyer of some part of the NBA package.

Between the NBA, the $2.7 billion ESPN pays annually for NFL rights and its new six-year, $7.8 billion college-football playoffs deal, among others, another full-scale media rights deal with the UFC could be too rich for its pockets compared to Netflix.

“The legacy media companies, they have a lot of debt, and they have to pay through the nose for the sports rights,” says McQueen. “Because the sports rights, with the NBA or the NFL . . . they’re what’s keeping the pay-TV (PTV) ecosystem together and the pay-TV ecosystem is what's generating cash flow and profits for the legacy media companies, which they’re using to fund the streaming services.”

Benefits and Potential Cost of Netflix’s Sports Fandom

When TKO made the deal with Netflix for Raw, one of the main benefits for the WWE was that it standardized the wrestling promotion’s international distribution. WWE had previously been scattered across a hodgepodge of international partners, with some larger regional partners but

still very fragmented.

Netflix will now be the WWE’s turnkey international distributor.

“In a lot of these international markets,” says LEK’s McQueen, “Netflix will probably have higher penetration than in the PTV ecosystem to actually get UFC content or the WWE content in front of more fans and increase that fan base and ultimately drive more monetization because I think Netflix will be able to monetize it at a higher level.”

The same logic applies to UFC, which currently has assembled a bevy of different international partners because ESPN+ is not available globally.

But if Netflix does choose to buy some UFC rights, it could have downstream effects on the rest of Hollywood seeking to supply it with shows. Sarandos and CFO Spencer Neumann preached discipline in their content spending to investors this past week. “The budget is the budget,” Sarandos said. The money to pay for a live sports package would have to come from somewhere — and that somewhere is likely the budget for originals (the vast majority of its content spending) or licensed shows. Either way, live sports could translate into fewer buy orders from the best buyer in town.

More Partners Equals More Money

As the NFL has consistently proven, a sports league can generate a lot more revenue if it divvies up its rights to multiple partners.

Netflix, for example, may now own the media rights to Raw, but the WWE’s other weekly programming — SmackDown! — belongs to Comcast. It signed a new five-year deal, which starts in October, where it will pay $287 million annually to continue to broadcast it on USA Network and Peacock.

Could a similar-type package work between Netflix and ESPN?

Like the WWE, the UFC has two main offerings: There are its numbered events like the one Sarandos attended, which are pay-per-view through ESPN+, and then there’s Fight Night, which operates on a roughly biweekly basis, that’s either streamed without extra charge on ESPN+ or broadcast on ESPN or ABC. Netflix has never pursued an à la carte model, so the PPVs might be unattractive to the streamer.

Fight Night would be an easier entry point into the sport. Plus, without an added surcharge, that would more effectively service Netflix’s advertising mandate for engagement, whereas ESPN+ — or whatever service it becomes by 2026 — could still generate subscribers from exclusive PPVs.

With Netflix now generating $2 billion a quarter in profit, Sarandos may be thinking of one of Tyson’s most colorful quotes as he thinks about his competition: “When I fight someone, I want to break his will. I want to rip his heart out and show it to him.” Welcome to the arena, Ted.

Time to Combine The Final Four. John Kosner’s Latest SBJ Column With Ed Desser

Original Article: Sports Business Journal, by John Kosner and Ed Desser, April 15th, 2024

In the 2021 NCAA Gender Equity Media & Sponsorship Analysis, we wrote that the Men’s and Women’s Division I Basketball Final Fours should be staged at a single location on the same weekend, starting ideally in 2023. Imagine if the NCAA had done so! Last year, the epic matchups of Iowa with Caitlin Clark against undefeated South Carolina and then eventual champion would likely have packed Houston’s NRG Stadium! The 2024 women’s final outrated the men’s by a previously unthinkable 26%!

As to the debate about whether to expand significantly the number of teams playing in the men’s tournament ...

We say: “No!”

Sports media is undergoing historic change. If you’re not constantly improving, you’re falling behind. For Tier 1 properties, the key strategy is often expansion, building upon what’s already there, primarily in the postseason: NFL playoffs have gone from eight to 14 teams; MLB from four to 12; College Football Playoff from four to 12/14 schools; the NBA has added both Play-In and In-Season tournaments; the World Cup will have 50% more teams (48) in 2026.

But expansion is not the only way to improve. The NCAA men’s and women’s basketball championships are already almost perfectly designed:

• True national championships.

• All single-elimination games.

• A near-ideal combination of automatic qualifiers covering all D-I basketball conferences, plus an appropriate number of at-large schools (Blue bloods and Cinderellas!).

• So perfect that March is the busiest month for vasectomies … really!

To increase the value of their two basketball crown jewels, the NCAA and its schools should focus on strategically improving what they already have — not diluting it further. While beautifully constructed, the men’s and women’s tournaments, as media properties, have barely changed in decades. It’s high time:

• Let’s start with the beginning. The first two full days of the men’s tournament are a national holiday for many sports fans, but who can take Thursday/Friday off? The NBA playoffs start on Saturday/Sunday, enabling every game to be nationally televised to the biggest possible audiences. Open the men’s tournament on Saturday/Sunday — up to eight games per day could be scheduled unopposed! Then use Monday/Tuesday late afternoons and evenings for the second round. We also suggest using home arenas for both tournaments for the first weekend — cutting down on travel, ensuring a great atmosphere for TV and rewarding the excellent play of higher seeds during the regular season.

