We believe a series of global macro tailwinds will help drive value creation across the TMT sector. Additionally, the sports industry offers its own secular trends that will further support significant value creation across the asset class. Below is a roundup of industry news highlighting some of these themes and related transactions.
- LaLiga has been proactively adapting its digital strategy to engage younger audiences, a demographic increasingly favoring highlights over live coverage. This includes partnerships with youth-oriented brands like EA Sports and a strong presence in esports. Now, LaLiga is collaborating with WSC Sports to elevate its digital engagement by offering AI-driven highlights in a mobile-friendly vertical format, a shift from traditional landscape presentation.
- The partnership aims to personalize content for fans, allowing them to access match snippets and related content tailored to their preferences and favorite teams. This approach has led to a significant increase in app usage, with a 70% rise in the number of sessions and a 30% increase in time spent on the platform. LaLiga's digital efforts have also contributed to its status as the most followed of the top European football leagues on social media, with over 200 million followers across various platforms.
- LaLiga is exploring further enhancements in content and distribution, such as automated commentators' translation and augmented reality integration in broadcasting. The goal is to diversify the user experience, potentially including different language layers and integrating popular culture elements like superheroes and cartoons. These efforts are part of LaLiga's broader strategy to drive ticket sales and expand its international audience.
Smart stadiums, Web 3.0 and AI among IMG’s tech trends of 2024 as TikTok tops digital power rankings
(Building Businesses Around Disruptive Technology / Rise of Women Sports / Transformational Growth Levers)
- IMG's 'Digital Trends Report' identifies smart stadiums, digital monetization of women's sports, and the advancement of AI and Web 3.0 as major sports technology trends for 2024. The report emphasizes the transformation of the stadium experience through fan-facing digital innovations and operational technologies, as well as the growing role of Web 3.0 in the sports ecosystem.
- The report highlights the significant growth in women’s sports and its digital-savvy audience, which presents new commercial opportunities, particularly in streaming platforms. Additionally, the rapid adoption of generative AI in 2023 surprised IMG, and the sports industry is expected to explore more applications of AI for organizational efficiency and content creation.
- The concept of 'social media' is evolving, with different digital platforms serving varied functions for sports organizations. TikTok is named the most influential third-party digital platform, followed by YouTube and Instagram. The report suggests a tailored approach to digital platforms based on their unique capabilities in updating content, entertainment, revenue generation, and community building.
- 38% of soccer fans indicate their enjoyment of the UEFA Euro 2024 would not be diminished if they couldn't watch live matches. Italian fans highly value live broadcasts (only 25% indifferent), while Turkish fans show the least attachment to live viewing (47% indifferent). Among English fans, 37% are fine without live coverage, with a higher indifference rate of 42% among Gen Z fans aged 16-24.
- There's a notable age gap in preferences; 61% of fans aged 45 or older prefer live viewing, compared to 51% of Gen Z fans. Additionally, 21% of older fans are interested in online content, in contrast to 40% of Gen Z fans. This reflects a shift in consumption habits, with younger fans engaging with soccer through various channels such as digital highlights, social media, and video games.
- Andrew Baker, Head of Strategy at Footballco, observes a decline in the importance of watching live 90-minute matches among young fans. He notes the diverse ways in which fans now engage with soccer, emphasizing the need for brands to adapt by using multiple digital and social touchpoints to reach different fan communities. Euro 2024, starting on June 14th in Munich, remains a significant event, with the BBC and ITV holding broadcast rights in the UK.
- Max, Netflix, and Disney+ (alongside Hulu and ESPN+) are exploring subscription bundles, and there's a potential new bundle in the works between Apple TV+ and Paramount+. This trend towards bundling is a strategy to reduce customer churn, as people are more likely to maintain a subscription that covers multiple services.
- Bundling is seen as an effective way to prevent customers from frequently changing their subscriptions based on available content. With rising fees for individual services, offering a combined subscription fee for multiple platforms is expected to retain more viewers.
