League shelves sensors program on hits What's trending with concessions? Plugged In: Kenneth Shropshire TV success of worlds bodes well for USSA Sports Media: Facebook video WWE fights back on OTT network The launching of Air Jordan The Sit-Down: Dennis Gilbert Concessionaires go deep with analytics The 2015 class of Forty Under 40
SBJ/January 30-February 5, 2012/MediaPrint All
Last week’s purchase of Big Lead Sports by the USA Today Sports Media Group was a record-breaker, but executives don’t expect the deal to spur a run of near-term acquisitions of rival independent online sports properties.
The deal, pegged by industry sources at about $30 million, represents the largest independent U.S. sports Web property ever to be acquired in terms of raw traffic. Big Lead Sports, a network of more than 500 owned and affiliated sites previously known as Fantasy Sports Ventures, has risen as high as fourth in monthly comScore sports traffic rankings, with a peak audience of more than 20 million unique users.
“I wasn’t super-surprised, as I figured this was the path they were on. But it doesn’t change anything for us,” said Brian Grey, chief executive of Bleacher Report. That sports journalism site was built on user-generated content but introduced a
Big Lead Chief Executive Chris Russo will leave the company after a transition period of a few months but says he wants to stay on the entrepreneurial side of digital media.
Photo by:SHANA WITTENWYLER
Other independent online sports outlets, including 24/7 Sports and ThePostGame.com, also expressed intentions to maintain their current plans amid the Big Lead Sports acquisition.
Specific financials on the Big Lead acquisition were not disclosed, so it is not known how much of a multiple of revenue the purchase represents, or how much Chris Russo, Big Lead Sports’ chief executive, will make from the sale. Today’s acquisition marketplace is far different than before the economic collapse of 2008, but other independent online sports properties far outside the top 10 of most trafficked sports destinations sold for far more over the past five years. Yahoo! bought the college recruiting network Rivals.com in 2007 for $98 million. Yahoo!’s 2010 purchase of Citizen Sports Network was pegged by industry sources at $35 million. CBS Corp. paid $43 million for MaxPreps in 2007. Some of those companies, however, had subscription content components that helped drive up their purchase prices — an element that Big Lead Sports did not have.
Other sources said that Russo had been shopping the Big Lead Sports equity for many months and that several media entities passed on the deal, giving Gannett additional negotiating leverage. Talks with Gannett took place slowly and quietly over much of last year. Russo and Big Lead Sports used boutique banking outfit Mesa Global to aid on the transaction.
After a transition period of several months, Russo will depart the company he helped found and build. The former NFL, NBC and New Line Cinema executive has no fixed career plans, and intends to take some sort of extended break later this year. But he said he wants to stay on the entrepreneurial side of digital media, focusing more specifically on social media.
“I think that kind of concentration is where I want to go next, having a more purely social focus and helping bring more marketing dollars into the space,” Russo said. All other current Big Lead Sports staff will likely remain on board with the USA Today Sports Media Group.
The deal marks another aggressive move for the USA Today Sports Media Group as it bulks up its overall profile (see related story). But it also inherits a substantial job of integrating Big Lead Sports’ vast network of sites, and widely varying degrees of content quality, into its portfolio of properties. Company executives said the acquisition will allow it to organize content on a more topical basis, as opposed to the more geographic orientation it now uses. The move also deepens USA Today’s reach into fantasy sports with both gaming and content.
“Certainly getting the additional scale in this deal is important from a sales and monetization standpoint,” said Dave Morgan, USA Today Sports Media Group senior vice president of content. “But what this also does is gives a lot of additional touch points in individual categories, individual sports and allows us to go a lot deeper and a lot stickier in those areas.”
■ What does the sport of horse racing offer in terms of storytelling and film production?
Milch (left), with stars Dustin Hoffman (right) and Nick Nolte, sees the track as a great stage.
Photo by:JEFF KRAVITZ / FILM MAGIC
■ Do you think horse racing, more than any other sport, lends itself to storytelling? What about NFL football?
MILCH: To me it does. Man’s relationship with an animal is something that complicates horse racing in a way that, for example, NFL football is not complicated. Football is a beautiful exploration of human possibility, but what is added in horse racing is all of the nuance of relating to a different species and trying to understand and bring out the best.
