March 21 - 27, 2011 Vol. 13 — No. 46

Top Stories

  • NFL warning sponsors about deals with players trade group

    The NFL, despite having locked out the players, was continuing to use player images on team websites and NFL.com last week without their permission, citing a First Amendment justification. The development comes as the league also disclosed it is advising sponsors to be wary about signing group licensing deals with the players’ newly established trade association, strongly suggesting that the group might not have the legal right to market the players.

    Since 2000, NFL sponsors had been able to sign players to group licensing deals, a right contained in the collective-bargaining agreement. Those rights expired with the CBA’s demise earlier this month, meaning NFL sponsors no longer could use player images.

    The decertified NFL Players Association, which now is acting as a trade association and not a union, has said it continues to represent players for group licensing, but the league is questioning that assertion.

    “We don’t understand the source of their rights,” said Gary Gertzog, the NFL’s senior vice president of business affairs. “In the [now expired] CBA, it states group licensing rights are designed to support the objective of the union. If the union no longer exists, there is certainly a question whether those rights are valid, and people who do business [with the new players association] should be looking into those questions.

    “We have communicated to our sponsors who were relying on these rights [that] if they are still interested in group players they will have to find out how to access those benefits, whether through some other entity the former union has or going directly to the agents or players,” he said.

    The NFLPA did not reply to requests for comment over several days last week on these matters. Two weekends ago — immediately after the expiration of the CBA and before Gertzog’s comments here — Keith Gordon, the head of the commercial marketing and licensing arm of the NFLPA, said the decertified group “is now actively engaging with non-NFL sponsors who seek to align themselves [with NFL players].”

    Gertzog pointed to the following line of the now-expired CBA as evidence, by his contention, that the new NFLPA probably does not have player rights: “In consideration for this assignment of rights, the NFLPA will use the revenues it receives from group licensing programs to support the objectives as set forth in the bylaws of the NFLPA.” His point is that group licensing is tied directly to the union’s bylaws, which no longer exist.

    The dispute will not cover all sponsorships because the NFLPA cut its own player deals for trading cards, video games and apparel. “The waters are very murky,” said Woody Thompson, executive vice president of Octagon, whose clients include Sprint and MasterCard, NFL team sponsors. “There are statements being made by a number of parties about what will and will not fly for [NFL] sponsors and non-sponsors. I think it’s a little bit of a wild West show right now.

    “We are hearing a lot of different versions of this, and without having a full understanding of the legal documents, it’s tough,” Thompson added. “The PA is telling us that their marketing agreements are unaffected … but if the PA doesn’t exist, I don’t know how they can have any rights over what we do with individual players.”

    Gertzog said that if a league sponsor signed a player deal, the league would not prevent team logos from being used in those ads.

    David Grant, a principal at Team Epic, which has as clients NFL sponsors Visa, FedEx, IBM and Mars (Snickers), says that much is subject to interpretation right now, and such uncertainty is not a good thing.

    “Are you going to sign up for something that over the course of the next few months may change drastically,” he said. “We can live with a season, a shortened season or no season. What we can’t live with is uncertainty. That’s what we have, now and for the foreseeable future. When you have uncertainty, your only choice as a marketer is to look other places. So everyone loses here: the league and the players.”

    While the NFLPA also did not respond for comment on the website issue, the lawyer for Jim Brown, who is suing Electronic Arts for allegedly unlawful use of his image, said the new NFLPA is likely to take action.

    “I suspect that this will generate another claim in the lawsuit by the players, who will allege that the NFL is infringing their rights of publicity and the trademarks they have in their own personas,” said Ron Katz, partner with Manatt Phelps.

    An intellectual property expert disagreed, saying the league could make a convincing First Amendment case, which is the justification cited by Gertzog. The primary purpose of league websites are to inform, and most of the players are public entities, said Barry Werbin, a partner at Herrick, Feinstein and chairman of its intellectual property and technology group

    “The fact that the league is a commercial entity doesn’t mean the usage is for commercial purposes,” he said. “But I would understand the ire of the players.”

