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Volume 21 No. 1


NBC officials won’t guarantee a Triple Crown, but the network is pulling out all the stops to make this year’s Belmont Stakes the most-watched sports television program of the second quarter, with cross-promotion throughout NBCUniversal platforms.

This Saturday’s race, in which American Pharoah will run to become the first Triple Crown winner in 37 years, will be promoted on “The Today Show,” “The Tonight Show Starring Jimmy Fallon,” “Late Night with Seth Meyers” and “Access Hollywood,” as well as on other programs on E!, CNBC and even The Weather Channel, said John Miller, NBC Sports chief marketing officer.

Last year’s Belmont Stakes drew 20.6 million viewers (12.0 average rating), the second-highest viewership number on record.

“It is our goal to beat last year’s number,” Miller said. “History seems to be a little bit on our side in that regard, because when you have multiple Triple Crown contenders [in consecutive years], it builds up.”

Tonalist (left) wins the 2014 Belmont Stakes, dashing California Chrome’s Triple Crown hopes.
The most-watched Belmont Stakes came in 2004, when 21.9 million tuned in to watch Smarty Jones just miss winning the Triple Crown. The Triple Crown consists of the Kentucky Derby, the Preakness Stakes and the Belmont.

“Today” and Weather Channel forecaster Al Roker will be at Belmont Park; NBC entertainment shows will cover the celebrities going to the race on Thursday and Friday nights; Chris Kay, the CEO of the New York Racing Association, which owns Belmont Park, will be interviewed on CNBC; and comedians Meyers and Fallon are expected to feature the race in their own styles.

Though total coverage across networks will be down from last year’s 16 hours, the number of live hours of coverage will increase from seven to eight.

NBC will also promote through social and digital media the Triple Crown Trophy, which is a separate cup from the Belmont Stakes Trophy and has not been given out since 1978, when Affirmed was the last horse to win the Triple Crown. “This is the loneliest trophy in the history of trophy-dom,” Miller said.

The Belmont on TV

Ratings for the race since it returned to NBC in 2011.

2014 12.0 20,600 Tonalist California Chrome
2013 4.5 7,000 Palice Malice None
2012 4.8 7,700 Union Rags   None*
2011 4.3 6,800 Ruler On Ice None

* Triple Crown contender I'll Have Another scratched the day before the 2012 Belmont Stakes.
Source: NBC Sports

The television rating for the Belmont Stakes, when there is a Triple Crown at stake, is usually three to four times the rating for the race in a normal year.

NBC sells its ad inventory for all three races before the Derby. “When they buy it, they don’t know what they are going to get,” Miller said. “If they get a normal [non-Triple Crown] rating, they get a pretty good rating. But if they get a Triple Crown [in play], it’s a really nice bonus.”

Like last year, the Belmont Stakes will lead into the Stanley Cup Final, and Miller expects the race to help boost the hockey rating, as well. Last year’s Stanley Cup Game 2, which followed the Belmont, averaged 6.4 million viewers, making it the most-watched Game 2 since 1994.

As of last week, there were a few advertising units left to sell for the race. Among the advertisers for the show are Longines and Ram Trucks.

Rob Hyland, NBC’s producer of horse racing coverage, is adding more talent to cover the race and more features, including one on “Sports Streak Busters,” since the 37-year Triple Crown drought is one of the longest in sports.

“We are planning to hear from people in the world of sports and entertainment giving their shoutouts to American Pharoah,” Hyland said. “Mark Messier and the Rangers winning the Stanley Cup in ’94; Curt Schilling and the Red Sox; Andy Murray being the first Brit to win Wimbledon on home soil; John Elway winning his first Super Bowl.”

Editor's note: This story is revised from the print edition.

Longtime television executive Len DeLuca has joined the content team at IMG, where he will work on developing original content.

DeLuca, a veteran of three decades at CBS Sports and ESPN, has consulted with IMG in the past, but this new role will make him senior vice president for original content. He will be peers with three other IMG executives at the senior vice president level: Michael Antinoro (programming and production), Michael Bloom (original content) and Will Staeger (programming and content strategy).

