KM 5/7/24 KM 5/7/24

John Kosner Spoke with Rishad Tobaccowala About The Future of Sports Media

Original Article: What Next? by Rishad Tobaccowala, January 6th, 2024

John Kosner on the Future of Sports

John Kosner is the President of Kosner Media, a digital media and sports consultancy and an investment advisor to sports tech startups on the future of sports.

His four decades of expertise include building ESPN into the world's leading digital sports destination; he also struck ESPN's original streaming deal with Bamtech, which led to Disney's acquisition of Major League baseball's technology firm in 2016.

In a world where sports is dominating media and fusing with gaming anybody interested in business should listen to it (even if you are the rare bird who does not follow sports.)

John argues that sports will follow gaming into the interactive world building communities around sports players online and offline as younger fans look for new ways to engage.

He advises us to follow his old Disney colleague, Steve Jobs’ mantra: “beware the status quo” in a world where everything including sports is being re-imagined.

John explains why integrity and trust will be key in a world of sports as AI and sports betting scale.

Listen To The Podcast

KM 5/2/24 KM 5/2/24

John Kosner Spoke with Dan Kaplan of Awful Announcing About ESPN’s Signing of Jason Kelce

Original Article: Awful Announcing, by Daniel Kaplan, May 2nd, 2024

Jason Kelce signing shows no expense is too great for ESPN when it comes to the NFL

ESPN has spent tens of millions of dollars on Monday Night Football talent, even in an era of cost-cutting elsewhere.

First it was the eight-figure annual salaries for Troy Aikman and Joe Buck. Then there was the move of tabbing Scott Van Pelt to host the pregame show. Then the ManningCast added Bill Belichick as a regular guest. And now ESPN’s Monday Night Football has also won the scramble to snare Jason Kelce, the boisterous smiling former Philadelphia Eagles center and host with his brother Travis of a top rated podcast, New Heights.

“Jason has a chance to sort of be a breakthrough, especially if you imagine that at some point he’ll be paired with his brother,” said John Kosner, a media consultant. Travis Kelce has two years remaining on his recently reworked contract with the Kanas City Chiefs.

ESPN may be belt tightening in some areas but when it comes to MNF and everything before and after the game, no expense appears too high.

It wasn’t that long ago that critics savaged MNF for its talent (remember the ill-fated tenure of Jason Witten, and the mocked Booger Mobile) and for the quality of its games. No more. MNF may not exactly be leaving the other broadcasters in the rear view mirror–after all Tom Brady is scheduled to take over lead announcing duties at Fox; of course he might change his mind as he has done before – but the moves are certainly notable.

“I wonder whether this move (Kelce) by ESPN raises the pressure on some of the other broadcasters to do more to find other ways to innovate,” Kosner said. “Because they’re amassing at ESPN the best talent team. And this again, is the most popular sport in America.”

The other broadcasters have not all been quiet. CBS Sports made waves this week by going younger with its talent team, moving out Phil Simms and Boomer Esiason, and bringing in Matt Ryan to the studio show. Fox, again, is poised to add Brady as number one color commentator, and it has the long running number one ranked pregame show.

And ESPN after all is a different animal than its competitors. For one, ESPN fought for years for better games. Despite spending more in rights fees than any of the broadcasters, ESPN persistently had poor games. Paying through the nose for broadcast talent is seen in industry circles as a signal to the NFL, and advertisers, that ESPN is treating the NFL broadcast with utmost devotion and respect. And it has paid off by appearances. Since the new broadcast contracts that went into effect last season, ESPN’s games, which drew record ratings, were often blockbuster matchups. And the league even agreed to flex games to Monday night–it has not done so yet.

“ESPN wants the best games they can get and their schedule has gotten progressively better over the last few years, certainly since Jimmy Pitaro took over (ESPN),” Kosner said. “And, but I think that the real end game is to build viewership and tune in to other programming that they do around the NFL.”

Another reason for the all-in spend around MNF, unlike its competitors, ESPN has no non-sports businesses competing for resources. And the NFL is the biggest sport, so it is always going to invest in football.

“They got a lot more NFL programming hours than anybody else,” media consultant Patrick Crakes said. “They have to. Their return on investment could be diluted by that. So they don’t want that to happen. So they’re investing a lot.”

And Kosner said, “those networks are not really comparable to ESPN, because they’re not in the SportsCenter business. They’re not in the NFL Live business. And in certain cases, they haven’t added that much talent because they didn’t have to… none of them do the hours of content and programming.”
For those who snark the pregame shows, the announcers, the sideline reporters and so on don’t matter because fans just want the games, Crakes, and Kosner disagreed, arguing it is important the overall NFL product is presented as professionally and slickly as possible.

“They have to constantly think about how they’re presenting because their brand is largely dictated by it,” Crakes said. “When I was at Fox, even after we launched FS1, my consumer research group came back saying what had been being said forever: the entire brand of Fox Sports centered around the pregame show of the guys at the desk.”

Kosner didn’t disagree games are what fans value most, as evidenced by the rights fees paid to the NFL. “But from the standpoint of building a healthy network business, “ he added, “you would like to get people to tune in at all hours and sort of express their fandom that way.”

And the popular and rambunctious Kelce, who pounded beers in the parking lot and went shirtless at the Kansas City Chiefs-Buffalo Bills divisional round game in Buffalo, just might be must-watch TV.

KM 4/20/24 KM 4/20/24

John Kosner Spoke with Matthew Frank of The Ankler About Netflix’s Potential Interest in UFC Media Rights

Original Article: The Ankler, by Matthew Frank, April 20th, 2024

Last Saturday night during the UFC 300, TKO and Endeavor CEO Ari Emanuel had his usual ringside seat to the mixed-martial arts (MMA) spectacle. Right next to him, though, was a new friend to the octagon: Ted Sarandos. (Hat tip to David Spade of all people for capturing the Netflix co-CEO obstructing his view.)

Sarandos thanked UFC and its president Dana White on his Instagram Stories, but what he didn’t mention was that he may very well have been there to inspect the merchandise up close. (A UFC spokesperson declined to comment.) While sports media-rights watchers circle the NBA and its current negotiations, speculating what, if anything, Netflix may want for itself (the In Season Tournament? The Play-In games?), UFC’s media rights are only months away from being renegotiated. MMA is not only global like the NBA, but it’d be cheaper than pro basketball and much like UFC and WWE making sense within its parent company, TKO Holdings, ultimate fighting might also be a perfect pairing with Netflix’s just-acquired rights to stream WWE Raw starting next January. (Netflix did not respond to a request for comment.)

Also in January 2025, the UFC will start the process of determining its next rights deal (or deals). In 2018, UFC negotiated a $1.5 billion all-inclusive media rights deal with ESPN, which expires at the end of 2025. TKO president Mark Shapiro told investors in March that it is the company’s “preference to stay at Disney” — while just happening to add that three different platforms had already reached out about UFC switching services.

He also declared that the UFC had easily asserted its rank among the four major sports, up there with football, basketball and baseball and ahead of hockey.

“The ratings on ESPN and ESPN 2, apples-to-apples against the NHL, even including the playoffs, we dwarf them,” Shapiro said. “You put a Fight Night — not a pay-per-view, not a preliminary bout in front of the pay-per-view — a regular weekly Fight Night on ESPN does double-digit ratings.”

If Netflix is going to make the leap from sports entertainment to live sports, don’t be surprised if Sarandos is preparing for a double-leg takedown.

Netflix Whiplash

Over the years, Netflix has been adamant about its disinterest in live sports. As recently as last October, Sarandos said there was “no core change in our live sports strategy or licensing live sports.” He said Netflix could impact the sports business via bringing “value” to “the drama of sport.”

Since at least 2016, when the service debuted Last Chance U about football players at junior colleges likely playing their last-ever games, it has developed a niche in offering sports docuseries. It has gone on to cover everything from a hardluck Premier League club (Sunderland ‘Til I Die) to the vaunted Drive to Survive and Quarterback. These then led to Netflix’s made-for-TV sporting “events” — the Netflix Cup and Netflix Slam — a more manufactured drama, but ever so slowly Netflix was inching its way forward.

Then in January, about three months after Sarandos forswore that there’d be no live sports on the service, Netflix signed its 10-year, $5 billion deal with TKO-owned WWE to air Raw weekly. WWE may technically be “sports entertainment,” but to its rabid fans, wrestling is a sport. Netflix’s next move, announced in March, is a boxing exhibition featuring Jake Paul vs. Mike Tyson, a stunt which will likely draw a considerable amount of eyeballs when it streams live on July 20. “Judging from the early excitement around the Jake Paul-Mike Tyson fight,” Sarandos told investors on April 18 during the company’s earnings webcast, “there's going to be a lot of people waking up in the middle of the night all over the world to watch this fight in real time.”

He rhapsodized about the “magic” of “folks gathering around the TV together in the living room to watch something all at the same time,” expressing his belief in “these kind of eventized cultural moments.” (Never mind that Netflix’s on-demand binge model helped erode that for everything but live sports.) UFC fights, of course, are the epitome of that kind of event. And so much for your own personal algo and the find-your-own-adventure on Netflix in its new age, as “broad” becomes the new “prestige.”

That’s Advertainment

Why the sudden shift into more live sports? Netflix’s implementation of an ad tier — another idea that the company pooh-poohed for eons until it decided to launch one in late 2022. Year-round sporting events lend themselves to appointment viewing, which drives higher engagement and advertiser interest.

“That's where sports really shines, and I think that that kind of underpins some of the value that WWE will bring to Netflix,” says Geoff McQueen, managing director at LEK Consulting, a strategic consulting firm with a media and entertainment practice. “UFC [would] do something very similar.”

In particular, UFC gets at advertisers’ coveted 18-34 demographic. “Netflix is already the leader in terms of distribution. I believe [UFC] would help Netflix with retention,” says John Kosner, a former ESPN digital media executive who now runs his own consultancy, Kosner Media. “[It] would help them reach UFC's younger, male demo, which I'm sure is part of their target and not as easy to reach.”

Disney’s Shifting Sports Ambitions

As Disney CEO Bob Iger seeks to reset the company on surer footing (and secure his legacy) and ESPN Chairman Jimmy Pitaro (maybe) auditions to replace him, ESPN’s streaming ambitions as of late are in flux. In February, the company announced a joint venture with Fox and Warner Bros. Discovery for a streaming sports service coming in the fall of 2024. ESPN also announced the launch of a new flagship DTC service that will debut in fall 2025, featuring both the linear ESPN and ESPN+ offerings.

Both new services, but in particular the latter, raise questions about what ESPN’s new setup might look like and the role UFC might play. Although UFC appeared to give ESPN+ an early boost — the sport’s first live event on the platform in 2019 generated 568,000 new subscribers — ESPN+ is still so small that it is dumped into the “other” bucket of streaming services that command less than 0.8 percent of the audience according to Nielsen.

“If there's no ESPN+, then it raises the question of ‘Okay, well, what about the proprietary content that we acquired for ESPN+, whether it's UFC or La Liga, or Bundesliga, or NHL Center Ice or the PGA Tour Thursday/Friday?’” asks Kosner. “How does that stuff fit in?”

Additionally, Disney, whose market capitalization sits roughly where it did when it made its original deal with the UFC, is looking to re-up its media rights deal with the NBA this summer. ESPN currently splits the NBA with Warner Bros. Discovery for a collective $24 billion over nine seasons, a figure that only looks to surge upwards in the coming negotiations, even if Netflix isn’t a buyer of some part of the NBA package.

Between the NBA, the $2.7 billion ESPN pays annually for NFL rights and its new six-year, $7.8 billion college-football playoffs deal, among others, another full-scale media rights deal with the UFC could be too rich for its pockets compared to Netflix.

“The legacy media companies, they have a lot of debt, and they have to pay through the nose for the sports rights,” says McQueen. “Because the sports rights, with the NBA or the NFL . . . they’re what’s keeping the pay-TV (PTV) ecosystem together and the pay-TV ecosystem is what's generating cash flow and profits for the legacy media companies, which they’re using to fund the streaming services.”