• Update the TV schedule. Expand distribution, improve time periods. Would the NFL construct a playoff schedule with no Sunday night network TV windows whatsoever? Of course not. The Duke-N.C. State regional final drew 15.1 million on CBS, Sunday at 5:05 p.m. ET. What would it have done at 8 p.m. ET? The South Carolina-Iowa rematch on ESPN drew 18.7 million and ended just after 5 p.m. ET. How about if it started on ABC at 8:30 p.m.? All games should be elevated into the best, not best-available, time slots. Everyone wins! With the plethora of networks available between CBS, WBD and ABC/ESPN, game times could be coordinated and staggered to better effect. Being more aggressive will create a virtuous cycle, yielding more rating points and resulting ad dollars and higher rights fees starting in 2033.

• Truly cross-promote. The NCAA mandates that CBS/WBD and ESPN modestly cross-promote the respective tournaments. But when games are live simultaneously, announcers directing fans to NCAA.com for schedules is not ideal. The NCAA now uses “March Madness” branding for both events; it should include the women in its March Madness Live app, too.

• Combine the Final Fours! Big East Commissioner Val Ackerman outlined this idea in her 2013 white paper, and last month Casey Wasserman championed it on Bill Simmons’ podcast. Currently, the pieces fit and could remain: The women play Friday/Sunday and the men Saturday/Monday. But the NCAA could also create a Super Saturday with all four semifinals and a Monday night championship doubleheader with prime-time slots for both. With CBS/Turner, it could also update its sponsor sales approach, permitting devoted women’s championship sponsors to buy stand-alone packages without buying through the men’s overhang. In her white paper, Ackerman wrote that a combined Final Four would “create an unparalleled college basketball showcase that would bring together the best players and coaches in both sports and, importantly, allow the women’s tournament to avail itself of the presence of sponsors, media representatives and important guests who typically bypass” the women’s final weekend in favor of the men’s. The women’s leaders aren’t “in the room where it happens.” Let’s change that! The men and women could also play in the same venue, share hotel allotments (which any Super Bowl city can manage), and create a Basketball Super Bowl!

Reasons we feel negatively about championship expansion:

• The broadcasters won’t pay materially extra for more early-round games in either tournament.

• There’s limited room to expand the men’s tournament — one week later is the Masters, one week earlier are most of the conference championships (Idea: Use the NIT, not the “First Four,” to qualify the final slots).

• Any change in the automatic qualifiers negatively affects the appeal of the tournaments. This year, the biggest men’s stories early were Oakland, Yale and James Madison. But in other years it’s been Saint Peter’s, Cornell and Loyola (Chicago).

• Yes, the expanded Big Ten and SEC want to maintain the percentage of their schools making the tournaments, but not at the expense of optimal tournament design.

NCAA leadership considered our 2021 combined Final Four recommendation but then selected separate locations through 2031. That’s a big miss. Hopefully the leaders of college sports will reconsider. There’s no better time than now.

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Ed Desser is president of consultancy Desser Sports Media Inc. (www.desser.tv). John Kosner is president of consultancy Kosner Media (www.kosnermedia.com). Together they developed league TV strategy and ran the NBA’s media operations in the ’80s and ’90s.

John Kosner’s Comments on NCAA Championship TV Start Times were Featured in Ben Koo’s Column in Awful Announcing

Original Article: Awful Announcing, by Ben Koo, April 9th, 2024

The madness has ended for both the men and especially the women. This year’s tournaments have been a major success in terms of interest and television ratings.

But as much as positivity surrounded both tournaments this year, there was one issue that fans and sports media folks took issue with—the tipoff times of both championship games. Below we look at the fan feedback and what realistically could change, if anything.

Women’s Championship Game at 3 p.m. ET on Sunday

In August 2022, The Athletic’s Richard Deitsch reported that the women’s championship game would be moving from its traditional home of ESPN to the more broadly distributed ABC for the final two years of the existing contract. Deitsch had long advocated for that move and ESPN President of Content, Burke Magnus, signaled that while they could only commit to 2023 and 2024 on ABC, the plan was for the game to stay on ABC should ESPN renew the contract, which they indeed did, and is already looking like a money-printing steal for ESPN.

While the move to ABC has been good from a visibility standpoint, the game slid back from the 8 p.m. ET tipoff time it held the year before on ESPN to 3 p.m. ET. That five-hour change had some feeling like it was not optimally scheduled. Our poll, which got 4,000 responses, showed that fans thought 3 p.m. ET was too early on Sunday although the old 8 p.m. ET tipoff was seen as too late. Nearly 80% of the poll respondents seemed to like the idea of a tipoff time between 4-8 p.m. ET.

Although most folks found the tipoff time too early, some found it just right.

Many people responding to our poll, as well as general fodder on X/Twitter, cited that the 3 p.m. tipoff time was not ideal due to activities including day drinking, youth sports, errands, family events, and church. 6 p.m. seemed to be the sweet spot many were looking for.

In defense of the 3 p.m. tipoff time, Deitsch made the point that the NFL does quite well in the afternoon.

While 8 p.m. or later only got 6.5% of the votes in our poll, many people noted that NBC’s Sunday Night Football kicks off after 8 p.m. and is the highest-rated regular season sporting event on a week-to-week basis. That said, that tipoff time would require ABC to nix their primetime lineup, something networks are very hesitant to do. Also, is the 8:20 ET kickoff of Sunday Night Football really optimal or simply done because of the late afternoon window before it?

John Kosner, a former ESPN executive, cites that the NFL starts its biggest post-season games at 6:30 p.m. ET which is probably a pretty definitive clue of what data signals is the most ideal time to start a game. That said, NFL games take three hours or more, whereas college basketball games take about two hours. So a 6:30 ET kickoff time for an NFL playoff game is really a 6:30-10 p.m. ET window whereas a college basketball game is more likely to go from 6:30-8:45 p.m. ET.

