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SBJ/August 13-19, 2012/MediaPrint All
Bleacher Report has been one of the most polarizing destinations in online sports media, with its battery of user-generated content and liberal use of sexually suggestive slideshows sparking widespread industry debate over its relative merits.
But last week’s purchase of the 6-year-old portal by Turner Sports for an estimated $175 million was hailed as perhaps the most powerful testament to date of the fast-rising stature of independent digital sports media outlets.
The deal nearly doubled the record for the acquisition of any pure-play American online sports media outlet, the 2007 purchase of Rivals.com by Yahoo for $98 million. The Turner buy also was nearly six times the estimated $30 million USA Today Sports Media Group paid in January for the 70 percent of Big Lead Sports that it didn’t already own.
“This is really great for the entrepreneurial space that we operate in. It really validates what lot of people, including ourselves, have been doing to create new things and create value for both users and investors,” said David Katz, founder and chief executive of ThePostGame.com. “The Bleacher deal sends a really good signal to the space that big media believes entrepreneurial value is being created.”
Katz and ThePostGame.com, which operates in partnership with Yahoo, are nearing completion of a Series B venture capital round worth less than $5 million but drawing notable investors including former tennis stars Andre Agassi and wife Steffi Graf, and former Yahoo Chairman Terry Semel. But Katz and other independent digital sports media outlets said they aren’t necessarily chasing a big exit right on the heels of Turner’s acquisition.
“I’m very happy the market has responded by ascribing a strong asset value to something somewhat similar to what we do, but we still have very big aspirations to become the world’s leading digital media company,” said Jim Bankoff, chairman and chief executive of Vox Media, parent of SB Nation. “We’re still, quite frankly, in the early stages of building this company, and we’re still very long on Vox, as are our investors. We don’t see this as a musical chairs game at all.”
For Turner, the Bleacher Report acquisition provides a mainstream online sports property more focused on news content and not necessarily subject to swings of seasonality, as are the league and sport-specific sites it helps power such as NBA.com and NCAA.com. Turner did have such a property to present to advertisers when it ran the business operations of SI.com for about a year and a half. But once that relationship dissolved late last year amid a series of corporate culture clashes, Turner again had a hole in its portfolio.
“Having a 52-weeks-a-year platform was definitely important to us. In all candor, it was something we didn’t have,” said David Levy, Turner president of sales, distribution and sports. “This is a well-established brand, and we see a big opportunity to enhance our consumer experience and take what Bleacher Report already does well and expand significantly upon it.”
The company had planned to develop its own branded general-interest sports portal to launch in either late 2012 or early 2013, but those plans are now dead with Bleacher Report in hand.
Turner also intends to use Bleacher Report content and talent regularly across its television assets, including CNN and Headline News.
The Bleacher Report acquisition, roughly six times annual revenue, is high by online media standards. But Turner’s buy was also described by many industry observers as a technology buy as much as a media one, in which Bleacher Report’s publishing platform, which pushes out more than a thousand articles a day along a wide range of team affinities, was just as valuable as the eight-figure monthly audience the company attracts, if not more so.
“Once you get into technology platforms, it makes it a lot easier to justify any price,” said one digital media executive speaking on the condition of anonymity.
For Bleacher Report, the Turner acquisition extends a marked ascendency that in many ways began when Chief Executive Brian Grey joined the company in June 2010. Since then, Grey hired a new sales team and boosted advertising revenue significantly, helped close a $22 million round of venture capital funding, hired a team of experienced writers and editors to help boost editorial quality, launched a YouTube channel, and played a key role in shepherding the Turner deal to completion.
Bleacher Report has raised more than $40 million overall in funding, primarily from Silicon Valley venture capital firm Oak Investment Partners and more than any of its direct competitors.
Coinciding with the opening of the 2012-13 English Premier League season and qualifying for the 2014 FIFA World Cup, ESPN is stepping up its commitment to global soccer coverage.
The U.S. television debut of “ESPNFC Press Pass,” a news-and-views show broadcast the last 10 years only on ESPN International and on the Web, is slated for Thursday at 2 a.m. ET on ESPNews. The show subsequently will run 30 minutes on weekdays, 60 minutes on Sundays, and be dark on Saturdays. “Press Pass” joins programs like “Fantasy Football Now” and “MMA Live” as examples of ESPN
The rebranding comes as the EPL season and 2014 World Cup qualifying begin.
The network’s first EPL match this season is between Arsenal and Sunderland on Saturday at 9:30 am ET. It will be broadcast on ESPN, ESPN3 and ESPN Deportes.
ESPN’s altered soccer strategy is on the heels of record numbers during
Euro 2012. During the monthlong tournament this summer, a soft launch of ESPNFC.com and ESPNsoccernet.com logged an average of 919,000 unique visitors per day, up 35 percent from Euro 2008. The ESPNsoccernet app for iPhone and Android generated 33.6 million total page views. The final match between Spain and Italy on July 1 delivered the highest-rated telecast ever on ESPN Deportes: a 12.9 Hispanic household coverage rating and 1.125 million viewers.
The rise in popularity of the EPL in the United States is also a touchstone.
“Soccer has become much more of a global game in the U.S. the last few years,” said Steve Palese, coordinating producer for soccer at ESPN. “After the success of Euro and the Premier League, we plan to continue to grow the audience with ESPNFC.”