Benefits and Potential Cost of Netflix’s Sports Fandom

When TKO made the deal with Netflix for Raw, one of the main benefits for the WWE was that it standardized the wrestling promotion’s international distribution. WWE had previously been scattered across a hodgepodge of international partners, with some larger regional partners but

still very fragmented.

Netflix will now be the WWE’s turnkey international distributor.

“In a lot of these international markets,” says LEK’s McQueen, “Netflix will probably have higher penetration than in the PTV ecosystem to actually get UFC content or the WWE content in front of more fans and increase that fan base and ultimately drive more monetization because I think Netflix will be able to monetize it at a higher level.”

The same logic applies to UFC, which currently has assembled a bevy of different international partners because ESPN+ is not available globally.

But if Netflix does choose to buy some UFC rights, it could have downstream effects on the rest of Hollywood seeking to supply it with shows. Sarandos and CFO Spencer Neumann preached discipline in their content spending to investors this past week. “The budget is the budget,” Sarandos said. The money to pay for a live sports package would have to come from somewhere — and that somewhere is likely the budget for originals (the vast majority of its content spending) or licensed shows. Either way, live sports could translate into fewer buy orders from the best buyer in town.

More Partners Equals More Money

As the NFL has consistently proven, a sports league can generate a lot more revenue if it divvies up its rights to multiple partners.

Netflix, for example, may now own the media rights to Raw, but the WWE’s other weekly programming — SmackDown! — belongs to Comcast. It signed a new five-year deal, which starts in October, where it will pay $287 million annually to continue to broadcast it on USA Network and Peacock.

Could a similar-type package work between Netflix and ESPN?

Like the WWE, the UFC has two main offerings: There are its numbered events like the one Sarandos attended, which are pay-per-view through ESPN+, and then there’s Fight Night, which operates on a roughly biweekly basis, that’s either streamed without extra charge on ESPN+ or broadcast on ESPN or ABC. Netflix has never pursued an à la carte model, so the PPVs might be unattractive to the streamer.

Fight Night would be an easier entry point into the sport. Plus, without an added surcharge, that would more effectively service Netflix’s advertising mandate for engagement, whereas ESPN+ — or whatever service it becomes by 2026 — could still generate subscribers from exclusive PPVs.

With Netflix now generating $2 billion a quarter in profit, Sarandos may be thinking of one of Tyson’s most colorful quotes as he thinks about his competition: “When I fight someone, I want to break his will. I want to rip his heart out and show it to him.” Welcome to the arena, Ted.

KM 4/15/24 KM 4/15/24

Time to Combine The Final Four. John Kosner’s Latest SBJ Column With Ed Desser

Original Article: Sports Business Journal, by John Kosner and Ed Desser, April 15th, 2024

In the 2021 NCAA Gender Equity Media & Sponsorship Analysis, we wrote that the Men’s and Women’s Division I Basketball Final Fours should be staged at a single location on the same weekend, starting ideally in 2023. Imagine if the NCAA had done so! Last year, the epic matchups of Iowa with Caitlin Clark against undefeated South Carolina and then eventual champion would likely have packed Houston’s NRG Stadium! The 2024 women’s final outrated the men’s by a previously unthinkable 26%!

As to the debate about whether to expand significantly the number of teams playing in the men’s tournament ...

We say: “No!”

Sports media is undergoing historic change. If you’re not constantly improving, you’re falling behind. For Tier 1 properties, the key strategy is often expansion, building upon what’s already there, primarily in the postseason: NFL playoffs have gone from eight to 14 teams; MLB from four to 12; College Football Playoff from four to 12/14 schools; the NBA has added both Play-In and In-Season tournaments; the World Cup will have 50% more teams (48) in 2026.

But expansion is not the only way to improve. The NCAA men’s and women’s basketball championships are already almost perfectly designed:

True national championships.
All single-elimination games.
A near-ideal combination of automatic qualifiers covering all D-I basketball conferences, plus an appropriate number of at-large schools (Blue bloods and Cinderellas!).
So perfect that March is the busiest month for vasectomies … really!

To increase the value of their two basketball crown jewels, the NCAA and its schools should focus on strategically improving what they already have — not diluting it further. While beautifully constructed, the men’s and women’s tournaments, as media properties, have barely changed in decades. It’s high time:

Let’s start with the beginning. The first two full days of the men’s tournament are a national holiday for many sports fans, but who can take Thursday/Friday off? The NBA playoffs start on Saturday/Sunday, enabling every game to be nationally televised to the biggest possible audiences. Open the men’s tournament on Saturday/Sunday — up to eight games per day could be scheduled unopposed! Then use Monday/Tuesday late afternoons and evenings for the second round. We also suggest using home arenas for both tournaments for the first weekend — cutting down on travel, ensuring a great atmosphere for TV and rewarding the excellent play of higher seeds during the regular season.
Update the TV schedule. Expand distribution, improve time periods. Would the NFL construct a playoff schedule with no Sunday night network TV windows whatsoever? Of course not. The Duke-N.C. State regional final drew 15.1 million on CBS, Sunday at 5:05 p.m. ET. What would it have done at 8 p.m. ET? The South Carolina-Iowa rematch on ESPN drew 18.7 million and ended just after 5 p.m. ET. How about if it started on ABC at 8:30 p.m.? All games should be elevated into the best, not best-available, time slots. Everyone wins! With the plethora of networks available between CBS, WBD and ABC/ESPN, game times could be coordinated and staggered to better effect. Being more aggressive will create a virtuous cycle, yielding more rating points and resulting ad dollars and higher rights fees starting in 2033.
Truly cross-promote. The NCAA mandates that CBS/WBD and ESPN modestly cross-promote the respective tournaments. But when games are live simultaneously, announcers directing fans to NCAA.com for schedules is not ideal. The NCAA now uses “March Madness” branding for both events; it should include the women in its March Madness Live app, too.
Combine the Final Fours! Big East Commissioner Val Ackerman outlined this idea in her 2013 white paper, and last month Casey Wasserman championed it on Bill Simmons’ podcast. Currently, the pieces fit and could remain: The women play Friday/Sunday and the men Saturday/Monday. But the NCAA could also create a Super Saturday with all four semifinals and a Monday night championship doubleheader with prime-time slots for both. With CBS/Turner, it could also update its sponsor sales approach, permitting devoted women’s championship sponsors to buy stand-alone packages without buying through the men’s overhang. In her white paper, Ackerman wrote that a combined Final Four would “create an unparalleled college basketball showcase that would bring together the best players and coaches in both sports and, importantly, allow the women’s tournament to avail itself of the presence of sponsors, media representatives and important guests who typically bypass” the women’s final weekend in favor of the men’s. The women’s leaders aren’t “in the room where it happens.” Let’s change that! The men and women could also play in the same venue, share hotel allotments (which any Super Bowl city can manage), and create a Basketball Super Bowl!

Reasons we feel negatively about championship expansion:

The broadcasters won’t pay materially extra for more early-round games in either tournament.
There’s limited room to expand the men’s tournament — one week later is the Masters, one week earlier are most of the conference championships (Idea: Use the NIT, not the “First Four,” to qualify the final slots).
Any change in the automatic qualifiers negatively affects the appeal of the tournaments. This year, the biggest men’s stories early were Oakland, Yale and James Madison. But in other years it’s been Saint Peter’s, Cornell and Loyola (Chicago).
Yes, the expanded Big Ten and SEC want to maintain the percentage of their schools making the tournaments, but not at the expense of optimal tournament design.

NCAA leadership considered our 2021 combined Final Four recommendation but then selected separate locations through 2031. That’s a big miss. Hopefully the leaders of college sports will reconsider. There’s no better time than now.

Ed Desser is president of consultancy Desser Sports Media Inc. (www.desser.tv). John Kosner is president of consultancy Kosner Media (www.kosnermedia.com). Together they developed league TV strategy and ran the NBA’s media operations in the ’80s and ’90s.

KM 4/9/24 KM 4/9/24

John Kosner’s Comments on NCAA Championship TV Start Times were Featured in Ben Koo’s Column in Awful Announcing

Original Article: Awful Announcing, by Ben Koo, April 9th, 2024

The madness has ended for both the men and especially the women. This year’s tournaments have been a major success in terms of interest and television ratings.

But as much as positivity surrounded both tournaments this year, there was one issue that fans and sports media folks took issue with—the tipoff times of both championship games. Below we look at the fan feedback and what realistically could change, if anything.

Women’s Championship Game at 3 p.m. ET on Sunday

In August 2022, The Athletic’s Richard Deitsch reported that the women’s championship game would be moving from its traditional home of ESPN to the more broadly distributed ABC for the final two years of the existing contract. Deitsch had long advocated for that move and ESPN President of Content, Burke Magnus, signaled that while they could only commit to 2023 and 2024 on ABC, the plan was for the game to stay on ABC should ESPN renew the contract, which they indeed did, and is already looking like a money-printing steal for ESPN.

While the move to ABC has been good from a visibility standpoint, the game slid back from the 8 p.m. ET tipoff time it held the year before on ESPN to 3 p.m. ET. That five-hour change had some feeling like it was not optimally scheduled. Our poll, which got 4,000 responses, showed that fans thought 3 p.m. ET was too early on Sunday although the old 8 p.m. ET tipoff was seen as too late. Nearly 80% of the poll respondents seemed to like the idea of a tipoff time between 4-8 p.m. ET.

Although most folks found the tipoff time too early, some found it just right.

Many people responding to our poll, as well as general fodder on X/Twitter, cited that the 3 p.m. tipoff time was not ideal due to activities including day drinking, youth sports, errands, family events, and church. 6 p.m. seemed to be the sweet spot many were looking for.

In defense of the 3 p.m. tipoff time, Deitsch made the point that the NFL does quite well in the afternoon.

While 8 p.m. or later only got 6.5% of the votes in our poll, many people noted that NBC’s Sunday Night Football kicks off after 8 p.m. and is the highest-rated regular season sporting event on a week-to-week basis. That said, that tipoff time would require ABC to nix their primetime lineup, something networks are very hesitant to do. Also, is the 8:20 ET kickoff of Sunday Night Football really optimal or simply done because of the late afternoon window before it?

John Kosner, a former ESPN executive, cites that the NFL starts its biggest post-season games at 6:30 p.m. ET which is probably a pretty definitive clue of what data signals is the most ideal time to start a game. That said, NFL games take three hours or more, whereas college basketball games take about two hours. So a 6:30 ET kickoff time for an NFL playoff game is really a 6:30-10 p.m. ET window whereas a college basketball game is more likely to go from 6:30-8:45 p.m. ET.

Ultimately, as Sports Media Watch referenced in the posts above and below, the 3 p.m. ET tipoff is more of a byproduct of ABC not wanting to disrupt its primetime lineup, something we saw as the post-game show ended with no warning on ABC (it continued on ESPN).

Will that be the case moving forward? Given how massive the ratings were and the fact that the clunky transition was into paid programming instead of their primetime lineup, something Sports Media Watch labeled as “borderline incompetence,” it seems likely some change will take place. With “America’s Funniest Home Videos” (yes, still a thing) airing at 7 p.m. ET, a tipoff pushed back to the 4-4;30 window would allow ABC to capitalize on the millions watching versus dumping them into paid programming.

Another option is to go even later and have ABC take a break from their normal primetime schedule which would currently be “America’s Funniest Home Videos” and then “American Idol,” although I think moving the latter is very unlikely. Ultimately, ABC and ESPN now have ratings data that is significantly more compelling. You’d think it helps make the case that a 3 p.m. ET tipoff leading to paid programming does nobody any good. We’ll have to wait and see what their plan is for 2025, given that next year’s game will be the first in ESPN’s new deal with the NCAA.

