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Wednesday, April 23, 2008

peacocking
Professional puckheads won’t have to go begging for National Hockey League broadcasts next season, as NBC has extended its broadcast agreement with the league through the 2008-09 season.

“There have been positive signs for the league, both on and off the ice,” Dick Ebersol, chairman of NBC Universal Sports & Olympics, said in a statement. “Ratings were up this year; the Winter Classic in Buffalo was a huge success; advertising sales were healthy; and the product on the ice has never been better, led by young, marketable stars such as Sidney Crosby and Alex Ovechkin. We believe this is a sport that will continue to grow.”

Ratings for the regular-season Sunday games on NBC were up 11 percent from last year.

We’ve heard all this before — a one-year bump is nice, but doesn’t guarantee any long-term commitment. The key component is that NBC is getting the content for free — no rights means the NHL is simply getting some much-need exposure, and the network has no risk in either broadcasting or else bumping the random game.

Still, having a prime broadcast presence is still a status symbol that any claimant to major-league sports must have. It might not mean as much five years from now, but for now, it’s a requisite that the NHL is glad to have.

by Costa Tsiokos, Wed 04/23/2008 03:21:26 PM
Category: Hockey, SportsBiz, TV
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Tuesday, April 08, 2008

If you watched last night’s NCAA men’s basketball championship game, you might have noticed the shiny new ladder that was used for the night-ending climb to the ceremonial net-clipping.

What, you didn’t? That’s bad news for Werner Ladder, because they ponied up the necessary scratch to be named the “Official Ladder of the NCAA Basketball Championships”.

Actually, I didn’t watch a minute of the game, since I’m not a hoops fan. But this news item worked on me in a sense, because I did make sure to tune in at the end, just to see how that ladder would be precisely-positioned for the camera to catch that prominent Werner logo. So I noticed it, if no one else.

But why stop the sponsorship gravy only halfway up?

Still unsold but presumably available would be a sponsorship of the Official Scissors of the NCAA basketball net-cutting ceremony. More often than not, a bandage scissors provided by the winning team’s trainer is used to actually cut down the nets. Perhaps ShopScissors.com?

There is, of course, an echo of gallows humor to the observation. Because it’s a lead-pipe cinch that by this time next year, some scissor-maker will step up and buy their way into that coveted “official NCAA scissor-cutters” spotlight. In fact, this year’s branding focus on the official ladder will serve to spur the bidding on the until-now moribund scissor namings-right opportunity — money begets money. That competitive spirit is what college sports is all about, right?

Maybe the winning clip-job sponsor will throw a curveball into the process, and have the Scissor Sisters on hand to deliver a deranged serenade for this triumphant ceremony.

by Costa Tsiokos, Tue 04/08/2008 12:19:28 PM
Category: Basketball, SportsBiz
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Sunday, March 30, 2008

nationally
Baseball’s Washington Nationals are starting this season in brand-spanking-new Nationals Park — and in this age of stadium naming rights, that kind of default facility name is bad news.

If, for no other reason, the depreciative effect:

Had a deal been in place already, the corporate sponsor would be identified with the park from its first day of existence — just as CitiBank will be identified with the New York Mets’ still-to-come Citi Field, just as telecommunications behemoth MCI was linked to Washington’s MCI Center two years before it opened. Some experts believe a relationship that begins on Opening Day — or, in some cases, years in advance — means the fan base will permanently link the corporation with the team.

“With every day that passes once the ballpark is open, the value of that rights deal could very well decrease,” said David Carter, the executive director of the University of Southern California’s Sports Business Institute. “There’s so much upfront media attention and buzz, and that impacts how the name would be received by the public… The opening weekend is a tremendous amount of positive publicity, and that could have a halo effect to a sponsor if one was in place.”

It’s strange to think that a phantom facility is more valuable, marketing-wise, than an already-existing brick-and-mortar structure. But it’s true, and I’ve noted that mindshare has an awful lot to do with it:

The chief reason why the naming-rights prices are super-sizing is that they’re being applied to brand-spanking-new buildings. That’s key. Instead of slapping a new name onto an old building — that comes with an entrenched name and tradition that, sometimes, never gets completely supplanted — the naming-rights holder gets virgin territory. So there’s no chance of Prudential Center being referred to by its “old” name, because there is no old name for the stubborn voices to hang onto.

In a way, things have come full-circle in the stadium naming game: Corporate branding of an events edifice has gone from a crass rarity to an essential element. And as the DC situation illustrates, it’s now even a top-of-list priority.

by Costa Tsiokos, Sun 03/30/2008 09:57:09 PM
Category: Baseball, SportsBiz
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Tuesday, March 11, 2008

Here’s a cute local sports media maneuver: To coincide with this week’s rebranding of the Fox Sports New York (FSNY) to MSG Plus, the channel’s Islanders pre- and post-game host Deb Kaufman is taking the opportunity to rechristen her own on-air handle.

