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Volume 25 No. 50

World Congress of Sports

Shanks said the lack of a U.S. squad in the World Cup is not a killer for the net
Photo: Tony Florez

Fox Sports President & COO Eric Shanks said that the network’s new Thursday night NFL package is equally vital to the company as its core Sunday afternoon one. Fox’ newly signed package for Thursday night games, pegged at more than $3B for five years, will arrive with a series of planned broadcast enhancements, marquee-level matchups, and a firm commitment to make the weeknight slot a key focal point for the sport. “We’re so invested for the next five years in Thursday night, there is no game, at least in our package, that is too good to be on Thursday,” Shanks said. “We’re just as invested in Thursday as we are in Sunday. It’s just as important to us.” Fox Sports’ heightened investment in the NFL also further signals the network’s heightened corporate focus around live content. That new focus has been further crystallized by the proposed purchase by Disney of most of 21st Century Fox’ entertainment assets, leading to what Shanks called a “New Fox” based heavily around sports and news. “This starts with the strategic goal of being the leader in live. And the most valuable content in live, and really media in general, is the NFL,” he said. “So you have to have a big investment in the NFL.”
 
STILL STRONG: Like the Thursday night NFL games, the upcoming FIFA World Cup in Russia has also been branded by some critics as an overpay by Fox Sports, particularly without the participation by the U.S. team in this year’s tournament. But Shanks said the lack of the American squad is not a killer for the network. “As a fan, I wish the U.S. made it. But let’s not forget the eyes of the world are on the World Cup,” he said. “We think it’s the greatest sporting event in the world. We did have to make adjustments in our marketing and storytelling as we led up to this. But we’ve made those adjustments.”
 
Quick Hits:
 
* Shanks levied heavy praise on baseball, pointing in part to strong ratings in many local markets serviced by Fox regional sports networks, as well as dramatic seven-game World Series each of the past two seasons. He also pointed to efforts by MLB Commissioner Rob Manfred, Deputy Commissioner/Business & Media Tony Petitti and others around developing new generations of fans. “I really have great belief in the management at baseball … They’re really working hard to make sure that baseball is not only healthy today but set up for generations to come,” he said. 
 
* Like many others, Shanks is closely watching developments around the broad legalization of sports wagering, even more than large-scale media mergers. “The sports wagering thing is the one that has real change with it Turner, AT&T and so forth, they all exist today,” he said, pointing to the proposed Time Warner-AT&T merger. "But what doesn’t exist today is sports wagering on a certain level.”

 
Shahid (c) sees Mexico City as an NFL possibility, as football there is an “upper-middle-class sport"
Photo: Tony Florez

Fathers and sons often work together in family-owned businesses, but that dynamic can become slightly more public when those businesses are an NFL team and one of the oldest clubs in English soccer. As part of an afternoon panel on Day 1 of the '18 CAA World Congress of Sports, Jaguars and Fulham FC Owner Shahid Khan sat down for an interview alongside his son Tony, who serves as Jaguars VP/Football Technology & Analytics and Fulham Dir of Football Operations. Shahid: “This is serious money. Serious business. And you can’t screw it up just because you want your son involved.” Tony, who also owns and operates data firm TruMedia Networks, noted analytics has become a big part of Fulham, particularly as it looks to return to the EPL. Tony: “We really turned things around by going to a more analytics-heavy approach. Basically, we weigh analytics 50% in every decision we make.” 

APPLES & ORANGES: Shahid, on major differences between English soccer and the NFL, said, “The NFL is very fan-friendly, and in our case, we’re the youngest team in football. 20 years old. We want people coming in and having a good family experience. English soccer, or soccer period, is hard core. No breaks. No alcohol in English stadiums during games. So if you’re looking for revenue from that side, it’s not there. It’s ticket sales and sponsorships. Very much an eat-what-you-kill mindset vs. a shared revenue model which the NFL has.” 

WHERE TO PLANT A FLAG: The Jags have been at the forefront of playing games in London, with Shahid noting that is due to certain limitations being in the Jacksonville market (i.e. high number of transplants in the market, three NFL teams already in Florida). Shahid, when asked where it could make sense for an NFL team abroad, said, “The place you want to start is London. We can sell out our game in around three days, 85,000 tickets, at a significant premium. And the makeup of the crowd is around 30% from greater London, 30% from outside greater London and 40% from outside the U.K. So what it does is it really exposes football to a diverse audience.” Shahid noted they are teaching fans about tailgating, and that consuming alcohol during games is something new for English fans. Shahid: “That’s a new experience for a lot of people, which they love!” Shahid noted 1:30pm local time in London for a game is ideal because it's primetime in China and “very rarely do they have live sports in China because of the time difference.” Other than London, Shahid sees Mexico City as an NFL possibility, as football in that country is a very “upper-middle-class sport,” meaning “great demographics.” 

