Sports Media & Technology: New Technologies Change Industry

The 7th Annual Street & Smith's/Players Inc Sports Media & Technology conference concluded yesterday in N.Y. The day’s first session, “How New Media Impacts Traditional Television,” featured CBS Sports Senior VP/Programming Mike Aresco, Desser Sports Media Principal Ed Desser, YES Network President & CEO Tracy Dolgin, NHL Senior VP/TV & Media Ventures Doug Perlman and Pilson Communications President Neal Pilson. Perlman said properties have “constantly got to be striking a balance between these new opportunities that you want to capitalize on and how they impact your existing businesses. Part of what we always wrestle with is when they first come along, a lot of these opportunities may not have significant bottom line revenue. But you also want to be sure you’re speaking in the language of the next generation because you don’t want to miss an opportunity.” Aresco: “You want to know what younger people are going to be watching down the road, so you want to develop those new technologies and try to make sure that doesn’t cannibalize what would be considered the mature technologies.” Pilson, on competitive dangers of new technologies: “Some things in isolation may not do violence to the basic pattern. ... I don’t think we should get overly concerned with that in our negotiations, because I don’t think you can prevent it and the incidence of use probably is going to be marginal for a considerable period of time.”

Perlman Says Hockey More Of A Challenge To Show Via Internet

SPORTS OVER THE PHONE: Dolgin, on offering sports content via mobile phones: “I am not a big believer that someone needs to watch an entire baseball game on a phone. ... So I think you have to create highlight packages, alerts, short periods of time that phones will be working on. But I think we have to work in concert with [MLB] even on that to make sure it is done in such a way as to not cannibalize other rights.” Perlman said showing hockey on the Internet is “perhaps more challenging than baseball, which tends to move at a slower pace. Our games are not played during the day traditionally, so there is not that office viewer. When one takes into account the potential business opportunity and all the contractual relationships that we have to be cognizant of, it hasn’t made sense.”

TIMES, THEY ARE A-CHANGIN’: A later panel, “How VOD, HD and New Technologies Are Changing the Face of Sports Media,” included iN Demand VP/Strategic Planning & Product Development David Asch, ESPN VP/Strategic Business Planning & Development Bryan Burns, Verizon FiOS TV VP/Programming & Marketing Terry Denson, PGA Tour VP/New Media Paul Johnson and Gotuit Media Corp. Chair & CEO Dan O’Brien. Denson said, “There are plenty of cues out there that the content providers are comfortable with video over an IP delivery, that consumers are looking for it on demand and that it is the convenience they are asking for.” With regards to consumers buying HD TVs, Burns said, “Price as a deterrent to sale is gone. It is now about financing. Be it right or be it wrong, no interest until 2007 or 2008 is making the difference.” Burns said in ’06, “For the first time, there will be more high-definition television sets sold in this country than SD sets.”

ELIMINATING THE MIDDLE MAN? Denson said, “In many ways, ESPN is becoming one of these virtual distributors. ... With ESPN360, if they are offering literally hundreds, if not eventually thousands of video assets, live games and highlights, then what do you need me for? Especially once that economic shift takes place, all you have to do is sign up for the cheapest Internet service possible. It diminishes the value of us networks: Comcast, Verizon or any network provider. You go straight to ESPN. ... And that is ultimately what content providers want to do generally — if they can cut out the middle guy, then that helps their business if they can get the same reach.” Burns responded, “I think we have to look all the time as to where the economics flow in the value chain. If a business is good for our distributors, then it is good for us. ... What we would like to have is a very robust set of businesses that benefits rights sellers, us as packagers, [Verizon et al] as distributors and the consumers. ... I don’t think we are trying to plot some nasty strategy to cut out the distributors.”