Fox Sports later this month will relaunch and rebrand its college sports and recruiting destination Scout.com as Fox Sports Next.
With the rebranding, Fox Sports Next will also have a greater degree of integration with Fox’s national TV coverage of college football and regional coverage of several college sports. Fox Sports Next content and talent, including recruiting analysts Greg Biggins and Jamie Newberg, will regularly be featured on-air. The shift will also far more overtly link the property with its corporate parent, bringing the branding more in line with other Fox Sports properties such as FoxSoccer.com.
“This has been a good, strong, profitable business for us, but we felt it needed some updating and a fresh look,” said Kyle McDoniel, Fox Sports Next senior vice president and general manager. “There’s an entirely new back-end infrastructure in place and an overall framework that’s going to mesh much more strongly with the television side.”
Fox Sports Next used New York-based digital agency Sarkissian Mason to aid it on the relaunch effort.
Several competing sports media brands have rallied around “Next” as a brand concept, most notably ESPN, which has used the tag since 1998 to feature emerging athletes. But McDoniel said the use of “Next” will help create market differentiation for the Fox property, which has often surpassed 5 million unique monthly users and also has a significant subscription content component to the business.
“Recruiting is obviously an important segment,” McDoniel said, “but we’re really looking more broadly than that, which is why ‘Next’ makes sense. We’re going to be much more about what’s coming up overall with your favorite team. [Outgoing Fox Sports Chairman] David Hill always said life is a pregame show, and we’re going to be much more about what’s going to happen next.”
They felt they were not getting enough credit for the strides they took to put content on digital and mobile platforms. The strategy of making every event available live online has never before been tackled during the Olympics. NBC’s extensive mobile apps have never been used for the Games, and the idea of quickly turning around highlights for video-on-demand never has been considered before.
The frustrations were valid. NBC’s coverage of the London Olympics looks nothing like previous Games. NBC should get more credit for embracing online and mobile applications as much as they have this year. Still, there’s room for improvement. I expect NBC to make a few changes by the time the Winter Games in Sochi come around in 2014.
■ It’s finally time for NBC to retire the idea that tape-delayed telecasts drive prime-time ratings.
I know the Olympics’ prime-time TV viewership is on pace to set an all-time high. And I know it’s risky to make a bet on a $1.2 billion investment, which is what NBC paid for rights to the London Games.
But all evidence suggests that prime-time viewership will not be hurt significantly by live coverage earlier in the day.
Arguments for keeping the tape delay in place has the feel of the mid-1990s, when TV executives worried that putting too many events on cable would cut into prime-time telecasts. Later, TV executives worried that too many live events online would cut into prime-time viewership.
Neither claim is true. NBC’s own research backs up my view. It has found that people are more likely to watch a prime-time tape-delayed telecast when they already know the results of the event. All the spoilers on Twitter and Facebook this year helped NBC market its prime-time telecast.
Why not show an event like a marquee swimming race live on one of its cable channels? NBC could still tell stories and add context to its prime-time show.
I predict that NBC will hold back fewer events for prime time from Sochi in 2014. The Summer Games in 2016 shouldn’t be a problem, since Rio de Janeiro is roughly in the same time zone. Who knows how we’ll be watching the 2018 and 2020 Games. But I don’t expect tape delay to be a big part of it.
■ NBC’s online programming has not been up to par.
It’s great that NBC has made every event available live online. But it’s not enough. The user experience is basic and far below the expectations I have for programming that carries the NBC Sports brand. Much of the video I’ve seen has no announcers and offers no replays. NBC should aspire to do more than a bare-bones online offering.
Internet users have expectations when they watch online video, like the ability to pause, rewind or watch a replay.
If you were 10 seconds late to the 100-meter dash — or if you experienced buffering during it — you were out of luck. You’d have to wait for NBC’s prime time. That’s not how Internet users are conditioned to watch video.
In Sochi, I expect NBC to put more of its production values into its online experience, even something as simple as voice-overs from New York-based announcers.
NBC should be proud of the amount of users it brought to NBCOlympics.com. It started slowly. I heard from many savvy Internet users early on about too much buffering and stopped video. One respected media industry veteran said his cable provider, Comcast, wound up doubling his Internet speed at no extra cost. After the opening weekend, the executive said the online video worked fine.
NBC and its distribution partners fixed the problems quickly so that by the Olympics’ second week, I heard almost no complaints about the quality of its online offering.
■ The two shining stars of these Olympic Games have been NBC’s video-on-demand offering and distributors’ authentication processes. Both worked surprisingly well.
I heard virtually no complaints from people logging into NBC’s online coverage. Distributors, like Comcast, made it simple and easy for its subscribers to authenticate. By the time Sochi rolls around, authentication will not be an issue. This is a big step forward for TV Everywhere.
Video-on-demand also has been a pleasure. My distributor is Comcast, which makes highlights from every event available by the time I wake up in the morning. My managing editor has Time Warner Cable. He made a good suggestion that the video-on-demand system should show, for example, the entire gymnastics program in addition to cutting individual highlights. This would enable him to watch longer, without having to navigate through VOD every two minutes.
But that’s a minor quibble. By Sochi, I expect VOD to offer more content and allow users to navigate it easier.
John Ourand can be reached at firstname.lastname@example.org. Follow him on Twitter @Ourand_SBJ.