If Video Killed the Radio Star, who's threatening Sports TV?: Intersections by The Connect - Issue #9

On this installment, will touch on the continued cord-cutting/never traits observed on Gen Z, and elaborate on how the distribution and the content portrayal, are culprits of the disenchantment and the lack of engagement. Also, there’s light in the tunnel and the leading properties and great companies are finding ways to close that gap, and focus on “last-mile” content delivery.

To do so, I'll reference some key concepts that can be found on "The Ultimate Assist " (John A. Fortunato. 2001, Hampton Press, Inc.), on the strategic approach the NBA followed in the 1970s/80s to develop the popularity of the product, hand in hand with the television networks that broadcasted the games.

Also reposting here great conversations we had with our good friends Joe Markowski of DAZN, and Cesar Ruiz of Microsoft, in which we cover respectively what the industry can expect in regards to the next model revisions that will balance out subscriptions and in-platform advertising, and the shifting tides in the advertisement and media world, and where opportunities can be found in the new world of digital media.

If you enjoy the reading?join and share , as in this newsletter we’ll be always covering myriad topics from partnership building, to investment in sports and technology, going through sports governance and economics, always interlacing our own perspective with other esteemed sources.

Join us at the intersection of it all!

- Rayde

Rayde Luis Baez ?is?The Connect , and came to service businesses, connecting them at the intersection of advertising, sports, entertainment, tech & media. He has also Co-founded?SPORTHINK ,?that through its founders, partners and advisors bring a wealth of knowledge and insight, to sports & entertainment companies, and the capital markets, building bridges to generate incremental value.

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Personal notes about the media game.

In the sports industry we occupy many hours and days trying to figure out why the young consumers disengage with the top sports. That notion has been thrown spuriously into many debates, as recently as with the European Super League clash, in which both sides of the argument countered about the "football is dying" threat because the lack of engagement of what is considered the future consumers of the sport. One side cries that something must be done because the viewing figures in that segment (and in general) are declining, the other side claims that if that were to be true, then why is TikTok entering into football .

Without wanting to antagonize with either side, have to trim down the categoric stance on both sides: TikTok is looking to widen its user base, not only to engage with their already captured segment elsewhere; the sports product as conceived by traditional media is impossible to balance with the vast array of options of content and media to consume from in this day and age.

The most important thing is that we must not confuse the elements of the communication ecosystem. There's a Sender, a Receiver, a Medium, a Message, and most importantly the Codes in which the transmission occurs. Then, there's the Receiver's Feedback, which informs the effectiveness of the whole flow.

Truth is that for quite some time, sports properties have focused on revenue maximization, on the back of an scarce media market created through exclusivities. While economic gain and maximization is the ultimate objective of the property administrators, scarcity creates a bottleneck for access to the content that in previous generations wasn't a problem; you went to where the content was being broadcasted. The younger generation is platform-centric, which means that content must gravitate to where their consumption happens. That is a major shift, and a source of massive market shock.

But the mechanics of the content consumption market are not new, as John A. Fortunato writes in "The Ultimate Assist: the relationship and broadcast strategies of the NBA and Television networks " (2001. Hampton Press, Inc.), giving a detailed account on the intricacies of the NBA relationships with television networks, from where the NBA Finals were aired in tape delay -denoting a very, very low interest in the product- in the 1980s, to the current status of the league where it rakes more than US$3 billion in media rights revenue globally, annually. The book provides insight into the different broadcast strategies that the NBA and its broadcast partners employed, to make NBA games more appealing to fans. At its core, those strategies still hold today.

Exposure and Portrayal: a strategic approach

As alluded above, the discernment of what is content and what is media, is essential to build an appropriate communication strategy that maximizes reach (and fulfills its revenue optimization purpose).

It is unquestionable that media has the leverage of Exposure, which has the power to influence the audience. Moreover with the directedness of engagement, which can happen without any filters through digital platforms (i.e. Brexit, 2016 US Elections, COVID-19 response, etc.). The challenge today comes from the audience's ability to curate on their own what they want to consume, when they want to consume it, and where.