All four senior vice presidents report to Mark Shapiro, IMG’s chief content officer.

The original content team is working on projects such as a film on the life of former New Orleans Saints safety and ALS activist Steve Gleason, branded content for Visa and Anheuser-Busch InBev, the inaugural Live Nation Music Awards for Turner, and programming for NFL Network.

DeLuca most recently has consulted for his own shop, Len DeLuca & Associates, while also teaching at New York University’s Tisch Institute for Sports Management, Media, and Business. He left ESPN in 2010 after a 14-year run of working on a variety of properties, from Major League Baseball and the NBA to college sports and tennis. It was during that time that DeLuca and Shapiro worked together at the network.

DeLuca also was an executive at CBS from 1980-96, during which time he worked on the NCAA basketball tournament, SEC football and the NFL.

ESPN will have a trio of new faces on its popular postgame college football studio show this season, according to several sources.

The network has settled on Adnan Virk to host the show, with Joey Galloway and Danny Kanell providing analysis. The three also will appear in-studio during halftime and after games. They will be featured on both ABC and ESPN.

Virk, Galloway and Kanell replace Rece Davis, Lou Holtz and Mark May, who had been with “College Football Final” since 2005.

Davis, who hosted “College Football Final” since 1999, is moving over to host ESPN’s popular college football pregame show, “College GameDay.” May, who has been with the show since 2001, is moving to another college-focused studio show with host John Saunders and former Texas coach Mack Brown. Holtz retired in April.

The moves are significant for ESPN, which has invested heavily in college football. ESPN pays the College Football Playoff $470 million per year for the rights to three CFP playoff games and four additional bowls.

The 36-year-old Virk has hosted shows such as “Baseball Tonight” and “Olbermann.” Galloway has been with ESPN as a college football analyst since 2012, and Kanell has done some Friday night college football games for the network.


Facebook hires Warriors’ Cote to handle sports teams

Facebook has hired Kevin Cote from the Golden State Warriors to head up the social media company’s effort to partner with sports teams. Cote reports to Dan Reed, Facebook’s head of global sports partnerships.

Reed has focused a lot of his efforts on league relationships. Three months ago, he said he wanted to hire somebody to help show teams the best ways to use Facebook and Instagram. Reed has said that he wants teams to use Facebook to better engage with fans, including selling tickets and sponsorships, as well as driving television tune-in.

Cote spent 11 years running the Warriors’ digital, mobile and social strategies.

— John Ourand


PGA Tour on Periscope: ‘We’re not unsure at all’

The PGA Tour took exception to the part of my column last week that described the tour as unsure of how to deal with streaming services like Periscope.

“We’re not unsure at all,” said Ty Votaw, chief marketing officer of the PGA Tour. “We have a phenomenal relationship with Twitter and Periscope.”

Votaw said the PGA Tour does not stream anything that runs afoul of its partners’ copyrights. The press conferences it streams via Periscope, for example, do not compete with its media partners.

Votaw also hit back at the suggestion that there’s an inconsistency between the PGA Tour’s use of Periscope and its decision to revoke journalist Stephanie Wei’s credential for using the streaming service during part of a practice round. He said the PGA Tour took action against Wei after several previous warnings. He added that the tour took action to protect its media partners’ copyrights.

The PGA Tour has been making interesting moves in the digital space.

A Snapchat post at the Phoenix Open attracted 21 million views, and one at The Players Championship amassed 13 million.

— John Ourand

TV sports networks, and the advertisers that fund them, have spent the past decade chasing younger viewers. But if sports TV executives have their way, that push to get younger and younger is about to change — not so much that they will target senior citizens, but some of the most influential executives in sports media don’t think 20-year-olds should have the type of influence they currently wield.