Men’s Championship Game at 9:20 ET on Monday

As seen below, the late tipoff time of the men’s championship game is nothing new.

But once again, the topic of the tipoff time drew the same commentary it does every year.

The first thing to consider here is that a college basketball game tipping off at 9:20 ET will essentially end at the same time that NBC’s Sunday Night Football ends (11:30-ish) although the game starts a full hour later. So while the game starts later than most big time games we’re used to, it ends at about the same time.

The other thing to consider is that Monday is a workday and the networks have to juggle the fact that a game starting sometime around 8 p.m. ET will not allow viewers on the West Coast much time to travel back from work. Given how much of the West Coast population lives around areas with known difficult commutes (Bay Area, Los Angeles, Sacramento, Seattle, etc.), networks are more or less juggling the question “Do we gain more viewers on the West Coast by giving them added time to get back home?” versus “how many viewers are we losing on the East Coast by pushing this game later in the night?”

Given how the game has never really moved off of its 9:00-9:20 tipoff time for decades, the data seems to support the fact that despite rankling fans on the East Coast, the 9:20 ET tipoff time is pretty optimal. Keep in mind Nielsen provides ratings data for the largest markets in the U.S., so they can see where ratings will be impacted by start times, allowing networks to potentially adjust accordingly.

While the Eastern time zone has ~47% of the country’s population, the Pacific time zone has just under 17%. So while more people are annoyed on the East Coast and perhaps that could be factored in more, the networks seem to be saying ‘Yes they are annoyed on the East Coast, but they still watch, whereas West Coast viewers in many cases will be unable to watch at all if the game was earlier.’

The thinking is that X amount of viewers, with Y amount of them being annoyed, is better than having fewer viewers in total, even though those watching might be happier overall.

That’s a long way of saying if you’re someone who finds the tipoff time too late for the men’s championship, you’ll likely have to move timezones, have a coffee, or just deal because it doesn’t seem like it will be changed anytime soon.

KM 4/8/24 KM 4/8/24

John Kosner Spoke with Josh Carpenter of The SBJ About Pro Golf’s Media Deals

Original Article: Sports Business Journal, by Josh Carpenter, April 8th, 2024

As negotiations slog on between the PGA Tour and PIF on a potential agreement and PGA Tour Enterprises continues to be built out, one consistent talking point in golf has been how the product will be improved with an influx of capital. Specifically, when it comes to improving the product, much has been discussed about potential changes to it on TV or via other viewing avenues.

The PGA Tour’s media deals with CBS, NBC and ESPN run through 2030, but could new money lead to changes to those contracts before then? Might fans see fewer ads and more golf shots during broadcasts? SBJ caught up with a pair of media industry veterans -- Ed Desser and John Kosner (both regular SBJ contributors) -- to talk about what might be in store.

The below has been edited for brevity and clarity.

Q: With this influx of new capital, could the PGA Tour’s current media deals see changes? Or how might golf broadcasts look different going forward?

Desser: What's broken in golf is not their TV deals. Their TV deals to me are pretty good. They're heavily into broadcast. And so you at least have potential for wide availability, expanded hours over the course of years. People are accepting of a fairly robust level of inventory in telecasts. It's not really different in other sports. And so to me, while I can certainly appreciate the notion of lower commercial loads, I don't know that that has a meaningful impact on audience. It seems very unlikely to go to lower commercialization, which isn't to say that there couldn't be some premium options. A streaming service that is continuous coverage of holes. They do a little bit of that now, but if literally you could follow every group from beginning to end. That could be a very nice premium product that wouldn't generate huge audiences, but it could be incremental and satisfy part of the audience that would be willing to pay.

Kosner: I see streaming options coming, follow your group, limited commercials, the “Every Shot Live” product that they do with the Players. I could see those things happening. But in general, fans want to see the top golfers in action on Saturday and Sunday afternoons. LIV grew up in part because that wasn't really happening every weekend on the PGA Tour. And now golf's fragmented. So, this all kind of augers for some sort of broader partnership so that fans can get what they want, which is to see the best players playing every Saturday and Sunday. There’s been talk of the formation of a global golf tour, and while maybe that’s not really of interest to the U. S. media companies, it could be of interest to Apple, could be of interest to Netflix, could be of interest to Amazon.

Q: Should the PGA Tour’s decline in viewership this season on linear television be concerning? Or is it more cyclical and a sign of more households cutting the cord?

Desser: The broader perspective is better and one should be thinking about what were the numbers four or five years ago and to what extent has losing so many names (to LIV) negatively impacted the tour. It's enough guys that it's gotta hurt. These are, if not household names, they're certainly household names in golf households. And I think you've got to factor that in. But yes, audiences on television keep shrinking because there are more and more opportunities. The only real exception on an ongoing basis has been football and really NFL football.

Kosner: If you recall a year ago, you had the crusade, the tour was taking on LIV. They had brand new tournament structures. They had a lot of promotion, they had some exciting conclusions. There was a lot of energy into this a year ago that it's not quite the same thing this year. And these sports are cyclical. You have stars rise and fall, sometimes you have super dramatic games. Women's college basketball is having a sensational winter and spring, and we think it'll be strong next year, but Caitlin Clark will not be there.

Media consultants dish on improving the golf TV product

One consistent talking point in golf has been how the product will be improved with an influx of capital. When it comes to improving the product, much has been discussed about potential changes on TV or via other viewing platforms.

My colleague Josh Carpenter caught up with a pair of media industry vets -- Ed Desser and John Kosner (both regular SBJ contributors) -- to talk about what might be in store.

"All of sports has to focus on improving its product in a far more competitive environment," said Kosner. "The issue with over-commercialization, to the extent that that's a criticism, I kind of believe that's going to solve itself over time. The PGA Tour, the networks, the advertisers are going to conclude, 'We have to show more golf because we can't retain our audience.' ... It wouldn't surprise me at all to see more Mountain and West Coast locations for golf so that events could get scheduled into prime time and get better windows. It's great for the U.S. Open when they play at Olympic [in San Francisco]. ... By the same token, you may see with the influx of international dollars, more big events with big fields that are played in the Middle East, overseas and are airing at odd times."

"There's an interesting question whether there could be new products created that might appeal to younger audiences," noted Desser. "Clearly the tour is always looking for ways of attracting a younger demo because, let's face it, it's hard for younger people to afford the sport. And so they've got to figure out ways of introducing it and perpetuating it among younger people, or they'll be in the same mode as like horse racing where the average age is deceased."

KM 4/5/24 KM 4/5/24

John Kosner Spoke with Ira Boudway of Bloomberg About TV Viewership for the NCAA Women’s Basketball Championship

Original Article: Bloomberg, by Ira Boudway, April 5th, 2024

In this issue:

We look at one of the few decent sports broadcasting deals around. Congrats ESPN.
We talk to former Phoenix Suns vice president and co-owner Andy Kohlberg, who owns Spanish football club RCD Mallorca along with Steve Nash and Steve Kerr, about what it’s like taking a team to the cup final.
We round up who is winning the Bloomberg Brackets for a Cause. Hint: swipe right.
And check out our chat with RedBird Capital's Gerry Cardinale, who has his hands (and a lot of money) in everything from AC Milan to the United Football League to Fenway Sports Group. The former Goldman Sachs partner joins The Deal with Alex Rodriguez and Jason Kelly to talk about shaking up the sports media landscape and advising the late George Steinbrenner.

If you aren’t yet signed up to receive this newsletter, you can do so here. Send your feedback here.

Clark Delivers (and Then Some)

Hi, it’s Ira. I was in Albany, New York, on Monday night watching the Iowa Hawkeyes play LSU in the NCAA women’s college basketball tournament. At the risk of sounding corny, the game was a reminder why we watch sports in the first place. One of the hazards of this job is that you become jaded. You start to see sports as an industry. Teams become tax dodges for the mega rich. Leagues become legalized monopolies designed to exploit the talent of their players and monetize the devotion of their fans.

But for two hours on Monday night, I got carried away in the spectacle.

A rematch of last year’s championship, the game promised high drama and delivered beyond expectations. Caitlin Clark, Iowa’s sharpshooting superstar, sought revenge after LSU stifled — and taunted — her last time around. This time, with a Final Four appearance on the line, Clark was magisterial, scoring 41 points, including nine threes, in a victory. But LSU, led by Angel Reese and Flau’jae Johnson, kept it close until the final minutes in a fast-paced, back-and-forth game.

Afterwards, as I stood watching Iowa players celebrate, a fan came down to the sideline. He wanted something, anything, to keep as a memento. (Hope he liked the stat sheet I handed him.)

“Americans understand the difference between a regular event and a big event,” says John Kosner, a sports media consultant and former executive with the NBA and ESPN. “That game was tied at halftime. I think everybody was calling their friends and saying: ‘Are you watching this?’”

As it turned out, 12.3 million people watched on ESPN, the largest audience ever for a women’s college basketball game, breaking the record set by the same two teams in last year’s championship.

It’s a big number for any sporting event beyond the NFL — more than the audience for any game from last year’s World Series and all but one game of last year’s NBA Finals. And it’s more than any men’s college basketball game over the weekend, save one: N.C. State’s upset of Duke on Sunday evening, which had the advantage of being on CBS, a broadcast network in many more homes than cable.

NCAA March Madness Weekend TV Viewership

Women's games (highlighted in gray) drew record highs for ESPN/ABC.

Source: Nielsen

Clark has provided a huge lift to the women’s game. Five years ago, in 2019, the women’s final between Baylor and Notre Dame drew 3.7 million viewers, which, at the time, seemed like a good number. This year, Clark and Iowa drew more than 3 million for a first-round blowout of Holy Cross and nearly 5 million for their second-round matchup with West Virginia.

On Friday, Iowa eked out a win against UConn — the winningest program in the sport — to set up a showdown on Sunday with undefeated South Carolina in the title game on ABC. Drawing 20 million viewers is not out of the question.

Which brings us back to the cold business side of the Clark phenomenon. In January, ESPN agreed to a new 8-year, $920 million deal for the right’s to the women’s March Madness tournament, along with 39 other NCAA championships across a variety of men’s and women’s sports, including volleyball, gymnastics, and tennis. At an average annual value of $115 million, the agreement more than triples the value of the previous deal with ESPN. Yet it still may be undervaluing women’s basketball.

In 2021, after Sedona Prince, then playing with the Oregon Ducks, posted a viral video juxtaposing the pathetic “weight room” provided to players for that year’s women’s tournament with the elaborate setup for the men, the NCAA commissioned an independent equity review. Kosner and his colleague Ed Desser wrote the media analysis for that review and argued that the NCAA and ESPN were failing to unlock the full value of the women’s tournament.

The following year, at Kosner and Desser’s recommendation, the NCAA extended the March Madness branding to the women’s bracket for the first time, an obvious move that should have been made years ago. But the NCAA did not follow the pair’s recommendation to sell the tournament separately from other championships. According to their analysis, women’s March Madness alone could fetch between $81 and $112 million per year.

ESPN, however, likes the bundle for the extra programming to spread across its networks. So instead of breaking women’s basketball out, the NCAA sold them an even bigger bundle. Women’s March Madness, by the NCAA’s estimate, accounts for 57% of the value of the new deal, or about $65 million per year. CBS and Warner Bros. Discovery, by way of contrast, are set to pay a combined $1.1 billion per year for the rights to the men’s tournament beginning next year.

While Clark won’t be around next year when ESPN’s new deal also kicks in, the network appears to have scored a bargain. “She has established a higher base of interest for women's college basketball,” says Kosner. “Next year, I expect ratings will be down from these historic heights, but I still think that they will be at levels that we hadn't seen before.”