PLAYING IN THE BIG TIME: Shahid also talked about the power of the NFL, saying, “To this day, I’m intimidated by what the NFL is. You can’t be anonymous anymore.”

CBS Sports NFL analyst and Big3 Chair Amy Trask stopped by World Congress All-Access, sponsored by Heritage Werks, to discuss NFL and NFLPA with John Ourand.

Monahan said the Tour's new slogan represents what its players are doing, day in and day out
Photo: Tony Florez

The PGA Tour’s new “Live Under Par” marketing slogan represents the property’s effort to “take our sport to another level,” said Tour Commissioner Jay Monahan. Speaking in a featured interview at the '18 CAA World Congress of Sports, Monahan said the newly introduced campaign marks a deliberate evolution from “These Guys Are Good,” retired after a 21-year-run. “In today’s day and age, it gave an opportunity to pivot and move in a different direction. ... We don’t have to stage a photo shoot for this. It’s real. It’s authentic. It’s what our players are doing, day in and day out. And we’re excited to see it develop naturally.” Monahan acknowledged the new slogan has been less received in Europe, where the phrase has a more negative connotation. But the marketing around “Live Under Par,” is primarily designed as a U.S.-focused effort.
 
LENDING AN EAR: Monahan, who succeeded Tim Finchem early last year, conducted an extensive listening with a variety of stakeholders around the Tour. “We have a distributed business model. So understanding what your constituents are thinking ... is definitely important on a go-forward basis. It’s led us to 'Live Under Par.' It’s led us to changes in (our) schedule, and it’s going to lead us to other changes in how we present our content.” The schedule changes taking effect next year, done in collaboration with other entities such as the PGA of America, notably will shift the PGA Championship to May, the Players Championship to March, and create a new focus on the FedExCup next August. “We tried to look at our overall schedule through the eyes of the fan and we’re looking to own August and end our biggest events before the arrival of football in the fall,” Monahan said.
 
Quick Hits:
 
* Monahan said he was enthused for the Zurich Classic later this month in New Orleans, which will also feature walk-up music for each participating team, a concept popular in other sports but largely foreign to golf. But he added the event, now one of the tour’s most popular tournaments, also highlights the rising interest in team-based competitions among both players and fans.
 
* He branded the sport’s presence in the ’16 Rio Games as a major positive for the Olympics movement, despite widespread player defections due to the Zika virus, pointing in part to robust TV viewership in several territories for the competition. “When we talked to the IOC and talked to our partners, it was seen as a resounding success. And looking ahead, I think golf’s contributions to the Olympics is going to be significant,” he said. 
 
* The Tour will ultimately return to a Trump Organization-owned golf course. Monahan said the property’s ’16 departure from Doral was due to the lack of a tournament sponsor.
 
* Monahan said his current handicap index is 4.6, but “trending higher.”

A wide-ranging opening panel at the ’18 CAA World Congress of Sports touched on just about every hot topic in the sports industry, from the challenges of reaching younger fans to the future of television and college sports reform. Pac-12 Commissioner Larry Scott, asked about major challenges facing college sports, particularly basketball, said, “A year ago, you wouldn’t have found anyone in college basketball that thought an NCAA recruiting violation could also be breaking federal law and could land them in prison. Many people are scared straight right now.”
 
THIRSTY FOR THURSDAYS: The NFL’s “Thursday Night Football” package has received plenty of criticism over the years due to a less-than-spectacular schedule, but Cowboys Exec VP & Chief Brand Officer Charlotte Jones Anderson and ESPN Exec VP/Programming & Scheduling Burke Magnus both remain bullish on the property. Jones Anderson’s response to whether “TNF” was a buy, sell or hold: “Buy. Buy. Buy.” Magnus added, “I like it. I would like to buy it.” Magnus also said ESPN’s relationship with the NFL is “paramount.” Magnus: “From a business perspective, nothing is more important than the NFL to us.”
 
IF YOU BUILD IT...: CBS Sports NFL analyst and Big3 Chair Amy Trask, who hails from L.A. and worked for years with the Raiders in the market, said of the local acceptance of the Rams and Chargers, “If this was a class and I had to give a grade, I would say ‘incomplete.’ … Los Angeles has not had a new, modern, state-of-the-art football stadium since 1923. Until we have (that), you can’t judge whether or not it’s going to be a success. What do we know about Los Angeles? People want to go to the cool spot. They want to go where it’s cool to be seen. If the stadium is as (Rams Owner) Stan Kroenke has explained to people it will be, it has the opportunity to be that.”

