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Volume 21 No. 35

Leagues and Governing Bodies

During his three-year stint as the No. 2 executive at the NFL, Tod Leiweke said very little publicly as the league careened from one crisis to another, from Deflategate to kneeling-gate.

 

One month after leaving to help bring an NHL team to Seattle, he’s ready to open up, and he has some sharp words for those who attack the league, and in particular his old boss, Commissioner Roger Goodell.

 

“Complete, ridiculous malarkey,” he said of the criticism levied at the commissioner. In fact, while many have taken shots at Goodell’s $30 million to $40 million annual compensation in the past, Leiweke contended Goodell earns every penny if not more.

 

“I don’t mean to make light of executive compensation — because I know these dollars, as a kid who grew up on the wrong side of the tracks if you will, one could make the case that many executives are paid so much more than school teachers, firemen, police officers — but I think Roger has added extraordinary value to the NFL,” Leiweke said. “I am one guy who says, without really knowing the details of his contract, I don’t think Roger Goodell is overpaid.”

 

Leiweke came to the NFL from a long career in team sports, having served as the top executive on teams ranging from the NFL’s Seattle Seahawks to the NHL’s Tampa Bay Lightning. When hired at the NFL, his role was to bring some of his team insight to a league office that was often criticized for being tone deaf and isolated from the clubs.

 

Asked why he is speaking out now, Leiweke replied that Goodell didn’t like to hit back at detractors.

 

There were times that I wanted to speak out, but that’s not Roger’s way. … He doesn’t parade around and say, ‘Look how good I am.’ Sometimes I wish we did a lot more of that for him.
Tod Leiweke
Former NFL COO

“People just love taking shots and so be it, that’s part of life, he accepts that,” Leiweke said. “I guess I found it a little bit harder, I grit my teeth a little bit more, but you follow his lead.”

 

That was the style during a pair of controversies last fall, President Donald Trump’s broadside against the league over players protesting during the national anthem and the campaign by Cowboys owner Jerry Jones to restrict Goodell’s new employment contract. 

 

Asked about the recent New York Times story that detailed a meeting last October between players and owners in the aftermath of the Trump attack, Leiweke had harsh words for whomever released the audio recording of that discussion.

 

“Sometimes people do things that I think are dumb and unwise and go against the very being of the NFL, being a team sport and trust and all those things,” he said. “It happens, it is unfortunate, and there were a couple of times it happened, and I wish I had known who had done it because you would have loved to confront that person.”

 

Leiweke comes back often to a fact about the commissioner that he finds telling: Goodell keeps a Polaroid of himself as a young boy sleeping with a football. The point to Leiweke is that the old photo shows how much Goodell loves the game and does what he thinks is right.

 

“The NFL vital signs are very strong,” he said. “It’s not to say there are not challenges, but I think a little bit of the frustration for me were people … seeing the challenges and not the good stuff.”

 

For Leiweke, that is what pains him when he sees Goodell being attacked.

 

“There were times that I wanted to speak out, but that’s not Roger’s way,” he said. “He is on the other hand a very humble guy and he doesn’t beat his chest. He doesn’t parade around and say, ‘Look how good I am.’ Sometimes I wish we did a lot more of that for him. Now I can say these words.”

A report commissioned by professional tennis relays fears that match betting in the U.S. could lead to corruption at the sport’s lower-level events.
Photo: Getty Images

As the U.S sports industry eagerly awaits word from the Supreme Court on whether it will lift a longtime ban on sports betting, something of a warning shot has come from the global tennis business, which in the last decade has been plagued by significantly more gambling scandals than any other sport.

 

A report commissioned by the top professional groups in the sport concluded that much of the gambling-related corruption in tennis is found at its lower levels, where players in under-the-radar tournaments can get paid more by bettors for under-performing than they are likely to earn by playing their best.

 

The findings, released late last month, sounded strikingly similar to concerns raised by Major League Baseball and the NBA during legislative hearings in states that might welcome sports betting if federal law allows it.

 

Both have argued that if states do allow sports betting, the leagues should have the option of preventing bookmakers from taking bets on games in their minor and developmental leagues. The gaming industry argues that doing so would only drive bettors to unregulated markets.