    Staff writers Terry Lefton and Liz Mullen contributed to this report.

  • Getting all the calls

    They pace the sidelines during March Madness, but increasingly they’re becoming prevalent away from the court as well.

    Izzo
    GETTY IMAGES
    The animated Tom Izzo of Michigan State makes a popular pitchman.
    College basketball coaches, the face of their program and often the face of their school, are in demand now more than ever as brands tap into their celebrity quotient. Close to 20 college basketball coaches are being used in TV and online ads for NCAA corporate sponsors during March Madness. Among the most popular: Geno Auriemma, the women’s basketball coach at the University of Connecticut; and Tom Izzo, the men’s coach at Michigan State.

    Unlike the pros, where the players are the stars, college athletes are not permitted to endorse products per NCAA rules. So brands have latched onto the coaches for their recognizability and sideline theatrics, which transfer naturally to the camera.

    “We’ve found the basketball coaches to be very animated and even pretty good at ad-libbing in these spots,” said Jeff Garrant, account director at GroupM ESP, which represents NCAA partner Unilever and its Dove for Men brand.

    Once the domain of only the game’s legends, such as Duke coach Mike Krzyzewski, endorsements are seeping deeper into the college game. UPS is using Notre Dame’s Mike Brey, UConn’s Auriemma and UCLA Athletic Director Dan Guerrero, as well as former Purdue women’s coach Carolyn Peck. Capital One has tapped Auriemma, Izzo, Missouri’s Mike Anderson and Kansas’ Bill Self. Georgetown coach John Thompson III is featured in a Dove for Men spot.

    All are accomplished basketball coaches, but never before have sponsors seen them as anchors to national ad campaigns like they do now.

    “It comes down to brands wanting to stay current and they can’t use the current athletes,” Garrant said. “So the stars you can use are the coaches. They’re very personable, almost NASCAR-esque in that regard. They are used to being in the spotlight, even more so than college football coaches, so they aren’t shy. When they’re on the sidelines, everyone knows who the basketball coaches are, but the football coaches are one of about a hundred people on the sideline.”

    The 13 NCAA corporate champions and partners have access to the coaches because, in addition to their NCAA deal, they build in corporate sponsorships with the men’s and women’s coaches’ associations — the NABC and the WBCA. When they negotiate their deals, the brands get time with coaches, typically 30 minutes to an hour, rolled into their NABC and WBCA sponsorships.

    Charleston, S.C.-based Fishbait Marketing, which represents the NABC and WBCA, works with the partners to select coaches and create basketball-themed activation. Fishbait’s role helps brands navigate the college space to find the right coach and set up the time.

    Izzo
    COURTESY OF CAPITAL ONE
    Capital One tried to film the coaches' spots quickly out of respect for their schedules, but things took a little longer with Izzo, aka "the leader of Sparta."
    “They really help streamline the process,” said Marc Mentry, managing vice president, advertising and sponsorships, for Capital One. “We know the coaches have very hectic schedules and we need to respect their time. In all of our spots, we took less than an hour with each guy. It was a little longer with Coach Izzo because there was more makeup and dress involved.”

    NCAA partners spend mid-to-high seven figures, while corporate champion deals (AT&T, Capital One, Coca-Cola) can range into the eight figures. The coaches associations get paid instead of the individual coaches, but coaches volunteer to be part of the spots because it increases the visibility of their program and theoretically helps recruiting, while also promoting basketball and helping drive revenue into their trade association.

    Infiniti, in its second year as a March Madness sponsor and the first year as an NCAA corporate partner, used exclusive interviews from 16 basketball coaches in a “Round by Round” bracket promotion on CBSSports.com.

    Content from the 16 coaches will also appear on TV as branded features on the Infiniti-sponsored pregame shows during the NCAA tournament. Some of the coaches are familiar names, such as Krzyzewski and Izzo, while others like Baylor’s Scott Drew and Purdue’s Matt Painter are fresh faces.