“It’s something I’ve always wanted to do; there just never seemed to be a good time to do it,” she said. “Since the network was changing its name…”

Well, why not? Starting with tonight’s Islanders-Lightning game, Deb Kaufman will be Deb Placey, her name in her non-work life for the 13 years since she married Ed Placey, a senior coordinating producer for ESPN college football…

She does not plan a formal announcement but figures [Isles announcers] Howie Rose and Billy Jaffe will take care of spreading the news.

Actually, she did make the announcement on the air, during the pregame show. I’m sure many Islanders fans hearts were broken upon hearing that Deb is already hitched; I suppose they could start drooling over competing NHL television MILF Christine Simpson on Versus.

It’s worth noting that MSG Network has not caught up on this development, as it still lists her as Deb Kaufman on her bio page. Rebranding is always a tough row to hoe.

by Costa Tsiokos, Tue 03/11/2008 10:18:50 PM
Category: New Yorkin', SportsBiz, TV, Women
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Tuesday, March 04, 2008

footsbatshoopspucks
Part One was a month ago. Now, Metropolitan Corporate Counsel takes a further overview look at how the major pro sports league exploit their playing facilities as revenue streams: Namely, via naming rights and amenitized in-stadium premiums like luxury boxes, club seating and personal seat licenses.

As I pointed out a while back, the New York metro area is lately leading the way in terms of naming rights deal, dollar-wise:

Thus, in a span of less than three months, three New York area teams from different sports generated almost $1 billion in sponsorship fees. Such astronomical numbers can be attributed not only to the location of the facilities, but also to the pent-up demand for such agreements. Indeed, prior to this string of deals, the last naming rights agreement in the New York area had been in 1996 when Continental Airlines put its name on the former Brendan Byrne Arena in New Jersey’s Meadowlands sports complex.

And it’s always important to remember that, just because a stadium name remains unblemished by corporate rechristening, that doesn’t shut the door on selling select facility components:

Similarly, although the Yankees do not plan (at this time) on renaming their new $800 million palace - as the Yankee Stadium moniker is as sacrosanct as names can be in sports - they do plan on selling naming rights for each gate at the stadium. In light of the history, popularity, and importance of the New York Yankees, these mini naming rights deals should prove very profitable as well.

By the same token, I wouldn’t be surprised to see the Yankees sell the naming rights to the actual playing field — something like “Merrill Lynch Field at Yankee Stadium”.

As with the first edition of this report, there’s not much new here. But it’s a good summation of the current landscape of big-time sports business leveraging.

by Costa Tsiokos, Tue 03/04/2008 10:25:15 PM
Category: New Yorkin', SportsBiz
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Monday, February 18, 2008

post no bills
Goaltenders enjoy the spotlight that comes with being the focal point of the on-ice action. So maybe it’s natural that they’re the ones spearheading the long-expected migration of advertisements onto major-league player uniforms, in the form of the Goaltender’s Club, a proposal to sell corporate logos on the jerseys of the NHL’s 60 goalies.

A copy of the goaltender’s club proposal, obtained by the [Toronto] Star, shows corporate presence on a jersey could range from subtle to more invasive.

One proposal shows Roloson’s blue and orange team jersey with a small Rexall logo above the Oilers symbol. The drugstore chain’s symbol could also be “sublimated (dyed right into the fabric) on a portion of the sleeve.” A second proposal depicts Brodeur’s Red Devils jersey. The team’s NJ on the chest is positioned above a large tag for the bank UBS and adjacent to an RBC logo. Bank Morgan Stanley’s symbol could be featured on the goalie’s sleeves and shoulders.

A third proposal shows Detroit goalie Hasek’s red jersey, again with the Red Wings’ logo front and centre above the larger symbol of insurance company AIG. The company’s logo could also be displayed on the sleeves and on the bottom of the jersey’s back. The presentation also suggests goalies be allowed to choose the jersey’s colour and depicts Hasek’s in black, blue, green and white styles.

The differentiation of the goaltender’s uni colors is the biggest problem I have with this concept. I know it mirrors European soccer goalies’ looks, and that’s why I hate it: Goalies on the grass look like clowns half the time, donned in a shiny outfit that makes him stand out from his teammates to the point of distraction. It’s an unnecessary visual divider for the spectator. I don’t care how explicit it might otherwise be to tell which goalie is with which team — breaking that uniform pattern breaks the uniformity. That’s why they’re uniforms, remember?

Actually, the biggest problem I have with this scheme is that it’s based upon the idea that NHL clubs are hemorrhaging cash, thereby justifying the monetization of another aspect of the game. Any declaration of poverty among the major-pro franchises is met by extreme skepticism by me, because it’s a refrain that’s been repeated for decades, despite rising franchise values and ever-sweeter arena/commercial real estate deals. In short, I don’t buy the justification.

But does any of that matter? There’s money to be made, and players’ jerseys are the vacuum waiting to be filled.

My sense is that the NFL, MLB, NBA and NHL are all waiting one another out. The first one to blink — be it hockey or one of the other major team sports — will be the green light for the others to follow suit. Until then, the idea seems too minor league for North American sports mores to accept all at once.