ICYMI

College hoops star Jack Gohlke’s three-pointers helped Oakland University upset a college basketball behemoth. Now, he’s helping his school as it prepares to tap the bond market.
EuroLeague, the top tier of men’s professional basketball in Europe, is exploring raising capital through the sale of a minority stake.
Scotty Cameron’s custom clubs are solid investments, objets d’art that attract a whole other level of devotee. Are they worth the love?
The bid to build a $2 billion ballpark and surrounding entertainment district in Kansas City faced a surprising opponent.
Tottenham Hotspur is in talks with potential investors over a stake in the London football club, marking another Premier League club hunting for cash after a boom in sports team valuations.
Billionaire Steve Cohen said he expects that more businesses will move to a four-day work week, one of the reasons he’s made investments in golf. Obviously.

Brackets for a Cause: Crunch Time

The annual Bloomberg Brackets for a Cause competition is getting tasty. Among the 58 participants, each person pledged $20,000 to pool a total of about $1.1 million dollars to be donated to various charities split between the top three brackets in both the men’s and women’s tournaments.

Leading the men's pack so far is Whitney Wolfe Herd, the founder of dating app Bumble. Herd has been a top performer in previous years, coming in second in 2022. Whatever the connection between building a successful dating algorithm and picking brackets, I want to know. Herd's got UConn beating Purdue in the final.

For the women's bracket, two private equity bosses are topping the table, with Dynasty Equity co-founder and CEO K. Don Cornwell drawing with Peter Weinberg, co-founder of Perella Weinberg Partners. Cornwell is picking South Carolina, a team that has been picked by 69% of participants to win it all. Ventas Chairman & CEO Debra Cafaro and Weinberg are the only two people who have UConn winning it all which is surprising given the program is arguably the best in women's college basketball history. — Aysha Diallo

An American in Mallorca

The Spanish football cup final — the Copa del Rey — is set to be played this weekend between Athletic Bilbao and RCD Mallorca, so we asked co-owner Andy Kohlberg what it’s like for an American owning a football team based in Palma de Mallorca, the largest city of the Balearic Islands, a sunny archipelago off the Mediterranean coast of Spain.

Pretty nice, I guess?

A Phoenix Suns vice president, Kohlberg bought Mallorca in 2016 with Robert Sarver, his former boss at the Suns, and gained a majority stake last year. Basketball coaches Steve Nash and Steve Kerr also own minority stakes. It’s been a rocky few years to say the least.

In 2017, the team was relegated to the non-professional third division, but has managed to claw its way back to the top tier, where it now sits just above the relegation zone.

“When we bought the club, we did not plan to go up and down; it’s difficult when it happens,” said Kohlberg. “We’re just trying to build a good foundation, invest in the academy, invest in the stadium, invest in the practice facilities and weather the storm that way.”

Some US owners try to replicate American sports franchises. Focus on stuff outside of football. Build a business. Increase revenue. Repeat. Which is great when you don’t get relegated and have the stipend of broadcasting rights to fund your franchise ad infinitum.

For Mallorca, who’s fighting to keep its place in LaLiga, relegation would imply slashing its budget to about €10 million ($10.8 million) from this season’s €70 million, of which about 60% comes from TV broadcasting rights.

But focusing on work off the pitch has its success stories. We’ve written about how Venezia FC’s owner Duncan Niederauer, the former chief executive officer of the New York Stock Exchange, has turned the club into a viable business in part via a high-fashion rebrand of club merchandise. A similar plan is underway at FC Como.

Mallorca has a million inhabitants, and last year the Balearics were visited by about 14.4 million tourists.

“Maybe they are not the real Mallorca fan, maybe they’re from Germany and a Bayern Munich fan, but want to come for a unique football experience,” said Kohlberg. “Having different VIP areas for different levels of fan experience is something that the American sports have done quite well.”

The goal isn’t changing the culture of Spanish football, but rather “trying to broaden the choices that people have while still maintaining the core of the culture and the integrity of Spanish football and Majorcan football,” he said.

To be sure, that implies dealing with profound business differences, and “that’s hard,” said Kohlberg. “We tried to learn and take a few things from the NBA, but you can’t try to copy what you do there.”

The club already invested €30 million to revamp its 23,000-seat stadium, following the injection from CVC Capital Partners of €1.37 billion into LaLiga’s clubs. The refurbishment eliminated the running track and moved the stands closer to the pitch, created a tunnel with glass walls to see the players ahead of games, an exclusive 50-seat stand behind the benches and facilities including restaurants, clubs and a gym. That helped boost annual revenue to €64.4 million, more than tripling in the last three seasons. The club is even profitable, something rare among European football clubs.

Playing the cup final this Saturday it's “very unusual,'' said Kohlberg. “We're very proud, very happy and also very surprised.'' — Thomas Gualtieri

John Kosner Spoke with Eric Prisbell of On3 About The TV Viewership Potential of the 2024 Women’s Final Four

Original Article: On3, by Eric Prisbell, April 5th, 2024

To truly assess the magnitude of this year's men's and women's Final Fours, don't merely watch the games. Watch who's watching the games.

Never before in March Madness lore have viewership data for both events been under such a spotlight. Credit Caitlin Clark and the parade of stars for levitating the women's game to heights never before seen or imagined, attracting a wide swath of fans that extends far beyond typical NCAA Tournament hoop-heads.

Let's cut to the chase: If Clark's Iowa team faces unbeaten South Carolina in a dream national title game, it would almost certainly be the most-watched women's game in history. Viewership could very well also eclipse that of Monday's men's national title game, a feat unimaginable even five years ago.

"If we get the Iowa versus South Carolina rematch for the women's championship on Sunday afternoon [on ABC], I believe they'll eclipse 20 million viewers and easily top the men's final, which this year is on TBS on Monday night," John Kosner, who led digital media at ESPN from 2003-2017 and is president of media consulting firm Kosner Media, told On3 on Thursday.
"Americans recognize and show up for the big event."

If only the women's championship were broadcast in primetime, a potential Iowa-South Carolina rematch – the Hawkeyes beat the Gamecocks in last year's national semifinals – would draw an even larger audience.

Viewership expectations continue to be ratcheted up in the wake of an extraordinary 12.3 million people watching Iowa topple LSU in an Elite Eight game shown on a cable network (ESPN). That number topped even the most ambitious projections for a title game rematch that was a year in the making.

To put it in perspective, more people watched an Iowa women's basketball game than every World Series game and all but one NBA Finals game in the most recent postseason. Five years ago, a script with that plot would have been tossed out as pure fantasyland.

And had the game been broadcast on ABC or on a simulcast, Bob Thompson, the retired FOX Sports Networks president, said on social media that Iowa-LSU probably would have "easily" exceeded 16 million.

The devil is in the details, of course, and the enduring takeaway transcends the Clark Effect, which is profound and has dramatically elevated the women's game. Attracting 6.7 million viewers for UConn's Elite Eight victory over USC was also remarkable. UConn drew that large of an audience for only one (1995) of its 11 title game victories.

It's convenient to lampoon the men's game, which is afflicted with a variety of chronic issues. But viewership for the men's tournament is actually up 4% over last year, averaging 9.4 million viewers across CBS, TBS, TNT and truTV.

The two men's Elite Eight games on Sunday – Purdue-Tennessee and NC State-Duke – averaged 12.8 million viewers, a 30% increase over last year and the most-watched Elite Eight doubleheader since 2019.

The possibilities are enticing: A UConn-Purdue title game wouldn't exactly be akin to drinking flat soda. Nor would a UConn-NC State championship, which would cue an incalculable number of four-decade-old clips of Jimmy V running around the court in Albuquerque looking for someone to hug.

That said, make no mistake: The Women's Final Four is The Show.

KM 4/3/24 KM 4/3/24

John Kosner Moderated an NFT.NYC 2024 Panel: ‘What’s Next in Sports, Loyalty, & Social Experiences.”

Original Article: NFT.NYC, April 3rd, 2024

Listen to the Panel Recording

John Kosner moderated an NFT.NYC 2024 panel featuring Pet, Essem Harris, and Asher Weiss!

You can find the recorded panel here.

KM 3/29/24 KM 3/29/24

John Kosner Spoke with Lucia Moses of Business Insider About Amazon Prime Video Sports

Original Article: Business Insider, by Lucia Moses, March 29th, 2024

Those who have taken on the role of technical advisor to Jeff Bezos, which denotes a high-potential executive serving for a time as his "shadow," often go on to do big things. One of them is Jay Marine, who oversees Amazon's sports business as the vice president of Prime Video and global head of sports. Marine is little known in the US sports industry but has a much bigger profile at Amazon. A 20-year vet of the company, Marine helped launch the Kindle, Amazon's first homegrown device, before serving from 2013 to 2015 as Bezos' advisor, an intense role that involves traveling and going to meetings with Bezos and whose alums include Andy Jassy, now the CEO.

From there, Marine was sent to London in 2015 to launch Prime Video abroad, leading to a move into sports, starting with the US Open tennis and Premier League soccer rights. Now the NFL's "Thursday Night Football" sits under him, the result of a $11 billion, 11-year deal.

Industry insiders who have dealt with Marine say he's analytical and down-to-earth, without the big personality that might compete with the many sports execs he might find himself negotiating with. Marine, a New Jersey-based father of three girls, joked on "The Sports Media Podcast" that his "claim to fame" was playing in a high-school basketball playoff game against Chris Webber and a football game against Tyrone Wheatley.

"Neither one of those worked out very well for me, but we did play the games," he said.

He compared his current remit to the early, scrappy days of Amazon. "I think we're at our best as a company when we act like a startup," he said. "I love to do new things and build things."

Marine's next move could be for the NBA, which Amazon craves for its young, global fan base. The league began 45-day talks with the incumbents Disney and Warner Bros. Discovery on March 9. If the NBA creates a third digital-rights package, Amazon is seen by many as a stronger contender than Apple and Netflix, which have made smaller moves in live sports.

Marine's main job is to prove that sports can be a valuable and efficient asset in keeping people subscribed to Amazon's $139-a-year Prime membership.

"For us, everything starts with Prime," Marine told CNBC in a rare interview last fall. "We sit around saying, how can we make Prime better, how can we add more value to Prime? We want Prime to be the best membership program in the world."

Antenna research has suggested that sports programming can punch above its weight as a retention tool for streamers. And the rise of sports within Amazon has led to tensions over finite resources between sports and entertainment. Some insiders on the entertainment side — which has taken big swings, like "Lord of the Rings," but has generally been seen as a middling success — saw a clear power shift toward Marine and the sports business in January when Amazon MGM Studios, its entertainment production arm, and Prime Video had their biggest layoffs to date.

John Kosner Spoke with Mike McCarthy of Front Office Sports About The Media Value of NFL Christmas Games

Original Article: Front Office Sports, by Mike McCarthy, March 28th, 2024

The NFL is planning a lucrative Christmas present—to itself.

The league is poised to auction off TV rights to its two new Christmas Day games for the 2024 season, say sources with direct knowledge of the strategy, with bidding likely to start in the $50 million range.

The league plans to open the bidding to all of its media partners, say sources, including CBS, Fox, NBC, ESPN-ABC, and Amazon Prime Video. Collectively, these media giants will pay the NFL $110 billion through 2033.

The games are more likely to appear on linear TV networks than streaming platforms, the sources say.

The NFL declined to comment.

There’s no league better than the NFL at slicing and dicing up rights to find new revenue streams. Prime paid the league $100 million for exclusive streaming rights to the league’s first Black Friday game between the Jets and Dolphins last fall. The tech giant will now pay an estimated $120 million for the rights to its first playoff game this season. NBCUniversal’s Peacock, meanwhile, paid $110 million for streaming rights to the Chiefs-Dolphins wildcard playoff win last season.

Andrew Brandt, the former Packers executive turned consultant, estimates the Christmas Day games could end up selling for a 20% to 25% increase over the Black Friday game, which averaged 9.61 million viewers.

The NFL typically “exceeds expectations” when it comes to media deals, notes John Kosner, the former ESPN executive. He thinks the new Christmas Day games could sell for $75 million to $100 million apiece.
“The premium prices have come for exclusive streaming rights to NFL playoff games,” Kosner says. “NFL Christmas Day/night games have huge and growing audiences—but they are regular-season games scheduled seven months in advance. And traditionally the ad market for Christmas Day is not as robust.”