Ultimately, as Sports Media Watch referenced in the posts above and below, the 3 p.m. ET tipoff is more of a byproduct of ABC not wanting to disrupt its primetime lineup, something we saw as the post-game show ended with no warning on ABC (it continued on ESPN).

Will that be the case moving forward? Given how massive the ratings were and the fact that the clunky transition was into paid programming instead of their primetime lineup, something Sports Media Watch labeled as “borderline incompetence,” it seems likely some change will take place. With “America’s Funniest Home Videos” (yes, still a thing) airing at 7 p.m. ET, a tipoff pushed back to the 4-4;30 window would allow ABC to capitalize on the millions watching versus dumping them into paid programming.

Another option is to go even later and have ABC take a break from their normal primetime schedule which would currently be “America’s Funniest Home Videos” and then “American Idol,” although I think moving the latter is very unlikely. Ultimately, ABC and ESPN now have ratings data that is significantly more compelling. You’d think it helps make the case that a 3 p.m. ET tipoff leading to paid programming does nobody any good. We’ll have to wait and see what their plan is for 2025, given that next year’s game will be the first in ESPN’s new deal with the NCAA.

Men’s Championship Game at 9:20 ET on Monday

As seen below, the late tipoff time of the men’s championship game is nothing new.

But once again, the topic of the tipoff time drew the same commentary it does every year.

The first thing to consider here is that a college basketball game tipping off at 9:20 ET will essentially end at the same time that NBC’s Sunday Night Football ends (11:30-ish) although the game starts a full hour later. So while the game starts later than most big time games we’re used to, it ends at about the same time.

The other thing to consider is that Monday is a workday and the networks have to juggle the fact that a game starting sometime around 8 p.m. ET will not allow viewers on the West Coast much time to travel back from work.  Given how much of the West Coast population lives around areas with known difficult commutes (Bay Area, Los Angeles, Sacramento, Seattle, etc.), networks are more or less juggling the question “Do we gain more viewers on the West Coast by giving them added time to get back home?” versus “how many viewers are we losing on the East Coast by pushing this game later in the night?”

Given how the game has never really moved off of its 9:00-9:20 tipoff time for decades, the data seems to support the fact that despite rankling fans on the East Coast, the 9:20 ET tipoff time is pretty optimal. Keep in mind Nielsen provides ratings data for the largest markets in the U.S., so they can see where ratings will be impacted by start times, allowing networks to potentially adjust accordingly.

While the Eastern time zone has ~47% of the country’s population, the Pacific time zone has just under 17%. So while more people are annoyed on the East Coast and perhaps that could be factored in more, the networks seem to be saying ‘Yes they are annoyed on the East Coast, but they still watch, whereas West Coast viewers in many cases will be unable to watch at all if the game was earlier.’

The thinking is that X amount of viewers, with Y amount of them being annoyed, is better than having fewer viewers in total, even though those watching might be happier overall.

That’s a long way of saying if you’re someone who finds the tipoff time too late for the men’s championship, you’ll likely have to move timezones, have a coffee, or just deal because it doesn’t seem like it will be changed anytime soon.

John Kosner Spoke with Josh Carpenter of The SBJ About Pro Golf’s Media Deals

Original Article: Sports Business Journal, by Josh Carpenter, April 8th, 2024

As negotiations slog on between the PGA Tour and PIF on a potential agreement and PGA Tour Enterprises continues to be built out, one consistent talking point in golf has been how the product will be improved with an influx of capital. Specifically, when it comes to improving the product, much has been discussed about potential changes to it on TV or via other viewing avenues.

The PGA Tour’s media deals with CBS, NBC and ESPN run through 2030, but could new money lead to changes to those contracts before then? Might fans see fewer ads and more golf shots during broadcasts? SBJ caught up with a pair of media industry veterans -- Ed Desser and John Kosner (both regular SBJ contributors) -- to talk about what might be in store.

The below has been edited for brevity and clarity.

Q: With this influx of new capital, could the PGA Tour’s current media deals see changes? Or how might golf broadcasts look different going forward?

Desser: What's broken in golf is not their TV deals. Their TV deals to me are pretty good. They're heavily into broadcast. And so you at least have potential for wide availability, expanded hours over the course of years. People are accepting of a fairly robust level of inventory in telecasts. It's not really different in other sports. And so to me, while I can certainly appreciate the notion of lower commercial loads, I don't know that that has a meaningful impact on audience. It seems very unlikely to go to lower commercialization, which isn't to say that there couldn't be some premium options. A streaming service that is continuous coverage of holes. They do a little bit of that now, but if literally you could follow every group from beginning to end. That could be a very nice premium product that wouldn't generate huge audiences, but it could be incremental and satisfy part of the audience that would be willing to pay.

Kosner: I see streaming options coming, follow your group, limited commercials, the “Every Shot Live” product that they do with the Players. I could see those things happening. But in general, fans want to see the top golfers in action on Saturday and Sunday afternoons. LIV grew up in part because that wasn't really happening every weekend on the PGA Tour. And now golf's fragmented. So, this all kind of augers for some sort of broader partnership so that fans can get what they want, which is to see the best players playing every Saturday and Sunday. There’s been talk of the formation of a global golf tour, and while maybe that’s not really of interest to the U. S. media companies, it could be of interest to Apple, could be of interest to Netflix, could be of interest to Amazon.

Q: Should the PGA Tour’s decline in viewership this season on linear television be concerning? Or is it more cyclical and a sign of more households cutting the cord?

Desser: The broader perspective is better and one should be thinking about what were the numbers four or five years ago and to what extent has losing so many names (to LIV) negatively impacted the tour. It's enough guys that it's gotta hurt. These are, if not household names, they're certainly household names in golf households. And I think you've got to factor that in. But yes, audiences on television keep shrinking because there are more and more opportunities. The only real exception on an ongoing basis has been football and really NFL football.