    “Coaches aren’t just the focal point of the program, they’re also becoming increasingly polished,” said Aaron Anderson, associate director for integrated programs at OMD, which worked with Infiniti. “In most cases, we had only 20 to 30 minutes to shoot the interviews and the coaches cranked out great content.”

    Rick Jones, the captain of Fishbait Marketing, said only a couple of coaches were used last year by Infiniti and Capital One, but “we’re significantly up this year,” he said of the number of coaches being used.

    “Our mission with the coaches associations is to celebrate the game, and these brands are supporting college athletics, so anything we can do to help, we do it,” Jones said.

    OMD’s Anderson added: “We felt like last year we had more ownership of the college space because we were one of the few using coaches. This year, there are quite a number of brands using coaches.”

    screen grab
    Capital One used Izzo, Syracuse’s Jim Boeheim and North Carolina’s Roy Williams with the Ivan Brothers last year and it went so well that the credit card company came back with more coaches this year. Most of the content from this year’s “Visigoth SportsNet” will run online at youtube.com/capitalone and on March Madness on Demand, while some will be edited into commercials and branded content during the tournament. Capital One also is taking ads to ESPN where it has a sizable ad spend.
    screen grab

    “The first thing we all said this year was, ‘We’ve got to have the coaches.’ They’re that good,” Mentry said. “They’re in positions as coaches where they’re like improv actors because they never know what a reporter is going to ask. They’re put on the spot all the time and they’re good on their feet.”

    The coaches usually appear without any attachment to the school where they work. For the brands to use the
    screen grab
    school’s marks, they would need to go through the school’s multimedia rights holder and that could lead to additional fees. In one case, a school wanted a partner to pay $25,000 to use the coach in an ad and the partner decided to go elsewhere. Because the coaches association works directly with the coach, some rights holders said they weren’t even aware that their coach was involved in an ad shoot.

    “Part of it is that the coaches are
    screen grab
    UPS is using (from top) forrmer Purdue women’s coach Carolyn Peck, UConn women’s coach Geno Auriemma, Notre Dame men’s coach Mike Brey and UCLA AD Dan Guerrero.
    respectful of the association and want to help, but it’s more than that,” said Jim Haney, executive director of the NABC. “The bigger commitment is to growing the game and the coaches understand that they play a big role as champions of basketball. They also know that this time of year is our opportunity to talk about basketball when the game is front and center.”

    Capital One’s “Visigoth” spots introduce the coaches without referring to their schools. Anderson is an “NCAA coach,” not the Missouri coach. Self is the “legendary coach,” not the Kansas coach. Auriemma appears in a plain shirt with a Nike logo, but there’s no reference to UConn.

    UPS’ spots (youtube.com/ups), however, do identify Brey as the Notre Dame coach and Auriemma as the UConn coach, but both are wearing sport coats and not school logos.

    Jones said the coaches are sensitive not to work for any brands that might conflict with their school’s sponsors. If a coach’s school has a relationship with FedEx, for example, Jones would not have recommended that coach to UPS, which in fact, is a corporate partner at UConn.

    “The college space, as we all know, is fraught with problems in category exclusivity and multiple rights holders,” Jones said. “Everybody wants to feed from the same trough. … We don’t have the coaches appear in their school gear because the partner might not have the rights to that school, so we try to be sensitive to that and not use the school’s marks.”

  • Pac-10 seeks college's richest TV contract

    The Pac-10, deep into its talks with ESPN and Fox, is seeking the richest media contract among all college conferences, according to industry sources.

    The conference, which is expanding to 12 teams next season with the addition of Colorado and Utah, has been in exclusive negotiating windows with both networks. Sources said the Pac-10 has told the media companies that it wants considerably more than the $205 million per year that the SEC got combined from CBS and ESPN for an all-in package.