There’s been such a focus on reaching millennials that it is refreshing to hear some top media executives say they aren’t as important to TV sports as some may believe. Some of these executives argue that it makes as much sense for advertisers to chase younger millennials — think the 18-to-24 demographic — as it did to chase teenagers a decade ago. Today’s younger millennials have extended their adolescence so much that they shouldn’t be courted by advertisers as much as they have been, they say.

Fox Sports President Eric Shanks cited research that said millennials in the 18-24 demo are much more like teenagers than the 25-34 millennials. On average, the 18-24 set stays in school longer, lives at home longer and doesn’t work normal jobs. They wait much longer to form a household, get married and have kids.

“Millennials make up a big portion of the workforce, but their earning power actually is not very much at all,” Shanks said on a recent panel session at the Paley Center in New York City. “The 18-34s — that demographic that TV ratings have been based on for decades — makes absolutely no sense anymore. Eighteen-to-24-year-olds look much more like teenagers in their consumption habits than 25-plus.”

CBS Sports Chairman Sean McManus sounded a similar theme.

“We’re less concerned with how you reach the millennials and monetizing them because they don’t have a lot of disposable income,” he said.

That doesn’t mean that these networks are shunning this younger demographic. Network executives still want to produce the sports that appeal to them as a way “to get them into the funnel,” said NBC Sports Group Chairman Mark Lazarus.

“We want to get them into the video consumption funnel,” he said. “[Advertisers] want to get them into the product funnel and build brand loyalty over time.”

Fox Sports has found that the sports that work best with younger viewers are the ones that don’t require long time commitments. Shanks specifically referred to soccer and the UFC as two sports that don’t take too long and do well with younger audiences.

“New media requests put much more of a value on their time than their money because they don’t have any money,” Shanks said. “The sports that request millennials’ time are the ones that are going to have to figure out how to attract millennials the hardest.”


The numbers for 12-17s and 18-24s are relatively similar, but there's a sharp shift from there to the 25-34s.
12-17 18:15
18-24 18:33
25-34 24:52
12-17 1:49
18-24 1:42
25-34 3:20
12-17 3:55
18-24 4:09
25-34 2:56

* All figures in hours:minutes. Source: Fox Sports

Speaking on the same panel, ESPN President John Skipper said his network puts an emphasis on sports that are popular with young men, in particular.

“I’m not sure that we spend a whole lot of time talking about targeting specifically towards millennials,” he said. “We do spend time thinking about what sports younger viewers care about. … That’s why our network this weekend has soccer and NBA and lacrosse and college softball.”

The key is to get advertisers to follow suit.

“All of us realize that the content that we have is first class; we’re going to draw the viewers,” McManus said. “The question is, how is the audience going to change in terms of consuming your product and how you get paid for that. The traditional model of selling 30-second spots still works to a large extent, but it’s not the future.”

It’s not the future because TV networks are finding that younger millennials are not consuming video the same way older millennials consume it.

“The more important issue with the millennials is that they spend less than a third of their time watching video [by] watching it on traditional television,” Skipper said. “This is why it has to be about mobile, other kinds of devices and authenticated television.”

John Ourand can be reached at Follow him on Twitter @Ourand_SBJ.

Peter Guber remembers visiting Stanford University’s Virtual Human Interaction Lab about a year ago, putting on a virtual reality headset and being completely blown away.

“It was a whole new experience. I was completely transported to that other place,” recalls Guber, co-owner of the Los Angeles Dodgers and Golden State Warriors and head of Mandalay Entertainment. “And any time you can create something completely brand new like that, a new opportunity and new way for a fan to be involved, I thought it was worth investing into that. I think this is something right in the crosshairs of the future.”

The courtside perspective as seen through a virtual reality camera.
Guber recently made an undisclosed seven-figure investment he termed “very significant” into NextVR, a California-based technology company working to enable VR experiences for major sports leagues and networks.