- The Wall Street Journal reports that both Apple TV+ and Paramount+ experienced a customer-defection rate of over 7% in October, higher than the industry average. Discussions about a joint bundle, which would be cheaper than separate subscriptions, are in early stages and the final details are yet to be determined.
- The recent game between Michigan and Ohio State, featuring two undefeated teams, attracted over 19 million viewers, making it the most-watched regular-season college football game in 12 years. This game, broadcast on Fox Sports, was the most-watched regular-season college football game on any channel since 2011.
- Interest in the game was likely boosted by the sign-stealing scandal involving Michigan. Michigan coach Jim Harbaugh was serving a suspension due to this scandal. Michigan's win over Ohio State marked their third consecutive victory and propelled them to the Big Ten championship game.
- The Michigan-Ohio State game's viewership nearly doubled that of the season's second-most watched game, Oregon's win over Colorado, which had over 10 million viewers. The game between Alabama and Auburn was the second-most viewed in Week 13, with over nine million viewers, marking CBS's final regular-season SEC telecast before ESPN takes over the conference's TV contract.
- Amazon Prime Video's broadcast of the Seattle Seahawks vs. Dallas Cowboys NFL game on November 30 set a new high with an average of 15.26 million viewers. This season, Thursday Night Football (TNF) is averaging 12.58 million viewers, a 29% increase from Prime Video’s 2022 average, indicating the growing popularity of the streaming platform for live sports.
- The viewership for this game significantly surpassed last year's comparable game and is close to the NFL’s TNF figures when aired on traditional networks. Five games this season already have higher viewership than last season’s top game. These numbers are a positive indication for Amazon's future media rights deals, especially as they expand into broadcasting other sports like the National Women’s Soccer League and NASCAR.
- Despite the success, TNF on Amazon Prime Video still doesn't match the viewership of NBC's Sunday Night Football or ESPN's Monday Night Football. Amazon’s first-ever Black Friday game drew lower viewership, but the company is looking to better integrate such broadcasts with its e-commerce platform. The success of TNF and recent acquisitions of sports media rights suggest Prime Video is increasingly becoming a key player in the live sports streaming market.
- The Premier League has secured a ￡6.7 billion deal with Sky and TNT Sports for its UK television rights, spanning four years from the 2025-26 season. This agreement maintains the league's revenue levels and significantly increases the number of live games broadcasted.
- Sky has obtained rights to air a minimum of 215 live matches, including all final day fixtures, while TNT Sports will broadcast 52 matches. The BBC will continue airing 'Match of the Day' with a weekly highlights package. For the first time, all matches outside of the traditional Saturday 3pm kick-offs will be televised live in the UK, indicating a substantial expansion in content availability.
- This deal reaffirms the Premier League's status as a leading domestic football competition, despite modest growth in annual revenue from domestic rights and a challenging environment for broadcast rights, with some tech companies like Amazon losing out in the current auction. The increase in live matches could influence the traditional Saturday 3pm blackout policy, with discussions underway to allow live broadcasts of the Women’s Super League during this time slot.
- A recent study by MKTG Sports and Entertainment reveals that 41% of Australians now view men's and women's sports as equal, marking an 8% increase from March 2023. Key factors driving this perception include easier access to women’s sports on TV and improved views on the quality and competitiveness of women's sports.
- Younger and female Australians show higher perceptions of gender equity in sports, with significant increases in 2023. However, the study highlights a disparity in media coverage, noting that only one-fifth of Australians believe women’s sports receive adequate media attention, emphasizing the need for better coverage to achieve gender equity.
- The positive shift follows the 2023 FIFA Women’s World Cup, where Australia achieved significant milestones. Efforts to promote gender equality include the Australian government’s AUS$200 million women’s sports fund and adding Women’s World Cup games to the national anti-siphoning list. The Matildas, Australia’s women’s national soccer team, play a crucial role in these efforts and were recently ranked as Australia's most valuable sporting brand.
