SBJ/April 3 - 9, 2006/World Congress Of Sports

Crossing media borders

Predicting the future: From left, Tony Petitti
of CBS Sports, David Levy of Turner Sports and
Bobby Betros of Digital Orchid.
Digital convergence has given way to platform agnosticism.

In a development destined to change the landscape of sports media, senior network executives and analysts appearing at last week’s Octagon/Street & Smith’s World Congress of Sports said the days of being defined by any one particular medium or device are quickly and irreversibly evaporating.

“We’re just aggregating consumers. We really don’t care what devices they use,” said David Levy, president of Turner Sports, which among other properties televises NASCAR races and operates through Turner Sports Interactive. “It’s about creating touch points. Ultimately, brands will win across all technologies.”

Added Levy’s boss, Turner Broadcasting System Chairman Phil Kent, “A child today does not identify one medium as a primary medium and another as a secondary medium, and I don’t think kids today will look at TV in first position in 20 years.”

Of course, such attitudes are years in the making, as all major sports leagues and media outlets have developed a bevy of online and wireless content as a means to stay in touch with fans. In particular, NASCAR’s new set of TV deals with Fox, ESPN/ABC and Turner are so inclusive of interactive and mobile rights that they are not at all accurately described as simply TV agreements.

Many such efforts at media proliferation have also been done with at least some element of fear as to cannibalization of local and national TV ratings, gate attendance, or sponsorship revenue. Recent months, however, have seen an increasing wave of anecdotal evidence to suggest such concerns are unfounded.

CBS, through its online outlet, drew more than 5 million visits to its free March Madness on Demand products for the NCAA men’s basketball tournament last month with no appreciate effect on TV ratings. Traffic to and attendance at major league parks both continue to soar to all-time highs. The NBA is quickly moving into online distribution of out-of-market and archived game video with no detriment to the rest of the league’s growing fiscal pie.

“All these mediums are complementary. History has always shown that, but sometimes it still takes awhile to learn,” said Jeff Shell, president of programming for Comcast. “Sports drive platforms. Either you can put boundaries and try to keep out everything else, or you can look for ways to enhance value.”

But the blurring of lines also holds massive implications for future rights negotiations. The NASCAR deal was rather clean in its foresight and inclusion, but for every other major league, TV and digital rights are more splintered.

“People like [CBS and Turner] would feel differently if their content wasn’t tied together,” said SJS Sports President Steve Solomon. “We’re still in a very difficult process of determining how all the rights talks will play out. If you only own some of the ball and are paying for all of it, that’s a tough spot to be in.”

Already, advertisers are beginning to embrace a deeply blurred media landscape, leveraging buys over multiple platforms, giving sports properties the security of incoming revenue to be aggressive in developing new forms of content.

In particular, ESPN executive vice president and CFO Christine Driessen said as much as 34 percent of consumers’ media time is spent online, compared to just 3.7 percent of sports ad spending going to Internet vehicles, figures that suggest significant growth yet to come.

“We’re going to see many more bundled buys,” said Rich Bilotti, Morgan Stanley Dean Witter managing director. “The competition isn’t TV versus the Internet, it’s how much they can both shake out of print.”

That ad growth, however, has only raised more pressing questions of content pricing as technology grows. March Madness on Demand follows a path blazed by newspapers, radio and broadcast TV in offering vast content for little or no cost.

But Bob Bowman, CEO of MLB Advanced Media, said pricing lessons for sports can foremost be learned from the cable TV industry.

“We like our model,” Bowman said. “Ninety-five percent of the video on our site is free. We like that, the advertisers like that, the sponsors like that. But we think that the cable companies, the satellite companies and the wireless companies have done it right. If you want to get something of value, you’re going to pay a little bit for it.”

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