The NFL’s Christmas Day tripleheader in 2023 generated record TV audiences last season. CBS drew an average of 29.6 million viewers for an early-afternoon game between the Chiefs and Raiders. Fox drew 29 million for its lateafternoon broadcast of Giants-Eagles, and ESPN pulled 27.1 million for a prime-time Ravens-49ers game. Those figures dwarfed the average audience of 2.86 million for the NBA’s five competing Christmas Day games.

The NFL previously said its teams would not be in action this Christmas due to the holiday falling on a Wednesday. But the nation’s richest, most powerful sports league doesn’t like to leave money on the table. Besides generating more media-rights revenue, the NFL’s Christmas Day doubleheader will serve as another shot across the bow of the NBA, which dominated TV sports on the holiday for decades.

On his podcast, Colin Cowherd said the NFL is trying to effectively take Christmas Day away from the NBA as a tentpole TV event. “The gloves are off. It feels to me like the NFL has said, ‘We’re going to squeeze you,’” said Cowherd. “I do believe that’s a tipping point. That Christmas Day mattered a lot to the NBA. Those NFL games put a blanket over it.”

On Tuesday, NFL reporter Albert Breer of Sports Illustrated’s MMQB noted that the league would put the new Christmas games up for bid among the networks.

KM 3/26/24 KM 3/26/24

John Kosner Spoke with Adam Grossman of Revenue Above Replacement & JohnWallStreet About How AI Video Creation will Drive Sports Media Rights

Original Article: JohnWallStreet, by JohnWallStreet, March 26th, 2024

Savvy sports executives are trying to figure out how to monetize the content and data powering generative AI large language models (LLMs). Industry insiders believe succeeding on that initiative can help keep media-related revenues tracking up and to the right.

But OpenAI’s recent launch of Sora, a text-to-video AI model, has the potential to have an even greater impact on the industry by increasing the universe of ad buyers. If there are more companies willing to market themselves during live sporting events, then those broadcast rights should become more valuable.

Sora, currently available to just product testers and creative professionals, is not the first AI platform to enable users to turn text-based prompts into production-grade videos. Meta is among those with (or working on) a similar offering.

However, OpenAI’s ability to take a technically complex process and make it easy for everyday consumers to use (like it did with ChatGPT-3) has business leaders inside and outside of sports paying attention to the product before it has even been fully released.

Inside sports, the focus has been on how Sora can help to democratize commercial production, and how that will influence ongoing and future media rights negotiations.

Rights holders generate most of their revenues from carriage/affiliate fees and advertising. But because the process of creating commercials has historically been both costly and time-consuming (think: creative ideation, securing talent, production shoots, post-production editing), the pool willing and able to invest in them was limited. Only large-scale corporations with multi-million-dollar budgets could afford to produce spots for international, national, or regional broadcast.

“The leading media companies generally serve the top 100 sports TV advertisers,” John Kosner (president, Kosner Media) said.

Of course, those are not the only businesses that could benefit from –and would have interest in– advertising during sporting events. There is little else on television that enables a marketer to reach as many viewers at once, and “diehard” sports fans tend be younger, more educated, and have higher-incomes than the median population.

“Sora could make [sports broadcasters] bigger players for the 4,000 or so [other businesses] that power Meta,” Kosner said.

Coincidentally, no company has done a better job of demonstrating that a broader market of advertisers likely exists for sports properties than Meta. Several times in recent years large sports advertisers have suspended ad buys across Facebook or Instagram (see: Coca-Cola, Diageo, Mars, HP, and CVS Health’s ad pause in 2020), and none of those protests made a substantial dent in its business.

That is because the tech giant generates the bulk of its advertising revenue selling to smaller companies.

Meta generates billions in advertising dollars enabling rights owners to monetize content of all lengths and audience sizes, and by making it easy for niche brands to reach their target audiences. Remember, Meta has extensive data on the billions of people who use its platforms daily (think: specific interests, behaviors).

Sora can help companies, of any size, create video campaigns befitting all types of sports content.

That includes the tech giants, Amazon, Apple, and Netflix, who have all started to dip their toes into the sports broadcasting space.

“Having trained SVOD entertainment audiences to watch and binge their favorite shows with no commercials, leading streamers [now] need sports to establish robust ad businesses,” Kosner said. “That's why many of us expect the leading digital companies to become bigger and bigger ad buyers.”

And like Meta, Amazon, Apple, and Netflix all have billions of data points on their customers. These companies should be able to leverage their sports content and insights to help brand partners, regardless of size and budget, reach their target demo.

Legacy rights holders should be able to benefit from platforms like Sora too. In addition to having their own streaming services that need to be marketed, the broadcast networks are gradually obtaining data from connected televisions and able to provide granular details on viewers to advertisers.

But it takes more than just reaching the target audience to run a successful campaign. Brands also need to develop commercials that can drive their desired outcomes and objectives.

And that’s where Sora can really help resource constrained companies. Its platform allows them (and content creators) to quickly –and cost effectively– develop and test creative concepts.

Media experts believe text-to-video platforms will be particularly beneficial for emerging sports properties that have traditionally struggled to sell larger corporations on advertising due to their audience sizes.

Removing the creative bottleneck should enable rights owners and holders up and down the value chain to generate more money from live sports rights. But there are headwinds that could slow adoption of the tech. Sora, like many other AI offerings, will still needs to address intellectual property concerns.

“While [these models] may ultimately enable near-instant production of videos for a creative concept, if the reference content that underlies that creative isn’t in the Public Domain, then the derivative creator –the broadcaster, advertiser– will still need to license the necessary IP rights to use it for commercial purposes,” William Mao (SVP, global media rights, Octagon) said.

However, the emergence of text-to-video AI should be viewed as a net positive for the industry. Growing the number of potential companies capable of creating and leveraging advertising during live sporting events will result in short-term revenue gains for rights holders and make those rights more valuable over the long-haul.

KM 3/25/24 KM 3/25/24

The New Dilemma in Sports Media. John Kosner’s Latest SBJ Column With Ed Desser

Original Article: Sports Business Journal, by John Kosner and Ed Desser, March 25th, 2024

For rights owners, negotiating sports media agreements was never easy, but it was straightforward, pre-COVID:

Estimate rights for fair market value.
Identify at least two interested linear networks with capacity.
Determine which will provide the best consideration package, optimal schedule and quality production.
Negotiate and close.

If shelf space existed and the money was right, the sport would get both the largest potential audience on established platforms and revenue, reaching substantially all sports fans. Plus, since almost everyone (100 million homes) subscribed to cable TV,non-sports fans essentially subsidized fans and sports programming seemed practically free. Live sports emerged as the most attractive, valuable form of entertainment, becoming the linchpin of the cable bundle/sports marriage. Here are a few things to keep in mind:

Today, sports retains its unique competitive advantages, but it’s hard to recognize the media business:

Just about 40% of homes still subscribe to most linear cable sports networks, and RSN re-tiering is lowering that while further increasing fan costs.
Cable affiliate revenue is declining. Lost revenue from disconnects now exceeds the price increases networks and distributors can pass on to remaining subscribers — shrinking network margins and the available funds to pay for sports.
While broadcast stations can technically reach all homes in a market, just two-thirds of viewers actually have access (15% via antennas). Students recently told John that they thought they had to subscribe to Paramount+ to watch a recent NFL playoff game.
Typical linear network audiences are a small fraction of before. Shockingly, the average combined four-network 18-49 adult prime-time entertainment audience is down to just 1.6 rating points (from mid-40s) — a mere 0.4 per network!
Thus, these once-mighty linear channels no longer provide the large, assured audiences, lead-ins, and promotional value for sports they did a decade ago.
Meanwhile, streaming services, social media platforms and video games each generate more total screen time than all linear TV networks combined.
The viewing habits of those under 30 do not resemble their elders. Most simply don’t watch linear network programming, let alone full games, with the same frequency. It’s the first generation watching pirated sports feeds.

Input A is now Input B. Most viewers’ default video programming setting is streaming, not “live” linear TV. New strategies are needed to engage younger fans.

Today, every event, on every network, competes for audience not just against each other (like the “old” days) but also against every viewer’s highly curated, and practically unlimited, SVOD favorites list of movies and TV shows, culled from deep libraries of all content ever produced. Younger audiences also choose from an endless supply of free, ad-supported short-form videos on social media networks, YouTube, a host of video games or play uncapped in free virtual worlds like Fortnite or Roblox. Even top-tier sports struggle to draw large audiences across attractive demographics to generate growing media rights value in this unprecedented, hyper-competitive environment. Indeed, only the weekly ritual of fall football appears safe — so far!

To grow revenue and fan bases, all sports media properties must think differently:

If you’re not a top dog (SBJ, Jan. 29, 2024), look out! Expect your media model and rights revenues to be challenged.
Just licensing your events to a linear network alone, and hoping to attract a large fandom, is unrealistic and no longer a viable strategy. A single vanilla feed is unlikely to satisfy an increasingly diverse fan base. Instead, you will need multiple platforms and a variety of targeted products.
Researching your fan base is a must. (not just relying on Nielsen or syndicated services). Do a SWOT analysis on your media business. How many are willing to pay for your content? How much are sponsors willing to support you? How and where do your viewers spend their time? How do they define fandom? Do they bet on your sport? Where are your new opportunities?
Multiple media relationships/platforms will become the norm. “All means and media hereafter developed” grants are mostly behind us. Options are proliferating: linear (broadcast and/or cable), subscription, 4K, FAST channels, channel stores, viewing parties, social, gaming/gambling/sub-second latency, short-form/highlights, radio/podcasting/audio, data products, merch and collectibles, even super-high-resolution “back to the future” closed circuit.
Shorter-term agreements are in. The NFL deals run through 2033 but the league has an out after 2029. The 10-year WWE agreement includes both a five-year out and 10-year extension for Netflix. The NCAA “other” championships deal is now eight years, down from the previous 12, smartly co-terminus with the men’s basketball championship. Leverage has its benefits.
What is your direct-to-consumer model? Even if you don’t want to go it alone, it’s critical to know what pricing and revenues are possible, and how much it would cost to operate. Have a production, sales, and fulfillment plan in place, should it be needed. Some small properties have surprisingly sizable DTC audiences. This knowledge is a useful backstop for negotiations.

Change is already underway:

This is the second season of MLS’s exclusive deal with Apple.
The Suns/Golden Knights/Jazz have moved their games from RSNs to OTA and DTC.
NASCAR once had two media packages; now it has five.
ESPN/Fox/WBD announced a new sports streaming joint venture.
The CFP is expanding to 12 … or is it 14 schools?

Seismic change has hit the sports media world. We’re not going back. Be prepared for a variety of alternatives, some incremental, which may look quite different. For licensors, there are new buyers, but their priorities might be different. In an era of increasing tumult, it’s always wise to plan ahead.

KM 3/19/24 KM 3/19/24

John Kosner Spoke with Mike McCarthy of Front Office Sports About Caitlin Clark’s Potential Impact on WNBA Media Negotiations

Original Article: Front Office Sports, by Mike McCarthy, March 19th, 2024

A wild card has emerged in the multibillion-dollar negotiations for NBA media rights: the WNBA.

The NBA and WNBA are jointly negotiating an extension of their current media-rights deals with the Walt Disney Co.’s ABC and ESPN. But the WNBA’s media rights are rising in value as Iowa’s Caitlin Clark prepares to join the league—and women’s sports reach new levels of popularity.

The WNBA believes its media rights are undervalued. If the league doesn’t get what it wants jointly from ABC and ESPN, it’s quite likely to negotiate its own separate deal, say sources close to the negotiations—either with Disney or a competitor. Possible packages and proposals are flying back and forth between the two sides, sources tell Front Office Sports, and the WNBA is open to anything. The goal is to maximize the league’s reach and market value.

