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.
- Formula E has expanded its U.S. media presence through deals with CBS Sports and Roku. CBS will broadcast five races live on its channel and Paramount+, while the Roku Channel will stream 11 races on its free, ad-supported streaming platform.
- The specific races for the 2024 Formula E calendar are yet to be determined, but the 2023 season includes a total of 16 rounds. Financial details of the agreements have not been disclosed.
- Formula E recently raced in Portland, Oregon, in front of a sold-out crowd and will return there next year. The series aims to reach younger fans with its new Gen3 car and hopes to attract a wider audience through its media partnerships.
- Deloitte's survey on sports fan behavior highlights that live events are the favorite type of sports content for nearly three-quarters of respondents, although this preference drops to 58% among Gen Z and millennials.
- Gen Z fans heavily rely on social media for sports consumption, with over 90% using platforms like social media to consume sports content, including game clips, highlights, athlete interviews, and posts from athletes.
- Younger fans, particularly Gen Z, are redefining their sports consumption habits by utilizing a mix of engagement channels. While TV remains the primary medium for watching sports, younger fans are more likely to watch on a range of devices, indicating a shift in viewing preferences.
Streaming usage rebounds in May, and The Gauge? welcomes a third FAST service
(Unbundling and Rebundling of the Media Ecosystem, Changing Video Consumption Habits)
- Streaming usage rebounded in May, capturing 36.4% of total TV viewing after a dip in April. The increase was partly due to a methodology change to better capture streaming usage and reflected changes in viewing behavior.
- The Roku Channel, a free ad-supported television (FAST) service, accounted for 1.1% of total TV usage in May, highlighting the growing presence of FAST services. Combined, the three independently reported FAST services (Pluto TV, Tubi TV, Roku Channel) have comparable usage to Peacock and HBO Max and collectively attract more viewership than Amazon Prime Video.
- Netflix and Amazon Prime Video experienced usage gains in May, with Netflix benefiting from the methodology change and having the top three streaming titles. YouTube remained the top platform, while total TV viewing decreased by 4.4% due to declines in broadcast and cable viewing, particularly in sports and news programming.
- The 2023 College World Series in Nebraska set new attendance records with a total attendance of 392,946 and a per-game average of 24,559, surpassing expectations.
- LSU's victory over Florida in the championship game drew 24,878 fans, including notable figures like Joe Burrow, Kim Mulkey, and Brian Kelly, highlighting the strong support from LSU's fan base.
- The event's success adds to the growing popularity of the College World Series and supports efforts to make Omaha a national youth sports destination, with a planned $54 million project to renovate the Tranquility Park field complex.
- Despite the underwhelming performance of major baseball teams, MLB's national TV partners have seen a 26% increase in ratings compared to the previous year.
- The average viewership per game across Fox, ESPN, FS1, and TBS is 923,689, with significant gains in national broadcast and cable windows and MLB attendance is up at 21 of the league's 30 venues, with year-over-year increases in turnstile spins tracking at +8%.
- The introduction of a pitch clock and reduced game duration has contributed to higher TV ratings and increased fan engagement in the midseason.
- The NASCAR Cup Series street race in Chicago attracted a total audience of 4.795 million viewers on NBC and Peacock, making it the most-watched NASCAR race on NBC platforms in six years.
- Despite weather delays and a shortened race, viewership peaked at 5.383 million TV viewers, and the event became the most streamed NASCAR race in NBC Sports' history with 163,500 viewers tuning in on Peacock and digital platforms.
- NBC's coverage of the Cup Series has had a strong start, averaging 4.009 million viewers for the first two races, the best start for the broadcaster since 2017. NBC will continue to cover NASCAR races, broadcasting 25 races across the Cup and Xfinity Series this season, including the final six races of the Cup Series Playoffs.
- A study by the Women's Sport Trust (WST) reveals that 60% of the UK public believes brands should invest in both men's and women's sides of a sport, indicating that female sport is an important part of sport sponsorship.
- Women's-only sport sponsorship deals are popular due to their ability to attract new audiences and drive brand affinity, with 63% of women agreeing that brands should give equal coverage to men's and women's teams in advertising.
- Brands that support women's sport through sponsorship are viewed more favorably by 29% of the population, and 16% are more likely to buy from a brand that sponsors women's sport compared to 13% for men's sport. High-profile sponsorships such as O2's sponsorship of England's women's rugby union team and Coca-Cola's sponsorship of the FIFA Women's World Cup have achieved significant awareness.
- The Women's Tennis Association (WTA) has announced a revised calendar structure and a plan to achieve equal prize money for events where both men and women compete.
- The goal is to increase prize money over time, with WTA 1000 and 500 combined events reaching monetary equality with their ATP counterparts by 2027. Single-week WTA 1000 and 500 events will achieve this by 2033, and WTA 250 tournaments will see a 34% increase in prize money from 2023 to 2033.