His involvement, in which he also will chair an advisory board for NextVR, is just a hint at the sports industry’s rapidly accelerating interest in virtual reality, which offers an immersive 360-degree viewing experience. Through virtual reality, fans can get the feeling


SBJ Podcast Archive:
From Jan. 5: Senior writer Bill King and Assistant Managing Editor Tom Stinson discuss Peter Guber.

of sitting courtside at an NBA game, directly behind the glass at an NHL game or inside the cockpit with a NASCAR driver. Far beyond just an enhanced version of a regular game broadcast, virtual reality seeks to provide a deeper sensory experience, re-create the feeling of being physically present in the stadium or arena, and offer a new way for fans to engage with their favorite sports.

And unlike a typical sports broadcast, where a director makes all the decisions on what a viewer sees, a fan in virtual reality has total control over where they choose to focus.

“Sports is the holy grail for virtual reality,” said Brad Allen, NextVR executive chairman. Allen has worked in investment banking, funding early-stage technologies, for more than three decades but says, “I’ve never seen so many chief executives, commissioners, people at that level, all get excited about the same thing.”

Virtual reality as a technology has existed in various forms for five decades, and is common in military and aviation circles. But as a mainstream consumer product, it’s never caught on — until now.

Spurred in part by recent technical advances and Facebook’s $2 billion purchase early last year of Oculus VR — in essence a huge bet by Mark Zuckerberg, Facebook co-founder, chairman and CEO, on virtual reality becoming the next major digital platform — a bevy of sports and media properties are actively seeking to develop their own presence in the space in preparation for a mass-market adoption widely projected to arrive in 2016.

In recent months, the NBA, NHL, NASCAR, MLB and Fox Sports all have conducted tests with content produced in virtual reality, including live events, and are seeking to develop public offerings in the format.

The NBA showcased the technology and its work with Oculus and consumer electronics giant Samsung during its All-Star Game earlier this year in New York, further highlighting virtual reality’s importance to the sports industry. That occurred just days after Commissioner Adam Silver made his own visit to Stanford, like Guber, for a firsthand experience.

Highlight clips from that All-Star Game weekend are available through Samsung’s Milk VR virtual reality application, a prelude to an expected sharp increase in available content next year.

“We’ve got fans all over the world,” said Jeff Marsilio, NBA vice president of global media and the league’s point man for virtual reality. “The reality is that very few of them are able to attend an NBA game, and even fewer of them have the opportunity sit courtside. So what virtual reality does is offer that type of experience to everyone.”

And it’s not just live game broadcasts and event highlights where virtual reality is beginning to have an effect. The technology is being eyed as the next great advance for coaching and training simulations. In the not-too-distant future, quarterbacks will be able to conduct a VR simulation with an oncoming blitz, not unlike how a fighter pilot prepares for combat. A company dedicated to virtual-reality-based coaching for football, Strivr Labs Inc., recently emerged out of the Stanford Virtual Human Interaction Lab, and the technology is expected to spread to other sports soon.

Media outlets also are beginning to incorporate virtual reality into their newsgathering operations. Gannett recently introduced to the public a mobile application, VR Stories, that takes its traditional storytelling to virtual reality. Among the initial deployments within VR Stories have been coverage of the Cincinnati Reds and Kentucky Derby through Gannett newspapers The Cincinnati Enquirer and The (Louisville) Courier-Journal.

“Our goal is to tell stories in new ways and find audiences navigating away from traditional media approaches,” said Mitch Gelman, Gannett Digital’s vice president of product. “Our position is that we’re storytellers, and this is a new way to do it.”

Getting social right

Watching sports in most instances is a deeply social experience, and VR’s unsuccessful predecessor, 3-D TV, was doomed in part by its inability to foster that interaction while wearing the glasses (see related story).

Zuckerberg and Facebook, conversely, saw virtual reality as an inherently social possibility when it bought Oculus VR, and VR developers are actively working to address the “isolation issue.”

Efforts are underway to incorporate vocal interaction and access to social networks directly within virtual reality.

Even deeper applications, such as people virtually attending social occasions (including a game) together, are being contemplated.