The WNBA declined to comment for this story.

The WNBA currently earns about $60 million annually from its TV and streaming deals with ABC-ESPN, Amazon Prime Video, CBS, and ION. With excitement building around Clark and women’s March Madness, the league will try to push its annual media-rights payout to between $80 million and $100 million, predicts former ESPN executive John Kosner. ABC-ESPN generates about two-thirds of the WNBA’s annual rights revenue on a deal that will, like the NBA’s, expire after the 2024–’25 season.

“You can’t miss all of the attention the 2024 [NCAA] women’s championship is receiving and ESPN’s strong ad sales efforts against it. All of this inures to the benefit of the WNBA’s media rights,” says the former ESPN executive turned founder of Kosner Media. “Caitlin Clark is that most unusual athlete who brings fans to the sport for the first time. Far more people will tune in to the WNBA this summer, and they’ll discover the wealth of talent in the women’s game.”

The WNBA just posted its most-watched season in 21 years, averaging 462,000 viewers per game across national TV partners ABC, ESPN, ESPN2, and CBS—up 21% over last year. On ABC alone, regular-season games averaged 627,000 viewers. The league also had its most-watched WNBA Finals in 20 years, averaging 728,000 viewers per game—a 36% year-over-year increase. As far as the live gate, the league’s average attendance rose 16% to 6,615 fans per game, the highest figure since 2018.

The rising tide of women’s sports is lifting all boats—or at least many. For the first time, Fox Sports averaged more viewers this season for women’s college basketball than men’s college hoops. Iowa’s stirring comeback OT victory over Nebraska grabbed more than 3 million viewers, making it the most-watched women’s college basketball game on CBS in 25 years. So-called “women’s elite sports” are projected to generate more than $1 billion in revenue for the first time in 2024, according to Deloitte.

Donna Orender, the former WNBA commissioner, expects a “significant increase” in WNBA rights as Clark enters the league—almost certainly as the No. 1 pick of the Indiana Fever at the league’s draft in New York City on April 15.

“The No. 1 driver of [TV] ratings points right now happens to be Caitlin Clark,” Orender tells FOS. “And her first game in the WNBA will be this spring. Her fans are going to follow. The WNBA’s fans continue to grow. It’s that convergence point that’s really moving things forward.”

The National Women’s Soccer League just set the record for the largest media-rights deal in women’s sports history via its $240 million deal with ESPN, CBS, Amazon, and Scripps Sports. The four-year deal will pay NWSL about $60 million a year—or 40 times what the previous deal did. That landmark pact bodes well for the WNBA as it nears tip-off of its 2024–’25 season May 14, according to Orender.

“These rights have been depressed, or suppressed, for quite a long time. But it’s always a question of buyer and seller. Everyone’s always trying to get their best price,” she says. “But I think there is a recognized increase in value across the board for women’s sports. And I think that’s going to be represented in the new rights fees that will be paid.”

Orender has a point. There’s an argument that the WNBA’s media rights are undervalued vis-a-vis men’s sports leagues. Take the NHL, which is in the second season of twin seven-year deals with ESPN and TNT. The NHL pockets a combined $625 million annually from ESPN and TNT—more than 10 times that of the WNBA’s current payout. But the WNBA’s average national viewership of 462,000 across ABC, ESPN, ESPN2, and CBS last season nearly equaled the 474,000 for the league’s regular season on ESPN on TNT last season. WNBA fans also tend to be younger and more diverse, making them more attractive to advertisers.

The NBA is currently in a 45-day exclusive negotiating period with ABC-ESPN and TNT for new long-term agreements. The league will seek up to $75 billion for its next long-term media rights, according to CNBC. That would more than double the combined $24 billion from its twin nine-year deals through the 2025 season.

Here’s the problem for ESPN and TNT. Once ESPN’s exclusive negotiating period ends April 22, NBA Commissioner Adam Silver is expected to throw open the bidding to Amazon, Apple, and former TV partner NBC Sports. Amazon is looking to replicate its success with the NFL’s Thursday Night Football by devoting a night to the NBA. The NBA, meanwhile, is looking to bring back the magic of the Michael Jordan/Chicago Bulls glory days in the 1990s. Losing the NBA would be a serious blow for ESPN and TNT as they try to launch their as-yet-unnamed streaming service, nicknamed “Spulu,” with partner Fox this fall.

KM 3/18/24 KM 3/18/24

John Kosner Spoke with Eric Prisbell of On3 About NCAA Women’s Basketball Championship TV Ratings

Original Article: On3, by Eric Prisbell, March 18th, 2024

Examine the NCAA men’s and women’s tournament brackets, envision dream matchups in the Final Four and consider something that has never before been remotely in play:

The women’s NCAA Tournament is the main attraction.

From South Carolina’s undefeated season and LSU’s quest to repeat as national champion to Caitlin Clark’s irrepressible offensive repertoire, the women’s bracket has monopolized the most compelling storylines. From Angel Reese and JuJu Watkins to Clark, it features a bevy of recognizable faces much like the men’s game did a generation ago.

This is Clark’s last dance. But now that the game is super-charged by more promotion across more platforms, this popularity surge could be more than a mere “One Shining Moment” for women’s hoops. The women’s game isn’t just having its moment.

“I think it is sustainable,” Neal Pilson, who served two stints as CBS Sports president in the 1980s and 90s as its coveted NCAA men’s tournament surged in popularity, told On3. “Women’s sports and the TV networks have finally seized on the promotion value of the athletes similar to how the NBA features its stars when promoting key games – ‘Lebron v. Steph,’ for example.

“Such promotion is very effective with the viewers.”

Ahead for the men’s tournament could well be an enticing buffet of captivating early upsets – likely more than in the women’s bracket – unexpected heroes and thrilling buzzer-beaters. But at least for this season, there’s no denying that the dearth of familiar men’s faces – other than Purdue’s Zach Edey – means the connective tissue between fans and the game is weaker.

Caitlin Clark is transcendent star in rare air

Meantime, the women’s event has a once-in-a-generation talent in Clark, the undisputed face of all of college hoops.

Amid the women’s tournament’s rise in appeal over the last several years, it has “broken through to a new level because of the phenomenon” of Clark, John Kosner, who led digital media at ESPN from 2003-2017 and is president of media consulting firm Kosner Media, told On3.

“She is that most unusual of athletes who brings fans who might not care about the sport to watch,” Kosner said. “In my lifetime, that’s a short, short list – including Muhammad Ali, Michael Jordan and Tiger Woods.”

With the possibility of Clark starring in the national championship game on ABC, with the men’s game broadcast on TBS, could the women’s final rival the men’s in viewership?

If Clark reaches the championship, Kosner expects that rating to match that of the NCAA men’s championship on TBS, adding, “I believe it would exceed the men’s if ABC was carrying the game in prime time – like the men’s – and not at 3 p.m. ET.”

Last year’s LSU-Iowa women’s championship garnered 9.9 million viewers, making it the most-watched women’s game ever. The UConn–San Diego State men’s final attracted 14.69 million, making it the least-watched men’s championship in recorded history.

Because of the perpetual promotional build-up for the men’s final throughout the tournament, Pilson still believes the men’s final will outrate the women’s by a “substantial margin.” But he noted we could still see a record rating for the women’s final with Clark or LSU matched against unbeaten South Carolina in the championship.

Brands well aware of Caitlin Clark’s broad appeal

Clark is a jaw-dropping sensation. Former NBA player Tim Legler said last week on “The Tony Kornheiser Show” that Clark is one of the five most entertaining basketball players he has ever watched at any level.

“She is must-see TV,” Legler said. “I never thought we’d ever see a women’s player shoot the basketball from the shooting distances she’s shooting it. And you can make an argument that her range, relative to her game, her sport, is better than even Steph Curry’s range.”

Brands are well aware that her appeal transcends the traditional sports audience.

The Iowa star has the top-ranked women’s basketball On3 NIL Valuation at $3.1 million. The valuation trails just Bronny James, Shedeur Sanders and Livvy Dunne. With 1.4 million social media followers, Clark has endorsement deals with State Farm, Nike and Gatorade among others.

According to a recent report, Clark’s State Farm ads are 46% more likely to generate engagement than other State Farm ads.

More broadly, Brand marketing expert Kyle Christensen – the chief marketing officer at Splash – said the difference in brand interest in the women’s tournament five years ago to now is like the difference between “midnight and noon on a sunny day.”

How high is that interest this March?

“As an advertiser,” Christensen said, “you’d be a fool if you plan to show up on the men’s side and not show up on the women’s side.”

Christensen said some male-targeted brands should absolutely explore spending in women’s college basketball. And he believes Pepsi and DraftKings missed an opportunity with its recent announcement on a creative “Zero Right Bracket Challenge.”

Why not take the idea and leverage it on the women’s side, rather than only the men’s side?

Women’s game deprived of ‘spotlight’ it has deserved

As Christensen and others stress, we don’t yet know the ceiling on the popularity of the NCAA women’s tournament. It is only now that it is being showcased and promoted and super-charged with the resources necessary to see it thrive.

It was only three years ago several athletes – led by former Oregon women’s basketball player Sedona Prince – took to social media to demonstrate the inequality between weight rooms, food and other amenities provided by the NCAA to athletes during the men’s and women’s basketball tournaments.

A report prepared by Roberta A. Kaplan and her law firm found that the organization’s “broadcast agreements, corporate sponsorship contracts, distribution of revenue, organizational structure and culture all prioritize Division I men’s basketball over everything else in ways that create, normalize and perpetuate gender inequities.” Kosner and fellow media consultant Ed Desser provided analysis for the Kaplan report.

The NCAA has since addressed many of the inequities with branding and resources. It also recently secured an eight-year, $920 million rights deal with ESPN for 40 championships, including the women’s tournament. And it is engaged in discussions, albeit belatedly, regarding awarding financial units to schools in the women’s tournament.

Now the event is thriving. Its stars and storylines are promoted, highlighted and showcased. At least for this year, the women’s tournament takes center stage.

“It hasn’t been given the spotlight it has deserved over time,” Christensen said. “It’s the dawning of a new day.”

KM 2/15/24 KM 2/15/24

John Kosner Spoke to Jessica Toonkel of The Wall Street Journal About LeBron James’ Production Company SpringHill

Original Article: The Wall Street Journal, by Jessica Toonkel, February 15th, 2024

LeBron James is particular about his facial hygiene. He favors a Neutrogena pink-grapefruit wash.

“I love it, I love it, I love it,” the NBA superstar says.

James, 39 years old, also loves the business potential. His company, SpringHill, is launching its own rival face wash in a men’s grooming line—part of a major expansion of his burgeoning business empire in the twilight of his career.

“I told them I want this face wash to resemble that,” James said, “because I love how the crystals make your face feel super-washed.”

Almost a decade ago, James helped create a new kind of company: one built around the personality of a sports superstar who can talk directly to millions of fans on social media. Entertainment was the primary focus. SpringHill has made movies like Adam Sandler’s “Hustle” and “Space Jam: A New Legacy,” and TV series like NBC’s game show “The Wall” and the barbershop talk show “The Shop.”

Now James and his longtime business partner, Maverick Carter, have a dizzying list of expansion ideas. Beyond the grooming line, SpringHill is making plans to expand internationally, with an eye on Western Europe, the U.K. and possibly Japan and Africa. The company is planning to bring a version of “The Shop” to the U.K., hosted and executive-produced by British actor Idris Elba. SpringHill is discussing launching a free, ad-supported streaming channel, and is hunting for acquisitions, with a particular focus on videogames and animation.

Success isn’t a slam dunk. Building a consumer-product brand is notoriously difficult, and in entertainment, SpringHill is competing with a crowd of companies that have similar ambitions, while a new era of austerity in Hollywood is clouding the prospects for production deals.