I’m resigning myself to the expectation that it’s a question of when, not if. I’d be really pleased if the NHL, being my favorite sport, not be the one to cross the line first. But I’m sure that, say, 10 years from now, it’ll all be academic.

by Costa Tsiokos, Mon 02/18/2008 11:00:53 PM
Category: Advert./Mktg., Hockey, SportsBiz
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Monday, February 04, 2008

footsbatshoopspucks
Here’s a bookmark worth keeping track of: Legal professional newspaper Metropolitan Corporate Counsel is running an overview on the current status of major professional sports stadium jockeying in the U.S., with a particular focus on the New York metro area. The current installment deals with the public financing of these stadia deals, and the use of governmental eminent domain to secure building sites for those facilities.

Exhibit A includes a high-level breakdown of the public-till pricetag for the New York Mets and their soon-to-rise Citi Field, along with the comparison dollar figure for their cross-town rivals:

In total, the direct subsidies, exemptions, and bond financing will save the Mets approximately $276 million, while costing New York City $155 million in lost revenue and the State of New York $89 million. The Yankees received a very similar financial package from the city and the state, with the team receiving $276 million in benefits over a thirty-year period, at a cost to the city and state of $170 million and $85 million, respectively.

Not a bad business to be in. Underlining all that: Since 1996, 65 franchises in the NFL, NBA, NHL, and MLB have engineered new or substantially renovated arenas/stadia, with government money paying the lion’s share of that construction.

Part two of this analysis will deal with the naming-rights end of the sports-biz equation. I’m hoping the law reporters will bear in mind this qualifier for why prices for such corporate christenings have increased lately:

The chief reason why the naming-rights prices are super-sizing is that they’re being applied to brand-spanking-new buildings. That’s key. Instead of slapping a new name onto an old building — that comes with an entrenched name and tradition that, sometimes, never gets completely supplanted — the naming-rights holder gets virgin territory. So there’s no chance of [the NHL New Jersey Devils’] Prudential Center being referred to by its “old” name, because there is no old name for the stubborn voices to hang onto. That’s worth an extra couple hundred thousand per year, I figure.

I’m crossing my fingers on landing one of those coveted law-talkin’-guy footnote citations…

by Costa Tsiokos, Mon 02/04/2008 11:30:58 PM
Category: New Yorkin', SportsBiz
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Friday, February 01, 2008

no buts
Today marks the 15th anniversary of Gary Bettman’s tenure as National Hockey League commissioner.

Let me take this opportunity to isolate a prime example of the idiotic knee-jerk thinking that dominates such sports-journalism retrospectives:

Revenues and franchise values have also markedly grown, BUT so have player salaries. (emphasis mine)

“But”? That simple qualifier speaks volumes. It’s not “and so have player salaries”, which would cast the increase as a supporting effect of the league’s strength. Instead, it’s the accusatory “but”, implying that well-paid talent is a negative thing. Despite commonly-accepted perceptions, it’s wrongheaded thinking. Fact is, when both sides are making more money, that means the business is in great shape.

With that out of the way…

It’s been a 15-year wild ride: Expansion, relocations, and arena deals have changed the league’s landscape, while lockouts and disciplinary actions have contributed to uneasy labor relations. Plenty of assessments will be offered over the next few days, most of them negative — no surprise, as the chief steward of any sport is a naturally disproportionate target. Personally, I rate Bettman’s reign as neutral-to-slightly-positive. I’m fully supportive of the efforts to widen the scope of the game, and that wasn’t going to happen by keeping the 1993 status quo: Preventing weak-sister franchises from relocating and avoiding a presence in the fast-growing U.S. southeast and west regions. Counterbalancing that is his culpability for the lockout season and shoddy player treatment overall, even though that’s a function of his following orders from the owners (like every other sports commish does). And of course, marketing efforts — including the dearth of big-money national TV exposure — have been mostly as inept as they were pre-Bettman, when the NHL had presidents instead of commissioners.

All that’s fairly apparent, at least to me. I’m not your average fan, of course — I’m more astute, frankly. And I watch NHL games practically every night, to the exclusion of most other television offerings; so by that measure, I give the current state of the league a thumbs-up.

Bettman himself has a few more years left on his gig. As long as the revenues keep streaming under his watch, the owners will keep him around. On balance, that’s a positive thing.

by Costa Tsiokos, Fri 02/01/2008 08:24:59 AM
Category: Hockey, SportsBiz
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Tuesday, January 22, 2008

well versed
Worth noting: Versus and the National Hockey League will remain hitched in the near future, as the fledgling cable sports network has extended its telecast agreement with the hockey folks through the 2010-11 season, at around $75 million per year.

And there’s no shortage of nice things being said:

During the 2006-7 season, Versus’s N.H.L. rating stayed flat at a 0.2, but because of the overall growth of subscribers, viewership rose 31 percent to 212,366.

[Versus president Gavin] Harvey said the deal was turning a profit.