For more from the panel, see yesterday’s Closing Bell.

ESPN Exec VP/Programming & Scheduling Burke Magnus stopped by World Congress All-Access, sponsored by Heritage Werks, to talk to John Ourand about ESPN+.

After listening to Hulu CEO Randy Freer for 30 minutes, you can conclude that the streaming service will eventually acquire major sports rights. The more compelling question is what it will do with those rights. “Ultimately, over time, sports rights will continue to prove their value,” Freer told media writer John Ourand during an interview on Day 1 of the ’18 CAA World Congress of Sports. “The challenge we all have is to innovate on how we distribute those rights to consumers.” Freer, who was a major buyer of live sports during his 20 years at Fox Sports, said he believes in live sports and thinks it can be a major customer acquisition tool for Hulu, which now has more than 17 million subscribers. Today, a large majority of viewers of Hulu’s live television option, which debuted in May '17, are sports viewers during significant events.

SINGLE SERVINGS: The real value will come when on-demand customers can buy into live sports for a single game, or in other unique packages, without purchasing the standard live television service. Freer predicted that viewers would soon be able to buy a single Saturday’s worth of college football, instead of buying the entire live product. Or a baseball fan could buy a single weekend series or game. “Giving on-demand customers the opportunity to participate in live sports will help us grow subscribers over the long term,” Freer said. Separately, he also addressed Hulu’s decision to buy a sponsorship of the NHL Stanley Cup Playoffs. He said the entire streaming industry worries that consumers “still don’t know quite what we are,” and that Hulu was looking for an awareness play with the NHL deal.

Cowboys Exec VP & Chief Brand Officer Charlotte Jones Anderson talks about the upcoming NFL Draft with John Ourand for World Congress All-Access, sponsored by Heritage Werks.

Swann’s 30-minute interview covered both his business background and his playing days
Photo: Tony Florez

Most people in the room at the ’18 CAA World Congress of Sports yesterday probably didn’t remember that Lynn Swann primarily lined up on the right side of the field during his playing days. So, when NFL Network host Steve Wyche, the moderator for Swann’s one-on-one interview, took the seat on the right, USC’s AD had a quick response: “You’re in my chair.” Swann’s 30-minute interview covered his business background and his playing days as one of the best wide receivers to play the game, both of which helped prepare him for the AD chair at his alma mater even though he had never previously worked in athletic administration. “I had served on the boards of global companies,” Swann told the audience. “That’s helped me run a better business practice.” 

SOLID GROUND: The Pro Football HOFer, who won four Super Bowls in nine NFL seasons, said he found the Trojans’ athletic department in solid shape when he took over in April '16 for Pat Haden. “We had a solid core with our staff, so my charge was not to clean house,” Swann said. Despite his distinguished football background, Swann made it clear that “I do not call plays. We have coaches we’ve hired to do that and I let them do their job. My job is to help the coach be a good manager.” Swann was asked about the $270M renovation to United Airlines Memorial Coliseum and he came back with an interesting story about an original piece of rebar that sits in his office. “It’s not round, it’s square,” he said. “That’s how it was in that time period,” referring to the Coliseum, which opened in 1923.

Kydd Lee (c) said that she is hopeful about the future as more people become aware of these issues
Photo: Tony Florez

The issues of gender and diversity took center stage in a “bold conversation” with three female CAA executives on Day 1 of the ’18 CAA World Congress of Sports. The panelists noted that attendees may not be used to talking about these topics at a sports conference, but that given the breadth and scope of the #MeToo and TIME’S UP movements it’s a conversation that everyone should be involved with. CAA agent Christy Haubegger said the issues of exclusion and lack of opportunity are found across industries and that these movements are working to eliminate those problems and create safer, more productive work environments. She said the TIME’S UP Legal Defense Fund, which has already raised some $20M in just its first six weeks, is a part of that. “We fundamentally believe everyone needs fair and safe workplaces,” she said, “but everyone can’t do it because they may need a lawyer. Now there’s a place they can go. We’ve had thousands of people inquire about resources.” Haubegger recalled one story that illustrated the circumstances they are working to change: “We’ve heard from a woman at a nuclear power plant and she’s being aggressively sexually harassed. She’s charged with our safety and she doesn’t feel safe herself.”