Kosner: If you recall a year ago, you had the crusade, the tour was taking on LIV. They had brand new tournament structures. They had a lot of promotion, they had some exciting conclusions. There was a lot of energy into this a year ago that it's not quite the same thing this year. And these sports are cyclical. You have stars rise and fall, sometimes you have super dramatic games. Women's college basketball is having a sensational winter and spring, and we think it'll be strong next year, but Caitlin Clark will not be there.

Media consultants dish on improving the golf TV product

One consistent talking point in golf has been how the product will be improved with an influx of capital. When it comes to improving the product, much has been discussed about potential changes on TV or via other viewing platforms.

My colleague Josh Carpenter caught up with a pair of media industry vets -- Ed Desser and John Kosner (both regular SBJ contributors) -- to talk about what might be in store.

"All of sports has to focus on improving its product in a far more competitive environment," said Kosner. "The issue with over-commercialization, to the extent that that's a criticism, I kind of believe that's going to solve itself over time. The PGA Tour, the networks, the advertisers are going to conclude, 'We have to show more golf because we can't retain our audience.' ... It wouldn't surprise me at all to see more Mountain and West Coast locations for golf so that events could get scheduled into prime time and get better windows. It's great for the U.S. Open when they play at Olympic [in San Francisco]. ... By the same token, you may see with the influx of international dollars, more big events with big fields that are played in the Middle East, overseas and are airing at odd times."

"There's an interesting question whether there could be new products created that might appeal to younger audiences," noted Desser. "Clearly the tour is always looking for ways of attracting a younger demo because, let's face it, it's hard for younger people to afford the sport. And so they've got to figure out ways of introducing it and perpetuating it among younger people, or they'll be in the same mode as like horse racing where the average age is deceased."

John Kosner Spoke with Ira Boudway of Bloomberg About TV Viewership for the NCAA Women’s Basketball Championship

Original Article: Bloomberg, by Ira Boudway, April 5th, 2024

In this issue:

• We look at one of the few decent sports broadcasting deals around. Congrats ESPN.

• We talk to former Phoenix Suns vice president and co-owner Andy Kohlberg, who owns Spanish football club RCD Mallorca along with Steve Nash and Steve Kerr, about what it’s like taking a team to the cup final.

• We round up who is winning the Bloomberg Brackets for a Cause. Hint: swipe right.

• And check out our chat with RedBird Capital's Gerry Cardinale, who has his hands (and a lot of money) in everything from AC Milan to the United Football League to Fenway Sports Group. The former Goldman Sachs partner joins The Deal with Alex Rodriguez and Jason Kelly to talk about shaking up the sports media landscape and advising the late George Steinbrenner.

If you aren’t yet signed up to receive this newsletter, you can do so here. Send your feedback here.

Clark Delivers (and Then Some)

Hi, it’s Ira. I was in Albany, New York, on Monday night watching the Iowa Hawkeyes play LSU in the NCAA women’s college basketball tournament. At the risk of sounding corny, the game was a reminder why we watch sports in the first place. One of the hazards of this job is that you become jaded. You start to see sports as an industry. Teams become tax dodges for the mega rich. Leagues become legalized monopolies designed to exploit the talent of their players and monetize the devotion of their fans.

But for two hours on Monday night, I got carried away in the spectacle.

A rematch of last year’s championship, the game promised high drama and delivered beyond expectations. Caitlin Clark, Iowa’s sharpshooting superstar, sought revenge after LSU stifled — and taunted — her last time around. This time, with a Final Four appearance on the line, Clark was magisterial, scoring 41 points, including nine threes, in a victory. But LSU, led by Angel Reese and Flau’jae Johnson, kept it close until the final minutes in a fast-paced, back-and-forth game.

Afterwards, as I stood watching Iowa players celebrate, a fan came down to the sideline. He wanted something, anything, to keep as a memento. (Hope he liked the stat sheet I handed him.)

“Americans understand the difference between a regular event and a big event,” says John Kosner, a sports media consultant and former executive with the NBA and ESPN. “That game was tied at halftime. I think everybody was calling their friends and saying: ‘Are you watching this?’”

As it turned out, 12.3 million people watched on ESPN, the largest audience ever for a women’s college basketball game, breaking the record set by the same two teams in last year’s championship.

It’s a big number for any sporting event beyond the NFL — more than the audience for any game from last year’s World Series and all but one game of last year’s NBA Finals. And it’s more than any men’s college basketball game over the weekend, save one: N.C. State’s upset of Duke on Sunday evening, which had the advantage of being on CBS, a broadcast network in many more homes than cable.

NCAA March Madness Weekend TV Viewership

Women's games (highlighted in gray) drew record highs for ESPN/ABC.

Source: Nielsen

Clark has provided a huge lift to the women’s game. Five years ago, in 2019, the women’s final between Baylor and Notre Dame drew 3.7 million viewers, which, at the time, seemed like a good number. This year, Clark and Iowa drew more than 3 million for a first-round blowout of Holy Cross and nearly 5 million for their second-round matchup with West Virginia.

On Friday, Iowa eked out a win against UConn — the winningest program in the sport — to set up a showdown on Sunday with undefeated South Carolina in the title game on ABC. Drawing 20 million viewers is not out of the question.

Which brings us back to the cold business side of the Clark phenomenon. In January, ESPN agreed to a new 8-year, $920 million deal for the right’s to the women’s March Madness tournament, along with 39 other NCAA championships across a variety of men’s and women’s sports, including volleyball, gymnastics, and tennis. At an average annual value of $115 million, the agreement more than triples the value of the previous deal with ESPN. Yet it still may be undervaluing women’s basketball.

