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 4/9/24 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 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 3/19/24 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 1/25/24 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.”

WHERE DO YOU THINK THE KELCE BROTHERS END UP?

KM 1/13/24 KM 1/13/24

John Kosner Spoke with Chris Bumbaca of USA Today about Peacock’s Exclusive NFL Playoff Game

Original Article: USA Today, by Chris Bumbaca, January 13th, 2024

On multiple occasions during the final game of the 2023 NFL regular season, NBC play-by-play announcer Mike Tirico offered viewers a variation of the same promotion over and over.

“And don’t miss the first-ever exclusively streamed playoff game Saturday night,” Tirico said as the Buffalo Bills battled the Miami Dolphins with the AFC East on the line. “Available only on Peacock.”

Downloading a streaming app to watch an NFL playoff game? For some, the idea seems ludicrous. For another type of media consumer, it’s normal. For the NFL and NBCUniversal, it’s a forward-thinking way to stay ahead of the curve – and make more money.

“We know and we see the continued evolution in the media landscape, and we want to be where our fans are,” NFL executive vice president of media distribution Hans Schroeder said on a conference call. “We know they’re increasingly, especially younger fans, on different screens.”

Why did an NFL playoff game end up on Peacock?

The addition of a seventh playoff team in each conference – and the elimination of a bye for the No. 2 seed – added two extra games to the wild-card slate. With that increased inventory, the NFL saw an opportunity to diversify its media presence on one of the biggest weekends of the football calendar.

“Considering cord-cutting and the soft TV ad-sales market, I think they have no choice but to pursue streaming because that’s where the growth is gonna be," John Kosner, the president of digital media and sports consultancy Kosner Media, told USA TODAY Sports. "That’s where media companies are investing.”

NBC Sports president Rick Cordella said the window was presented as a streaming-only game as part of the new media rights deal that went into effect prior to this season. NBCUniversal put together a pitch for the Saturday night game to air on Peacock. That, plus a reported $110 million, was all it took for Peacock to score rights to a matchup that resulted in the No. 3 Kansas City Chiefs — "Swifties," meet "The Office" — and No. 6 Dolphins.

“It’s not as if we shifted any games from linear to stream,” Cordella said. “This was an additional game that was available to us.”

In the past two years, an extra game was given to another broadcast partner, such as CBS or FOX, while the other went to ESPN on Monday.

The Chiefs-Dolphins game will still be available on the local NBC channel in the teams’ respective television markets.

“It’s historic, right?” Kosner said. “(NBC) also got a terrific game."

NFL fans becoming familiar with streaming

The NFL had 93 of the top 100 broadcasts in 2023, according to Nielsen ratings. That’s in large part due to their reach over cable, Kosner said. The league is able to offer a greater percentage of games available for free on TV than any other league.

In its second year of exclusively streaming “Thursday Night Football,” Amazon saw a 24% increase among total viewers (11.86 million) compared to the previous season (9.58 million). Kosner could see Amazon entering the postseason mix as early as 2025.

An international game was exclusively available on ESPN+ this year for the second straight season. And the NFL introduced NFL+, which allows fans to watch local and prime-time games for a monthly or yearly subscription rate.

All “Sunday Night Football” games on NBC are streamed simultaneously on Peacock (CBS does something similar with its NFL package and Paramount+). Peacock currently has 30 million subscribers, according to NBCUniversal. Comcast president Mike Cavanagh said in December the platform took on $2.8 billion in losses in 2023.

"It’s going to be fascinating to see," Kosner said. "I would be surprised if there wasn’t a lot of consternation among NFL fans as to they don’t know where the game is, they’re annoyed they have to pay $5.99 to see it. But this is how you seed new markets and new platforms."

The deal between NBCUniversal and the NFL for the streaming-exclusive playoff game is for this season only. Schroeder said future postseason games available digitally will be evaluated during the offseason.

"That really was at the top of our list as we thought about the major media partnerships we did a couple years ago," Schroeder said, "making sure all our partnerships had broad digital distribution and that we are growing in that important place for our fans."

What will ratings look like?

NBC did a version of a dry run by airing the Dec. 23 Bills-Los Angeles Chargers game exclusively on Peacock. According to Nielsen data, the game averaged 7.3 million viewers, peaking at 8.4 million from the 10:45-11 p.m. ET.

The expectation is that the first wild-card game Saturday between the Houston Texans and Cleveland Browns, which starts at 4:30 p.m. ET on Saturday, will draw in excess of 20 million viewers. NBC is betting on the lead-in to drive viewers toward Peacock and that first broadcast will be filled with self-promotion and reminders of how to watch Chiefs-Dolphins during that Browns-Texans matchup.

“We’re going to take a lot of learnings from it,” Schroeder said. “Certainly, viewership will be one of them. That will be just one of the criteria we think about and look at the opportunities we have going forward.”

Why NBC wanted to put an NFL playoff game on Peacock

Simply put: subscribers. Paying customers.

Cordella said that success won’t be judged Sunday morning or by the ratings. The long-term behavior by customers who signed up for the game – and can cancel at anytime – will be the lasting impact.

“We did this for a reason. It’s not just to get people to watch on Saturday night,” Cordella said. “It’s to get people to watch and experience all this various content that we have across the Peacock service.

“It’s down the road – did people behave how we thought they would behave once they get inside the platform?”

Additionally, Cordella pushed back on the idea that the game amounted to a $6 pay-per-view (the cost of a monthly subscription – with ads). He cited the growing men’s and women’s college basketball presence on the platform, with the top-ranked Purdue men losing Tuesday night followed by Iowa star Caitlin Clark playing the next. WWE, Premier League, MLB and other sports leagues have presences on Peacock. The Paris Summer Olympics later this year will also be featured on Peacock.

“There’s a wealth of content that people may be unaware it exists,” Cordella said.

And those are all reasons for sports fans to keep paying a monthly bill for Peacock.

“They’re very sports-focused, between EPL and college football," Kosner said. "So they’ll have to tell that story, along with ‘Saturday Night Live,’ and all that content they have. But I think it’s going to be a challenge to keep the many, many fans who really were subscribing just to watch this particular game.”
Still, Kosner predicted "millions" of sign-ups from Saturday alone.
“That’s going to be great for Peacock," the longtime ESPN executive said. "I can’t imagine what other content Peacock could offer that would give them the boom they’re going to get on Saturday night. The test, of course, is how many of the fans are going to stay with the service next month?”

The Taylor Swift effect

Kosner wondered whether the choice of Kansas City was a factor (Schroeder provided a non-answer about a holistic approach to scheduling wild-card weekend).

“You have Taylor Swift, her factor here,” Kosner said. “That’s going to attract women, that’s going to attract younger, tech-savvy fans. Was that a choice made on purpose? Because that’s an audience that Peacock would like to have.”

Who are the announcers for the Chiefs vs. Dolphins on Peacock?

Chiefs vs. Dolphins is one of three games to air on NBC properties this weekend. Tirico will be the play-by-play announcer for two, starting with the Peacock game. He will be joined by Jason Garrett as the game analyst and Kaylee Hartung as the sideline reporter.

Meanwhile, NBC opted to go with its top college football broadcast crew of Noah Eagle, Todd Blackledge and Kathryn Tappen to call the early game – leaving Al Michaels, he of “emeritus” NBC status, out of the picture. Tirico will then travel overnight to call the Los Angeles Rams at Detroit Lions on Sunday (8 p.m. ET, NBC).

Kosner expects the early Saturday broadcast to use the lead-in as an advantage and heavily cross-promote Peacock sign-ups.

What will be different about Peacock playoff game?

Like the first Peacock game, the fourth quarter will have no commercials. Cordella said they learned a lot three weeks ago during the first experiment about when to toss to the studio or stay with the break in the action on the field with the broadcast booth.