“Without the N.H.L., we’d be in a more difficult pickle,” he said.

Since the Comcast-owned Versus acquired the rights to the N.H.L. — after ESPN vowed to drastically reduce its rights payment to the league — the network has grown by about 10 million subscribers to 74 million, more than 22 million fewer than ESPN or ESPN2. It has also increased its subscriber fee to about 26 cents a month, from less than 20 cents.

It doesn’t hurt that Comcast also owns the Philadelphia Flyers, and thus has a vested interest in providing the league national exposure. Besides, despite all the running-down, there’s still a bigger chasm between the bush-league sports and the NHL; at the end of the day, it’s one of the Big Four sports, albeit the weak sister of the bunch (the way it’s been since the 1970s, really).

I’ll take all the TV time for hockey I can get. If Versus’ continued slow-but-steady growth represents a tandem trend with the NHL, all the better. It does verify a certain vague positivity in hockey’s perception ever since the NHL Winter Classic garnered modestly good reviews.

by Costa Tsiokos, Tue 01/22/2008 11:17:08 PM
Category: Hockey, SportsBiz, TV
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Wednesday, January 02, 2008

snow on ice
I already knew how good a game the Pittsburgh Penguins’ 2-1 shootout win over the Buffalo Sabres in the NHL Winter Classic outdoor game was, because I watched it. The image of snowflakes falling on the rink couldn’t have been more fitting for this special spectacle.

But that doesn’t mean squat. I watch hockey practically every night. What matters is if anyone else watched the NBC nationally-televised game, after a moderate amount of hype over retrofitting Buffalo’s Ralph Wilson stadium from football to hockey, and with competing college football games on.

Happily enough, the gimmick worked: NBC got a 2.6 national rating, the best numbers for a nationally-televised NHL game in ten years.

That’s not to say that a 2.6 is great:

The numbers would have been better if it did not go up against a close Capital One Bowl between Florida and Michigan, the latter a hockey hotbed. That game did a 9.9 overnight nationally and a 4.5 in New York.

So in the larger scheme of things, the ratings were good when compared to the typically puny viewing audience hockey draws on network TV. Baby steps, basically.

Nothing talks like money, and this kind of exposure will prompt the league to push more bowl games — at least one annually, and perhaps two. I can see this easily get done to death: Columbus versus Pittsburgh at Ohio State’s football stadium, Devils versus Rangers in Giants Stadium (with the Devils as home team, since it’s back in their old Meadowlands stomping grounds), Chicago versus Detroit in Soldier Field, etc. All would be thrilling — but not in rapid-fire succession. Let’s hope there’s some restraint.

by Costa Tsiokos, Wed 01/02/2008 10:55:16 PM
Category: Hockey, SportsBiz
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Saturday, December 29, 2007

buff impact
Until the novelty of playing hockey in a football bowl wears out, it appears the National Hockey League and its teams will have some economic impact numbers to throw around when pitching future Winter Classics:

With four days to go before the puck drops on the outdoor hockey rink in Ralph Wilson Stadium, the Buffalo Convention & Visitors Bureau estimates the New Year’s Day event will generate more than $5 million in direct revenues.

“Our projections tend to be conservative, but based on local hotel reservations, this is going to be a very significant event for Buffalo-area hotels and restaurants,” said the CVB’s Doug Sitler.

If those estimates hold, the Jan. 1 NHL event will top the $4.2 million in spending tied to the multiday slate of NCAA basketball tournament games played in HSBC Arena last March.

Five million bucks is not super-huge when it comes to dedicated major-league sporting events. In comparison, the last Super Bowl was hyped to have generated $298 million for South Florida; even if, as contended, that figure is somewhat inflated, it still points to an entirely different magnitude of dollar volume.

But then, no one is touting the Winter Classic as Super Bowl-caliber. It’s a regular-season game between the Pittsburgh Penguins and Buffalo Sabres that otherwise wouldn’t be worthy of special notice. The venue and date makes it special, and so it’s attracting more visitors and discretionary spending to the Buffalo area. That’s all it needs to do to help the league get exposure.

As long as the NHL restricts these bowl games to once per year, they’ll achieve their purpose, and everyone will be happy.

by Costa Tsiokos, Sat 12/29/2007 06:19:15 PM
Category: Football, Hockey, SportsBiz
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Monday, December 24, 2007

For all the crowing about how the future of Internet content lies in user-generated or “spontaneous” material, a talent rush has cropped up in an unexpected corner: Sports reporting. ESPN and Yahoo! are poaching sportswriters from newspapers and magazines, bulking up on original reporting to feed their Web properties and other media outlets.

Rising demand for star sportswriters, driven by rising television and Internet revenue, coincides with the declining fortunes of newspapers, which has left fewer jobs and less money to go around for most journalists. The paradox is not lost on the lucky few who benefit.

“This hiring at a high level, I know how amazing it is, given what’s happening everywhere else in the business,” said Mark Fainaru-Wada, who uncovered steroid scandals as a San Francisco Chronicle reporter and a co-author of the book “Game of Shadows.” He was recently hired by ESPN. “We just went through a 25 percent newsroom cut at The Chronicle,” he said.

