Breaking down AT&T’s sports strategy

When Jeff Zucker sits in the NFL’s offices over the next few months and tries to convince the league to sell him a package of media rights, as league and media business figures expect, he almost certainly will focus on the company’s diverse platforms like Bleacher Report and AT&T stores more than TNT or TBS.

Zucker, who last week was named CEO of WarnerMedia News & Sports, takes over the sports division from Turner President David Levy, who resigned earlier this month from the company. In their few public comments about the role of sports in WarnerMedia’s future, AT&T Chairman, CEO and President Randall Stephenson and Zucker have been open about their desire to remain aggressive in bidding for sports rights, which is music to the ears of all the U.S. sports leagues that are eager to see more deep-pocketed bidders.

While the new company does not have a broadcast network, sports business executives expect it to try to engage leagues and conferences with the wide scope of its assets, which include everything from brick-and-mortar AT&T retail stores and the national DirecTV satellite service to regional sports networks to linear television channels and Bleacher Report. AT&T officials believe the wide scope of their assets will make up an attractive offering for a media company that does not operate a traditional broadcast network.

Before he left, Levy outlined this vision to several sports executives, who expect Zucker to follow a similar strategy.

Jeff Zucker, CEO of WarnerMedia, is entrenched in media and entertainment circles.getty images

Now that AT&T’s Time Warner acquisition is official, industry executives expect the company’s conversations around rights negotiations to have little to do with linear television. Imagine how much AT&T could market the leagues and their games in their AT&T stores, of which there are about 5,300. It would not surprise sports executives if AT&T, the nation’s second-largest telecom, starts to load its cell phones with the B/R Live app, which would make that a more attractive place for media rights. What can AT&T do to make mobile connectivity in league arenas and stadiums better, especially with the promise of 5G?

Zucker already has a template for these types of deals. He was president and CEO of NBCUniversal during the 2008 Beijing Games when NBC’s owner, GE, used its Olympic sponsorship and media rights deal to sell industrial products into the closed Chinese market. He is well entrenched in media and entertainment circles.

A Harvard grad who is not afraid to mix things up, Zucker made headlines at a young age. He was the executive producer of the “Today” show in his mid-20s and ran NBCUniversal at 40. He is a force of personality who already is well known to league officials — a superstar executive along the lines of Dick Ebersol, the longtime broadcast executive with whom he worked through the 1990s and 2000s.

Many league executives expect WarnerMedia under Zucker to look a lot like the WarnerMedia that Levy had been touting, at least initially.

Sports executives expect WarnerMedia to emphasize the amount of data that it has, particularly from its DirecTV set-top boxes, that can identify to the second who is watching what and when. They expect Zucker to use DirecTV for the types of megacast features that ESPN has popularized, with different channels providing different views of a game. Turner already has rolled out home-team productions around NCAA tournament games on TNT and truTV. DirecTV could provide even more channels.

They also expect Zucker to tout things like Bleacher Report and House of Highlights, like Levy has done for years. In the past, Turner has sold Bleacher Report to leagues as a place where they can get in front of younger fans.

Even before the acquisition became official, Turner had tried to show off the scope of its offering. On November’s “The Match” with Tiger Woods and Phil Mickelson, for example, DirecTV offered it via pay-per-view, HBO produced a “24/7” show about the competition, and Turner International handled its global distribution. Plus, all of the marketing around the program helped consumers understand what the direct-to-consumer service B/R Live is and where they can find it.

During his meeting with staffers, the Wall Street Journal quoted Zucker telling them that he will be on the lookout for sports “that with the right business development can be developed into new properties that can be owned or licensed.” That means that “The Match” is likely to return and something like ELeague will have a lot of support.