Chiefs’ Charles Omenihu offers to buy Peacock subscriptions

Chiefs defensive end Charles Omenihu reacted to the playoff schedule announcement by posting on social media: “Us playing on peacock ONLY is insane I won’t lie.”

For Chiefs (and Dolphins) fans who are considered out-of-market viewers, that’s the reality of Saturday’s game. But Omenihu wanted to help out the members of “Chiefs Kingdom” who were displeased with the situation.

“I saw the comments and want y’all to be able to watch us play," Omenihu wrote on social media. "So, I’m giving away 90 3-month Peacock memberships! To enter to win, reply to this tweet with why you should get picked. Picking winners Friday!”

The winners of the Omenihu sweepstakes will enjoy Peacock beyond Saturday night, which is what NBC wants. Everybody else better pony up that credit card information – if they haven't already.

KM 1/8/24 KM 1/8/24

John Kosner Spoke with Ira Boudway of Bloomberg about The NBA’s Media Negotiations

Original Article: Bloomberg, by Ira Boudway, January 8th, 2024

It’s been almost a decade since the NBA went to market with its national TV rights. In fall 2014, the league agreed to a pair of nine-year deals for a combined $24 billion with Walt Disney Co. (home of ABC and ESPN) and what’s now Warner Bros. Discovery Inc. (owner of TNT). At $2.7 billion per year, almost triple the annual value of the previous agreements, the deals helped the National Basketball Association grow rapidly—pushing player contracts into the hundreds of millions of dollars and franchise values into the billions. With those rights set to expire in 2025, the NBA will announce new landmark TV agreements this year.

Yet it’s been a tumultuous 10 years since the league was last at the table. Legacy media companies are being squeezed between the decline of the traditional cable bundle and the high cost of building subscription streaming services. In 2014, according to data from S&P Global Market Intelligence, more than 100 million US households had a multichannel pay-TV subscription. Now that number is below 75 million. The streaming apps created to recapture those lost viewers, meanwhile, are collectively racking up billions of dollars in losses each year for media giants such as Comcast, Disney, and Paramount.

This time around, industry observers say, the NBA will be hard-pressed to triple its TV money. And the league won’t be able to simply cut and paste from past contracts. “These deals are going to look and feel different,” says John Kosner, a sports media consultant and former ESPN executive.

The process officially begins in March when Disney and Warner enter an exclusive 45-day window to negotiate possible extensions. But the two incumbents aren’t likely to wait until then to submit bids. Possible newcomers, including Alphabet Inc. and Amazon.com Inc., have already begun positioning themselves to grab a piece of the NBA.

Currently, Disney gets 100 regular-season games, split between ESPN and ABC, plus a piece of the playoffs and all of the NBA Finals. Warner gets 64 regular-season games and a share of the playoffs. Most observers anticipate that both networks will continue carrying NBA games. “I wouldn’t expect either of the incumbents to fumble the opportunity,” says Ed Desser, a sports media consultant and former NBA executive. The shape of those packages is likely to change, however, as the league looks to carve out space for partners that can reach younger audiences and help keep the sport relevant. “The NBA has a younger-skewing fan base that is more liable to be accessed via a streaming platform,” Desser says. “You’ve got to fish where the fish are.”

In the past three years, the National Football League, Major League Baseball, and Major League Soccer have all done TV deals with the tech giants. The NFL sold Thursday Night Football to Amazon for more than $1 billion per season and its out-of-market Sunday Ticket package to Alphabet’s YouTube TV for $2 billion, while Apple Inc. bought Friday night games from MLB for a reported $85 million and then spent about $250 million to become the streaming home of MLS.

The NBA is almost certain to bring in a nontraditional broadcaster, too. To maximize revenue in a fractured landscape, says Daniel Cohen, a media rights consultant at Octagon Inc., the league will need to expand its partners to three or four. “If they do that with the right packages, then I could see $2.7 billion going to $6 billion,” Cohen says, referring to its annual haul. (Such a setup might look like this: a reduced number of games on ESPN-ABC and TNT; a weekly exclusive game on Apple TV+; and the league’s new In-Season Tournament going to Amazon.)

For fans, that could make following the NBA costlier and more complicated, with additional paywalls to jump over. But such is the life of sports fans these days as the cable bundle unravels.

KM 1/5/24 KM 1/5/24

John Kosner Spoke with Ben Portnoy of The Sports Business Journal About ESPN’s New NCAA Media Agreement

Original Article: Sports Business Journal, by Ben Portnoy, January 5th, 2024

That quaking you feel beneath your feet is coming from Indianapolis.

The NCAA this week announced a landmark eight-year deal with ESPN worth $115 million annually ($920 million total) for the broadcast rights to 40 championships — including women’s basketball, volleyball, gymnastics and more.

The move is a major one for NCAA President Charlie Baker, ESPN and those involved with the discussions. What does it all mean?

Here are a few takeaways:

NCAA avoided temptation to split up its TV package

Speculation in college sports circles in recent months centered on whether the NCAA would consider breaking out the women’s basketball tournament or the men’s and/or women’s College World Series into their own media bundle in some capacity.

Baker and his team decided against that. Why? Let him explain:

“What we had always said was we wanted the best deal for all of our championships,” Baker said when asked if the NCAA considered packaging the women’s basketball tournament separately. “If you think about it, it’s [2,300] hours of programming, which over the eight years of the deal will take place in an enormous number of settings with a whole variety of challenges and on the ground circumstances [making] this something where if you can get a production partner who’s willing to bite the whole thing of at a price that we believe is more than market competitive, we thought that was a better way to go.”

The decision to keep things bundled largely as they had been is layered. While there was a public narrative that the women’s basketball package could be healthy on its own, there was at least some fear that breaking of the most lucrative pieces of this package could devalue the remaining sports and leave them out to dry. In many media circles, both consultants and network sources shared that the value of the package was far greater with it being bundled and maintained. There are also the simple complications of having potentially more than one broadcast rights partner on these championships — more cooks in the kitchen, etc.

This isn’t to say there was lack of interest. Hillary Mandel, executive vice president and head of Americas for media at IMG, suggested there would have been plenty of interested parties should the rights have hit the open market (ESPN had an exclusive negotiating window on this deal).

Sources told Sports Business Journal that Fox Sports was among the parties that might have been interested in the rights to NCAA women’s basketball and volleyball if they were broken of, given the network’s investments in both sports in recent years.

“If you were to unbundle, the top of the package would be grabbed by everybody,” said Mandel, who consulted on the deal alongside Karen Brodkin, executive vice president and co-head of WME Sports. “But what would happen to everybody else? That’s not who the NCAA is. They don’t want to leave anybody behind.”

What does it mean for women’s basketball?

It’s a win for a number of women’s college sports, but if there’s a crown jewel in this collection of rights, it’s the NCAA women’s basketball tournament.

Baker told SBJ the NCAA valued the women’s basketball tournament at $65 million annually, or roughly 56% of the total value of the media rights included in this package. That’s a big number considering the entire last deal signed with ESPN in 2011 was only worth about $40 million annually.

“The trajectory of this property, in particular women’s sports, over the past few years, is extremely positive,” said Nick Dawson, ESPN’s senior vice president of college sports programming and acquisitions. “To have the entirety for eight more years is, in our view, a great place to be.”

Detractors will say the NCAA didn’t get enough in this deal. Media consultants Ed Desser and John Kosner, who provided analysis for the “Kaplan report” on gender equity published in 2021, estimated the women’s basketball championship could generate between $81 million and $112 million in annual rights fees and suggested it would be best sold as its own entity.