On most topics, nearly all of the news offerings from Yahoo are collected from other sources. But not in sports, where the company has made its first major foray into being a creator of original material. It has more than 20 sports staff writers, up from 4 just two years ago, in addition to sports celebrities who write columns for the site.

Many staff members at Yahoo Sports are less prominent — and less well compensated — than the people signed by ESPN, and many of them cover niche topics like mixed martial arts and fantasy football. But Yahoo Sports has shown it intends to play in the big leagues, hiring David Morgan, former deputy sports editor of The Los Angeles Times, as its executive editor. It is also making lucrative offers to some of the journalists hired by ESPN and Sports Illustrated and signing a few sought-after people like Mike Silver, a football writer who was lured away from Sports Illustrated…

ESPN declines to reveal precise numbers, but in the last 18 months, it has hired at least 15 writers and editors from major newspapers and magazines, most of whom are expected to feed material to all of its platforms. Vince Doria, senior vice president and director of news, says that ESPN has 80 to 100 reporters and producers, not including its many columnists, where “five years ago, that number was closer to 50.”

Why is this happening now? Basically, sports is one of the stickier content wells you’ll find, drawing hardcore online audiences who’ll spend hours staring at game recaps, fantasy analysis, rumor items, etc. Advertisers know this, and are following the eyeballs. I’m surprised that critical mass has arrived already, but apparently it has, and now ESPN/Disney and Yahoo! have the ad money to toss into fat signing bonuses for wayward journalists.

It’s something of an irony, in that sports reporting has always been considered something of a journalism backwater, generally not as worthy of respect as “hard news”. Sports and business news consisted of a ghetto for major newspapers, despite those sections’ popular appeal. So the upside-down economics of the Web now allow sports scribes to cash in; I guess we can expect to see a similar hiring surge for prominent business reporters, although the star system there resides more in magazines and CNBC than in newspapers (even the Wall Street Journal doesn’t have many “name” writers).

by Costa Tsiokos, Mon 12/24/2007 05:49:33 PM
Category: Media, SportsBiz
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Friday, December 07, 2007

patriot games
As loathe as I am to employ a decidedly overused phrase, I just have to as I ask this:

Is the New England Patriots’ pursuit of a perfect season creating the perfect storm for the National Football League in its efforts to force cable providers to add the NFL Network to their primary tier channel lineups?

That’s the emerging conspiracy theory, thanks to the Patriots’ two recent squeaker wins and the end-of-year NFL schedule:

No, the league isn’t raiding its rainy-day fund to take the Patriots to run the table, a bet that is increasingly popular in Vegas. But a lot is riding on whether the Patriots are unbeaten going into the Dec. 29 game against the New York Giants.

The NFL wants it to be must-see TV, but to see it you must watch the league’s own NFL Network. It’s one of eight games the league kept for itself this year, and one which some 70 million households won’t be able to see because of a bitter dispute the NFL is having with cable companies.

The more valuable the game, the more leverage the NFL figures it will have to force cable operators to carry the network on the lucrative basic cable tier. By far the most valuable game left this year will almost surely be Pats/Giants.

Take away the historic angle and it becomes a meaningless game between two teams most likely resting their stars for the playoffs. Make it mean something big and the NFL has a golden opportunity to force the hands of the cable companies.

The stakes are huge. If the NFL signs up all the major cable companies, it could be looking at revenues perhaps as high as $1 billion a year just for the network itself.

I guess the thinking here is that football fans will turn their wrath upon Comcast and Time Warner if the crowning of a 16-0 Patriots team is blacked out in most of the country. If enough cable customers wind up switching to satellite or other TV providers immediately afterward, it’ll be a strong sign that spurning the NFL comes at a cost. Presumably, watching New England go 15-1 won’t ignite the same passions.

Toss into this the flextime factor that NBC’s Sunday Night Football has in its hip pocket. NBC doesn’t get dibs to that final Pats game of the year — but they certainly are in a position to build the frenzy on a national level. Check out their options for the two weeks before season’s end:

- Week 15. NBC has Washington at Giants. Both might be in the playoff hunt. If not, since CBS protected Jaguars-Steelers, NBC might take CBS’ New York Jets at Pats — if the perfect season is still in play.

- Week 16. NBC’s Tampa Bay at San Francisco will likely be dropped from NBC. Best games, not protected: Fox’s Redskins at Vikings and Giants at Bills or CBS’ Miami at New England.

If New England is still undefeated by that point, you’d better believe NBC will help out the league by maximizing the exposure for those two games. It might be putting itself in position for retaliation by the cable providers down the road, but since the Patriots are already drawing monstrous ratings by virtue of the perfect-season dynamic, NBC’s short-term smart-money move is obvious.