“Hooking with the social graph is a deeply important part of this,” said Doug Perlman, founder and chief executive of Sports Media Advisors, which is working with NextVR on its development efforts. “This will wind up being a very social thing.”

The NHL conducted a VR test at its Stadium Series game at Levi’s Stadium this year.
Photo by: NEXTVR
At the time of the Oculus purchase, Zuckerberg predicted virtual reality would soon become a “part of daily life for billions of people,” largely due to that interaction component.

“This is really a new communication platform,” Zuckerberg said at the time of the announcement. “But feeling truly present, you can share unbounded spaces and experiences with the people in your life.”

Further aiding the development of VR content: It’s relatively easy to produce. As opposed to the low-position cameras, separate trucks and loss of facility seats typically required for game production in 3-D, shooting for virtual reality requires as little as a single and comparatively much smaller camera. And that camera can be placed in areas impossible to reach with a traditional setup, such as on top of an NBA scorer’s table, and operated remotely.

“The cost of entry is definitely not as high as 3-D,” said Mike Davies, Fox Sports senior vice president of field and technical operations. The network recently participated in a test of virtual reality for NASCAR at the Auto Club Speedway in California, and is considering similar experiments later this year for other sports it airs.

“We’re able to build a compelling experience from a single camera as opposed to a big, expensive, separate production like we had with 3-D,” he said.

Monetization matters

Even with that lower barrier to entry, the question immediately surfaces of how it will be funded and what a revenue model would look like. On the content side, initial tests such as what the NBA did in February with the All-Star VR content have been offered for free. Ultimately, though, leagues are eyeing a variety of subscription-based, on-demand and pay-per-view revenue models.

It’s still unknown how much VR programming viewers can comfortably watch in a single setting — the common view is that it’s less than they could on standard TV — so creating content packages is still in the embryonic stages.

“We’re still figuring out first what the ‘product’ is around virtual reality, and what the fans really want. That’s the first step,” the NBA’s Marsilio said. “I would be surprised if it doesn’t turn out to be a mixture of things.”

VR production requires fewer, smaller cameras than 3-D.
Photo by: NEXTVR
The NHL is in a similar position. The league has conducted several recent tests in virtual reality, including at its Stadium Series game earlier this year at Levi’s Stadium in California between the San Jose Sharks and Los Angeles Kings. But it has not yet progressed toward commercializing the platform.

“There’s a wow factor right away with this. We know that much,” said Bob Chesterman, NHL senior vice president of programming and production. “But the video quality still isn’t quite there yet, particularly on the live side. And we haven’t done all the due diligence yet on the business side that needs to happen. The technology still needs to catch up a bit. But things in this space are moving very fast. I would expect we’ll have a clearer direction in months, not years.”

Guber agreed.

“We’re still at a very early stage,” he said. “I don’t know yet where we’re going to net out at that end between the broadcasters, the leagues, the teams and so forth. That will be dealt with down the road. We’re not even at the start of the game with virtual reality, really. But there is value in this, no question, and it will definitely be monetized.”

Some media rights deals between sports properties and networks have legal language inclusive of all current and future video technologies, granting the networks the ability to exploit any new advancement of virtual reality. So in theory, a network such as ESPN that typically negotiates broad, platform-agnostic rights deals like that for itself could develop a VR content package to sell to the public. ESPN declined to detail its plans in virtual reality.

Other rights, comparatively, are more limited and do not necessarily contemplate virtual reality. So deployment to the public likely will be more on a case-by-case basis in the near term.

“This is a white-hot space that everybody is trying to understand,” Perlman said. “But the rights issues right now are a bit all over the place and are going to need to be sorted out.”

Game attendance, conversely, appears to be far less of an issue with virtual reality. Just as live attendance in sports mushroomed after the arrival of ubiquitous game coverage on TV, Guber and others see virtual reality as a powerful marketing tool to promote buying a ticket.