Kosner said ESPN is set up to manage the tonnage of the overall rights package “and although I think both Ed and I would argue that it would be a fascinating opportunity for one of the top digital companies, it’s not clear that any really got deeply involved.”

NCAA women’s basketball viewership has grown exponentially in recent years. The NCAA women’s title game between LSU and Iowa last year drew 9.9 million viewers on ABC, compared to the 14.69 million the men’s title game featuring UConn and San Diego State brought in on CBS. The LSU-Iowa contest was also the first women’s basketball title game to air on broadcast TV under the current media rights agreement with Disney/ESPN, which began prior to the 1996 tournament, and the title game will continue to air on ABC under the terms of the new deal.

The media rights market is a tight one, with a clear bifurcation between top properties getting a rights increase and others weighing not-so-attractive options, but the NCAA still netted a deal worth three times the previous one.

“We’re seeing the fruits of many, many years of labor coming to fruition in women’s sports,” Desser said. “If you go back 25 years, women’s sports was really almost an afterthought. I think it no longer is. It’s now in the mainstream. If you can generate a [almost] 10 rating on a women’s college basketball game, then you’ve really come a long, long way.”

ESPN stays frugal, but keeps its hands in everything

Despite the issues facing Jimmy Pitaro, the leader of ESPN didn’t flinch when it came to maintaining the company’s relationship with the NCAA and its belief in college sports, and ESPN now controls the domestic rights to virtually all of the NCAA’s championships — the massive exception being the men’s basketball tournament.

The deal is set to include 2,300 hours of championship programming, 800 hours of which will be on linear ESPN platforms. That’s certainly helpful in filling air time across its various platforms, but it shows that ESPN is committed to amplifying the coverage across its networks.

“What we bring to the table here, yes it’s the studio, it’s our megaphone, it’s our brand, it’s our production quality,” Pitaro told SBJ. “But it’s first and foremost our multiplatform approach.”

ESPN has been prudent with recent deals. The network passed on the Pac-12 deal, yet it’s currently working to re-up its rights with the College Football Playof, which expire after the 2025 season. ESPN also has upcoming negotiations with the NBA and UFC.

The new deal with the NCAA is set to expire in 2032, the same year the men’s basketball rights are scheduled to hit the market. That should give the NCAA ample flexibility then, but could grant ESPN that same ability.

“Most of the time when you’re involved in a negotiation, there’s what people say at the beginning and then there’s what people say when they come back for the third time,” Baker said. “One of the things that was really impressive to me about this was ESPN, they wanted this and they were willing to work for it.”

A win for Charlie Baker and the NCAA’s forward thinking

Barely nine months into his role, Baker, the former Massachusetts governor, has been resolute in trying to bring the NCAA into the 21st century. The proposal regarding athlete compensation he unveiled at the SBJ Intercollegiate Athletics Forum last month was a monumental moment for college sports and a profound shift in thinking. Helping nab a media rights deal in a tight market is another impressive feat early in his tenure.

“We think this is a terrific opportunity and a great deal,” Baker said, “and a chance to give a ton of additional visibility through some of the elements of the agreement beyond just the money for a variety of our sports.”

The NCAA has plenty of chaos to sift through in the coming months. Myriad lawsuits regarding athlete compensation could result in major settlements and the college athlete employment debate rages on.

Still, Baker is garnering attention in a positive way — that’s significant in its own right.

KM 12/28/23 KM 12/28/23

Parks Associates Names John Kosner One of the Top Leaders in Video and Entertainment

Original Article: Parks Associates, Top 2023 Leaders in Tech - Video and Entertainment, December 28th, 2023

International research firm highlights industry leaders in entertainment and streaming, energy, connected health, multifamily, and connected home and security.

Parks Associates, the research authority on digital lifestyles and technology, today released its 2023 Top Leaders in Technology, an annual list that recognizes leading technology executives who are featured speakers at the firm’s annual executive conferences. Parks Associates recognizes these leaders for their pivotal roles in market growth and their dedication to expanding industry knowledge. The research firm reports that 90% of US internet households now own a smartphone, surpassing the television for the first time to become the most ubiquitous device among US consumers.

KM 12/11/23 KM 12/11/23

John Kosner Spoke to Ben Thompson of Stratechery About the Past and Future of Sports in an Age of Abundance

Original Article: Stratechery, by Ben Thompson, Thursday, March 2, 2023

An Interview with John Kosner About the Past and Future of Sports in an Age of Abundance

Good morning,

I am pleased to welcome John Kosner for a Stratechery Interview. Kosner was a long-time NBA and ESPN executive who oversaw the growth of ESPN.com, the ESPN app, fantasy sports, streaming, and podcasting. Since leaving ESPN in 2017 Kosner has been a venture capitalist, advisor, and consultant, and writes a regular column for Sports Business Journal.

We discussed Kosner’s career both at and after ESPN, how he always dreamed of building ESPN.com and how reality differed from his expectations, why Bill Simmons had such an impact on ESPN and the sports ecosystem, and why Twitter sent a chill down his spine. We also touched on the same topics I wrote about this week, including how to fix the NBA and whether sports will appeal to the next generation of fans (this interview was recorded before I published What the NBA Can Learn From Formula 1, and helped influence it).

To listen to this interview as a podcast, click the link at the top of this email to add Stratechery to your podcast player. On to the interview:

An Interview with John Kosner About the Past and Future of Sports in an Age of Abundance

This interview is lightly edited for clarity

Background

John Kosner, welcome to Stratechery.

JK: Thank you Ben. I used to listen to Mike and the Mad Dog on WFAN here in New York City, and the callers used to say things like “Longtime listener, first time caller”. So I’m a longtime reader, but first time caller.

Well, I appreciate it. You are one of my regular correspondents, which I’ve always appreciated, and it’s a very timely time to talk to you. I’ve been thinking a lot about sports and sports rights, and not just because I’m a sports fan. On Dithering we like to get into sports and some people get grumpy about it because they’re like, “Oh, I want to talk about tech.”

JK: Not me!

Well, yeah, but right now in particular, one of the first topics I ever wrote about on Stratechery was the cable bundle and entertainment and this period we are going through where it’s been one of those things where people have seen this coming for literally twenty or thirty years — and this kind of goes back to your time at ESPN, which we’ll get into — but right now it’s all happening.

Things are changing in a major way and so I want to get the chance to talk to you because you were there, as I just alluded to in the early days, working at ESPN, helping launch ESPN.com, ushering it through not just the initial launch, but the shift to mobile. I’d love to dive into that history and also get some of your takes on what’s happening now and where we’re going. So if that sounds good to you, we can dive in.

JK: Sounds great, Ben. Thank you.

So let’s start with your background. I think people in sports media obviously know who you are, probably far fewer people in tech. So what’s your background? How’d you get into sports? What’d you do at ESPN and what are you doing now? Let’s go through the whole thing.

JK: Great. So I’m one of the few people you’ll ever meet who has had the privilege of doing the jobs he dreamed of doing as a kid. I grew up in New York City, which is where I live now, and I grew up during the 1960s and 1970s and I was obsessed with sports on television. My idol was Roone Arledge, the famous executive producer of ABC Sports who invented up-close-and-personal style of journalism. He pioneered the Olympic TV coverage that we still see to this day in ABC’s Wide World of Sports. Anybody who loves Drive to Survive would appreciate Roone Arledge.

I learned about geography, math, storytelling, and character all through watching sports on TV. It was mesmerizing to me. It was worth noting too, when I was growing up, that three of the biggest sports were Major League Baseball, boxing and horse racing. As much as I loved sports television, I always dreamed of something that was even more. I wanted a product that could combine live sports telecasts with sports writing of the caliber of Sports Illustrated magazine, which I read every week, which would include video highlights, photography, audio, and realtime scores and stats. Essentially, I dreamed about ESPN.com about 20 years before the Starwave crew created it and it’s probably not coincidental that ESPN.com is the product with which I am most associated with decades later.