In 2021, after Sedona Prince, then playing with the Oregon Ducks, posted a viral video juxtaposing the pathetic “weight room” provided to players for that year’s women’s tournament with the elaborate setup for the men, the NCAA commissioned an independent equity review. Kosner and his colleague Ed Desser wrote the media analysis for that review and argued that the NCAA and ESPN were failing to unlock the full value of the women’s tournament.

The following year, at Kosner and Desser’s recommendation, the NCAA extended the March Madness branding to the women’s bracket for the first time, an obvious move that should have been made years ago. But the NCAA did not follow the pair’s recommendation to sell the tournament separately from other championships. According to their analysis, women’s March Madness alone could fetch between $81 and $112 million per year.

ESPN, however, likes the bundle for the extra programming to spread across its networks. So instead of breaking women’s basketball out, the NCAA sold them an even bigger bundle. Women’s March Madness, by the NCAA’s estimate, accounts for 57% of the value of the new deal, or about $65 million per year. CBS and Warner Bros. Discovery, by way of contrast, are set to pay a combined $1.1 billion per year for the rights to the men’s tournament beginning next year.

While Clark won’t be around next year when ESPN’s new deal also kicks in, the network appears to have scored a bargain. “She has established a higher base of interest for women's college basketball,” says Kosner. “Next year, I expect ratings will be down from these historic heights, but I still think that they will be at levels that we hadn't seen before.”

ICYMI

• College hoops star Jack Gohlke’s three-pointers helped Oakland University upset a college basketball behemoth. Now, he’s helping his school as it prepares to tap the bond market.

• EuroLeague, the top tier of men’s professional basketball in Europe, is exploring raising capital through the sale of a minority stake.

• Scotty Cameron’s custom clubs are solid investments, objets d’art that attract a whole other level of devotee. Are they worth the love?

• The bid to build a $2 billion ballpark and surrounding entertainment district in Kansas City faced a surprising opponent.

• Tottenham Hotspur is in talks with potential investors over a stake in the London football club, marking another Premier League club hunting for cash after a boom in sports team valuations.

• Billionaire Steve Cohen said he expects that more businesses will move to a four-day work week, one of the reasons he’s made investments in golf. Obviously.

Brackets for a Cause: Crunch Time

The annual Bloomberg Brackets for a Cause competition is getting tasty. Among the 58 participants, each person pledged $20,000 to pool a total of about $1.1 million dollars to be donated to various charities split between the top three brackets in both the men’s and women’s tournaments.

Leading the men's pack so far is Whitney Wolfe Herd, the founder of dating app Bumble. Herd has been a top performer in previous years, coming in second in 2022. Whatever the connection between building a successful dating algorithm and picking brackets, I want to know. Herd's got UConn beating Purdue in the final.

For the women's bracket, two private equity bosses are topping the table, with Dynasty Equity co-founder and CEO K. Don Cornwell drawing with Peter Weinberg, co-founder of Perella Weinberg Partners. Cornwell is picking South Carolina, a team that has been picked by 69% of participants to win it all. Ventas Chairman & CEO Debra Cafaro and Weinberg are the only two people who have UConn winning it all which is surprising given the program is arguably the best in women's college basketball history. — Aysha Diallo

An American in Mallorca

The Spanish football cup final — the Copa del Rey — is set to be played this weekend between Athletic Bilbao and RCD Mallorca, so we asked co-owner Andy Kohlberg what it’s like for an American owning a football team based in Palma de Mallorca, the largest city of the Balearic Islands, a sunny archipelago off the Mediterranean coast of Spain.

Pretty nice, I guess?

A Phoenix Suns vice president, Kohlberg bought Mallorca in 2016 with Robert Sarver, his former boss at the Suns, and gained a majority stake last year. Basketball coaches Steve Nash and Steve Kerr also own minority stakes. It’s been a rocky few years to say the least.

In 2017, the team was relegated to the non-professional third division, but has managed to claw its way back to the top tier, where it now sits just above the relegation zone.

“When we bought the club, we did not plan to go up and down; it’s difficult when it happens,” said Kohlberg. “We’re just trying to build a good foundation, invest in the academy, invest in the stadium, invest in the practice facilities and weather the storm that way.”

Some US owners try to replicate American sports franchises. Focus on stuff outside of football. Build a business. Increase revenue. Repeat. Which is great when you don’t get relegated and have the stipend of broadcasting rights to fund your franchise ad infinitum.

For Mallorca, who’s fighting to keep its place in LaLiga, relegation would imply slashing its budget to about €10 million ($10.8 million) from this season’s €70 million, of which about 60% comes from TV broadcasting rights.

But focusing on work off the pitch has its success stories. We’ve written about how Venezia FC’s owner Duncan Niederauer, the former chief executive officer of the New York Stock Exchange, has turned the club into a viable business in part via a high-fashion rebrand of club merchandise. A similar plan is underway at FC Como.

Mallorca has a million inhabitants, and last year the Balearics were visited by about 14.4 million tourists.

“Maybe they are not the real Mallorca fan, maybe they’re from Germany and a Bayern Munich fan, but want to come for a unique football experience,” said Kohlberg. “Having different VIP areas for different levels of fan experience is something that the American sports have done quite well.”

The goal isn’t changing the culture of Spanish football, but rather “trying to broaden the choices that people have while still maintaining the core of the culture and the integrity of Spanish football and Majorcan football,” he said.

To be sure, that implies dealing with profound business differences, and “that’s hard,” said Kohlberg. “We tried to learn and take a few things from the NBA, but you can’t try to copy what you do there.”