    Pac-10 Commissioner Larry Scott has said in the past that his priorities, in addition to the additional revenue, are to start a conference channel and to significantly boost the conference’s national exposure.
    The league currently receives about $54 million annually in media rights fees from ESPN and Fox, which is the lowest of the six major conferences.

    The Pac-10 allowed its exclusive negotiating window with ESPN to lapse earlier this month. ESPN was negotiating for a 20-game football package. The conference also is expected to let its exclusive negotiating window with Fox lapse without a deal at the end of the month. Fox is negotiating for a package that includes both football and basketball games.

    UCLA Arizona
    NEWSCOM
    If the Pac-10 enters open market, package will include football, basketball, online and marketing rights.
    The conference would then go to an open market in April with a comprehensive package of rights to sell, which would include football and basketball, online and full marketing rights.

    The most likely new bidder would be Comcast, which is interested in acquiring sports content in markets where it runs cable systems. Now that its NBC acquisition is complete, sports rights holders are hoping that the company becomes more aggressive in acquiring rights.
     
    Turner Sports also has made inquiries about the Pac-10’s media rights and would present a fourth bidder, which would be a best-case scenario for the conference. The Pac-10’s negotiations are being led by Scott, with Chris Bevilacqua of Evolution Media Capital consulting.

    The Pac-10’s pursuit of the richest media deal of all the conferences was emboldened, sources say, when it learned how much the Big 12 was expecting to make from its rights deals. Fox is close to a deal that will be worth an average of $90 million a year for the Big 12’s cable TV football rights.

    Each new media rights deal seems to reset the market in the college landscape. Fox’s Big 12 deal would represent a 350 percent increase over its current fee of $20 million per year. Fox, though, would wind up with much more content than it currently has, doubling the number of football games it is allowed to carry, from 20 to more than 40, as well as all digital and mobile rights to those games. No basketball was included in the deal and the Big 12 got the raise despite having two fewer teams with the defections of Colorado to the Pac-10 and Nebraska to the Big Ten.

    The Big 12’s $90 million figure also represents an increase from the $60 million that Fox suggested it would be willing to pay last summer as part of a new cable rights deal. Those talks surfaced as the Big 12 attempted to hold its conference together during realignment.

    During its negotiation with ESPN, the Pac-10 was seeking to get more than four times the $25 million the network currently is paying for its package of football games, sources said.

    As part of the exclusive negotiating windows, the Pac-10 must come back to ESPN and Fox if the conference winds up accepting a bid that is lower than the last price the conference offered during the window. Such terms are standard in many media rights contracts.

    Pac-10 officials have been open about their desire to launch a channel, akin to the Big Ten Network. The difference is that the Big Ten sold broadcast rights to ESPN for $100 million a year and a smaller basketball-only package to CBS. The Pac-10’s first option appears to be combining the national broadcast rights and the channel into a single deal.

    ESPN and CBS convinced the SEC to shelve its plans to launch a channel when they agreed to pay a combined $205 million per year for the rights to SEC content in 2008.

    Last year, ESPN agreed to pay the ACC an average of $155 million per year for an all-in deal that included all sports and online.

  • Wal-Mart sponsors $99 four-pack at NASCAR tracks

    Wal-Mart is taking its low-price promise to NASCAR this season, partnering with nearly a dozen tracks to sponsor a special ticket package that includes four tickets, four soft drinks, four hot dogs and one souvenir program for $99.

    The ticket promotion, which will be offered for 18 of 38 Sprint Cup races in 2011, serves as the first example of how Wal-Mart plans to activate its new licensing agreement with NASCAR.

    The world’s largest retailer signed an agreement earlier this year that allows it to develop apparel, home goods and other products bearing NASCAR, driver and team imagery and marks. It is promoting that affiliation at stores and on Speed, and NASCAR officials anticipate Wal-Mart also will spend on promotions at the track and team level.