Is it an active conspiracy by the league to pave the way to perfection? Extremely doubtful. But who doesn’t enjoy a whiff of scandal in the midst of a potentially historic season?

by Costa Tsiokos, Fri 12/07/2007 08:35:16 PM
Category: Football, SportsBiz, TV
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Thursday, November 01, 2007

the topssecond-placeon threethe rear
In case anyone’s still questioning the profitable popularity of major-league team sports: Sponsorship revenue for the NFL, MLB, NBA and NHL will cha-ching to a record high in 2007, according to a study released by IEG:

Those deals and others will help propel overall sponsorship revenue to $2.07 billion in 2007, with the NFL accounting for the largest share at $785 million. MLB is next, with $505 million, followed by the NBA at $490 million and the NHL at $290 million.

Sponsorship revenue for the four major pro sports totaled $1.8 billion in 2006 and $1.5 billion in 2005, IEG said.

Not too shabby, especially for the latter three leagues, which are regularly characterized as being in decline. Even in a fragmented sports media landscape — or perhaps because of it — the marketing dollars gravitate toward entertainment properties with assured, well-defined audiences.

And yes, that is the National Hockey League bringing up the rear, with 14 percent of the pie. That is the half-empty view; the half-full view is that, for a league that was marginalized even before the lockout season, getting close to $300 million is nothing to sneeze at.

If anything, I am surprised that the total dollars overall are so low, considering this accounts for international sponsorships. Canada alone should be pushing the NHL higher.

by Costa Tsiokos, Thu 11/01/2007 10:56:09 PM
Category: SportsBiz
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Thursday, October 04, 2007

With the Devils already gone, and the Nets short-timing it until they move to Brooklyn, the former Continental Airlines Arena is getting a new corporately-christened name. The Meadowlands facility will now be known as Izod Center.

Lest you think the arena’s now going to be festooned with pictures of crocodiles, clue yourself into the long-ago divorce of Izod and Lacoste, with the latter taking back its reptilian shirt-logo in the split.

What’s more interesting is the fashion rivals that Izod beat out:

Izod was chosen over Jay-Z’s Rocawear and Fort Lee-based Southpole in a three-way race among “clothes horses,” in part because of its parent company’s ability to tie in extensively with the $2 billion Xanadu retail and entertainment project that will surround the Izod Center…

All three bidders made pitches to a sports authority subcommittee Monday, with rap music mogul Jay-Z making part of Rocawear’s presentation himself. Each bid was thought to be $1.4 million to $2 million annually, but the board also considered each bidder’s financial viability, as well as other qualifications beyond cash.

It was basically two hip-hip/urban-wear fashion houses versus a rather fusty oldtime clothier.

I wonder if the New Jersey authority didn’t have qualms about having a state-run facility named after a brand (either Rocawear or Southpole) closely associated with African-Americans. Was there a concern that the very name would scare away white patrons, regardless of who was playing at the venue? And would that have a domino effect, in that the only viable acts that could be booked and guaranteed a good turnout would be rap concerts? I wouldn’t be surprised if that went into the thinking.

by Costa Tsiokos, Thu 10/04/2007 10:30:45 PM
Category: Fashion, Pop Culture, SportsBiz
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Wednesday, July 18, 2007

NASCAR competition consists of auto-racing teams, but they’re not “teams” in the same sense as those found in other major sports leagues. In fact, in stark contrast to the franchise structure that exists in big-time hockey, football, baseball, and basketball, NASCAR’s competing entities exist only on the sufferance of the sponsorship money they can pull in — if that dries up, the team goes belly-up.

There’s a reason for this state of affairs:

The recent passing of former chairman Bill France Jr., the staunchest opponent of franchising within the sport, have led to whispers that implementation of the ownership system may be on its way in NASCAR. Don’t bet on it. What will keep franchising from becoming a reality isn’t a desire for open competition. What will keep it from happening is the fact that franchising would alter the power structure within the sport, providing owners with much more leverage than they have now, and diluting the influence of the brass in Daytona Beach.

Look at sports leagues that have franchising, and you’ll also find ownership boards and policy groups. You’ll find offseason owners’ meetings where rules changes are discussed and approved. You’ll find that owners who pay millions of dollars for the right to compete also want a degree of authority on how their sport is run, authority that NASCAR is unlikely to give them.

It’s hard to argue with success. NASCAR’s grown into a multi-billion dollar enterprise under its entrenched single-source ownership, so there’s no compelling fiscal reason to change.

by Costa Tsiokos, Wed 07/18/2007 11:06:03 PM
Category: Other Sports, SportsBiz
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Monday, July 16, 2007

bettman'drozelle'd
It’s amazing to me how hockey columnists like Scott Burnside can’t figure out why Gary Bettman is preventing the Predators (or any other NHL club) from relocating to southern Ontario.

There are a couple of reasons. The more minor one: The now-favorable exchange rate between the Canadian and American dollars — which is doing more to level the league’s competitive field than the salary cap is — isn’t likely to last. Which means one more floundering Canadian team to have to subsidize in the near future. (This is a topic to delve into more deeply some other time.)