WORKING TOGETHER: CAA Chief Innovation Officer Michelle Kydd Lee said the “intersectional group of women on stage” did not have all the answers, either, and told the audience we’re in this together. She said she is hopeful about the future as more people become aware of these issues, adding, “This is an awkward conversation to have between genders, but that’s okay when we have a higher calling -- a safer place for all of us.” These movements began in entertainment, exploded last fall in the wake of numerous allegations of sexual harassment against Harvey Weinstein and others in that industry. Haubegger explained to the audience the nuances of the #MeToo and TIME’S UP movements: “MeToo is the notion of being hurt in some way by sexual violence, sexual abuse to sexual harassment. TIME’S UP is a movement that’s about addressing the issues at the workplace so no one has to say ‘me, too.’” CAA Exec Lisa Joseph Metelus says women in sports are also coming together to support each other. “I have a group of women outside CAA in the business,” she said. “We always thought it was important to create a community of women to support each other. We launched during (NBA) All-Star weekend here in L.A.” Twenty years from now, Metelus said she hopes to be able to say, “We were part of a community that created safe, fair, dignified workplaces for all.” But, she said, “This is the infancy of the movement. We’d love to have as much help as possible because this is about creating a better world for all of us.”

MAKING THE RIGHT CHOICES: All three women said executives and employees can each effect change within their organizations. “We can decide on who’s hired, who gets to come to the meeting. Use your power in the things you can influence,” Metelus said, adding, “Each of us has a role to play, whether having a brunch or in hiring decisions.” Haubegger said, “We focus on a small number of people who do these bad things, but all of us can do something in the places we’re in. A big part of inclusion is not saying we need a woman of color or a woman at the table, it’s about putting the right people at the table. I never feel like I’m at the table because a box has been checked.” Metelus: “Talent is distributed, opportunities are not.” Lee looked out at the audience and addressed the women looking on: “If you’re sitting out there, this seat (on stage) is ready for you.”

Coca-Cola’s Global Chief Diversity & Inclusion Officer Andrew Davis said leaders in sports and entertainment have “a responsibility to be the bridge to unite this country.” During a presentation on Day 1 of the ’18 CAA World Congress of Sports, Davis challenged those at the conference to “be that bridge.” He opened his presentation by showing Coke’s Super Bowl ad, titled “The Wonder of Us,” which focuses on diversity and inclusion and was written by a poet with the ad shop Wieden+Kennedy. Davis said that as global companies and sports teams try to grow their customer base, inclusiveness is as important as diversity. “You need an inclusive mindset if you want to grow,” he said, adding that the best way to do that is to look at underserved markets and emerging consumers. “Uniqueness plus belonging equals inclusivity,” said Davis. “People are wired to belong. If you find a sense of community, you give your best self.” Davis advised organizations to examine their diversity and inclusivity from the inside out to create an authentic message that will resonate in an increasingly polycultural country and world. “We want to be as inclusive and diverse as our brands,” he said, “which will unleash the power of perspectives to sustain growth.”

Hear Ticketmaster North America President Jared Smith discuss ticket affordability with Eric Fisher for World Congress All-Access, sponsored by Heritage Werks.

Content is always king, and in today’s media landscape that truth extends to athletes. Building on that idea was the focus of a featured presentation by 72andSunny Founder & Creative co-Chair Glenn Cole on Day 1 of the ’18 CAA World Congress of Sports. Cole revealed how his L.A.-based ad agency has handled the progression of helping athletes become creators, using an example from his own career of Deion Sanders, who wanted to use his superstardom to also push a potential hip-hop career. Another early example was David Beckham and the expansion of his personal brand. A current example Cole used to highlight the athlete-as-creator model is Rockets G James Harden and his deals with candy brand Trolli and Adidas. When a recent Harden-Adidas line was released, Trolli decided to make a candy version of a Harden shoe. Cole had five tips for working with creative people: ask questions; make stuff together; set creative constraints; feed the side hustle; and be an opener, not a closer.

 

NBA President of Team Marketing & Business Operations and Chief Innovation Officer Amy Brooks talks to John Ourand about capturing younger audiences for World Congress All-Access, sponsored by Heritage Werks.

The honorees largely didn’t see legalized gambling as having much effect on the industry
Photo: Tony Florez

Members of the '18 Class of Champions: Pioneers and Innovators in Sports Business, shared a career’s worth of knowledge during a panel on Day 1 of the ’18 CAA World Congress of Sports. They not only waxed on some memorable moments of their careers, but also talked about surprises in the current sports landscape and where they see future growth. Valuation is the biggest change that Galatioto Sports Partners President Sal Galatioto has seen over his career. “When I started you could buy a team for $60 million,” he said. “Now it costs that for a front row seat. Trees don’t grow to the sky. At some point they’re going to level out.” He said the pyramid is getting narrower at the top when it comes to those who can pay north of $2B for a franchise, which may eventually be a drag on prices. Proskauer Sports Law Group co-Head Howard Ganz chimed in that player costs are the biggest change he’s seen. “I don’t think anyone could anticipate how high salaries would go,” he said. “If not for the salary cap, I don’t now how high they’d go. Like Sal, I keep thinking it can’t go on (increasing), but it does.”