- Tottenham Hotspur has entered into a sponsorship agreement with Socios.com, integrating the latter's product into the club’s membership program to enhance fan engagement using Web3 technology. Socios fan tokens, created using Chiliz blockchain technology, will allow fans to engage with the club through various interactive activities and rewards.
- The five-year deal with Tottenham is estimated to bring a minimum of ￡500,000 per year to the club, plus a 50:50 revenue split from fan token sales. A recent fan token offering (FTO) of 500,000 tokens sold out quickly, generating $1 million to be shared between Spurs and Socios. With a total supply of 40 million fan tokens planned, significant future revenue is anticipated.
- The agreement includes traditional stadium signage and unique experiences for fan token holders, like private tours and access to training sessions. Spurs aim to use blockchain to integrate international supporter clubs into their digital ecosystem, with plans for more evolved and deeper integrations over time. This partnership is part of Socios’ broader strategy to strengthen and expand its existing partnerships in the sports industry.
- Endeavor Streaming has teamed up with audience engagement platform LiveLike to enhance the fan experience on EuroLeague TV, a streaming service for Euroleague Basketball. This collaboration is part of a broader agreement where Endeavor Streaming aims to provide improved viewing experiences for its direct-to-consumer services, leveraging LiveLike’s engagement, gamification, and community features.
- For the 2023-24 season, EuroLeague TV will introduce new live chat and engagement features, including an interactive watch-along experience within The Players’ View content library. This feature, involving players like Jake Cohen, aims to bring fans closer to the action with quizzes, polls, and cheer meters.
- The deal includes the implementation of LiveLike's loyalty and rewards program to increase audience engagement, attract new users, and retain fans by offering promotions and exclusive experiences. Alex Ferrer Kristjansson from Euroleague Basketball highlights the goal of enhancing fan engagement, while Peter Bellamy from Endeavor Streaming emphasizes the importance of interactivity and community in engaging sports and entertainment audiences. Additionally, Endeavor Streaming offers direct-to-consumer services for various other sports organizations and events.
- The New York Ironworkers (Rugby New York) and the Toronto Arrows have withdrawn from the 2024 season, following the loss of Los Angeles and Austin franchises and the relocation of the Atlanta franchise to Los Angeles. The league now comprises 11 teams.
- The Toronto team's withdrawal was influenced by the death of their majority owner, while New York's exit, along with previous franchise issues, highlights financial and operational difficulties. The league's commissioner resigned in early 2023, and there are uncertainties regarding player contract security and welfare.
- These developments occur as World Rugby watches MLR's progress, considering the upcoming Rugby World Cups in the United States in 2031 and 2033. The recent setbacks highlight the need for stability and player involvement in the league's management.
- Billionaire Steven Rales has agreed to purchase a 15% stake in the Indiana Pacers, valuing the NBA team at $3.47 billion. This purchase increases his total ownership to 20%, having previously acquired a 5% stake that was not publicly reported.
- The deal with Rales includes a provision that could lead to him gaining control of the team in the future, should the Simon family decide to sell. This could be through a "right of first refusal" or a "right of first offer," giving Rales an advantage in any potential sale.
- NBA team valuations have surged recently, highlighted by several teams being valued above $3 billion. The Pacers, currently owned by the Simon family who purchased the team in 1983, have seen their value increase significantly, with the team expected to be valued much higher than the previous $2.02 billion estimate. Herb Simon, the team's chairman, has confirmed Rales' minority investment pending league approval.
- TST, a 7v7 soccer championship with a $1 million prize, is expanding in 2024 to include an eight-team women's tournament, also offering a $1 million prize. This addition builds on the success of TST's inaugural event, which attracted over 35,000 fans and featured notable teams and players.
