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Volume 24 No. 114
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SMT Conference: Paul Tagliabue On Strategies To Maximize Rights Fees

To build a successful media strategy and maximize rights fees in the future, properties need to foster competition and invest in technology, former NFL Commissioner Paul Tagliabue said yesterday during a one-on-one interview at the ’12 Covington & Burling Sports Media & Technology conference. Tagliabue pointed to moves he made at the NFL as an example. When he took over as commissioner in '89, the league had broadcast-rights agreements with CBS and NBC, and a new, small agreement with ESPN. There was very little competition in the marketplace, but the NFL fostered competition on the broadcast side by selling rights to Fox, and on the cable side by selling rights to TNT. The league also invested in technology by partnering with DirecTV to make all games available on a “Sunday Ticket” package. Tagliabue said, “When you deploy your rights, you have to understand you can encourage technology and structure competition in a way that gives you a sustainable environment over the long run. You can’t just focus on what your rights fee is going to be or what your audience is going to be. You’ve got to, as a rightsholder, invest in technology -- directly or indirectly -- and invest in competition. ... As long as you keep investing in innovation, technology and competition you’ll be okay if you have a product that drives that.”


-- Tagliabue on the potential of YouTube, Netflix, Apple and others bidding for sports rights: “Each company presents a different set of issues. Some are going to be taken over by technology. Some are going to be the cutting edge of technology. As I look at the world right now ... the same three issues are present in higher education, business and sports: technology and the pace of innovation and the ROI for new technologies; globalization which creates massive new markets and also massive innovators, which creates the opportunity for conflict or collaboration; and value, which the other part of value is cost. You can use the technologies, you can use globalization, you can use partnerships to deliver better costs. But those three things -- and I’m traveling all over the world, you can have breakfast with business people, lunch with people in sports and dinner with people in higher education -- and those are the three things people are talking about.”

-- On the challenges of leading an organization: “What keeps you up at night is all the conflict you have at an organization. It’s not only internal conflict. It’s conflict with outside partners. Managing conflict is very hard. It’s stressful. It requires a lot of thought. It requires a lot of creativity. It requires a lot of confrontation. But it’s healthy. If you don’t have conflicting ideas coming up, odds are you have a comatose organization, which is not a good place to be. Conflict in this sense means conflicting idea. You have to have a balance between people who are entrepreneurial and people who understand the value of teamwork and building consensus. ... There was a great World War II general who said, ‘When everybody on my staff is thinking alike, I know nobody is thinking.’ You have to have different ideas bubbling up in your organization.”