 

“The most impactful argument you can make comes from what you see in the report: That the thing you’re worried about is happening right now,” said Sara Slane, senior vice president of public affairs for the American Gaming Association. “You can look for suspicious activity in a legal and transparent betting system. The idea that we’ll just shut this down with the minor leagues or lower-level tennis — it’s like saying prohibition is going to get people to stop consuming alcohol. It didn’t.”

 

The problem was exacerbated, the report said, by the International Tennis Federation’s decision in 2011 to sell live scores from tens of thousands of far- flung, lower-level matches to data firm Sportradar, which then resold them to bookmakers so that they could resolve in-match bets. While some sites took those bets before the Sportradar deal — reported to be for $70 million paid across five years — the lack of live, official data made them far less appealing.

 

The report, called the Independent Review of Integrity in Tennis, recommended that tennis events and tours no longer sell streaming data from lower-tier matches. It also recommended that the sport no longer take sponsorship dollars from bookmakers, a suggestion that will bring gasps from those in the U.S. who expect that to be a fruitful new source of revenue.

 

What does all this mean for the U.S.? For all the talk of integrity from the big sports leagues here, perhaps the real danger is in the minor leagues and on lower-paying circuits.

 

In recent months, both the NBA and MLB have lobbied states to grant them control over which games bookmakers can offer, a request they say they made with the G League and Minor League Baseball in mind.

 

Those who have pointed to the minors as a high-risk area argue that because players there make less money and aren’t as tied to the fate of their teams, they are more susceptible to bribes, more likely to bet on their own games and less protective of inside information that might benefit bettors. That’s precisely the dynamic that led to the recommendation that tennis shut down betting on its lower-tier events. Presumably any sport in which pay is low and in-game scores are sold to gambling sites could be vulnerable.

 

The casino industry has opposed putting the final say in leagues’ hands, arguing that tight restrictions in the U.S. will simply lead bettors to continue placing their bets offshore. The dispute isn’t over whether to restrict betting on minor leagues, small college and some amateur sports, but over who would decide when to do it and at what level.

 

“Our interest and the leagues’ interest are precisely aligned on this,” said Joe Asher, CEO of William Hill USA, the London-based bookmaker that accounts for about 30 percent of Nevada sports wagering. “It’s our money at stake. We don’t want to lose the money. So if a sporting body has a concern around any of this, we say bring it up to (state regulators). And then let them decide.”

 

The rigging of tennis matches has been well-documented. In the fourth quarter of 2017, tennis comprised 71 of the 114 suspicious bet alerts generated by the European Sports Security Association, an industry watchdog that monitors global betting markets for impropriety. The next highest sport was soccer at 18.

 

Match alerts skyrocketed after the Sportradar deal from 15 in 2013 to 240 in 2016 and 185 last year, according to the tennis report.

 

A Sportradar spokesperson said the proposal to end the data deal could be seen as “unlawfully” inducing the ITF to break a contract and to restrain trade.

 

The Supreme Court could rule on sports betting as soon as next week, and no later than June 25.

Areas of study include a shift in schedule to fall/winter and engaging younger, female fans.
Photo: Getty Images

The WNBA has hired innovation and brand design consultancy Sylvain Labs to study an array of potential business changes to attract younger, female fans as well as a potential shift of the league’s season away from its current summer schedule.

 

While the WNBA has used consultants before, league President Lisa Borders said New York-based Sylvain Labs will undertake the deepest and broadest study of the WNBA’s business, with recommendations expected by July. The company began its work with the league last month. It is the first professional sports league client publicly listed for Sylvain, and Borders said the league was attracted to the firm because of its reputation for developing creative business plans.

 

“We are evaluating our business from top to bottom and left to right,” Borders said. “Sylvain Labs has a creative bent for finding solutions that have not been necessarily unearthed.”

 

The move to hire Sylvain Labs comes as NBA Commissioner Adam Silver said last month that the league would consider shifting the WNBA schedule, which has been held during the summer months since the league was created in 1997. Any alterations in the league’s schedule would depend on arena availability, but Silver said a shift to a fall/winter schedule could boost attendance.