I grew up in an era of media scarcity. There were three broadcast networks, there were a handful of gatekeepers and limited bandwidth. Today’s landscape and media is the opposite of my childhood and to use a Stratechery theme, there’s now unlimited supply and so the world that I observe later is totally different. My career, I had the good fortune to intern at NBC Sports when I was in college.

When I graduated from college, I got started at CBS Sports where I worked in TV programming. That’s TV programming, not computer programming. I moved on from there to be head of broadcasting in the US for the National Basketball Association. This is truly a dream job for me, I’m sure you relate, as always, an NBA fan growing up, my favorite teams are the New York Knicks and the Phoenix Suns, and in your case the Milwaukee Bucks.

One of the topics of our conversation is Bucks versus Suns, which have a nice little burgeoning rivalry over the last few years.

JK: Interestingly, when I was at the NBA, one of the stars in the sports media business was Bob Iger. Bob Iger really came to prominence during the 1988 Calgary Olympics and then he was passed over to be president of ESPN, to his chagrin. He got over that because shortly thereafter they named him president of ABC Entertainment, which in those days was a much, much bigger job.

And he managed to get control of ESPN in the end. So I guess it all worked out for Bob.

JK: Yeah. I worked at the NBA for eight seasons, then I went to Sports Illustrated Magazine and then for over twenty years I was at ESPN, the last fifteen of which I ran digital media, so that’s ESPN.com, the app, streaming, fantasy games, podcasting and I got to oversee editorial, product development, I ran the P&L. It was truly a dream job. There was another sort of dream team of people that I got to work with, many of whom are still at the company. I left ESPN in June of 2017, and the first person to call me after my news was public was David Stern, the late NBA commissioner. And after — if you know David — after several insults, he suggested to me that we should combine to be investors and advisors to sports tech startups. He had retired from basketball in, I think in 2014.

Yeah, I was going to say 2014, somewhere around then.

JK: Yeah, and he had become a VC. So we got together and we created a little unit called Micromanagement Ventures, and if you know David, you’d appreciate the humor of that.

Yup.

JK: We invested in fifteen different sports tech startups, some of which proven very successful. WHOOP, WSC Sports, which does video highlights, Overtime, which now has a basketball league. Two of the companies got acquired, another one, fuboTV went public. Sadly, David suffered a cerebral hemorrhage in the fall of 2019 and he died on New Year’s Day 2020, and that was just a tremendously sad time. Like so many who know David, I miss him, I think about him all the time, I feel fortunate to have had really two experiences working with him. But in any case, I decided to stay in with the little companies. I have added a couple of other investment advisor positions with companies that are sort of the profile that David and I were looking at. I also consult for a couple of different companies. I consult for Apple, I’ve done projects for the LA ’28 Olympics, done projects for a cloud database company called Snowflake, I do expert witness work, and my friend Ed Desser from the NBA, he and I write articles for the Sports Business Journal.

That’s an excellent framing because I want to get to a couple of your articles. I do have a David Stern question. But there is a couple things you said in your introduction that were really interesting to me. Number one is I love the bit about how you weren’t obsessed with sports, you were obsessed with sports broadcasting or media.

JK: Right, exactly.

Because I’ve always felt like a weirdo because from day one I was fascinated with tech business and I had no business background. It was just that the implications of it seemed super interesting to me and I was interested in the tech part of it, but the products were less interesting than the business bit. And so I feel like you, I got to do the job that I wanted to do. But the second bit is you talk about how you witnessed this shift from scarcity to abundance, which is the dominant shift in everything, right? That’s what is undergirding what’s happening now. When you talk about envisioning ESPN.com basically 20 years before it happened, was that abundance bit in your worldview then? Or was it more like, “Oh, this is going to be a magazine online,” and then you came to appreciate that abundance over time?

JK: I had no idea that the abundance was coming, it just shows you how things changed. I remember when ESPN got started, I was a college freshman, I thought it was one of the stupidest things ever. They were showing reruns of college football games. I remember Nickelodeon got started, “Well who wants to watch that all day”? So I was on the total opposite side, but I’ve always been focused on the creation of great products, the surprise and delight, and I just thought if you could combine these things, wow, that would be something you would have. I remember when CNN Headline News started running scores on the ticker below their headlines, that was a big cultural moment in my life. There used to be a phone service in New York City called Sports Phone, 212-976-1313, and my parents used to strangle me because the phone bills would have incessant calls looking for Suns scores.

That’s amazing.

JK: So like a lot of things this was kind of self-serving, but it struck me that there was beauty to what was done in sports television. There was artistry to Sports Illustrated, and it made so much sense to be able to put those things together. One of the things that you talk about in your columns is what really connects isn’t a revamp of something you’ve already seen, it’s something that’s brand new. And when I got to ESPN and ESPN.com was two years old, I really felt like Nirvana.

ESPN.com

When you look back at the evolution of ESPN.com, there are a couple things I want to get to in that regard. To what extent do you think, just big picture, looking back over what has it been — twenty, thirty years now? — is ESPN.com a triumph for the company versus a, “In the long run, actually all that matters is sports on TV”? To the extent it’s a triumph, why? And to the extent it’s just something off to the side, were there opportunities that were missed or is it just that because of this abundant/scarcity thing, it’s just a completely different product than linear television?

JK: If I’m honest with myself, I think it’s somewhere in between how you describe it. I remember early research among young sports fans saying they really liked the offline version of ESPN, which always cracked me up. The offline version was the television. ESPN has always seen itself as a TV company first, that really hasn’t changed. But ESPN.com established itself as a truly unique service for fans and I think part of it was that it was created outside of ESPN, it was originally a joint venture between Paul Allen’s company, Starwave, and Disney. So it wasn’t started in the core ESPN, and you had some really brilliant people, Mike Slade, Tom Phillips, Geoff Reiss, Aaron LaBerge, who were pioneers with this experience before ESPN was truly integrated into it and it benefited from the point that many in ESPN management really just didn’t focus on it at the time, so we had a chance to experiment.

Right, which was a good thing.

JK: We had the chance to take chances and create something new. We also had, because of the Starwave heritage, a bunch of engineers who were big sports fans, which is really, really unusual and really benefited us during that time. It’s like you’re outside and it’s really foggy and then progressively over time it just gets clearer and clearer and you just begin to understand what to do. When I got started, it was probably the way people feel about blockchain and crypto today, that’s what the early days were like.

I’ll give you one story back there, which I think is kind of telling for how things went. In 2009, Apple was up in Bristol and Eddy Cue, who’s the head of Apple TV Plus and Services now, was in the meeting and he found out who I was and what I did and he came up to me and he said, “Hi, I’m Eddy from Apple and your scores, they suck.” And he took out his second generation iPhone and top left on iPhone was Yahoo Sports. So I said, “Okay, duly noted, you have my attention.”

I get back from the meeting to my desk in Bristol and I called up a fellow named Ed Macedo, who was the head of Stats and Information for ESPN. So I said, “Ed, I just met Eddy from Apple and he says our scores suck” and so Ed Macedo says to me, “Well, I use SportsLine for scores.”

Oof.

JK: So, this is like a Dave Portnoy moment, I called an emergency staff meeting and I said, “Ladies and gentlemen, we have a new priority — scores,” and people looked at me like I was a Luddite and they said, “Well, we do scores.” And I said, “Yeah, but Eddy says our scores suck,” and this is part of the beauty of the ESPN opportunity, is we had tons of bright people, we had a lot of money and resources, at least compared to others, and the fun part about being a leader is occasionally you can change the roadmap.