The club already invested €30 million to revamp its 23,000-seat stadium, following the injection from CVC Capital Partners of €1.37 billion into LaLiga’s clubs. The refurbishment eliminated the running track and moved the stands closer to the pitch, created a tunnel with glass walls to see the players ahead of games, an exclusive 50-seat stand behind the benches and facilities including restaurants, clubs and a gym. That helped boost annual revenue to €64.4 million, more than tripling in the last three seasons. The club is even profitable, something rare among European football clubs.

Playing the cup final this Saturday it's “very unusual,'' said Kohlberg. “We're very proud, very happy and also very surprised.'' — Thomas Gualtieri

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John Kosner Spoke with Eric Prisbell of On3 About The TV Viewership Potential of the 2024 Women’s Final Four

Original Article: On3, by Eric Prisbell, April 5th, 2024

To truly assess the magnitude of this year's men's and women's Final Fours, don't merely watch the games. Watch who's watching the games.

Never before in March Madness lore have viewership data for both events been under such a spotlight. Credit Caitlin Clark and the parade of stars for levitating the women's game to heights never before seen or imagined, attracting a wide swath of fans that extends far beyond typical NCAA Tournament hoop-heads.

Let's cut to the chase: If Clark's Iowa team faces unbeaten South Carolina in a dream national title game, it would almost certainly be the most-watched women's game in history. Viewership could very well also eclipse that of Monday's men's national title game, a feat unimaginable even five years ago.

"If we get the Iowa versus South Carolina rematch for the women's championship on Sunday afternoon [on ABC], I believe they'll eclipse 20 million viewers and easily top the men's final, which this year is on TBS on Monday night," John Kosner, who led digital media at ESPN from 2003-2017 and is president of media consulting firm Kosner Media, told On3 on Thursday. 

"Americans recognize and show up for the big event."

If only the women's championship were broadcast in primetime, a potential Iowa-South Carolina rematch – the Hawkeyes beat the Gamecocks in last year's national semifinals – would draw an even larger audience.

Viewership expectations continue to be ratcheted up in the wake of an extraordinary 12.3 million people watching Iowa topple LSU in an Elite Eight game shown on a cable network (ESPN). That number topped even the most ambitious projections for a title game rematch that was a year in the making.

To put it in perspective, more people watched an Iowa women's basketball game than every World Series game and all but one NBA Finals game in the most recent postseason. Five years ago, a script with that plot would have been tossed out as pure fantasyland.

And had the game been broadcast on ABC or on a simulcast, Bob Thompson, the retired FOX Sports Networks president, said on social media that Iowa-LSU probably would have "easily" exceeded 16 million.

The devil is in the details, of course, and the enduring takeaway transcends the Clark Effect, which is profound and has dramatically elevated the women's game. Attracting 6.7 million viewers for UConn's Elite Eight victory over USC was also remarkable. UConn drew that large of an audience for only one (1995) of its 11 title game victories.

It's convenient to lampoon the men's game, which is afflicted with a variety of chronic issues. But viewership for the men's tournament is actually up 4% over last year, averaging 9.4 million viewers across CBS, TBS, TNT and truTV.

The two men's Elite Eight games on Sunday – Purdue-Tennessee and NC State-Duke – averaged 12.8 million viewers, a 30% increase over last year and the most-watched Elite Eight doubleheader since 2019.

The possibilities are enticing: A UConn-Purdue title game wouldn't exactly be akin to drinking flat soda. Nor would a UConn-NC State championship, which would cue an incalculable number of four-decade-old clips of Jimmy V running around the court in Albuquerque looking for someone to hug.

That said, make no mistake: The Women's Final Four is The Show.

John Kosner Moderated an NFT.NYC 2024 Panel: ‘What’s Next in Sports, Loyalty, & Social Experiences.”

Original Article: NFT.NYC, April 3rd, 2024

John Kosner moderated an NFT.NYC 2024 panel featuring Pet, Essem Harris, and Asher Weiss!

You can find the recorded panel here.

John Kosner Spoke with Lucia Moses of Business Insider About Amazon Prime Video Sports

Original Article: Business Insider, by Lucia Moses, March 29th, 2024

Those who have taken on the role of technical advisor to Jeff Bezos, which denotes a high-potential executive serving for a time as his "shadow," often go on to do big things. One of them is Jay Marine, who oversees Amazon's sports business as the vice president of Prime Video and global head of sports. Marine is little known in the US sports industry but has a much bigger profile at Amazon. A 20-year vet of the company, Marine helped launch the Kindle, Amazon's first homegrown device, before serving from 2013 to 2015 as Bezos' advisor, an intense role that involves traveling and going to meetings with Bezos and whose alums include Andy Jassy, now the CEO.

From there, Marine was sent to London in 2015 to launch Prime Video abroad, leading to a move into sports, starting with the US Open tennis and Premier League soccer rights. Now the NFL's "Thursday Night Football" sits under him, the result of a $11 billion, 11-year deal.

Industry insiders who have dealt with Marine say he's analytical and down-to-earth, without the big personality that might compete with the many sports execs he might find himself negotiating with. Marine, a New Jersey-based father of three girls, joked on "The Sports Media Podcast" that his "claim to fame" was playing in a high-school basketball playoff game against Chris Webber and a football game against Tyrone Wheatley.

"Neither one of those worked out very well for me, but we did play the games," he said.

He compared his current remit to the early, scrappy days of Amazon. "I think we're at our best as a company when we act like a startup," he said. "I love to do new things and build things."

Marine's next move could be for the NBA, which Amazon craves for its young, global fan base. The league began 45-day talks with the incumbents Disney and Warner Bros. Discovery on March 9. If the NBA creates a third digital-rights package, Amazon is seen by many as a stronger contender than Apple and Netflix, which have made smaller moves in live sports.