 

“We want to make sure that the summer is the best place for the business,” Borders said. “Everything is on the table.”

 

Sylvain will also address the WNBA’s in-game experience and other business aspects, including efforts to attract a younger, female fan base.

 

“We will be evaluating all aspects of the operations from game day to marketing and digital,” said Ann Rodriguez, chief operating officer of the WNBA. “We want and we need to engage more women that are the age of our players.”

 

The WNBA is the latest league to bring in a consultant to address business operations. Last year, Major League Baseball conducted a full-scale review of its headquarters and MLB Advanced Media operations with the aid of management consulting firm McKinsey & Co.

 

Hiring Sylvain comes as the 12-team WNBA tips off its 22nd season on May 18 looking to build on last season’s gain at the gate. Last season, the WNBA averaged 7,713 fans per game, the highest attendance figure since the 2011 season.

 

This year, the league sees a potential attendance boost from entering Las Vegas with the relocation and rebranding of the San Antonio Stars into the Las Vegas Aces. The franchise was sold to MGM and will play at the Mandalay Bay Events Center.

 

The WNBA also is set to roll out a new advertising effort that includes custom spots featuring a player from each of the league’s 12 teams. The Marketing Arm is the agency of record on the new spots.

 

“We are trying a new approach with a variety of content that helps us sustain story lines,” Rodriguez said.

 

The ad campaign looks to counter last year’s 24 percent drop in TV viewership on ESPN and ESPN2.

 

“It will be player centric,” Borders said. “We recognize that we hear fans asking us about the players.”

 

Like last season, the WNBA this year will have 20 games streamed live on Twitter. ESPN and ESPN2 plan to televise 33 games, including regular-season action and every postseason game, as well as the WNBA All-Star Game on ABC. Last year, ESPN networks televised 32 games during the full season.

 

NBA TV televised 51 games during the full season last year and the network is expected to broadcast the same number this year, but the schedule hasn’t been announced.

F1 TV users will be able to watch all driver cameras.

Formula One is set to launch its over-the-top product this week ahead of the Spanish Grand Prix, marking the biggest move to date in the racing series’ efforts to revamp its digital business.

 

F1 TV’s debut was delayed earlier in the season, as F1’s digital group worked to perfect it. Frank Arthofer, F1’s global head of digital and new business, dismissed critics’ contention that the product should have been ready for the start of the season in late March, saying it was most important to have the product fully ready and professional before its launch.

 

F1 TV is launching only for computers but will soon be available on mobile and TV apps. The product will have two tiers: The premium F1 TV Pro, which will show live races and cost $70 to $150 annually, or $8 to $12 monthly, depending on locations; and a non-live tier called F1 TV Access that will cost $20 to $25 annually, or $2 to $3 per month. To start, F1 TV will be available in more than 50 countries and territories. F1 is producing the product with Tata Communications, NBC’s Playmaker, iStream Planet, CSG and Ostmodern.

 

In the U.S., F1’s OTT product could compete against ESPN — which picked up F1 media rights this year from NBC Sports  — because F1 TV Pro will also show live races for the entire season, all 20 driver cameras, plus additional exclusive feeds.

 

As of late last week, F1 was scheduled to start taking payments for subscriptions to the OTT product. Arthofer declined to disclose subscription estimates or registration totals. But in an interview with Motorsport.com in March, he gave a range of 5 million as a potential high-water mark, which would represent 1 percent of the 500 million fans F1 claims worldwide.

 

Liberty Media bought F1 for $8 billion at the end of 2016 and took over in 2017. The new ownership brought Arthofer on board in June of last year to build out its digital business. He mapped out a three- to five-year plan to increase the sport’s social and digital media footprint.

 

Arthofer said that when he joined F1, its digital group “was like a $6 to $7 million startup with very little infrastructure in all ways.”

 

Another digital effort that will debut this week is a new show that F1 will air exclusively on Twitter following races. “F1 Live Show” will be hosted by F1 personality and journalist Will Buxton and feature exclusive access to F1 drivers and executives, plus a panel that will feature the likes of 2016 F1 champion and now retired racer Nico Rosberg.