So we really dug into this challenge around scores, and the reason was, and I told the group, not trying to be flippant, “Here’s my theory, scores are a reason to come to the site every day and come multiple times and if we do a really good job of that, we can get people to read our recaps, we can get people to watch our video highlights, it becomes a sort of virtuous cycle”. And we invested, we ran high speed lines to every pro and college stadium and arena. We pioneered technology that had a score reveal itself, countdown reveal itself right in a webpage and within fifteen months, we had scores that were qualitatively and quantitatively better than anybody else, at least among our competitive set. The cheeky part of this is I sent the internal reports to Eddy at Apple, and the internal reports were really funny. “Holy smokes, Eddy’s right, we’re seventeen seconds behind Yahoo on this” and whatever, and I don’t know if you remember, but Apple used to take out these full page ads in the New York Times and Wall Street Journal and USA Today, and it’d be like the homepage of an iPhone and you’d have OpenTable and Facebook and New York Times.

“There’s an app for that” — they want to sweep that campaign under the carpet when they’re in court and saying they deserve all the App Store money, but anyhow, continue, that’s a side note.

JK: But fifteen months after Eddy’s visit, the ad came out and top left was ScoreCenter, the new scores app from ESPN, and it was like an inside joke between the two of us, and we’ve become friends since then. By the way, for the record, Eddy was absolutely right, because the site traffic really took off once we really embraced scores and real-time information, and it became a reason to come. Also, unlike ESPN in general, I insisted that we cover everything important in sports. It was like a pyramid. What’s the most important thing happening?

I’ll never forget before the Arizona/Pittsburgh Super Bowl, I forgot what year that was, I got a call, it was a Thursday night, and there was a big front page story on Troy Polamalu, who was the terrific cornerback for the Pittsburgh Steelers, a big profile, beautiful art, and the editor calls me up and is really excited and says, “What do you think?” So I said, “Not much.” And he said, “What do you mean?” And I said, “Well, the Lakers and Celtics…” and this was the team with Kevin Garnett and Ray Allen and Paul Pierce, “…the Lakers and Celtics are playing tonight and it’s a war, and where’s that game?” So the editor says to me, “Oh, the game’s on TNT.” I said, “I don’t care that it’s on TNT, it’s the most important thing going.” And so the editor says to me, “Well, I guess that means you expect me to put the Dallas/Utah game up next.” And I said, “If that’s the most important thing happening, absolutely.” I said, “We have all day long when games aren’t taking place to do features.”

The other super important thing, which is a differentiator here, was Bill Simmons.

I wanted to get to that because this is what’s really interesting about your focus on this scores bit. It’s fascinating in all sorts of respects, on one hand, kudos to you and ESPN for leaning into this because there’s an aspect, you mentioned the Olympics earlier, where real-time results kind of really fundamentally damaged the Olympics product to a certain extent, right?

JK: Right.

Bill Simmons

But, then in the complete opposite direction, in the feature direction, you were involved with two of the more incredible web properties in my estimation, which were number one, Page 2, where you sort of brought Bill Simmons in and you also had Hunter S. Thompson. I’d love to hear the story behind that, and then we can get to Grantland down the road, but tell me about Page 2 because this was something that was so unexpected from ESPN. You tell me about it for our young readers that don’t remember what that was.

JK: Page 2, I would say I didn’t mess it up, but the key architects in my memory were John Walsh, who was executive editor of ESPN, who moved over to the website when John Skipper took over as the head of ESPN Digital, and John Skipper moved on to bigger jobs, and so by 2003, I was running the website and John Walsh was there, but John had an idea that we were going to bring a bunch of the best writers to bear. So, there was also Ralph Wiley, who was a terrific writer who passed away. He had Norman Chad in there, he had had Hunter S. Thompson, and I couldn’t really follow a lot of what Hunter was writing, but the idea that Hunter was writing on ESPN.com was stupendous.

And again, there was just a level of surprise, but the breakthrough star in this, and I believe was also discovered by John Walsh, was Bill Simmons, and Bill Simmons to me was the defining sportswriter of our generation, and somebody who really changed the industry, really enhanced what we were doing at ESPN.com, both in terms of his writing and of course in terms of the development of his podcast.

I’d go further, I think he’s one of the defining writers period. The funny thing is everyone universally sort of agrees that Bill Simmons is the father of blogging, even though he never technically blogged, but what people are tapping into is he pioneered the voice of blogging that ultimately manifested through the blog format, but you started with obviously his newsletter and AOL and then coming to ESPN, and it was just such a completely different approach to sports writing and writing in general, where you are going to lean in and own the subjectivity, the first- person approach, to ignore any column limits, or word limits, or whatever it might be. It was abundance, it was abundant writing as opposed to scarcity writing. It’s hard to appreciate now when he’s such a fixture how transformative and incredible it was when he popped on ESPN, what is it, 2000, 1999, somewhere around there.

JK: Somewhere around there, and he pioneered this approach of sports and popular culture. He wrote unabashedly as a fan. The thing that I really appreciated was he worked really, really hard. He spent a lot of time agonizing and preparing for the columns, they were well-researched both in terms of the calls that he place on different things and the stats that he put into it. He was truly obsessed, and it was kind of similar to Howard Stern in a way. He was his audience, he understood what his audience was looking for, so he was really tremendous.

It became kind of obvious to me over time, because he was so popular, that you weren’t really going to have Page 2 with Bill Simmons, you were going to have something big with Bill Simmons, and that’s sort of what Grantland became. And, I remember John Skipper called me up, he and Bill had been laying out what Grantland could be, and John was almost kind of sheepish on the phone because I think he thought, “Well, Kosner is not going to like this. We already have a plan for this. It’s going to change everything,” but to me, it was like an IQ test, and Grantland took what Bill had done, he added a bunch of terrific contributors, he expanded what he was doing. It was very, very popular, and the truth is, there were other interesting voices in Page 2, but nobody who really broke through, in my opinion, the way Bill did.

So, this is really interesting because I think the Bill Simmons ESPN experience, particularly in the context of ESPN, is really interesting to me almost from a labor relations perspective, because what’s interesting is one thing that makes the web different is the ability to measure. Say you’re at CBS, and everyone’s going on and on about Tony Romo being the best thing since sliced bread.

JK: Mediocre today.

Exactly, but how do you tease apart audience interest in a game because it’s a football game, and football’s very popular, and the quality of the game, versus the play-by-play guy or the announcer, whatever it might be? Whereas on the web, you can measure exactly who’s getting how many clicks, who’s getting read, and if it feels like that sort of gets at one of the challenges of digital for broad-based media companies generally, because the talent, the people that actually drive it, it’s much more apparent to them and to you who’s actually driving value, it shifts a huge amount of bargaining power to the talent to the detriment of the overall company. Whereas in the analog world they sort of got to ride on the backs of super popular talent who didn’t necessarily know how much value they were contributing, and it was more of a socialistic enterprise broadly speaking. Is that something that resonates with you?

JK: It does. I kind of feel that it’s complicated, and the best managers, I think can figure that out. Meaning, I always thought in my job, we were lucky to have that problem. We were lucky to have somebody who’s becoming so popular that you’re going to pay him a lot of money, and sometimes people would ask me about Bill’s relative stature to other people, and I’d say, “Well, if other people were doing what Bill was doing, then we’d have another conversation.” It was more a challenge, I think, in those years of the fact that there wasn’t really a good sort of commercial strategy around the website. John Skipper loved the idea that we had sort of boxcar numbers of traffic and he loved trumpeting that, but we probably could and should have charged for some of what we did earlier.

There wasn’t a good ad model. It was all sponsorship. Everything that we did was a sponsorship because that was the way ESPN sold, and it was a big business. So, if you went to the homepage and you saw AT&T on the homepage, it was probably because AT&T had bought a huge package from ESPN that included, say the college football playoffs, and as part of that, they got a certain number of ESPN.com homepages. We weren’t really selling the medium for the medium, we weren’t really selling Bill for Bill.