DIFFERENT TIMES: Kay Koplovitz, founder of USA Networks and creator of the first sports cable channel on MSG, credited new revenue streams from social media and streaming that support these higher prices. But she added: “There will be a moderation on prices for teams when people parse out carriage of different entertainment and sports channels. Consumers will have to pay directly for some of them. I don’t know how it will be disaggregated. Will it be more beneficial? I think players will benefit. They’re the social media people out there pushing it.” ISP Sports Founder Ben Sutton noted the same dramatic growth in his area of the industry. “From 25 years ago to today, the first seven or eight schools whose rights fees we paid for, they are 3,000% to 5,000% higher,” he said. “I believe the barrier to entry is higher. When I started (ISP), private equity and venture funding were in their infancy as a financing model. I was very reliant on the bank. I think it would be difficult now. I don’t think impossible but challenging.” 

HERE COMES THE FUTURE
: Sutton said sports executives, commissioners and even concert venue owners should be concerned, “wondering where my next generation of fans are. No one is on a pronounced growth trajectory. Either sports will have to reinvent themselves or game day experiences will have to be reinvented. Millennials aren’t interested.” While Koplovitz isn’t a fan, she said she would be a buyer in esports: “I would be, even though I don’t consider it a sport,” she said. “It fills huge arenas with people watching others play.” Galatioto: “I can’t imagine watching someone play a video game. I’m inherently biased against esports. But if I were the owner of a franchise I’d invest in it as a hedge. In case I’m wrong and it takes off, I want to be there. ... The price (of franchises) is going to go up. There’s a lot of demand for these sports properties.”

WHAT’S THE SPREAD? The honorees largely didn’t see legalized gambling as having much effect on the industry. “Most of the people that want to gamble on sports already are,” said Koplovitz. Added Galatioto: “Leagues will get more money (if sports gambling is expanded in the U.S.) but if people want to gamble on sports, you already can. At European soccer matches you can bet on anything -- it must be the reason people watch soccer.”

ONE FOR THE ROAD: Sutton has started a private equity firm and said he’s “betting on jockeys not horses.” He added, “I’ve seen a million great ideas die because they didn’t have the right leader or team to execute. I’ve seen ordinary ideas turn into extraordinary companies because of the leader and team.” Ganz: “My best advice: The client is always right, but you have to figure out a way to tell client they’re wrong in a fashion to keep them as a client.” Koplovitz now helps women entrepreneurs raise capital in technology and life sciences. “I want to see women at parity in equity funding,” she said. “We’ve raised over $8 billion in startups. Maybe they’ll buy teams with their money. I always love the new frontier.”

Several individuals within the sports industry weighed in on social media during Day 1 of the ’18 CAA World Congress of Sports. Univ. of Illinois AD Josh Whitman tweeted, "Proud to see two fellow #ILLINI alumni, Shad and Tony Khan, on the big stage at the World Congress of Sports in Los Angeles. Amazing journey and incredible partnership between father and son, with far-reaching impact on sports." Learfield's Jack Patterson: "Cool the see @TonyKhan speak at #sbjwcs speak. Had heard he was super smart...it’s true. Enjoying hearing him speak about his role at @FulhamFC. Also his Dad Shahid is awesome too!" He added, "Good point by @CJonesAnderson from the @dallascowboys as she points out 7% of their fans attend a game. Even MORE reason you need to target fans on digital and social." AT&T's Denise Ebright: "Trolli beards+kicks, #BEASTMODE drawers. Thanks @72andSunny #SBJWCS #CreativePeopleWhoDoSport." Former Chip Ganassi Racing President Steve Lauletta: "Kudos to @caa_sports and @sbjsbd for featuring the #TimesUp movement at #sbjwcs such an important conversation for all industries...well done." NASCAR's Evan Parker: "Impressive- @bumble head of brand Alex Williamson says they routinely execute large-scale campaigns that go from inception to launch in just a few hours... Probably helps to be nimble in a world as fickle as dating." Harvard Group International's Chuck Cain: "Disruption & Innovation. Creativity. Diversity & Inclusion. 3 pillars of the discussion today at World Congress. Looking fwd to hearing and meeting great people." You can follow along to all the reactions from this year's conference by using #SBJWCS.