But the more concrete reason is that, when it comes to major-league sports, you don’t over-saturate your markets. And plopping another team in Hamilton or Kitchener-Waterloo — stone’s-throw distance from Buffalo and Toronto (and not even that far from Detroit) — effectively constricts the NHL’s presence, both regionally and continent-wide.

But no need to believe me. The National Football League itself encountered this very same dynamic some thirty-five years ago, just after the NFL-AFL merger was completed and further expansion was being contemplated. The football guys commissioned a report, “Socioeconomic Information on Candidate Areas for NFL Franchises”, delivered in December 1973 by Stanford Research Institute (now known as SRI International). It amounted to a detailed map of the football market outside the NFL’s 1973 boundaries.

The thought process of the Pete Rozelle-era NFL was dissected in David Harris’ 1987 book “The League: Inside the NFL”. Unfortunately, the book’s long out of print, and doesn’t appear to be online anywhere. But I’ve got a dog-eared copy, and the relevant section is reproduced below, with my notes:

At NFL direction, SRI made a preliminary investigation of twenty-four possible locations and then went into fourteen of those in detail. Of the cities investigated, ten seemed promising.

Of those ten, SRI identified the weakest expansion candidates as Honolulu, Hawaii and Birmingham, Alabama. The next five cities were deemed more promising as NFL cities, based on their current and trending demographics in 1973: Seattle, Indianapolis, Tampa, Phoenix, and Memphis. Given that four of those five cities eventually did land NFL clubs (and even Memphis temporarily hosted the Tennessee Titans, before they settled in Nashville), it’s safe to say that SRI knew what it was talking about.

However, when it came time to make the final recommendation for professional football best bets for expansion, SRI made a somewhat startling choice: The NFL’s most lucrative backyards.

Stanford Research Institute’s conclusions were simple: “According to all the economic and demographic criteria studied, the New York [Nassau and Suffolk], [Greater] Chicago, and Los Angeles [Anaheim] areas rank substantially above all the candidate areas, even when data are divided by two or three to account for a shared market.”

The demographics detailed by SRI presented the football monopoly with two fundamental dilemmas, both of enormous longterm consequence. The first was implicit in the size of the market SRI located. Even after adding two more franchises, some twenty-two percent of the NFL’s potentially profitable franchise outlets would remain fallow and the NFL would continue to be significantly smaller than its market… The principle question, as [the commissioner’s office] saw it was to choose from among the current options in a way that “strengthened the League and made it more truly national.”

The second of the NFL’s dilemmas was crystallized in SRI’s somewhat unexpected conclusion that the NFL’s best option was to put more franchises into its current three largest markets. But despite their independent size, Nassau, Greater Chicago and Anaheim were all still “suburbs” according to the terms of the NFL’s monopoly, and hence not significant enough for membership. In the long run, this stance would insure that the largest untapped markets for live football were not only frustrated at lack of inclusion in the NFL but even further frustrated by the lack of consideration at all…

Thus, the possibility of more franchises in the New York, Chicago and Los Angeles markets was summarily dismissed. The purpose of expansion was to extend the League’s monopoly, not reduce it.

“SRI did a good job,” [expansion committee member Dan] Rooney explained, “but they didn’t consider all the factors.”

In a nutshell: You don’t tend to the long-term health of a sports league by effectively imploding it thusly. Jim Balsillie’s efforts to move a team north of the border have been seconded by Canadian pundits who argue that hockey’s following is so strong that, not only would a southern Ontario team get support, but so would a second team in Toronto, and so on.

That’s probably true. Just as it’s true that, even today, NFL teams in burgeoning suburban zones would probably do well. But in terms of league macroeconomics, it sets the stage for ultimate constriction of the product. It’s in the same category as league contraction — again, the notion that shrinking the NHL’s footprint would concentrate its energy and revitalize it.

But ultimately, it’s short-sighted. The NFL braintrust didn’t fall for it three decades ago, and the Bettman regime shouldn’t let it happen in hockey now.

by Costa Tsiokos, Mon 07/16/2007 11:17:49 AM
Category: Football, Hockey, SportsBiz
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Monday, July 09, 2007

Practically the poster boy for ESPN for nearly two decades, Dan Patrick is leaving Bristol, effective next month.

His departure had been rumored for weeks, including a dead-end destination as Bob Barker’s successor on “The Price Is Right”. Even before that, he had been speculated as bound for a mainstream news-anchor gig, especially whenever an opening at corporate brethren “Good Morning America” appeared.

But here’s some fanciful thinking: Why shouldn’t Versus make a run at recruiting Patrick? The Comcast-owned sports programming network has made noises about building itself into a bona fide rival to ESPN, and demonstrated that aim by acquiring broadcast rights to the NHL, college football and other properties. The next step is to develop an in-house stable of on-air talent to give the network an identity. Pulling in Patrick, the former ESPN icon, would get Versus a higher profile that has so far proven elusive.

And, taking the next speculative step: Would it be possible to pair a Dan Patrick hiring with a recruitment of Keith Olbermann? How much of a big to-do would Versus create by reuniting the former “Big Show” duo from SportsCenter’s glory years?