When Bill became a really popular podcaster, I remember he was talking about the podcast network that Adam Carolla had built, “Why couldn’t we do it?” And the reason was I couldn’t really get people’s attention around it. In these big successful companies, you get the tyranny of big numbers. “Yeah, that’s great, but it’s small, I’ve got to focus on something else”, and I suspect Bill probably had more frustration based upon that, the inability to commercially take advantage of what he was doing than some of the other stuff that happened.

Competing With the Internet

That’s my impression too, is it was really aside from of this drama stuff, it was like, “Why can’t you make money on this podcast or why don’t you even try to make money?” This ties back to my question earlier, and it’s very interesting to me, I’ve thought about in the context of tech companies in general. We talk about this even now in terms of the ChatGPT and search and all this sort of thing, there is sort of a bias amongst observers that these big companies ought to dominate every sort of space around them, every sort of adjacent space. It goes back to ESPN.com, what did it actually do for ESPN in the long run? Is this a sort of thing where — look, ESPN at the end of the day, it’s a cable channel, that’s what it is, and it’s inevitable you’re going to be constrained in exploring these opportunities, and it’s easy for Bill to say, “Oh, you guys messed this up,” or sit the outside and say, “Why didn’t Grantland become a bigger success or a subscription product?” And in reality, that’s actually the way the world works like new models of new companies.

JK: I don’t know, Ben. I think it’s all about decisions that get made one way or another and what gets prioritized. The last year that I was at ESPN, I remember November 2016, we had 141 million global uniques. We were number one in the world for the first time in a metric that I really care about. We were the number five daily digital property for millennial males 18 to 34 using their smartphone. I thought the wind was at our back, and had I stayed and maybe had more authority, I certainly would’ve prioritized more what we were doing. Would that have made a difference in the long run? I don’t know. We can only judge by what happened.

I’ll tell you that when Twitter got started, it sent a shudder through me, even in the early days of the fail whale and everything, because Twitter was about real-time information and the most valuable real-time information I was convinced they were going to have in time was sports. Even with all the challenges around that company today, I would say Twitter is an indispensable service to most sports fans, and it has taken up some real estate that ESPN could have or should have wanted to have. And so you can only judge by results. So, ESPN.com and the app remains very popular, it’s probably in that competitive set it’s probably still the number one service.

I still check it every day.

JK: As do I as well, but it also operates in a much more competitive environment.

It operates in a world of abundance, that’s sort of the problem.

JK: But also, if you’re a young sports fan, are you looking to ESPN and SportsCenter for sports video highlights, or are you looking to YouTube and Instagram?

Yeah, House of Highlights.

JK: I mentioned Twitter. On the television side, I remember, and Bill was one of the key people worked on this, the 30 for 30 documentary series really sort of supplanted HBO in sports documentaries. But if you look around today, it looks to me more like Netflix has taken the mantle. By the way, there’s a nice sort of through line here from Roone Arledge to what they’re doing at Netflix. But the big documentaries people are talking about, those series, are the F1, PGA Tour, and now the pro tennis one.

Well, actually, the Twitter point is a really interesting point, because I have two questions about ESPN at this point in time. So number one, to your bit about Twitter appropriately sending a shudder through your spine, I think one of the most remarkable things about the Big Ten story last summer, or them basically leaving ESPN, on one hand, there’s the ESPN angle which is like, “Well, I guess we’re going to finally find budget discipline”. But on the other hand, it used to be that it was insane to leave ESPN because ESPN basically had a pricing advantage, relatively speaking, because you needed to be on SportsCenter, and you needed to have ESPN talking to you. To the extent that that gets stripped away because all the talk is somewhere else, it’s interesting how that actually circles around to impact the core business. That’s where ESPN made a lot of money was on SportsCenter, that gave them a bargaining advantage when it came to rights and now it’s a much more direct sort of relationship, which increases the bargaining power of whoever you’re bargaining with because you don’t have these extra points of leverage.

JK: Right. And the decision to split the previous Big Ten package with Fox and Fox’s investment in the Big Ten Network, over time that became really, really significant and the Big Ten determined that it didn’t need, as you said, to be on ESPN, and that’s a big event in the industry. Now, I also think that ESPN’s acquisition of CBS’ SEC football package and the strengthening of that, Texas and Oklahoma coming in, may have convinced them that the Big Ten, as great as it is, is kind of a nice-to-have if you weren’t going to get the kind of games and rights that they wanted.

Right. They have inventory. You only have so many slots on a Saturday.

JK: Right, exactly. One of the reasons that I think there still will be a Pac-12 deal is the value of the late West Coast windows that the Pac-12 offers. Some of their fans hate it, but to me, live games really matter and that’s the window that — you could fill a Big Ten window with ACC, or SEC, or Big 12, perhaps not as well, but you could fill that window. But at 10:30 Eastern time, there are relatively few places that you can play, Pac-12 has most of them.

Another connection to this, do you think, and you’ve been out of it for six or seven years so I think it probably really does more apply to ESPN in recent days — do you think that they are, in some respects, too online? There’s an aspect where ESPN is the way to reach casual fans, but when you’re online, and I’ve noticed this mostly in the NBA because that’s what I pay the most attention to, but it feels like it’s trying to have a conversation with Twitter, or show how hip they are to the current takes or whatever it might be. And at the end of the day, the money comes from a broader audience tuning into these games, not the lunatics, like me, that are online tweeting about stuff. Is there an aspect where ESPN, it almost would be good to step back from real-time in the sense of what’s happening online right now, and refocus on real-time as in, “Hey, what game is actually on our channels”?

JK: I believe that less getting into the hot takes of things would be a better, that would be a content approach that I would favor. It’s not just ESPN, I think if you look across most websites, if you look across most TV news shows, they’re increasingly programmed by Twitter, either reflecting what’s on Twitter, or the breaking news that’s happening on Twitter, or trying to gin up more heated discussion that takes place on Twitter. It’s very popular. I find it to be a trap.

Yeah. I love your point about Drive to Survive. The documentary angle, that’s where ESPN — that was the missed opportunity. ESPN is actually benefiting from Drive to Survive actually more than anybody, more than even Netflix, right? The ratings are way higher, and if they had Drive to Survive, that’s great inventory. They learned this with 30 for 30, you have this inventory sitting on the shelf, you can drop in at any time. The game ends early, gets canceled, put a documentary on. They have all these daytime hours and what’s interesting about that is it’s anti-Twitter in a way, right?

Drive to Survive just came out this weekend about events that happened a year ago, but it’s something that Twitter could never do. It’s the production, it’s the cutting it all together, that seems to be a much more productive use of resources. One of the things I get so mad about is I feel the NBA and ESPN both do a very poor job of building stars, of building history. You contrast this with the NFL, and NFL Films, which I think is just an unbelievable product and has been for decades, where you have to build up tradition, you build new things, so that people feel invested and that’s a production of decades of investment.

JK: Well, one thing I will say is I believe that one of the unique aspects of the NBA is that its players are like Marvel superheroes for lots of kids and young people. So they may have gotten to it a different way, but the confluence of sports and music and fashion and popular culture is really centered around the NBA. Personally, I’m much more interested in the stories of the players. A friend of mine said, “Every NBA player is an amazing story, but we rarely hear the stories.” In addition, as a big fan, there’s a whole background about the strategy and the way the game is played, and how defenses work.

Why is that not there? ESPN does so much on the strategy and stuff of the NFL, and it feels like the NBA, it’s just Twitter televised.

