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John Kosner on WSC Sports in The Athletic

(8/21/19)


TEL AVIV, Israel — This year, about 1.6 million official sports highlights viewed on platforms ranging from Twitter, NBA.com to Instagram, to name only a few, will be generated by a small Israeli company that deploys artificial intelligence to do a job that once took teams of video editors.

The story behind that company, WSC Sports, is almost as wild, if not more so, than many of the plays its technology now delivers to fans around the globe.

“My initial thought was, ‘I’ve heard this pitch many times;’ I was skeptical,” said Bob Carney, the NBA’s vice president of emerging media, recounting his 2014 meeting with WSC when he handled digital for the NBA’s D League (now the G League). “Their Point Deck was incredibly poorly designed.”

AI was just coming into vogue, so business executives were used to hearing from obscure technology firms about how their software was the one. WSC had just branched into highlights from coaching technology, so that served as another negative. Nevertheless, Carney let them try a finished D-League game as a test and what came back shocked him; “eyebrow-raising” is the phrase he deployed.

“It was a pretty remarkable transformation from having one piece of content that was two minutes in length that was being manually created to 20-plus pieces of content per game that were being automatically created,” he said. Within a few years year, the NBA had hired this small startup with less than a half dozen employees to handle league-wide highlights for not just G League, but WNBA and then the NBA.

Those 1.6 million highlights are double the 2018 total, and by the company’s estimate 10 times the content human editors could produce.

WSC’s technology allows a league like the NBA, for example, to identify each dunk by a French-born player and immediately distribute those plays to French social media, or recognize cues like crowd noise or game moments to generate a highlight, which can be a few seconds or few minutes in length. The system actually learns what a highlight is.

Clients now include the PGA Tour, Cricket Australia, MLS, Bundesliga, Bleacher Report, Stadium and even esports. That list is hardly exhaustive because many leagues don’t give permission for WSC to say who they work for when there is not a sponsor relationship.

That’s why WSC, which says it works in 14 sports including surfing, steadfastly declined to comment on what is likely their biggest client, the NFL. That bit of information came from John Kosner, former executive vice president of digital media at ESPN, and a media consultant who advises WSC.

“They do all the NFL video highlights,” Kosner said. The NFL did not reply for comment.

Located about two miles from the Tel Aviv beach on the 28th floor of a black office tower, WSC is expanding rapidly with now over 100 employees. It just added 1,600 more square meters of office space, a 133 percent increase.

A half decade ago, it was largely just the four co-founders, self-identified Israeli “geeks.” Tech and NBA acolytes growing up, they were so smart in high school they qualified for an Israeli military program that sent them to school for four years instead of the front lines (they followed that up with six required years behind the scenes in the military). Almost all Israelis begin three-year military service when they turn 18.

“Our guys (in the military) were in charge of video solutions, video streaming, video encoding and stuff like that,” said co-founder Daniel Shichman, seated in a WSC conference room, the Mediterranean glittering in the distance. “I was in charge of wireless telecommunications systems. We have Jewish moms, so they wanted us to go and, you know, work as an engineer, go to Cisco, Intel, IBM.”

Israel is a tech hub, with the country of eight million third behind the US and China in number of listings on NASDAQ. But Shichman and his friends were basketball junkies, so following mom’s advice and taking the steady paycheck didn’t appeal (Ironically IBM’s name adorns their office building).

Shichman said as a teen he would stay up until 3 a.m. to listen to NBA games. In the main hall of the headquarters hangs Larry Bird and Magic Johnson jerseys. Not signed or special memorabilia; off the rack jerseys.

That youthful spirit is alive elsewhere in the office, which boasts a full-scale Jorkyball court. A French game played in an enclosed 33-by-16-foot enclosed court that pits two competitors who can only kick the ball (not dribble or control), at the two goals. Think of a cross between soccer and racquetball, and that’s what WSC employees do to blow off steam.

David Stern, the former NBA commissioner and adviser to WSC, calls them the crazy Israelis and still harangues co-founder Aviv Arnon for wearing torn pants to their first meeting.