All this is purely pie-in-the-sky. I’m sure Patrick has a non-compete clause that would prevent him from taking a rival offer so soon after leaving ESPN, and Olbermann is probably locked into his MSNBC work (and who knows if he’d even want to give that up). But if I were part of the braintrust at Versus, I’d be strategizing along these lines right now. Put together the big-money deal it would take to get at least Patrick on board, and pull in Olbermann as a bonus. There’d be no substitute for the resultant fanfare.

by Costa Tsiokos, Mon 07/09/2007 09:54:06 PM
Category: SportsBiz, TV
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Thursday, June 21, 2007

Two things I found surprising when I learned about Yahoo! acquiring Rivals.com today:

- I can’t believe Rivals.com remained independent for so long; I’d assumed some larger media concern, eyeing the dedicated audiences for high-school and college sports, had scooped it up ages ago.

- I also can’t believe that Y! Sports, with 15 million monthly visitors, is bigger than Bristol:

Yahoo Sports, which is advertising-supported but has a sizable subscriber base for its fantasy sports league, recently surpassed the audience of its biggest competitor, ESPN.com, which has about 12.7 million users, comScore says.

That’s got to be galling for ESPN, which has touted Web growth as a key driver in maintaining its brand position as the be-all end-all for sports. It’s still the king of televised sports, which is where the real money is; but if it can be knocked off its online perch, who’s to say it’s not vulnerable in TV in the long run?

by Costa Tsiokos, Thu 06/21/2007 10:04:27 PM
Category: Internet, SportsBiz
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Tuesday, June 12, 2007

My Football Club is where you can chip in, along with several thousand other fans, to scrounge up enough money to buy your very own professional team!

Hang on, though: This isn’t football as in National Football League. This is football as in futbol, as in soccer. English league soccer, to be specific.

What a buzzkill.

Not only that, but we’re not even talking Premier League glam-clubs like Manchester United, et al:

With an average of 500 signing up daily on his website, [organizer Will Brooks] reckons he’ll have more than £1 million ($1.98 million) to go shopping with within the month. “We can’t be certain what club we will be able to buy,” Brooks enthuses, though he knows the top teams will be beyond his budget. “It would be a mistake to bite off more than we can chew, and, in any case, a lot of people are saying ‘please buy a club of the size that will make the journey more exciting.’ ”

Given their potential purse, Brooks and his 50,000 partners are likely to get a smaller club, a third- or fourth-tier organization. But they would run it. They’ll vote online on the purchase, help pick the manager, and vote on which players to buy or sell. As Brooks says, it’s just like popular fantasy soccer or baseball games – but it’s not make-believe.

So the plan is to buy a low-minor league club, get a charge out of owning and running it, and hope it generates plenty of notoriety and support. A big bonus comes if the team can ride this way into eventually winning its way up to Premier level.

It’s a novel concept. In American terms, it’s sort of like applying the Green Bay Packers community-ownership model to English soccer, without the benefit of the grandfathering conditions that allow the Packers to exist.

Call it pessimism, but based on my previous encounter with a “wisdom of crowds” approach to business ventures, I see this effort fizzling out quick. For instance, the democratic approach in allowing participants to vote on which club to target for purchase will result in just one thing: Most of the voters on the losing side subsequently dropping out of the project, since “their” team would no longer factor in. Fans are funny like that.

That’s assuming $2 million will even be raised, or that even a low-tiered club will even be attainable. All in all, a better concept than a viable gameplan.

by Costa Tsiokos, Tue 06/12/2007 07:15:00 PM
Category: Other Sports, SportsBiz
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Sunday, May 06, 2007

The current run on news media companies (Thomson-Reuters, News Corp.-Dow Jones, Sam Zell’s acquisition of Tribune Co.) is rightly seen as being driven by the perceived devaluing of traditional media in the face of Internet competition.

But if that’s so, then why is so much money lining up to buy the supposed dinosaurs? It’s not like the media targets are going begging for saviors — in fact, they’ve had to fend off takeover attempts. If the New York Times’ and Wall Street Journal’s days are numbered, why are they in such demand?

Declining profit margins are cited as further proof of trouble, especially for newspapers. For all the concern there, are still a ridiculously fat 20 percent on average. So again — why the panic?

This recent spate of dealings brought to mind the similar business climate in major-league team sports. Franchises in the NHL, NBA, and MLB (not as much in the NFL) are constantly characterized as money-bleeding operations, practically untenable as going concerns. And yet, suitors line up to pay record re-breaking prices to own a team. Doesn’t make sense, does it?

The truth is that sports teams, thanks to facility operation options and unique advertising/marketing channels, are veritable cash generators. I get the feeling that media companies, who business-wise function on a comparable plane, are being positioned the same way: Outwardly assumed to be bad business ideas, but in reality very lucrative properties in the short and even long term.

by Costa Tsiokos, Sun 05/06/2007 04:08:08 PM
Category: Business, Media, SportsBiz
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