“I don’t see this as replacing the live attendance. Quite the contrary,” Guber said. “What better way to sell the allure of being there? And there’s unlimited capacity. The arena might only hold 18,000. But billions could watch through virtual reality. That presents a huge global opportunity, and something completely additive to the existing business structure.”

Advertising, meanwhile, is also a keen area of interest within virtual reality. Many entities are experimenting with virtual billboards, representing sort of an enhanced version of what is seen in traditional NHL game broadcasts and elsewhere. The type and placement of some of those ads probably will be determined in part by data that can be generated from where users focus their eyes within a VR broadcast.

Gannett thus far has gone down a more traditional route, selling a traditional, six-month presenting sponsorship to Cincinnati’s Christ Hospital for its VR coverage of the Reds. But other options include immersive forms of native advertising, more standard video spots and product placement.

“We’ve only begun to explore ways to integrate advertising into the VR experience,” Gelman said. “There are lots of different approaches we can take against this.”

In many ways, the current rush of virtual reality activity rises from the ashes of 3-D television, which five years ago was widely seen as the next great advent in video technology but failed to reach mainstream consumer acceptance.

Both 3-D TV and VR require special hardware, such as the headsets, and both technologies use a stereoscopic image that provides the feeling of depth.

But that’s where developers in the VR space intend for the similarities to end. Nearly every major consumer electronics manufacturer, from Samsung to LG to Sony and Oculus itself, has or is developing VR headsets for the mass consumer market.

The ultimate plan is for the headsets to be a low-cost, easily shared or replaced item, typically running less than $100, or perhaps even offered as a free add-on to a cellphone purchase. A significant retail push for this year’s holiday shopping season and then early 2016 is likely.

The bulky VR headsets that are now required resemble an oversized pair of ski goggles with a cellphone attached. But soon enough, they will receive a dramatic redesign.

“The current headset form, no doubt, is still sort of clunky,” said Brad Allen,

NextVR executive chairman. “But you have to think about this like the first cellphones, and how bulky they were compared to what we have now. It’s only a matter of time before we get a much more elegant VR experience through a very sleek pair of glasses.”

— Eric Fisher

A sampling of companies active in the burgeoning virtual reality industry

Headquarters: Laguna Beach, Calif.
Top executives: David Cole and DJ Roller, co-founders; Brad Allen, executive chairman.
Background: A technology company working with leagues and networks, NextVR has developed what it calls a “lens-to-lens system for capturing and delivering live and on-demand virtual reality experiences in true broadcast quality.”

Headquarters: Kansas City
Top executives: Brendan Reilly, chief executive and co-founder.
Background: Developers of VR-based coaching and training tools, Eon Sports has worked with major college football programs, including UCLA, Ole Miss and Kansas.

Headquarters: Los Angeles
Top executives: Jules Urbach, chief executive; Alissa Grainger, co-founder and president; Malcolm Taylor, co-founder and CTO.
Background: The cloud graphics and software company worked earlier this year with the NHL on a VR test of its Stadium Series game at Levi’s Stadium.

Headquarters: San Mateo, Calif.
Top executives: Nick Woodman, founder and chief executive; Anthony Bates, president
Background: Already active in extreme sports through its popular cameras, GoPro recently made a major move into virtual reality through its purchase of French software outfit Kolor.

Headquarters: Menlo Park, Calif.
Top executives: Palmer Luckey, founder; Brendan Iribe, chief executive; Jason Rubin, head of worldwide studios
Background: Oculus has released an early-adopter version of a VR headset, the Gear VR Innovator, and has a mass-market model called the Rift slated for release early next year. The company also has created a software development kit to allow third-party developers to create games and other experiences for the headsets.

Headquarters: Dallas
Top executives: Dale Carman, co-founder and executive creative director; Steve O’Brien, chief executive; Dan Ferguson, director of interactive.
Background: The independent animation and entertainment studio last year formed a dedicated VR division called Reel FX VR and is working on projects including a recent test with the Dallas Mavericks.