SBJ/December 20 - 26, 1999/No Topic Name

NASCAR wants film company

NASCAR is expected to acquire Street & Smith's Productions within several weeks and launch an in-house film production company next year modeled after NFL Films, according to people familiar with the negotiations.

Street & Smith's Productions is one of a half dozen Street & Smith's divisions owned and operated by American City Business Journals, a Charlotte-based company. SportsBusiness Journal, Sports Business Daily, Sports Business Institute, Winston Cup Scene and other titles and divisions of the Street & Smith's Sports Group will not be affected by the sale.

NASCAR's planned film venture would be modeled after the highly successful NFL Films, and there is even talk of eventually creating a NASCAR cable TV network similar to The Golf Channel, said motorsports industry sources.

Street & Smith's Productions already has motorsports ties through its work with Speedvision, ESPN and Fox Sports Net.

The source of this information came from neither ACBJ nor Street & Smith's Sports Group. American City Chairman Ray Shaw would only confirm that "discussions have taken place" and declined further comment.

Bray Cary, vice president of broadcasting and technology at NASCAR, declined comment. Cary will be in charge of the project, sources said.

Industry sources say the deal is all but done and will be announced sometime next month. Cary said earlier this year that one of NASCAR's goals is forming a production company modeled after NFL Films.

The planned film division will produce and package biographies, highlights shows and other entertainment offerings. In addition to providing programs for use on racing shows, the film group will market and sell highlight videos of individual races and drivers. It won't handle any live broadcasts of NASCAR races; those rights are held by the major networks.

Street & Smith's Productions is privately held and doesn't disclose revenue. In 1997, the company reported revenue of $6.5 million, but it has since declined to release any financials.

Cary has targeted the NFL and NBA as models for the start-up, observers say. Later this month, Cary is expected to visit NBA Entertainment's $100 million, 80,000-square-foot film headquarters in Secaucus, N.J., to explore ideas for the NASCAR unit.

NBA Entertainment, started in 1982, employs 250 workers and generates an estimated $45 million in revenue annually. It has expanded its mission in recent years, launching an NBA Web site, an all-NBA television network and managing events such as international tournaments.

NFL Films, based in Mount Laurel, N.J., has shot more than 7,200 games since its launch in 1962. The 310-employee film group shoots 700 miles of film annually and produces footage used by national networks on pregame and postgame shows, as well as promotional footage for individual franchises.

"The NFL has always looked at us as an advertising arm," said Steve Sabol, NFL Films president. "You have to make money, but this isn't a cash cow. If you look at it from the standpoint of advertising, though, we're producing 300 hours a year of advertising. That's invaluable."

The planned motorsports film division is part of a broadcast overhaul for NASCAR, traditionally a league that hasn't had the same national appeal — or bargaining power — as other major sports. Last month, Cary helped put the finishing touches on a six-year TV deal for race telecasts with Fox, Turner Sports and NBC valued at $2.4 billion.

Industry experts said NASCAR faces some unique challenges as it enters the video-production business.

"There are a lot of inherent problems because it's just cars going around in a circle," Sabol said. "How do you create the tension for the novice like myself who doesn't understand what separates a good driver from a bad driver or what is required? You have to educate your audience."

Erik Spanberg writes for The Business Journal in Charlotte.

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ESPN, Fox, Golf Channel, NASCAR, NBA, NBC, NFL

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