Marine's main job is to prove that sports can be a valuable and efficient asset in keeping people subscribed to Amazon's $139-a-year Prime membership.

"For us, everything starts with Prime," Marine told CNBC in a rare interview last fall. "We sit around saying, how can we make Prime better, how can we add more value to Prime? We want Prime to be the best membership program in the world."

Antenna research has suggested that sports programming can punch above its weight as a retention tool for streamers. And the rise of sports within Amazon has led to tensions over finite resources between sports and entertainment. Some insiders on the entertainment side — which has taken big swings, like "Lord of the Rings," but has generally been seen as a middling success — saw a clear power shift toward Marine and the sports business in January when Amazon MGM Studios, its entertainment production arm, and Prime Video had their biggest layoffs to date.

Related stories

Amazon did not comment for this story.

Amazon's sports moves have been mostly incremental

Marine has said Amazon plans to be a prominent sports broadcaster in every major country over time. But what that means exactly in terms of the rights it bids for, and doesn't, is unclear.

Apart from its big bet on "Thursday Night Football," Amazon's sports moves have been largely incremental. It has some WNBA games, Premier Boxing Champions fights, and NASCAR rights. It's investing $115 million in Diamond Sports in a deal to rescue the regional sports broadcaster from bankruptcy and give Amazon streaming rights to its games. The deal lets Diamond continue airing local NBA broadcasts, which makes it more likely Amazon will bid for national NBA rights, the analyst Ben Thompson of Stratechery wrote.

But Amazon passed on the Pac-12 last year, per Sports Business Journal. It also didn't renew its Premier League contract last year.

Marine said on the podcast that Amazon looks at the most popular (and costly) sports that bring the biggest audiences but is also interested in emerging (and less expensive) areas like women's sports that have growth potential, citing its deals with the WNBA and the National Women's Soccer League.

The media consultant Patrick Crakes said that it's still TBD whether sports can move the needle for Prime but that the NBA is attractive because its long season could help Amazon build a sport-viewing habit.

"I think they're experimenting," Crakes said. "The experimenting is getting more serious." Crakes added that "the level of scrutiny is now at its highest level" because Marine is "paying attention to it every day."

Marine's team has been in flux, too. Marie Donoghue, an ESPN vet who was brought on in 2018 to run sports-rights negotiations for Amazon and has been credited with helping land "TNF," found herself layered when Marine moved into his current role, in early 2022, between her and Mike Hopkins, a senior vice president. She left in January for DraftKings.

Amazon's continued moves in sports aren't a given

Amazon Prime's move into advertising also could drive it to add more sports, said John Kosner, a former ESPN executive who's now a sports media and tech consultant. Advertisers are willing to pay high rates to advertise in live sports, which draws engaged fans who are habituated to seeing ads during breaks.

There's a common perception that Amazon's ability to outspend rivals gives it an edge in negotiating with leagues. Under Donoghue, it pulled out all the stops for "TNF," taking out a Super Bowl ad to promote it and hiring star anchors.

But Amazon isn't one to overspend just because it can. Sports isn't existential to Amazon the way it is to a Disney or Warner Bros. Discovery.

If the billions it's spending on sports don't pay off for Prime, it could curb its ambitions.

The research firm Kantar said the Premier League drove Prime signups in 2021, and Marine said Amazon's first "TNF" game attracted a record number of Prime signups. He's been conspicuously mum on the subject since then.

Money also isn't everything to the sports leagues. They have other interests besides helping Amazon sell more stuff, like having partners with social channels and content arms that can help grow the leagues' audiences.

Still, "TNF" has boosted its credibility with leagues and advertisers. Average viewership increased by 24% in year two over year one, to about 12 million per game, and the viewers have been younger than those of the TV broadcasts.

"I think things have been shifting," Marine said on the podcast. "More than ever, leagues are excited to work with us."

John Kosner Spoke with Mike McCarthy of Front Office Sports About The Media Value of NFL Christmas Games

Original Article: Front Office Sports, by Mike McCarthy, March 28th, 2024

The NFL is planning a lucrative Christmas present—to itself.

The league is poised to auction off TV rights to its two new Christmas Day games for the 2024 season, say sources with direct knowledge of the strategy, with bidding likely to start in the $50 million range.

The league plans to open the bidding to all of its media partners, say sources, including CBS, Fox, NBC, ESPN-ABC, and Amazon Prime Video. Collectively, these media giants will pay the NFL $110 billion through 2033.

The games are more likely to appear on linear TV networks than streaming platforms, the sources say.

The NFL declined to comment.

There’s no league better than the NFL at slicing and dicing up rights to find new revenue streams. Prime paid the league $100 million for exclusive streaming rights to the league’s first Black Friday game between the Jets and Dolphins last fall. The tech giant will now pay an estimated $120 million for the rights to its first playoff game this season. NBCUniversal’s Peacock, meanwhile, paid $110 million for streaming rights to the Chiefs-Dolphins wildcard playoff win last season.

Andrew Brandt, the former Packers executive turned consultant, estimates the Christmas Day games could end up selling for a 20% to 25% increase over the Black Friday game, which averaged 9.61 million viewers.

The NFL typically “exceeds expectations” when it comes to media deals, notes John Kosner, the former ESPN executive. He thinks the new Christmas Day games could sell for $75 million to $100 million apiece.

“The premium prices have come for exclusive streaming rights to NFL playoff games,” Kosner says. “NFL Christmas Day/night games have huge and growing audiences—but they are regular-season games scheduled seven months in advance. And traditionally the ad market for Christmas Day is not as robust.”