- The revised calendar will focus on strengthening top-tier WTA events, including increasing the number of WTA 1000 tournaments to ten and introducing additional one-week WTA 1000 events in Doha, Dubai, and another city yet to be named. The number of WTA 500 tournaments will also increase to 17, and the WTA 250 level will have a stronger regional focus to support the development of emerging players.
- The NFL's first regular-season game in Germany, featuring the Buccaneers and Seahawks, drew 69,811 fans to Allianz Arena in Munich, showcasing the country's growing interest in American football.
- Germany's reputation as an American football-loving nation was further solidified as the Chiefs and Dolphins' upcoming game in Frankfurt sold out in just 15 minutes, with 1,420,587 people in the online ticket queue within two minutes.
- The high demand for tickets, with a queue representing approximately 1.7% of the German population, indicates the enthusiasm and popularity of American football in Germany.
- The Premier Hockey Federation (PHF), a North American women's hockey league, has been purchased by the Mark Walter Group and Billie Jean King Enterprises.
- The Mark Walter Group and Billie Jean King Enterprises will partner with the Professional Women's Hockey Players' Association (PWHPA) to create a new professional women's hockey league launching in January 2024.
- The new league aims to unify the women's hockey landscape in North America, which has been divided among different leagues and unions, and will be financially supported by the Walter family and led by prominent figures such as Billie Jean King and Stan Kasten.
- LaLiga has received its third payment of €482m ($526m) from private equity firm CVC Capital Partners as part of their agreement signed in 2021.
- The total amount received by LaLiga through the venture called LaLiga Impulso, established with CVC, now stands at €1.447bn. The final installment of €482m will be delivered before the end of the 2023-24 season, completing the agreed payment of €1.929bn.
- CVC acquired an 8.2% stake in LaLiga's new commercial rights unit and, in return, provides cash injections to LaLiga, which distributes the funds among clubs. The funds received by the clubs have specific limitations on their usage, with requirements for investments in club growth, optimizing financial structure, and a maximum percentage for transfers. Real Madrid, Barcelona, and Athletic Club did not participate in the deal and do not receive funding from LaLiga Impulso.
- Jim Ratcliffe, the founder of Ineos, remains hopeful of acquiring Manchester United and is willing to be patient to secure a takeover of the club. Ratcliffe has tabled a reported bid of ￡6 billion and is competing with Sheikh Jassim Bin Hamad Al Thani for control of the club.
- The takeover process has been protracted and is expected to continue into the next season. The Glazer family, who owns United, reportedly favors a deal with Ratcliffe as his offer values the club higher than Sheikh Jassim's proposal.
- Ratcliffe has expressed his desire to acquire United, stating that he believes Ineos would do a good job and has the right intentions. However, non-disclosure agreements limit what he can discuss about the negotiations. Ratcliffe's bid involves acquiring up to 69% of the shares owned by the Glazers while allowing the family to retain a stake in the club. Investors holding the publicly traded A shares have been pushing for the Qatar bid, which is for 100% ownership of United.
- Saudi Arabia is reportedly planning to launch a multibillion-dollar investment company as part of its sports expansion efforts. The company will be part of the country's Public Investment Fund (PIF) and will provide additional funding for Saudi Arabia's ventures in sports, including soccer, golf, and boxing.
- The decision to increase global sports investments is said to be driven by Qatar's hosting of the 2022 FIFA World Cup and the performance of the Saudi Arabia national team during the tournament. The country's shift in perspective towards global sports is described as a "noticeable sea change."
- The new investment company aligns with Saudi Arabia's Vision 2030 project, aimed at diversifying the country's economy beyond oil. While notable PIF investments like LIV Golf and Newcastle United won't fall under the new company, it will focus on exploring new opportunities. The company may follow the approach of PIF's Savvy Games Group, which has made significant acquisitions in the gaming industry.
- NFT specialist Candy Digital, known for its digital collectibles in sports leagues like MLB and Nascar, is merging with Web 3.0 company Palm NFT Studio. The merger aims to combine resources, technology, and licenses to enhance innovation and scalability in the challenging blockchain-based technology market.
- The merged entity will retain the name Candy Digital, with CEO Scott Lawin continuing in his role, while Palm NFT co-founder and CEO Daniel Heyman will join as president. The goal is to redefine brand experiences through co-creation, loyalty rewards, and community connections.
- Candy Digital, valued at $1.5 billion in 2021, experienced setbacks due to the NFT market crash and had to lay off a third of its employees. However, the merger with Palm NFT Studio is expected to accelerate its sustainable growth efforts and capitalize on the potential of integrating NFTs with physical products.