James, sitting in an airport hangar one December afternoon and awaiting a Los Angeles Lakers team flight, said he’s always wanted to excel in more than one area—basketball fans know him as not just a dominant scorer, but an elite passer, rebounder and defender. “I have always felt like I was a Swiss Army knife,” says James.

He extends the analogy to the expansion of SpringHill into new lines of business. “We couldn’t just be a wine opener,” he says, “We wanted also to be a pair of scissors and a fingernail clipper.”

In its production business, SpringHill is trying its hand at a new format: a reality series following five National Basketball Association players, including James, through the season. The show is destined for Netflix.

SpringHill is looking to expand at a time when many streamers and advertisers are pulling back on spending, posing potential challenges for the company. The corporate owners of streaming services like Disney+, Peacock and Paramount+ are looking to burnish their balance sheets by culling their output and being more selective about which projects to pursue. SpringHill, like any creator in show business, could feel that pressure as it tries to sell programming in the coming years

“Many of the potential buyers for content and acquirers for their company are themselves in financial distress,” said John Kosner, a former ESPN executive who now runs his own media-consulting company.

SpringHill is competing with a number of production companies that are pitching sports content to the likes of Netflix, Amazon and Apple. Skydance Media, the company behind such hit movies as “Top Gun: Maverick,” and several “Mission: Impossible” titles, teamed up with the National Football League in 2022 to create sports-related content. “When you dig into leagues, athletes and the history of games themselves, it has been an untapped treasure trove with stories that haven’t been told,” said Skydance Chief Executive David Ellison in an interview last fall.

SpringHill is trying to distinguish itself with scripted content but hasn’t had many breakthroughs. It is in early development with Brad Pitt’s production company on a new show about sports agents that will be similar to Netflix’s popular show “Call My Agent,” according to people familiar with the situation. Some media investors who have looked at SpringHill question whether it is worth the $725 million valuation it was given when it raised money in late 2021—at the peak of the streaming-video boom.

Investors who did put money into SpringHill are optimistic, in part because it is stretching beyond the uncertain business of producing hits in Hollywood.

“Hits can be consumer products, a touring live show, partnerships with Fortune 100 brands, as well as TV and film projects,” said Jason Stein, founder and managing partner of SC Holdings, an investor in SpringHill and adviser to the company. “By design, SpringHill is not focused exclusively on hits in the traditional sense.”

‘Company Builders’

James ignited a movement in the sports world. Kevin Durant, Megan Rapinoe and Naomi Osaka are among the many other athletes that have launched media companies, hoping to control their own narrative, make a cultural impact and build a real business.

The list of such outfits keeps growing. The NBA’s Giannis Antetokounmpo in January announced a new production company, Improbable Media, whose first offering is a documentary about his rise for Amazon’s Prime Video.

It’s not only superstars: JJ Redick, a successful NBA role player, has launched his own firm built around podcasts like “The Old Man and the Three.” Pat McAfee parlayed a career as an NFL punter—not exactly the most glamorous of positions—into a successful YouTube show, building a company that now licenses its programming to Disney’s ESPN.

“There are a lot of people saying ‘Why am I not doing it if LeBron is?’ ” said Paul Wachter, CEO of Main Street Advisors, a SpringHill investor who has been an adviser to James since 2005.

Omaha Productions, the entertainment company started by former NFL star Peyton Manning, has gained significant traction—not just because its series “Quarterback” became a Netflix hit last year, but because it is intent on developing a robust pipeline.

“You don’t want to be a one-trick pony in this business,” said David Nevins, a former head of Paramount’s Showtime, who is now CEO of North Road, which has a stake in Omaha. Having your company attached to a famous athlete only gets you so far, he said. “It’s the smart company builders that will win,” Nevins said, adding that Manning is one of those executives.

SpringHill is the most mature, and the most diversified of the bunch—with lines of business that include advising brands on strategy and creating content for advertisers like Nike. The majority of SpringHill’s roughly $200 million in revenue comes from its studio business and advertisers hiring the company to create sponsored short videos meant to be shared on social media. For example, Toyota hired the company to create a short video about the importance of historically Black colleges and universities, starring former NBA player J.R. Smith.

When visitors enter SpringHill offices in Los Angeles, they are greeted with a neon sign saying, “I Am More Than an Athlete.” It’s dawning on more companies—from media to sportswear to luxury goods—that athletes can have a much bigger footprint in the business world than just starring in ads and movies, Carter said.

There’s a long history of athletes forging lucrative careers in business: Magic Johnson became a billionaire not as a former Lakers star, but through investments in an insurance company, movie theaters and sports franchises, among other areas. Now social media has allowed athletes to develop a deeper connection with consumers, giving them even greater opportunities, Carter said.

“Talent and creators—and I am putting athletes in that bucket—mean more to consumers now because they have the technology to speak directly to them,” Carter said.

SpringHill invests in and helps to grow other athletes’ production companies, including tennis star Osaka’s Hana Kuma, which recently spun off from SpringHill, and Miniature Géant Studio, started by NBA superstar Joel Embiid.

‘The Decision’

James, the NBA’s all-time leading scorer and the league’s oldest player, was in a playful mood last year on the morning after a Lakers win. As he waited for his flight in December, he was icing his knees and joking with teammates barely half his age about videogames and their attire. “You look like you are going to Bermuda,” he said to Anthony Davis, who was sporting tropical shorts.

James saw a need for athletes to tell their own stories before many of his current teammates were in the NBA.

The turning point came when James and Carter got panned by the press and fans for “The Decision,” a live ESPN broadcast in 2010 in which James announced he was leaving his hometown team, the Cleveland Cavaliers, to join the Miami Heat.

That was one of the reasons that led to James and Carter to launch “Uninterrupted,” a website designed to enable athletes to speak directly to fans that was one of several companies that were combined to make up SpringHill.

Carter, who has known James since they were kids in Akron, Ohio, was working in marketing at Nike before going to work with his longtime friend in 2005. His office at SpringHill’s headquarters reflects his eclectic interests, with books ranging from “The Pininfarina Book,” filled with photography from the Italian design firm, to “A Time Before Crack,” another photography book about New York City in the 1980s.

Carter studied Disney’s business plan when launching SpringHill. His mentors include Walt Disney CEO Bob Iger, Verizon CEO Hans Vestberg and former American Express CEO Ken Chenault.

Many of SpringHIll’s early projects have origins in James’s upbringing. For example, he was a big fan of game shows growing up, and was at the 9 a.m. pitch meeting with NBCUniversal for “The Wall,” in which contestants have the opportunity to win millions of dollars. NBCUniversal just renewed the show for a sixth season.

“The Shop,” a talk show that takes place in a barbershop, was inspired by James’s and Carter’s youth. “I didn’t grow up reading newspapers. I wasn’t fortunate enough to be in a library so you gained a lot of your information and intel of things in the world of the barbershop,” James said. “You can be unfiltered.”

The show, which has featured such guests as former President Barack Obama, football legend Tom Brady and singer Drake, is now on YouTube after airing for the first five seasons on HBO.

SpringHill’s upcoming men’s grooming line is named for his show “The Shop,” which spawned the idea, Carter said. James recalls that when he used to visit the neighborhood barbershop as a kid, you could get everything from incense to beard oil to hair gel, and envisioned something similar with the grooming line.

James has been involved in product development—he participated in focus groups of male employees at SpringHill discussing their grooming routines. When it came to face wash, he wanted his beloved Neutrogena product to be a model.

The challenges for the grooming line, which is to be sold exclusively through Walmart, will include competing against consumer-product giants with deeper pockets and longtime connections to large retailers, and persuading more men to use such products in the first place.

Basketball’s ‘Hard Knocks’

Every summer for years, James and Carter have gone on vacation together with their families on a yacht in the Mediterranean Sea. A question would pop up: Why aren’t we doing our own version of HBO’s “Hard Knocks”? It was a frequent conversation.

James, a lover of all things football, is a huge fan of the HBO show, which each year follows a different NFL team’s preseason training camp. When “Quarterback” became a big hit for Netflix, James saw an opportunity to press forward with a similar basketball show.

Getting the NBA to sign on was step 1. SpringHill had been cultivating its ties with the league for years. It cast a number of NBA players in “Hustle,” which helped build trust between the two sides. After the NBA and Netflix signed up for the idea of an NBA reality series, it was time to find the players.

James was interested in participating, but he had one key question: How would this affect a documentary of his life if he decides to do that someday? “It’s the only question he cares about,” Carter said.

Carter told him not to worry—the show wouldn’t preclude a documentary spanning his career. The NBA series, which will also feature Jayson Tatum, Jimmy Butler, Domantas Sabonis and Anthony Edwards, is being made in partnership with Omaha Productions and the Obamas’ Higher Ground Productions.

James has been featured in TV shows and films including Judd Apatow’s “Trainwreck,” with Amy Schumer. He surprised many on that movie’s set with his deadpan delivery of lyrics from the song “Gold Digger,” offered as relationship advice for a pal played by Bill Hader.

James hopes to be more involved in the creative side of SpringHill when he retires. He says he would love to do a docuseries with his son Bronny, who plays for University of Southern California.

He also would like to do more acting.

“The next movie I want to do is a rom-com,” he said.

KM 2/9/24 KM 2/9/24

John Kosner Spoke with Mike McCarthy of Front Office Sports About Sports Rightsholder Streaming Concerns

Original Article: Front Office Sports, by Mike McCarthy, February 9th, 2024

LAS VEGAS — ESPN, Warner Bros. Discovery and Fox Corp. may have overlooked some key stakeholders with their ambitious plans for a combined streaming service. Namely: the powerful sports leagues to whom they pay billions in media rights fees.

In Vegas for the Super Bowl, where seemingly all of the media world is amassed, I’m hearing that the leagues went on red alert as soon as the three media conglomerates announced the multisport streaming service Tuesday. The notion: They’re suspicious that the members of the unnamed streamer collective will eventually try to bid for live-game rights as a combined entity, likely reducing the total media rights fees paid out to the leagues.

The new math in sports media is that the more media partners leagues have, the higher the total rights payouts they reap. The NFL, for example, will pull in $110 billion in media rights fees through 2033 across its deals with ESPN, Fox, CBS, NBC, and Amazon Prime Video. Throw in the league’s seven-year deal with YouTube for Sunday Ticket and that’s another $14 billion in the NFL’s pockets.

And other pro leagues are closely following the NFL playbook. That’s why the NHL switched to two national media partners, ESPN and TNT, receiving a combined $625 million per year. With one media partner, NBC—albeit years earlier, in 2011—they collected $200 million per year.

With the NBA’s media rights expiring after the 2024–’25 season, look for The Association to double its media partnership from two to four, say my sources. Incumbents ESPN and TNT could be joined by Amazon Prime Video and NBC, a former media partner. The goal, as always, is to maximize rights fee by signing multiple partners.

For their part, the three companies involved in the joint-venture agreement maintain that they will continue to negotiate and acquire their respective sports rights independently. Let’s take them at their word. But things could change down the road. It’s still a legit concern for rights holders, warns John Kosner, a former NBA and ESPN executive turned media consultant. “Anything that potentially cuts down on the number of competitors bidding on sports rights is going to be, by definition, a significant concern to sports rights holders. It has to be,” Kosner tells Front Office Sports.

Adding to the suspicion: The leagues were “blindsided” by Tuesday’s blockbuster morning announcement, according to The Wall Street Journal. Sports leagues like to be briefed in advance about any shifts in business strategy. Apparently that didn’t happen this week.

“An effort to notify the leagues wasn’t made until Tuesday, before a planned announcement. Many learned of it when The Wall Street Journal broke the news,” the Journal reported. “The reason for the cone of silence was to keep the plans from leaking prematurely during the months the companies were settling the details, people involved in the partnership said.”

With the dust settling, two days later, leagues are still looking for answers on what this thing is, when it will launch, who will run it, and, most importantly, how it will impact them. Until then, they’re playing catchup.