- In its second year, TST will grow from 32 to 48 teams, with a World Cup-style format hosted at WakeMed Soccer Park in Cary, North Carolina. The event will feature group stages leading to knockout rounds, culminating in championship games for both men and women.
- The inclusion of a women's tournament with equal prize money highlights TST's commitment to gender equality in sports. The event has garnered significant interest, attracting top talent globally and expecting to double its audience, with negotiations ongoing for broadcasting rights.
- Trackhouse Racing, known for competing in the NASCAR Cup series, is expanding to MotoGP by partnering with Aprilia. They will replace the Malaysian-backed CryptoData RNF MotoGP Team, taking on riders Miguel Oliveira and Raul Fernandez.
- The entry of Trackhouse marks a significant moment for MotoGP in the United States, a country with a rich MotoGP history but lacking a full-time American rider since 2015. Trackhouse's involvement aligns with MotoGP's efforts to expand its presence and appeal in North America.
- MotoGP resolved its dispute with the CryptoData RNF MotoGP Team, which was removed from the championship due to financial and public image issues. This resolution and the exit of RNF paved the way for Trackhouse's earlier-than-planned entry into MotoGP for the next season.
- Brentford FC owner Matthew Benham is exploring the sale of a minority stake in the club, following the team's successful rise to the Premier League and significant financial growth. Despite this potential sale, Benham remains committed to the club's long-term future.
- This move by Brentford reflects a broader trend in the Premier League, where clubs like Crystal Palace, West Ham United, Manchester United, Liverpool, Chelsea, and Everton are also seeking or have secured outside investment for various strategic reasons, including stadium development and expansion of club networks.
- Brentford's financial success, with record turnover and profit in 2022, and Benham's significant investment in the club, highlight the financial potential that attracts investors. This trend of investment and partnership in the Premier League is reshaping the economic landscape of English football.
- Blackstone, CVC Capital Partners, and EQT are bidding for a minority stake in the Bundesliga's media rights business, as reported by Bloomberg. Advent International is also showing interest in this deal.
- The German Football League (DFL) is seeking bids up to €1 billion for a stake of about eight percent. Bidders are expected to be from Western nations, excluding those from the Middle East or China, and cannot hold more than ten percent stake in a rival league. An eight-year minimum holding period is also a condition for the bidders.
- This initiative represents the Bundesliga's third attempt since 2021 to raise external capital to compete with top European soccer leagues. The bids, due on 30th November, will be presented to Germany’s 36 soccer clubs in the top two divisions on 11th December, as part of the decision-making process.
- Velocity Capital Management, through its Velocity Opportunity Fund, along with investment from Bolt Ventures, is acquiring Parella Motorsports Holdings (PMH), a leading owner and operator of grassroots motorsports events in the U.S., with the financial details undisclosed.
- Founded by Tony Parella in 2012, PMH owns prominent motorsports properties like the Sportscar Vintage Racing Association (SVRA) and the TransAm Series. Parella will continue as CEO post-acquisition, focusing on growth initiatives alongside a team assembled by Velocity.
- Velocity Capital Management plans to leverage PMH's potential through various revenue streams, including partnerships with Delaware North and the use of the Elevate hospitality and Videocities video platform. The involvement of experienced executives on PMH’s board aims to boost its growth trajectory and maximize its revenue potential.
- Shaun White, along with investors Josh Harris and David Blitzer, has acquired a controlling stake in We Are Camp, an Oregon-based extreme sports organization, for $10 million. This organization has been instrumental in nurturing many action sports stars.
- We Are Camp, the parent company of various action sports camps like Seek NW Skateboard Camp and High Cascade Snowboard Camp, has seen many elite athletes pass through its programs. The investment aims to enhance the facilities and expand its impact on young athletes.
- CEO Kevin English retains equity in the company, emphasizing the mission to engage young people through sports. The investment will enable We Are Camp to increase financial aid, develop partnerships with non-profits, and broaden its influence on youth sports engagement.