JK: I feel in general that the national broadcast of the NBA, whether they’re on ESPN or Turner in the US, are substantially similar to the national broadcast when I worked at the NBA. The picture quality is fantastic, the replays have really come a long ways. However, it’s still basically two people in a booth, someone on the sideline, it’s still kind of keys to the game. The whole dialogue around basketball that exists online and specifically on Twitter and on YouTube, et cetera, is not reflected at all on these shows.

To me, that’s a tremendous missed opportunity and something that I believe is inevitably coming. And I would just say, as a Phoenix Suns fan, you appreciate that if you look at the coverage of the team, it’s mostly done by people who aren’t journalists, they’re super fans and they’re bloggers, they’re on Twitter, they do podcasts, they’re on YouTube, they’re heavily influenced by the whole analytics movement around basketball. There’s a whole reality, I’m sure this exists for Bucks fans too, but there’s a whole reality in terms of how the game is analyzed, the best of these people will rewatch a game afterwards, it’s a smorgasbord that is not at all reflected. My point of view is not that there’s anything wrong with a core broadcast, it’s just that so much choice could be added and would be really valuable because no one necessarily wants a one-size-fits-all.

It’s a great point. There’s an opportunity for a whole host of sports fans that know ESPN, where this is basically user-generated content, you’re getting content for free and the experience of finding that content on Twitter is terrible. There’s an opportunity to pull this all in into one place and be like a portal where you could get all this sort of stuff, but whenever any of these big companies try to dip into UGC, they’re scared. They don’t want to have the controversial opinion, is that just sort of the limiter there, it’s too risky?

JK: It’s a real limiter. We did a lot of work on trying to set up sort of community features on ESPN, and each of them were disastrous in their own ways.

(laughing) Everyone who tries to do community online realizes how hard it is very quickly.

JK: We had comments on Bill’s page and I could still pick out the email he sent me, he was so mad about it, there’d be all this racist terrible stuff. I used to be relieved that no senior managers ever looked at that section of the website because I just thought it would be the end. Nonetheless, the way things have evolved on Twitter or on all the different group message features that fans use is such a part of the fan experience, and ESPN doesn’t really participate in that at all.

You know what? My take is that’s actually probably fine, I go back on my recommendation. I think you got to do what only you can do. This goes back to things like documentaries, things like leaning into your production capabilities, the stuff that fans can’t do, I think is more compelling.

Fixing the NBA

One quick question on the NBA. There’s a lot of angst that you sort of hit on. The All-Star ratings were way down, the rights negotiations are coming up again, players asked for trade demands, et cetera, et cetera. You knew David Stern better than almost anyone. What would David Stern do today? I’m in some NBA group chats, and they would kill me if I didn’t ask you this question, so here it is.

JK: Well, I mean, David would be very, very unhappy about the All-Star game. I was at the All-Star game, and it was a low point in a lot of ways, just in terms of the apparent effort from the players, and it was a desultory exhibition. Now, Adam isn’t frequently as public in whatever his point of view is as David is, but that doesn’t mean that he doesn’t feel similarly or hasn’t had some communication behind the scenes.

I think it comes down to the incentives that are out there, and what it takes to motivate people to do different things. The fact is the All-Star game has this rich history and tradition. Even when the ratings are down, it still gets a very significant audience, it’s a very profitable game for TNT. I’ll also say, the reality is this is a game that’s exclusively on TNT now, so how much of the country is that still really attracting? So the ratings are down. Well, okay, but you’re putting it on a platform now where you’re only reaching a certain set of sports fans. You’re not necessarily reaching young fans who just getting into the NBA. I just felt that there’s a certain expectation that fans have, there’s a certain expectation that people who paid to be in the arena have, as to what they’re going to get at the All- Star game and I think almost everybody would agree that that’s not what was delivered. All that said, I’m bullish on the NBA and what’s possible, and where I think their media rights are going to go up. I think I’m more bullish than you are.

Well, I mean the number one thing the NBA has going for it is they are good inventory for a relatively dead time of year. If the NBA season was in the fall, that would be big problem.

JK: Yes, totally. Think about it: in a subscription world, which is I think where we’re headed to, months matter. So you have an NBA regular season, that’s October through March, let’s say. You get into April, you have the Play-In Tournament, you have the playoffs and Finals and the Draft takes you through June. You have Summer League ball now, which is a more popular feature, in July you have international competitions.

And from the network perspective, you carried us to the NFL. Thank you, we appreciate it.

JK: Correct. So I think the real delivery of value or increased value for the NBA is about the regular season. What’s the biggest difference between the NFL and the NBA? It’s the fact in the NFL the regular season matters, and there are far fewer games. But to me, this is also a model, and what I mean by that is in the playoffs, every game matters, every game is nationally televised. There’s something amazing that happens in almost every game. Not all the games are great, but there’s always something at stake.

In the regular season. I would make an argument that something amazing happens almost every night, we just don’t know where that’s going to be. Okay. Last night, Damian Lillard hits 13 three pointers, scores 71 points in a game against the Rockets. I can guarantee you there’s no scenario on Earth where TNT or ESPN in their summer NBA schedule would’ve selected that game. So what I think is coming is going to be more like an NBA nightly approach.

Think about it, think about just the commoditization — you write about this all the time — the commoditization of subscription, VOD, and free ad-supported VOD. Everything now has been reduced to a series of horizontal tiles that you scroll through and on those horizontal tiles, you can have The Godfather and you can have Cocaine Bear and everything is available anytime you want to watch it. Whereas I believe a real alternative is, “Let’s watch the NBA tonight”, but let’s watch it in a way that you have a bunch of choice and there’ll be a curation function that will make sure you see something that’s really unique. I mean, the cool thing about the NBA is just this ongoing soap opera. You talked before about programming by Twitter and the limitations of that. This combined effect of modern media is you have a nightly soap opera. So who knew that Kyrie and Luka Doncic were going to be teammates, but I want to watch them play.

Right. But the schedule is already made so they can’t come back and remake it. That’s interesting. So you’re basically saying they need to shift to instead of, “I’m going to tune into X, Y, Z game.” Maybe that happens once a week because it’s clearly a big game, but the rest of the time it’s like the nightly NBA show and it’s like Red Zone or something and there’s commentators bouncing around.

JK: And my point is that today, I would argue sports is linear television.

Yeah.

JK: Sports is, specifically the NFL, and I believe when the NFL is not playing, the leading product for those sets of months, I think is the NBA and has room to grow, and that’s an alternative. I remember Must See TV and we had to watch 60 Minutes at seven o’clock on Sunday, but that’s largely gone now. The only thing that generates tune-in at a specific time are big sporting events.

Is this an area where the RSN collapse could be a benefit going forward? One of the limitations on just bouncing any game into the national TV slot or dipping in for ten minutes or fifteen minutes is RSNs have these exclusive rights, and if that goes away, on one hand, it’s going to be very painful for a lot of teams because that’s a third of the NBA’s television revenue, on the other hand, it does give much more latitude and freedom of movement to make it a destination. This is the sort of thing — I meant to have an article out before we talked to you, so I’m previewing it now — but the big shift you’re seeing generally in sports as an example of this is it used to be you just had to be there and get space, like the old model. If you were just in the cable bundle, you made money.

Now customers have to actively choose you and that’s a much harder business, but maybe the NBA because of the RSN collapse is coming along just in time so they can at least start building that.

JK: There’s an important distinction too, which is that this RSN collapse affects NBA baseball and hockey, but baseball and hockey have already made their national TV agreements, and those are in place through 2028. The NBA is still to negotiate theirs, which will start in ’25, ’26 so they have more flexibility as to what they might do than those other two leagues now. It feels a little to me, Ben, and I’ve read your coverage, it feels to me a little bit like what happened in the music industry is now going to be visited into sports media. What I mean by that is we come out of an era with the best of all possible models.

