How Pro Sports Has Gone From From Fearing to Embracing Having Highlights Everywhere

There once was a time when professional sports eschewed TV deals. It's hard to believe, I know. But team and league executives worried putting their games on television would cannibalize the revenue stream they'd relied upon for years - ticket sales.

Obviously, things changed, and media deals are now largely the reason valuations start with a B and not an M. But then social and digital media came along, and those same executives saw their worlds shaken, their paradigms changing by the day. They'd come to count on exclusive rights deal to keep their coffers full, just as their predecessors sought to push hardest for gate receipts. But eventually everyone catches up, and we've witnessed it the last decade or so in sports, as teams and leagues wise up to realize the opportunity that sits before them, one that . foresees a future far greater than anybody could have imagined decades ago.

Sal Siino, longtime executive in sports/entertainment/digital media/video has played on all sides of this game for several years and offered a keen eye into the industry when I spoke to him recently for the Digital and Social Media Sports Podcast. When clips from games began showing up on social media, it was seen as scourge, but, as Siino explains, eyes were soon opened and short-sighted worry was overcome by long-term vision.

“When people first started posting clips on YouTube, you saw the movie studios and sports leagues [issue cease and desist orders], and then after a while they'd start taking a step back and saying 'Wait a minute,'" said Siino, who has worked in the space for years, mostly recently a stint with WWE. "'One – there's not a really effective way to stop all this...and why do we want to take all this down? These are our most engaged, passionate fans who really are helping the engagement and the content, and what they're doing with our footage is truly organic. How do we harness this and sort of encourage it?'...The underlying notion that this isn't a bad thing for us...You see teams and other leagues working with influencers (and even feeding them content)..."

This idea led me to consider the cases of Major League Baseball and the National Basketball Association. For years, MLB was notorious for both being a leader in direct-to-consumer media and streaming, while also an active watchdog looking for copyrighted content on YouTube and assuring the perpetrators were shut down. Meanwhile, the NBA didn't just allow such usage of their IP, but many would say encouraged it. Look no further than the incredible success of House of Highlights or World Wide Wob (Rob Perez), which catapulted to stardom largely off of the secondary use of NBA clips. One could argue the NBA's relatively lax policy created millions of dollars of value for these two brands, among others. And therein lies the flickering light bulb for teams and leagues today - the opportunity to turn those B's into, well, more B's, and not just permitting but embracing all these platforms, and strategically utilizing them to fill their coffers even more. Siino sees the English Premier League leading the way in this space, baking a bigger revenue pie, with ever-growing pieces.

"It used to be, in the sports world you would do an exclusive rights deal with the broadcast network, and the broadcast network would control that (content) forever...," said Siino. "But now...you look at the EPL out of London, the way their rights are cut up and how many people have different game packages and short-form rights and highlight rights and re-air rights and social. There are so many different slivers of the pie.

“It's much more of a portfolio approach...Before if ESPN had broadcasted a football game they would own the copyright to that game...but now the league or the conference after the game ends, they own the content so they can leverage it in the future...”

But then we go back to the MLB-NBA dichotomy referenced earlier - if you make it so easy to find your content, anytime, anywhere, any platform - will cannibalization occur and even risk diluting the value of overall pie? There is no easy answer, but Siino and others in the know understand that the models that prevail today aren't amenable to such simplistic analysis. Nor can the notion of 'content' be generalized to such a degree that every channel, and consumption on every channel, is valued equally. It's a complicated picture and Siino appreciates the need for a measured approach.

“The question really becomes – does it cannibalize other opportunities? That's why I think you see a basket when folks are doing things on social, the content they're using there is often the non-exclusive rights. So doing it on one or two more platforms isn't going to jeopardize another deal from a monetary standpoint, explained Siino. "Whereas your broadcast deals (like a live game)...that becomes a different equation, because that would decrease the rights you get as a broadcaster if you can get it someplace else.”

Content was never meant to be a catch-all term, and it's the savvy content owners - the teams, players, and leagues - that are trying to determine the best mix of their asset, and all the different ways they can present it and slice it and ultimately monetize it in this multi-channel world. So you let Amazon have some rights, you let Verizon have other rights, ESPN+, Stadium, Facebook, Twitter, and whoever else may have millions of dollars and an audience to serve. May the highest bidder win, right? Not exactly. Because teams and leagues know there is value not being captured when they sell of their rights, when their fans consume their product on platforms other than their O&O. Siino told me about this missing piece that teams and leagues also see opportunity in capturing.

“I think the other play from that is really about data and analytics," he said. "When you're doing your own direct-to-consumer offering, there's so much you would get that you wouldn't get from a broadcaster, that you wouldn't even get from a YouTube. And that is all the data, the demographic information, the viewer habits, the information you can slice so many different ways that can really tie in to your underlying business, how you market, how you create, and there's a huge value in that...

"That's as big of a driver to all of this direct-to-consumer as much as the monetary piece...You're going to have the greatest access to data when you're in control yourself.”

So build your own real estate and enjoy the reams of data or sell your most valuable property and cash a few large checks? It's a good set of options to have for sports industry leaders because, regardless of how the models will continue to evolve, the content remains the most coveted and valuable in the world. And as consumption trends change and content can be packaged in more ways than our 20th century ancestors could have ever imagined, there will be more options to consider, more competing incentives, and no doubt more money to be made as long as sports continue to reign supreme.

We're living through a dynamic time in the industry, a great era for fans where leagues are maturing beyond a restrictive outlook when it comes to their content to making it easier for fans to be fans, embracing and not fearing new channels, and reaching and cultivating more fans than ever. We're a long way from those execs that shunned sports on TV, we're past the point of MLB trying to chase down every clip curator on YouTube, but the further we move beyond the past, the closer we get to the inevitable change that lies ahead. Because it's no longer about forcing the fans to come to your content, it's about appreciating that they want to.

LISTEN TO MY FULL CONVERSATION WITH SAL SIINO