SBJ/January 7-13, 2013/Opinion

Industry deals, people, issues to watch in 2013

A few interesting stories that caught my eye over the holiday season:

> ALL IN WITH TENNIS: Keep an eye on what Emirates is doing around tennis. Just before the new year, the Dubai-based airline agreed to a five-year sponsorship of the ATP that will make it the official airline of the tour as well as the new title sponsor of the ATP rankings. Earlier in the year, Emirates linked with the U.S. Tennis Association to become both the title sponsor of the U.S. Open Series and the official airline of the U.S. Open as part of a seven-year deal valued at nearly $90 million. So while the airline is an active sponsor of futbol and other sports around the world, it is clearly going all in on tennis and building a program around some of the biggest events and series in the sport.

What to look for next? I’m sure many of the U.S. Open Series events where Emirates has begun flying routes will hope for increased local activation, and I wouldn’t be surprised if the airline signs a few players in order to complement its event/series deals. The ATP’s global reach fits nicely into Emirates’ plans, as now the brand will have a weekly global television footprint through ATP Tour Productions television distribution. And the airline will be able to entertain its most coveted and lucrative customer segment — business travelers — in diverse markets throughout the world.
I hear all the time about the declining popularity of tennis, but the ATP’s tournament schedule is geographically diverse, and many of these markets are attractive business travel centers.

Jimmy Haslam, the Browns’ new owner, is reshaping that franchise.
Photo by: GETTY IMAGES
> HELLOOO, CLEVELAND! I am intrigued how new Cleveland Browns owner Jimmy Haslam is reshaping that franchise. Everything I’ve heard about him from those who know him is that he will be a strong, smart owner. His first round of hires indicates that he can spot talent, because after he hired Joe Banner as CEO, Haslam made another smart move in bringing on Alec Scheiner as the team’s new president. Scheiner is scheduled to start his new job this week after spending the previous eight years with the Cowboys, the last five as senior vice president and general counsel.

The Cowboys have had a number of talented business executives over the years, but Scheiner was continually referred to me years ago by insiders as someone to watch. The Georgetown Law grad had a big role in almost all of the team’s successful business initiatives, including the financing and construction of Cowboys Stadium.

To work with Scheiner, the Browns tabbed another well-regarded executive, former San Diego Padres senior vice president Brent Stehlik, as the team’s new executive vice president and chief revenue officer. Stehlik is a native of Cleveland who worked with Scheiner in the Cowboys organization before doing several innovative business deals under Tom Garfinkel at the Padres. Both of these young executives have a lot of runway on the business side to mine in Cleveland.

> THE PUBLIC CONTRIBUTION: I always keep my eye on stories related to public funding and team/community relations. An important one occurred right before Christmas when a deal was announced in Buffalo where New York state, Erie County and the Bills detailed a 10-year lease to keep the team at Ralph Wilson Stadium. A couple of interesting provisions in the deal: There will be $130 million worth of renovations to the stadium, with the Bills contributing $35 million, a higher team outlay than in previous deals. The state and county will share the remaining $95 million in renovation costs — with $54 million coming from the state and $41 million from the county. There is also a significant penalty on the team — $400 million — if it decides to leave Buffalo before 2023. The one exception is after year seven, when the team would pay only a $29 million penalty. After that year, the penalty would go back to $400 million.

There are a few takeaways in this deal for other teams and municipalities in terms of public funding trends, and it also establishes a bar for any possible relocation to the open Los Angeles market, or elsewhere. I’m sure Carolina Panthers owner Jerry Richardson took notice of this deal, as he hasn’t formally asked Charlotte for financial help for renovations to the 16-year-old Bank of America Stadium, but it’s believed that the team will seek public assistance to help pay for any projects. The city of Charlotte also could glean some lessons in how New York and Erie County sought assurances from the Bills, as the Panthers were floated earlier this season as a possible relocation candidate.

Another story of interest is the tense relationship between the Pittsburgh Steelers and the Allegheny County Sports & Exhibition Authority over who should pay for a planned expansion of Heinz Field. Much of the dispute is over the wording of a contract and the definition of capital improvements, but it still represents a significant outlay of public funds — a reported $35 million if the Steelers win in court — and any time a team is mired in a lawsuit with the city and county it presents image and public relations challenges.

> COLLEGE FOOTBALL TRENDS: If you didn’t catch it, you may want to check our archives for Austin Karp’s analysis of the 2012 college football ratings. The general perception continues to be one of strength around the college game, but while the numbers remain solid, they do hint at clutter, competition and saturation. While NBC saw gains around the success of Notre Dame, all other college football broadcasters saw a decline in viewership for their packages. CBS’s SEC schedule was down 10 percent from last year and 11 percent from 2010, while ABC was also down 10 percent from last year and 11 percent from two years ago. ESPN is off 4 percent for its 68 games from last year, while ESPN2 was down 13 percent for its 61 games.

Compared with the steep drop broadcasters are seeing for their prime-time programming, however, these dips are no reason for concern. There is more college football programming spread across more outlets than ever before, affecting individual network viewership.

> WHAT’S NEXT AT SBJ/SBD/SBD GLOBAL: I wanted to let you know about a couple of new editorial elements we’re working on for 2013. As a complement to our SportsBusiness Daily Global news service, we will produce a special issue focused entirely on some of the major issues, trends and people making an impact on sports business outside of North America. We hope this special supplemental print issue will offer fresh insight into the opportunities across the global landscape. Look for this special issue in September.

Also in September, we will debut the latest event from our conference group by hosting the inaugural Game Changers Summit in New York City. This event, which is an extension of our editorial special section featuring innovative women in the industry, will focus on the key topics that affect women in sports business, from the growing female fan base, to the current status of women in leadership roles in professional, collegiate and Olympic sports, to women’s sports properties themselves. We feel that bringing various constituencies together can help advance the conversation in this vital industry segment. If you have any questions, thoughts or comments about these new elements, please let me know.

Abraham D. Madkour can be reached at amadkour@sportsbusinessjournal.com.


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