Everybody’s paying for the games, even if they’re not watching the games.

JK: Everyone’s paying for the games, that gives birth to a robust ad business around it. I’m very optimistic about what will come in time, but that has to be built and it’s not built now. Even when new things are built, there’s a period of time it takes for sports fans to adopt to that. Young sports fans are much different than when I was growing up. One of the conundrums, I think, with the RSNs is the product itself —

Is terrible.

JK: Is mediocre.

No, it’s terrible. I’ll say it.

JK: But it hasn’t changed in 20 years. Now maybe YES Network or the Dodgers or the Cubs, the big market teams, maybe they’re investing, nobody else is investing. And how do you take a product like that and make it interesting and relevant to young fans? It’s not compelling.

The Next Generation

You wrote an article about Amazon streaming the NFL. You called it We’ve officially crossed the sports media Rubicon, and that was after the initial broadcast where the numbers were phenomenal. I think those numbers did come down a bit over the season. On net, the Thursday Night football was less watched than last year. But on the flip side, there were more young people watching it. Do you still feel the Rubicon was crossed, and why was that so important?

JK: One interesting note is that Amazon submitted to having Nielsen rate their games, I think, in part to generate ad sales. But you had that odd modern moment of comparing the Nielsen sample, which has been a staple of sports TV since I’ve been in, with the actuals that Amazon was purporting to share. When you talked about Bill Simmons before, you could see the actuals.

Right.

JK: So I thought for one thing it was interesting, somebody’s wrong. I figured that the Amazon rating this year was going to be considerably lower because it was new, because there was some subset of fans for whom Prime Video, “What’s that?”

They’re just not going to watch it, it’s too much work.

JK: So the audience was lower. One of the points in that piece is that Amazon, unlike the sports media networks that I worked at, Amazon knows who the viewers are. There’s a connection between the viewers and the program that never existed before, Amazon did this on a scale in terms of their production values, not matched in a normal regular season context.

It basically showed that, look, big sporting events can be streamed. That was basically an open question before, and that’s the most important takeaway.

JK: It was an open question certainly of that size and scale. I believe that if you had asked NFL people, people in the league office before they made that deal with Amazon, I think they would’ve expressed a bunch of skepticism that it would’ve happened. I also feel like Marie Donoghue, who’s a former ESPN colleague and now the person who runs Prime Video Sports, I thought it was shrewd for her to make the deal with Al Michaels — as unhappy as he seemed to be at some of those games — just because they got off to a really — and they had Fred Gaudelli in the truck — they got off to a really good professional start.

There was a level of familiarity. If you’re already changing so many other things, let it at least feel like a normal game.

JK: Right. Everyone would’ve been wait to criticize them if they didn’t do that, so I thought that that was a success. I’ll make two points, and I’ll make them in reverse. The important thing about Amazon and YouTube and Apple is that while they all want into sports, they don’t have to be in sports the way companies like ESPN and others that I worked at. It’s this a symbiotic relationship.

Right. It’s like Turner, no one believes David Zaslav when he says, “Maybe we won’t get the NBA.” It’s like we see your debt load, you need the cash flow, you’re going to be buying the NBA. That’s the big question and people in tech are certainly looking at this. I mean, you see everyone’s like, “Oh, look at Apple and MLS.” Well, it’s like, “Well, no one watched MLS, so Apple’s not really paying anything”. They get to prove out their model X, Y, Z that’s not necessarily applicable to these big sports.

On the other hand, you clearly have someone like Adam Silver hoping and praying that the tech companies will come in to bid up the rights. At the end of the day, because of that, when it comes to the biggest sports, given the fact that the tech companies don’t need it, does that mean that we’re probably not going to get many more deals? On the other hand, how much do sports executives need to be worried about the next generation of fans? I mean, that’s why the Amazon young people numbers are interesting. The scale of these streaming services, Netflix has way more US subscribers than cable generally does, right?

JK: Yeah. Right, and Amazon Prime video, its reach will exceed broadcast within this NFL deal. Keep in mind, one big factor with the NBA that will play to their benefit is it’s truly a global sport. That actually matters a lot more to tech companies than it does to US sports media companies.

Yeah, we’ll see. I feel like that’s been the pot of gold at the end the rainbow for the NBA for a long time and it’s worth remembering, they still make all their money in the US and it’s an important point.

One final question that has nothing to do with sports, but it’s a fascinating story. You have to tell me the story of your son becoming the most unexpected rockstar in the world. How does that work?

JK: So thanks for asking. My son Walter has a band and they’re called The Walters and in 2014 in Chicago, they wrote a song called I Love You So and they posted it on Reddit and it developed a following. The band got to tour, the band got to play Lollapalooza, and then they broke up. My son was driving an Uber in the summer of 2021, out of nowhere, high school girls started doing covers of I Love You So on TikTok and everything for them exploded.

So they reformed the band.

JK: Yeah, the band got back together. I Love You So is a platinum song. They got a record deal with Warner. Last year, last summer they played before 34,000 people in Jakarta. I sent you stats before, they have a bigger following on your side of the world than they do here and I bring it up only because it’s something that’s only possible —

Well, you bring up number one because you are an appropriately a proud father. But sorry, tell me number two.

JK: But number two is it’s something that only the Internet makes possible. You talk about your career and that you live online, only the Internet would make that possible. Lots of fantastic musicians all over the world, but this specific thing cracked for them. One of the funniest things is that the band members are all late twenties, early thirties and it was my son, Luke, who’s now 15, who actually found it on TikTok.

None of them are on TikTok. Yeah, that’s amazing, it’s an incredible story. It almost brings your story full circle in a way. You’re starting out wanting to create this polished product and then realizing actually we have to have live sports or live sports scores and then dealing with the issues of abundance and talent and all these sort of things. Then you circle all the way around to your son where it was because of abundance that he was even out there and then talent can really come from anywhere. That has implications for competition, for what resonates, for what things that are out there.

I mean, I guess the big existential question, just to wrap it up here, is sports has been such a defining feature of your and my life, and I think anyone of GenX or early millennials, there was nothing else to do, so you watched a lot of sports. Today, I love watching sports because there’s the inherent drama in it, you don’t know what’s going to happen. You might sit down to a big game and it might stink, but that’s because it also might be incredible. But in fifty years, is that still going to resonate or is the media environment going to be so fractured and people are going to all be in their little AI bubbles or whatever it might be that it just won’t mean anything anymore? Or will that make it even stronger? Which arguably has happened with the NFL.

JK: My answer is the parade in Argentina after the World Cup where everybody was in the streets, that sports is the only thing that unites people for all the reasons that you mentioned. I just feel, and this is a passion of my career and a bunch of the brilliant people I got to work with, is you have to create better, more compelling products. I believe everything is now aligned to get the sports leagues, the networks, the tech companies to combine to do that. That’s what I believe. I’m optimistic about technology. I’ve had ups and downs and I’ve experienced different things, but I’m optimistic about what’s possible. I believe that sports is going to be a huge beneficiary of all this. Even if the progression is not necessarily linear, we have ups and downs.

It’s clear where it needs to go, the question is how do we get from here to there? But that bit about products, I completely agree. It’s about this shift in customers have to choose you, you don’t get stuff for free anymore. The sooner that leagues and networks figure that out, the better off they’ll be.

JK: But the sports algorithm is coming and there’s now real reason to build it and if we have a chance to do another one of these in another couple years, I think we will be impressed at some of the new services that we see.

Well, we will have to do that. I look forward to it. John Kosner, thank you for coming on. As demonstrated, I could dive into the history of ESPN for easily hours, but I appreciate you putting up with all the questions. Yeah, we should definitely talk again soon.

JK: Thank you, Ben.

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