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Volume 23 No. 28
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PGA Tour-MLBAM initiative began around Augusta picnic table

The PGA Tour’s Rick Anderson vividly remembers the Tuesday morning practice session at the 2014 Masters when he and MLB’s Bob Bowman grabbed a picnic table to talk shop with some colleagues.

“There was a nice lady from England sitting at the table, and we asked if we could join her,” said Anderson, executive vice president of global media for the PGA Tour.

The woman, perhaps eating one of Augusta’s famed pimento cheese sandwiches, was soon bewildered by the technical talk and left.

Over coffee and sodas, the two executives, along with Chris Wandell, PGA Tour Digital director of business development; Luis Goicouria, PGA Tour senior vice president of digital platforms and media strategy; and Jeff Volk, MLBAM senior vice president of business development, began outlining what ultimately would become PGA Tour Live, pro golf’s entry into the world of over-the-top digital streaming.

The initiative, announced last week and set to debut this summer, pushes the PGA Tour into the rapidly expanding OTT genre and will offer live coverage on numerous digital platforms of one of the last pieces of unseen inventory in U.S. sports media: Thursday and Friday morning rounds of PGA Tour events. PGA Tour Live will show select pairings from those morning rounds at up to 30 tour events per season.

The deal comes almost one year after that meeting in Augusta, and in between were multiple negotiations — mostly at MLBAM’s and the tour’s Manhattan offices. Throughout the year, the tour, which had no plans to go alone on such an effort, specifically sought a partner to assist on the new service and talked to other vendors before settling on MLBAM last summer. It sealed the deal during this year’s Masters, at a house rented by the PGA Tour a few miles from Augusta National, with Anderson signing a 40-page contract that will make the early tournament coverage available for the first time.

“It was a Masters-to-Masters deal,” Anderson said. “It was a hard, open negotiation. It was never in trouble, but we had to grind through a bunch of different points.”

One sticky issue was the high cost of producing the OTT service.

The deal will ensure that golf fans can watch early-round action.
Financial terms for the multiyear deal were not disclosed, but similar to what MLBAM does for its growing cadre of other streaming clients (see related story), baseball’s digital arm will handle the encoding and distribution of the PGA Tour Live feeds and develop a mobile application for the effort. The tour, meanwhile, will pay production costs that will hit a six-figure sum per tournament and will sell ads against the product.

For the tour, the deal brings a long-desired way to monetize a glaring hole in its tournament coverage.

“It’s like not being able to watch first three innings of a baseball game,” Goicouria said of the lack of coverage of the early-round action. “From a strategic perspective, it is about giving more live video. And it is good for the tour to get into these type of businesses.”

The deal also brings the tour in line with other leagues that have successfully entered the realm of OTT content. The NFL last year debuted NFL Now while the NBA is developing its own OTT venture with ESPN.

“It is so important for sports to be on digital platforms,” Anderson said. “It is just important to demonstrate to our fans, sponsors and players that we understand the space and to make sure they know we are there.”

The tour also is banking on PGA Tour Live to attract a younger generation of viewers more comfortable with digital streaming while also using the OTT as a training ground.

“We want to really experiment with a lot of different stuff,” Anderson said. “Things we can try that we might not try on core broadcasts. It is also a place to develop talent.”

Given that golf has the oldest average TV audience of any major U.S. sport, with nearly two thirds of its typical viewers aged 55 or older according to Nielsen, it needs to get younger.

“Millennials are watching more and more sports on mobile devices, not on TV,” said Jimmy Lynn, a former AOL Sports executive and co-founder of mobile video startup Kiswe Mobile. “The mobile device is the center of their universe, and leagues are being smart as to how to tap into the millennials.”

PGA Tour Entertainment will produce the live streaming, with its hosts expected to add the morning coverage to their current duties. The tour will hire additional talent for PGA Tour Live, as well, though tour executives did not disclose specific plans.

The cost of PGA Tour Live has not yet been determined, but there will be some free content made available, Bowman said, and the live, featured pairings that are the centerpiece of the product will likely cost less than $10 per month.

For Bowman and MLBAM, the PGA Tour Live deal was one of familiarity and affinity. Bowman has deep, multiyear relationships with several tour executives, including Deputy Commissioner Jay Monahan, formerly an executive with Fenway Sports Group, the parent entity of the Boston Red Sox. MLBAM has been involved on other golf-related digital content, such as its support in recent years of Masters live streams. And MLBAM and the tour are partners in another OTT venture as well: 120 Sports.

Bowman, MLB’s president of business and media, is also a rabid golf fan, sneaking in a round of golf at the San Francisco Golf Club the morning of the April 28 afternoon press conference to announce the deal.

“It wasn’t too hard to get me to come out here; a lifelong golf fan,” he said last week during the announcement of the venture at the WGC-Cadillac Match Play event. “Baseball is first, but golf is a close second.”

Similar to the PGA Tour, Bowman saw an opportunity to leverage MLBAM’s expertise in live video streaming against that hole in the tour’s event coverage. As a result, PGA Tour Live will in part serve as a tablesetter for Golf Channel coverage later in the day on Thursdays and Fridays. It’s coverage that is expensive for networks to air.

MLBAM also intends to enable easy switching for users to go back and forth between the tour’s own, flagship mobile app and the forthcoming one for the video-driven PGA Tour Live.

“OTT ventures like this have to fit into the patchwork quilt of existing media deals,” Bowman said. “That said, this was one where there was a clear opportunity to better serve golf fans and give them more of what they’re looking for.”

PGA Tour Live initially will be marketed domestically but it is being made available globally, and the tour sees it as a way grow internationally.

“Don’t forget that we also set the pairings, so we will have the ability the tailor certain pairings for particular regions,” Goicouria said. “We think that will be very appealing.”

PGA Tour Live is targeting office workers who will stream to their cubicles, akin to what CBS and Turner do with March Madness Live.

“This is a unique property,” said Chris Russo, chief executive of sports digital and technology advisory firm Fifth Generation Sports. “It is taking Thursday and Friday coverage when people are not in front of TV sets and people are willing to watch on tablets and devices. MLBAM has built a great backbone, and it’s technology that many companies want to use. There is a lot of premium in the morning rounds that were not available.”