The NFL’s Christmas Day tripleheader in 2023 generated record TV audiences last season. CBS drew an average of 29.6 million viewers for an early-afternoon game between the Chiefs and Raiders. Fox drew 29 million for its lateafternoon broadcast of Giants-Eagles, and ESPN pulled 27.1 million for a prime-time Ravens-49ers game. Those figures dwarfed the average audience of 2.86 million for the NBA’s five competing Christmas Day games.

The NFL previously said its teams would not be in action this Christmas due to the holiday falling on a Wednesday. But the nation’s richest, most powerful sports league doesn’t like to leave money on the table. Besides generating more media-rights revenue, the NFL’s Christmas Day doubleheader will serve as another shot across the bow of the NBA, which dominated TV sports on the holiday for decades.

On his podcast, Colin Cowherd said the NFL is trying to effectively take Christmas Day away from the NBA as a tentpole TV event. “The gloves are off. It feels to me like the NFL has said, ‘We’re going to squeeze you,’” said Cowherd. “I do believe that’s a tipping point. That Christmas Day mattered a lot to the NBA. Those NFL games put a blanket over it.”

On Tuesday, NFL reporter Albert Breer of Sports Illustrated’s MMQB noted that the league would put the new Christmas games up for bid among the networks.

John Kosner Spoke with Adam Grossman of Revenue Above Replacement & JohnWallStreet About How AI Video Creation will Drive Sports Media Rights

Original Article: JohnWallStreet, by JohnWallStreet, March 26th, 2024

Savvy sports executives are trying to figure out how to monetize the content and data powering generative AI large language models (LLMs). Industry insiders believe succeeding on that initiative can help keep media-related revenues tracking up and to the right.

But OpenAI’s recent launch of Sora, a text-to-video AI model, has the potential to have an even greater impact on the industry by increasing the universe of ad buyers. If there are more companies willing to market themselves during live sporting events, then those broadcast rights should become more valuable.

Sora, currently available to just product testers and creative professionals, is not the first AI platform to enable users to turn text-based prompts into production-grade videos. Meta is among those with (or working on) a similar offering.

However, OpenAI’s ability to take a technically complex process and make it easy for everyday consumers to use (like it did with ChatGPT-3) has business leaders inside and outside of sports paying attention to the product before it has even been fully released. 

Inside sports, the focus has been on how Sora can help to democratize commercial production, and how that will influence ongoing and future media rights negotiations. 

Rights holders generate most of their revenues from carriage/affiliate fees and advertising. But because the process of creating commercials has historically been both costly and time-consuming (think: creative ideation, securing talent, production shoots, post-production editing), the pool willing and able to invest in them was limited. Only large-scale corporations with multi-million-dollar budgets could afford to produce spots for international, national, or regional broadcast. 

“The leading media companies generally serve the top 100 sports TV advertisers,” John Kosner (president, Kosner Media) said.

Of course, those are not the only businesses that could benefit from –and would have interest in– advertising during sporting events. There is little else on television that enables a marketer to reach as many viewers at once, and “diehard” sports fans tend be younger, more educated, and have higher-incomes than the median population.

“Sora could make [sports broadcasters] bigger players for the 4,000 or so [other businesses] that power Meta,” Kosner said.

Coincidentally, no company has done a better job of demonstrating that a broader market of advertisers likely exists for sports properties than Meta. Several times in recent years large sports advertisers have suspended ad buys across Facebook or Instagram (see: Coca-Cola, Diageo, Mars, HP, and CVS Health’s ad pause in 2020), and none of those protests made a substantial dent in its business. 

That is because the tech giant generates the bulk of its advertising revenue selling to smaller companies.

Meta generates billions in advertising dollars enabling rights owners to monetize content of all lengths and audience sizes, and by making it easy for niche brands to reach their target audiences. Remember, Meta has extensive data on the billions of people who use its platforms daily (think: specific interests, behaviors).

Sora can help companies, of any size, create video campaigns befitting all types of sports content. 

That includes the tech giants, Amazon, Apple, and Netflix, who have all started to dip their toes into the sports broadcasting space. 

“Having trained SVOD entertainment audiences to watch and binge their favorite shows with no commercials, leading streamers [now] need sports to establish robust ad businesses,” Kosner said. “That's why many of us expect the leading digital companies to become bigger and bigger ad buyers.”

And like Meta, Amazon, Apple, and Netflix all have billions of data points on their customers. These companies should be able to leverage their sports content and insights to help brand partners, regardless of size and budget, reach their target demo. 

Legacy rights holders should be able to benefit from platforms like Sora too. In addition to having their own streaming services that need to be marketed, the broadcast networks are gradually obtaining data from connected televisions and able to provide granular details on viewers to advertisers. 

But it takes more than just reaching the target audience to run a successful campaign. Brands also need to develop commercials that can drive their desired outcomes and objectives. 

And that’s where Sora can really help resource constrained companies. Its platform allows them (and content creators) to quickly –and cost effectively– develop and test creative concepts. 

Media experts believe text-to-video platforms will be particularly beneficial for emerging sports properties that have traditionally struggled to sell larger corporations on advertising due to their audience sizes. 

Removing the creative bottleneck should enable rights owners and holders up and down the value chain to generate more money from live sports rights. But there are headwinds that could slow adoption of the tech. Sora, like many other AI offerings, will still needs to address intellectual property concerns. 

“While [these models] may ultimately enable near-instant production of videos for a creative concept, if the reference content that underlies that creative isn’t in the Public Domain, then the derivative creator –the broadcaster, advertiser– will still need to license the necessary IP rights to use it for commercial purposes,” William Mao (SVP, global media rights, Octagon) said.

However, the emergence of text-to-video AI should be viewed as a net positive for the industry. Growing the number of potential companies capable of creating and leveraging advertising during live sporting events will result in short-term revenue gains for rights holders and make those rights more valuable over the long-haul.