“While we look forward to learning more about this new venture,” an NBA spokeswoman tells FOS, “we’re encouraged by the opportunity to make premier sports content more accessible to fans who are not subscribers to the traditional cable or satellite bundle.”

KM 2/8/24 KM 2/8/24

John Kosner Spoke with Rachelle Akuffo & Akiko Fujita of Yahoo Finance About Sports Streaming

Original Article: Yahoo Finance, by Rachelle Akuffo and Akiko Fujita, February 8th, 2024

The Walt Disney Company's (DIS) recent announcement of joint venture sports streaming service with Fox (FOX, FOXA) and Warner Bros. Discovery (WBD) dominated the company's latest earnings call. Kosner Media President John Kosner — who was also the former EVP of Digital & Print Media at ESPN — joined Yahoo Finance Live to discuss why this move benefits Disney and satisfies sports fans who "really want a bundle."

Kosner notes this push away from the traditional linear TV packages is "part of the evolution of the business." Although threatening cable, Kosner argues "there are a lot of people who still want to get their channels in a traditional way."

However, Disney now has to persuade consumers why they should "want this" bundle over cable since offerings like news channels are not included.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Angel Smith

Watch The Video

Video Transcript

RACHELLE AKUFFO: Well, the word sports was mentioned in Disney's first quarter earnings call 50 times. As the company managed to trim its losses in its streaming division, it now looks to solidify its place in the sports world. Announcing that its full suite of standalone ESPN channels will be available in the fall of 2025.

Now this comes after revealing a partnership with Warner Bros. Discovery and Fox for a sports streaming platform. Joining us now on this is John Kosner, Kosner Media President and former ESPN Executive Vice President of digital and print media. Thank you for joining us this morning.

So let's start by talking about the landscape that Disney is setting up here, because with this streaming deal, this will be the first time that you have your cord cutters and those who are loyal to cable will now have an alternative that really bridges both of them outside of the traditional cable bundle.

JOHN KOSNER: Yes, and the fans really want a bundle. I have a friend who's a big fan of the Arsenal Football Club who told me that he has to subscribe to seven different services to see every game. So the movement-- Disney announced two things yesterday. The movement to do the JV with Fox and Warner Bros. Discovery really addresses a consumer demand for better bundling.

They also announced, Rachelle, as you said, that they're going to launch their flagship service, a standalone ESPN streaming service in fall of 2025. So these moves reflect sports fan demand. And it's just part of the evolution of the business away from the traditional pay television bundle.

AKIKO FUJITA: John, how significant is the risk for cannibalization? I mean, the argument for very long has been that the only reason cable has gone this long or has been able to survive this long is because of sports. If you've got alternatives out there like the bundle, like ESPN streaming service that allow you to view that, what is the case for keeping cable around?

JOHN KOSNER: Well, there are lots of people who still want to get their channels in a traditional way, combining entertainment and news. The challenges for the new JV is going to be explaining to fans why they want this versus what they could get as a combination of channels.

As we know, at least today, NBC is not part of this. CBS is not part of this. We don't know yet who's running the JV. We don't really have any details yet about the product around the JV. So there are a lot of questions there. And clearly, Lachlan Murdoch said this, they want to target those who are outside the system. So, there is risk to cannibalization of existing pay-TV subscribers. But the promise that this could be better and more focused for fans has the probability of bringing other people into the mix.

KM 1/29/24 KM 1/29/24

Are All Sports Rights Fees Flattening? John Kosner’s Latest SBJ Column With Ed Desser

Original Article: Sports Business Journal, by John Kosner and Ed Desser, January 29th, 2024

Throughout our careers, premium sports properties have resembled growth stocks: rights fees headed skyward at double-digit rates. Sports perfectly exploited pay TV’s dual-revenue-stream-powered boom. National broadcast network deals grew, supported by station retransmission consent fees; powerhouse cable networks developed, propelled by affiliate revenue. Meanwhile, local pro team agreements drove near-ubiquitous distribution of RSNs. Sports advertising’s rising tide lifted all boats.

As we chronicled (SBJ, Dec. 11, 2023), the industry has entered a daunting new frontier. Recently, the Premier League, WWE, and NASCAR announced media deals more in line with inflation than growing at the previously hyper-inflationary levels.

Are all rights fees flattening, including for big bellwethers? We think not.

There are several factors influencing rights fees (and we mean cash rights fees, not production offsets or marketing commitments):

Attractiveness of the package: What’s the market’s perception? Formula One had to offer ESPN sweetheart terms in 2018 just to get desired exposure. By 2020, it got a small rights fee. Then with an assist from Netflix’s “Drive to Survive,” competition yielded $85 million annually from ESPN. F1 improved its story — and its market value. But what have you done for me lately? In 2023, F1 ratings were down 8%.

Time since last reset: New agreement reporting tends to compare average annual package prices (AAV), deal-over-deal. However, it is the step up from the final year of the previous deal to the first year of the new which usually counts. After that, it’s typically yearly cost-of-living increases. Thus, NASCAR, which ended 12-year Fox/NBC agreements, appeared to gain a bigger increase than the Premier League, whose last NBC deal ran only three seasons.

Has the package been under-market? Sometimes a sport and its media rights package get out of sync. Conditions at negotiating time matter. NASCAR saw huge rights fee upticks in previous deals, but then its viewership lagged (in part because it placed more races on lower-rated pay TV networks versus broadcast to generate more money). ESPN’s 12-year NCAA “other” championships deal was notably underpriced, and the explosive growth of the NCAA women’s basketball championship drove the recently announced, $920 million, 8-year-agreement.

Demographics (younger/older; income levels; geography): No one doubts the entertainment appeal of WWE, which helped drive last week’s Netflix deal, but its audience composition is not as attractive as other traditional sports, which draw the upscale male viewers that networks and their advertisers covet.

Demand: The NCAA “other” championships offer both tremendous volume and quality. But, realistically, how many bidders could handle its 2,200-hour tonnage, requirements for broad distribution, and event production? Answer: Only ESPN. Thus, when the NCAA determined to keep the championships package together (and not bid the women’s basketball championship separately) it became inevitable that ESPN would clinch the deal. Multiple networks are invested in college football, but ESPN has the incumbent’s advantage with the College Football Playoff — only it can pay more rights into the remaining two seasons of the current deal. ESPN appreciates how the CFP helps drive better ad sales throughout the five-month season, a competitive halo. On the other hand, the financial performance (and debt load) of media companies matters too. Paramount (CBS) and Warner Bros. Discovery (Turner) might aspire to be aggressive buyers, but their balance sheets constrain them.

Trend (where have audiences and sponsor interest gone from the last negotiation?): The standalone CFP has had an uneven ratings performance, in part because its participants have tended to come from the Southeast, Southwest and the 166 miles separating Ohio State and Michigan. However, the 2023 and 2024 semifinals were thrilling and Michigan’s championship run drew 27 million and 25 million viewers respectively. College football is the No. 2 sport in the U.S.

Nature of package: The NBA season is practically a year-round affair, with a seven-month pre/regular season, a two-month postseason, then the draft, summer ball, and WNBA in between. In a direct-to-consumer world, where months matter, that’s major churn mitigation. Additionally, NBA betting volumes already rival the NFL (team bets on the Celtics, Nuggets and Lakers were three of Action Network’s four most-tracked in 2023). The Premier League not only provides compelling live weekend morning and afternoon matches for NBC, but also it makes Peacock a must-have for international football fanatics. Savvy leagues change the partners, size, and elements of packages to adapt to the marketplace (e.g., the NFL moving Sunday Ticket to YouTube and adding influencers).

Tentpole property: The NCAA women’s basketball championship only covers three weeks, but it has emerged as ESPN’s leading event between January’s CFP and April’s Masters. The CFP already dominates its current windows and is set to expand by eight more.

Cord-cutting and a softer advertising environment aside, we expect the NBA to book a significant increase in its rights (as the NFL did) since it checks all the above boxes (perception, nine years since the last deal, young demos, high-demand property, gambling attraction, fairly stable audiences in a declining trend marketplace, significant interest from sponsors and fans, nine months of programming; and, certainly, a tentpole during its spring playoffs).

If ESPN closes its reported six-year extension, the CFP deal will also show a nice increase. Ironically, the CFP’s biggest challenge is that the NFL sucks much of the oxygen … and attractive time slots … out of the system. Twenty-three million viewers for the Peacock playoff game is just the latest example.

The big are getting bigger. CFP and NBA scores mean a lot less money left for everyone else. That’s the new reality of sports media: Still an up market — for a few.

Ed Desser is president of consultancy Desser Sports Media Inc. (www.desser.tv). John Kosner is president of consultancy Kosner Media (www.kosnermedia.com). Together they developed league TV strategy and ran the NBA’s media operations in the ’80s and ’90s.

KM 1/25/24 KM 1/25/24

John Kosner Spoke with Mike Gunzelman of OutKick About the Kelce Brothers’ Media Appeal

Original Article: OutKick, by Mike Gunzelman, January 25th, 2024

Move over, Mannings, you’re about to have competition.

The star NFL brothers are prime to take over the sports and entertainment world and you can be sure that the suits are noticing it – in fact, I predict that it may even lead to Travis retiring from the Chiefs sooner than later knowing full well that he would have a career in media the very next day.

“I don’t know if and when either or both will formally retire but once both do, they are a natural TV and media attraction,” former EVP of digital and print media for ESPN John Kosner told OutKick. “They are All-Pro performers who are smart, fun and authentic, appealing to everyone, just like the Mannings and Charles Barkley. That is super hard to find and extremely valuable in our polarized country.”

Which networks are the frontrunners?

“I really like Amazon as a target [for the brothers] including some sort of shopping angle and maybe also featuring their mom,” Kosner added.

ENTER: THE ALT-CAST

A year ago, I wrote that television executives were going to oversaturate and run with the alt-casts until there were too many and it would eventually ruin their uniqueness. I likened it to the rise of podcasts where anyone and everyone seems to have one. It’s already happening; now we have people like Kevin Hart having a weekly ESPN2 NBA alt-cast that nobody whatsoever cares about.

“But, unless you’re Pat McAfee, Charles Barkley – or as I’ve advocated for: Travis and Jason Kelce, there are few personalities that can make the alt cast work [as well as the ManningCast and KayRodCast featuring Michael Kay and Alex Rodriguez.],” I wrote back in April of 2023.

I was right.

Alt-casts only work if the PEOPLE ON THEM mesh and there are no two better candidates than Travis and Jason Kelce. They are absolutely buzzing and are a TV exec’s wet dream for the dollar signs and ratings that they would bring in.

Hell, they already are a proven concept.

The Kelce “New Heights” podcast is frequently the most downloaded sports podcast in the world.

You add the Taylor Swift aspect as well as Jason Kelce “conveniently” ripping his shirt off and being a DUDE while crushing beers when every sports fan was watching during that Chiefs-Bills game?

Jason alone just guaranteed himself a career in sports media for years from his antics at Sunday’s game.

With Netflix now entering the live sports broadcast business with a wild $5 billion purchase of the WWE’s Monday Night Raw rights, the competition is only growing for who can snag the Kelce brothers.

Eric Bischoff, who later went to the WWE and became a WWE Hall of Famer knows a thing or two about developing and selling characters on television. He created and was part of the famous nWo wrestling stable led by Hulk Hogan, Scott Hall, and Kevin Nash which single-handedly transformed television ratings and the sports entertainment industry still to this day.

He believes the Kelce brothers have all the intangibles to become superstars in front of the camera.

“They are the Mannings with character version 2.0. My bet is their agents are already in negotiations,” Senior Vice President and Executive Producer of World Championship Wrestling (WCW) Eric Bischoff told me.

Former ESPN executive John Kosner, who helped develop the talents of Bill Simmons, Adrian Wojnarowski, and Darren Rovell while at ESPN, agrees with Bischoff.

“I bet the Kelce combo is atop the draft boards at every network and sports media company including the streaming companies. I could see TV networks pitching them for both NFL and morning show work as well.”