“My girlfriend chose the jeans. It wasn’t me and I don’t remember why. But my other pants were off-duty that day,“ Arnon recalled of the New York meeting, where he admits he was in awe of meeting Stern. “I actually hid it for most of the meeting, I was able to like, I didn’t show, it wasn’t a big rip and tear. But when he walked around the table at some point and he saw it and then I was gone. That’s it. He hasn’t stopped talking about it.”

Shichman even jokes if the company goes public, they will make Stern wear a pair of shredded jeans. But Stern calls them crazy for more than ripped fabric. Beside the gall to disrupt the traditional and time-consuming video editing system necessary in the past to show highlights, they will do just about anything to get a meeting and woo a client. Arnon spends half his time on the road, and still flies coach. Asked wouldn’t it be better to fly business and arrive better rested, he replied, “It’s the hustling mindset.”

Once Shichman and Arnon were at the Consumer Electronics Show in Las Vegas and waited all week to get a meeting with Dan Gilbert, the Cleveland Cavaliers owner and now a WSC investor. (Disclaimer: Dan Gilbert holds an ownership stake in Courtside Ventures, which in turn holds a minority interest in The Athletic.)

The last night they were told no, but kept pushing. Gilbert was flying to Texas the next morning and offered them 15 minutes alone on his plane. They took it, got the entire 75-minute flight, and after landing bought tickets to get back to Vegas.

Asked if they got what they wanted, Shichman replied they only wanted to hear Gilbert’s view of the business. Of course it takes more than sleep-deprived bravado; the technology works.

“Most software systems that do this kind of work, are fairly static, meaning you have a tool and you can identify clips and distribute them, but it’s the same every time,” explained Kosner, the media consultant. “Their system is smart… it’s constantly learning and improving itself. So you say for instance, ‘OK, show me the best plays from Kawhi Leonard and Kevin Durant from the fourth quarter of Game 2 of the NBA Finals.’ And within a couple of minutes, it automatically spits that out, prioritizes by their algorithm. And then there are other little magical things.”

Shichman, Arnon and their partners — Hy Gal and Shmulik Yoffe — initially did not choose highlights. After the military they developed scouting technology for basketball (thus the WSC stands for World Scouting Corp). They decided the finite number of teams limited the business.

Then Shichman saw Dwyane Wade with a great block in the 2013 NBA Finals and tried to watch the highlight. “And I only found like a very bad version, pirated, low-quality version on YouTube,” he explained. “And then we said, it doesn’t make sense that now we’re watching, they’re very low quality, we’re not enjoying it, took us time to find it. The NBA doesn’t get anything for us watching that clip.”

The next frontier for WSC is gambling. The company is in discussions with betting houses to deliver highlights to gambling apps. The rights belong to the leagues, which would first have to sell the clips. But within a year, WSC expects to have a new client base.

The company counts several major-league owners as investors in addition to Gilbert. HBSE Ventures, the venture capital fund of the owners of the Philadelphia 76ers and New Jersey Devils, invested earlier this month in a $23 million Series C round. The Minnesota Vikings owners, the Wilf family, invested in 2016 through their WISE Ventures.

“WSC Sports has been a great fit in the portfolio,” Brian Cargo, who manages WISE’s portfolio, said in a statement emailed by a Vikings official. “We have been impressed by Daniel’s leadership, the consistent growth of the company over the last few years, and continue to support their on-going success.”

So why did an Israeli startup, and not say a Silicon Valley one, come to have such a heavy presence in this market? Essentially, WSC built a better AI mousetrap.

“We’ve got a significant amount of experience, further than anybody else, particularly in sport,” Arnon said. “And we’ve trained the software to identify those indicators, those key moments that are more interesting or less interesting, we teach the system to rate how great players are, but also to identify what is the play, and how to edit it. And to do that, by regular software…would have too many variations.

“Well, with machine learning,” he concluded, “you can, you can basically give it the insight that… an editor would, and then figure out all those cues in the visual, audio, in the statistics, and mash it all together to identify, ‘Oh, this moment, is a great moment.’”

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