■ Is it true that the character in “Luck,” Turo Escalante, is based on real-life horse trainer Julio Canani? Was he your trainer? How does he feel about it?
MILCH: Yes. And I think Julio feels pretty good about it. Julio is the trainer I won a Breeders’ Cup [race] with, a horse called Val Royal in 2001.
■ Are any of the other characters in the show based on real-life people?
MILCH: Not so completely as Escalante is based on Julio. There are a lot of characters who are composites of horsemen that I have known. Nick Nolte’s character mixes in some of [horse trainers] Jack Van Berg, some of Ron McAnally. But Escalante is purely Canani.
■ Do you think this show is going to help or hurt the sport?
MILCH: If it doesn’t help the sport I am going to be heartbroken. I try to tell the truth about things, and there are some heartbreaking moments in horse racing. But I also try to be very respectful and also to illuminate what is uplifting about it. I think that anyone who stays with the show for more than a few episodes, I hope, will feel the love I have for it.
■ Some people in the horse industry are very upset. For example, in the very first episode, you have a horse that breaks a foreleg and is put down. I know you have friends at Santa Anita. Have you heard from them?
MILCH: Yeah, I’ve heard some disapproval, but it is part of the story. It’s part of the game. That horse going down, in a way, is what makes it possible for these guys to win their Pick Six. And the highs and lows sort of mixed in together was what I was trying to show. I certainly wasn’t trying to sensationalize it or glory in it or trivialize it in any way.
■ What does Santa Anita provide in terms of visuals from a filmmaker’s point of view?
MILCH: It’s such a beautiful, beautiful place. Hollywood [Park racetrack] has its own appeal, but I think visually that Santa Anita is unparalleled.
■ If you would do a series or a film around another sport, what would it be?
MILCH: I would never do another sport. It’s the game I have spent an awful lot of time coming to understand, and for better or worse, it’s the one I want to write about.
■ When will you know it’s a success?
MILCH: Well, they’ve picked it up already. So, that is a good thing.
■ Why did they pick it up?
MILCH: Well, I think they were optimistic about it and they also want to get a head start on the production. Now I suppose something terrible could happen in the next week or 10 days and they could reverse themselves, but I know I’ve written three scripts for the next year.
USA Today Sports Media Group signed a one-year deal with NASCAR that will see the sanctioning body commit to a guaranteed ad spend with the national newspaper company, the latest move by USA Today in its push to enhance its sports brand.
It is the first time since 2006 that USA Today and NASCAR have had a formal relationship. NASCAR had a directed-media-spend agreement with Sports Illustrated over the last five years.
Under terms of the new deal, NASCAR will pay a preferred advertising rate to USA Today and encourage its sponsors to place NASCAR-themed print advertising in the publication.
USA Today will run two to three special sections on the sport around key events such as the Daytona 500 or Sprint All-Star Race. The parties are still in talks about when such issues will run.
USA Today Sports Media Group President Tom Beusse briefed NASCAR business partners on the new deal late last week in Charlotte.
“This move is a nice endorsement of our new strategy,” said Merrill Squires, USA Today Sports Media Group’s senior vice president of leagues and properties. “Although there was a similar relationship five years ago, we are a completely different organization now with a new sports marketing division, sports sales division and new sports content leadership.”
The deal is the latest in a string of agreements struck by USA Today Sports Media Group since Beusse, Squires, Peter Lazarus and Dave Morgan joined the Gannett-owned operation last year. In the last month, the team has signed a five-year preferred supplier agreement with the PGA Tour and reportedly spent $30 million to acquire Big Lead Sports (see related story).
Gannett hired Beusse and others with an eye toward expanding the relevancy and impact of the USA Today brand in sports, while balancing and enhancing sports content within Gannett’s local print products and their accompanying sites.
Though NASCAR Chief Sales Officer Jim O’Connell said the sanctioning body got great value out of the directed-media-spend relationship it had with Sports Illustrated, NASCAR executives found the vision for USA Today’s Sports Media Group to be compelling and its aggressive approach to recent deals and acquisitions energizing.
The USA Today Sports Media Group includes the flagship national newspaper, along with various sports sites, like HighSchoolSports.net and BNQT.com, Gannett’s 80 local newspapers and 23 TV stations.