    “Since I’ve been working here for 10 years, we’ve been looking for ways to get Wal-Mart involved,” said Terry Kalna, International Speedway Corp.’s managing director of partnership sales and marketing. “As excited as we are about this, we’re more excited about what else is still to come for NASCAR, the sport and the company.”

    Wal-Mart, which is working with The Marketing Arm’s Millsport agency on its NASCAR activation, worked with ISC and Speedway Motorsports Inc. to strike promotional agreements allowing it to offer the promotion. The participating ISC tracks are Auto Club Speedway in California, Darlington Speedway, Homestead-Miami Speedway, Michigan International Speedway and Watkins Glen International. The participating SMI tracks are expected to be Atlanta Motor Speedway, Charlotte Motor Speedway and New Hampshire Motor Speedway. It is working on similar partnerships with Dover and Pocono.

    Wal-Mart paid a promotional fee to the tracks for the rights to sponsor the ticket package. Terms of those promotional fees were not available and vary from track to track.

    Wal-Mart plans to promote the ticket offering at retail and during “Trackside” on Speed, a weekend race program it is presenting this season. It will direct fans to a special webpage — WalMart.com/NASCAR — where it provides a link to the ticket package and promotes the NASCAR apparel it sells.

    No purchase is necessary in order to buy the $99 package.

    “We talked about that, but it came down to: Let’s do something for race fans, let’s help them out,” Kalna said.
    ISC and SMI executives expect the promotion to help boost ticket sales at a time when attendance has been soft. Admissions revenue at the companies in 2010 decreased $35 million and $24 million, respectively.

    “The exposure for races — that’s a huge value,” Mike Burch, SMI vice president of business development, said of the promotion.

    The current agreements don’t include at-track signs or on-site activation rights, but Kalna said tracks are optimistic that Wal-Mart could add those elements to its spend later this year.

    “You’ll continue to see this Wal-Mart deal evolve,” Kalna said. “It will be good for the sport.”

  • Forty Under 40: Class of 2011

    SPORTS PROPERTIES & ASSOCIATIONS

    Jay Bauman, NFL
    Greg Byrne, University of Arizona
    John Currie, Kansas State University
    Chad Estis, Legends Premium Sales / Dallas Cowboys
    Jonathan Gilula, Boston Red Sox

    Intro
    Sophie Goldschmidt, NBA Europe
    Matt Higgins, New York Jets
    Rita Benson LeBlanc, New Orleans Saints
    Merritt Paulson, Portland Timbers
    Eric Nyquist, NASCAR
    Patrick Sandusky, U.S. Olympic Committee
    Ron Skotarczak, Madison Square Garden Sports
    Timothy Slavin, Major League Baseball Players Association
    Todd Taylor, Texas Rangers
    Andrew Walker, WTA

    AGENCIES

    Zak Brown, Just Marketing International
    Paul Danforth, CAA Sports
    Kern Egan, Richards Sports & Entertainment
    Jeff Ehrenkranz, Octagon
    Todd Goldstein, AEG Global Partnerships
    Adam Lippard, GMR Marketing
    Lawton Logan, IMG College
    Greg Luckman, GroupM ESP
    Bob Myers, Wasserman Media Group
    Rob Reed, AEG Facilities
    Chris Sanders, Helios Partners

    CORPORATE SPONSORS & PARTNERS

    Andrew Campion, Nike
    Barry Kahn, Qcue
    Scott Milleisen, JPMorgan Chase
    Sarah Robb O’Hagan, Gatorade
    Irwin Raij, Foley & Lardner
    Emmanuel Seuge, Coca-Cola Co
    Kim Taylor, MetLife

    MEDIA

    Justin Connolly, Disney and ESPN
    Mark Evans, Fox Broadcasting Co
    Eric Grilly, Comcast Sports Group
    David Katz, SportsFanLive.com / ThePostGame.com
    Jason Kint, CBSSports.com
    Leah Buhl LaPlaca, ESPN
    Albert Vertino, NBA Digital

    Forty Under 40 Winners: By The Numbers


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