 

Arthofer cited F1 data showing that it had a 60 to 70 percent growth rate in social media following last year, and added that the series is on track for similar numbers this year. F1 has 5.6 million Facebook followers, 4.2 million Instagram followers and 3.6 million Twitter followers. It also has a deal with Snapchat around content.

 

The series has a major esports initiative underway, and it has already unveiled one new esports-specific sponsor in DHL, which is also an overall F1 sponsor. Arthofer said he has two more partners he’s about to unveil.

 

Arthofer declined to disclose revenue growth figures but said his group focused this first year on building up its following and will now start to look more toward monetization. He mentioned selling traditional advertising, branded content and earning revenue from licensing — like the Twitter deal — as ways F1 will grow its digital revenue.

 

“It’s a 10-year game; we’re not in the short-term game on OTT,” Arthofer said. “For us, it’s about providing a deeper and better experience for the hardcore fans, doing it in a cost-effective way and making sure that both the product we launch with is of high quality and represents our brand, and that we have a sophisticated plan to make it better.”

Ever since NBC Sports Group’s Dan Lovinger watched the Indianapolis 500 as a kid, he’s had the venerable event pegged on his bucket list.

 

The executive vice president of advertising sales is about to get his chance to attend, as his advertising group and IndyCar’s business development group have started building an integrated relationship that will involve selling NBC’s advertising inventory alongside IndyCar’s sponsorship inventory, including the series’ title sponsorship.

 

NBC becomes IndyCar’s sole media rights holder starting next year, taking over the part of the season currently aired by ABC, including the Indianapolis 500.

 

Lovinger’s group flew to Indianapolis in late April to have their first meeting with IndyCar’s business group and brainstorm over new offers to take to the market. Lovinger and Rod Davis, chief revenue officer of Hulman Motorsports, which owns IndyCar and Indianapolis Motor Speedway, expressed confidence that the partnership will lead to more revenue and benefits for partners.

 

“IndyCar is this wonderful asset that, with a little bit of work on our end, we think we can restore some serious luster to,” said Lovinger. “When you think about the cross-portfolio promotional potential that NBCU brings ... we think there’s a lot we can do for IndyCar to increase consumer interest and certainly drive tune-in to some of these important races.”

 

IndyCar will share internal data and fan insights to help target companies to approach. The sides will review IndyCar’s inventory of assets, and NBC will become more familiar with how things work at the track with hospitality and experiential marketing.

 

IndyCar is this wonderful asset that, with a little bit of work on our end, we think we can restore some serious luster to.
Dan Lovinger
Executive VP, Advertising Sales, NBC Sports Group

“It’s an alignment on the key messaging, attributes and story that we’re going to tell,” Davis said. “It’s also [them] sharing, ‘Here’s who’s in the family’ — they obviously have tremendous relationships across the industry … so it’s kind of pooling their resources, from creative resources to their analytics and insights, and best practices they learned from properties like the Premier League.”

 

IndyCar has a relatively small sales group of three people, so having the aid of a group as large as NBC’s ad team could be a significant boon to the open-wheel series.

 

Lovinger said his team is starting with IndyCar’s title sponsorship opportunity, as Verizon will end its title deal after 2018. However, Lovinger said NBC plans to give Verizon a new joint offer with IndyCar for renewing. Verizon advertises with NBC Sports during programming including NFL games, so NBC could put together an alluring cross-property ad package.

 

“We’re going to start with the incumbent, because we believe that they deserve that opportunity and that there’s a way to show that there’s an improved opportunity for them, and then we’ll go from there,” Lovinger said.

 

If the new pitch to Verizon isn’t successful, Lovinger cited wireless, technology, quick-service restaurants and soft drinks as categories whose brands could fit well with the title deal.

 

“It’s really just a matter of turning up the heat on IndyCar in a way that it just hasn’t had in quite some time,” Lovinger said.

 

The 102nd running of the Indianapolis 500 is this month, and NBC likely will have several executives on hand to start preparing for taking over the event in 2019. Lovinger said it’s to be determined whether he can attend this year’s running, but he’s set on checking the event off his list at least by next year.

 

“We all have our bucket list of things we want to do, and on mine was selling a Super Bowl, which I was recently able to cross off the list this past February — and another was the Indianapolis 500,” he said. “I’m not sure if I’ll be able to get there this year, but I’ll certainly be there in 2019.”

To reach more fans, the Tampa Bay Lightning have set up viewing parties for playoff games at different locations around the city.
Photo: Tampa Bay Lightning

The NHL has altered its policy on local viewing parties of nationally televised playoff games, allowing teams to hold them more frequently and at greater scale. 

 

The league historically limited large-scale viewing parties to one game per best-of-seven series to protect television partners and advertisers, as well as to avoid oversaturated or unsuccessful local events. 

 

However, the league and broadcasters took note of recent successes, most notably the hundreds of thousands of people who took to the streets in Nashville during the Predators’ run to the 2017 Stanley Cup Final. The popularity of the events and the desire to build local momentum and fandom with more frequent and bigger events around playoff games spurred the change, which now allows teams to host as many viewing parties as they desire.

 

“It’s fair to say that there was a level of energy created [in Nashville] that really got us focused on this topic,” said David Proper, NHL executive vice president of media and international strategy, who noted it had been annually discussed among the league’s broadcast partners. “We’ve now seen how these events have helped to both maintain and increase relevance of the teams nationally and in their markets, and how that energy is also helping our broadcast partners.”

 

Jon Miller, president of programming for NBC Sports and NBCSN, wrote in an email that the network was impressed with the viewing parties but that it will “continue to monitor the effect on viewership.” 

 

Last year, the Stanley Cup Final averaged a 22.0 local rating in Nashville on NBC/NBCSN, even with large crowds of up to 50,000 people watching a game from outside Bridgestone Arena.

 

The Predators, who started public watch parties last year during the Western Conference Final, will have a free watch party for each of its playoff games this year. When the team is at home, it holds the viewing party across the street from Bridgestone Arena in a park, while for road games it holds the viewing inside the arena.

 

The Tampa Bay Lightning have also set up viewing parties for each of their playoff road games at different locations around the city in an effort to reach more fans, said Bill Wickett, the team’s executive vice president of communications. For their first road game of the postseason, Game 3 of the Eastern Conference first round against the Devils, the Lightning held a viewing party at a sandcastle festival on Clearwater Beach that attracted 1,500 fans. For Game 4 they moved it to a food hall in downtown Tampa and got more than 4,000 fans. 

 

“Fans want to be together watching these meaningful games, and there’s really no better time of the year to build your fan base and extend our reach into the community than in the playoffs,” he said.

 

The San Jose Sharks have moved viewing parties from local bars in years past to San Pedro Square Market, where the team has hosted more than 1,000 fans per game. Doug Bentz, Sharks vice president of marketing and digital, said the league’s new policy has particularly appealed to “younger fans that are all about this social experience.”

 

The Pittsburgh Penguins have been hosting viewing parties for home games on screens outside of PPG Paints Arena for the last 11 years but have now added elements such as food trucks and a DJ. This year, the team is also producing its own pregame show live outside the arena, which runs before NBC’s pregame that it shows on the screen. 

 

“Our fans demand it, want it and expect it,” said Tom McMillan, Penguins vice president of communications, adding that more than 20,000 people watched the potential clincher in Game 5 of the 2016 Stanley Cup Final outside the arena while the team was on the road.

 

The Winnipeg Jets have had the most Nashville-esque success with watch parties in these playoffs, with more than 18,000 people watching its first round-clinching win over the Minnesota Wild on April 20. Winnipeg has expanded capacity of its outdoor viewing space to more than 22,000 people in expectation for future crowds.

 

“It’s building a broader generation of fans, and taking the way the team is ingrained in the community to another level,” said Kevin Donnelly, senior vice president of venues and entertainment for True North Sports and Entertainment, the Jets’ parent company.

 

Susan Cohig, the league’s senior vice president of business affairs and integrated marketing, said the events are all about fan engagement and creating “the NHL version of a tailgate party.”

 

“It’s a tremendous celebration,” she added.