The relationship between sports properties and broadcast partners, in order to be effective, must focus first on setting the agenda with an integrated perspective, that is conscious of the power it yields on the audience: making the content as widest available as possible. The importance given by the coverage of the topic, has to be both from the abundance of information (scheduling), and the tone (storyline framing) in which it is covered. In order to effectively achieve that, the rights owners must make sure that their selection of broadcast partners is predicated not only on the size of the check, but also on the production treatment those partners will give that content in their programming slate. Maximizing exposure, at the very basic level, pushes the notion of the importance of that content, creating a special gravity that attracts eyeballs. Where in their slate, how hard they promote the content, defines public perception and the audience feedback of the message it receives.

A deeper strategic level, in which the sports property has to be hands-on in working with its media partners, is the Portrayal. Of both strategies, this is the one that focuses on the more qualitative aspects, and the one who is intended to appeal to the widest audience possible, in an individualized manner. Framing the heroes, the moments, the intra-stories trying to appeal to the different audience segments is the result of shrewd marketing work and intently product management, in which the property-media partner team must employ most resources, as not only the future growth of the fan base is completely dependent on those connections, but through that appeal the interest of advertisers and sponsors.

The virtuous circle perpetuates the engagement growth, by providing more exposure of correctly portrayed stories, in an ever-growing mechanic.

What's next?

Live sports are complicated to follow for most. When modeling appropriate business operations in sports, gauging the audience is key. In order to achieve sustainable growth and profitability, there's the always-elusive "general sports interested consumer", the one that doesn't commit exclusively to a specific competition, but rather makes a wide consumption from sport to sport. The one that prefers width, instead of depth in its sports consumption, to the point that a full game broadcast is too much.

That is why the properties that have the biggest following are those that have an always-on coverage, and have successfully managed to distribute different content formats across the media landscape.

But in the quest for the future fans, the coveted Gen Zers, which today don't have a fully developed purchasing power, nor the time or interest to invest more time than necessary, the fragmentation of the live sports rights makes it expensive and convoluted to discover.

Platforms like Buzzer aim to bridge that gap: lowering barriers of discovery, focusing on the key moments that accelerate engagement, and making it affordable for the generation that doesn't have much time and much resources -yet.

Last-mile tech to compliment and simplify the sports ecosystem, in the words of Bo Han -Buzzer's Founder & CEO-, to bring fans exactly what they want to see in a ultra personalized way -their favorite teams, players, and highlights all on one platform, which will be agnostic to the different sports and their broadcast partners.

“Certainly we’re going from a place where it was one price for an entire season of games. Now just in the last two years, we’ve made single games available. But I think you’re going to get to the point where somebody wants to watch the last five minutes of the game, and they go click, they’ll pay a set price for five minutes as opposed to what they would pay for two hours of the game. So I think you’re going to take the same great content, and you’re just going to make it that much more available to people who want it.” - Adam Silver, NBA Commissioner (CES Las Vegas 2017 Sports Business Innovation )

Seems clear: the future of sports media must be anchored on decentralization, and one-touch access to curated feeds of microcontent.

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From "Intersections: a podcast by The Connect"

Joe Markowski is a young media executive with hands-on experience across Europe, Asia and North America. He takes us through his journey from an undergrad out of the University of Nottingham, to working at the Perform Group through the ranks managing key client accounts like Euroleague Basketball and FIBA for their LiveBasketball.tv platform, and how that intimate understanding of rights holders enabled him to have a unique perspective of the current and future opportunities in global Sports Media, earning a spot on the internal DAZN foundational team at Perform Group, and how his work at DAZN has taken him from his native England to the United States, going through Japan.

We also touch upon what’s in store for DAZN with their imminent global launch, and what the industry can expect in regards to the next model revisions that will balance out subscriptions and in-platform advertising.

Cesar Ruiz is the Industry Vice President, Global Strategic Sales at Microsoft Global Advertisement. An advertising sales veteran, with vast experience in the media & sports industries across the Hispanic and General markets, now leading a multifunctional team at the avantgarde of platform offering in search advertising sales.

Cesar’s experience has taken him through industry-leading multimedia companies in North America,, namely Tribune Media, Televisa, ESPN and BeIN Media, before his current appointment leading Global Strategic Sales on the US Eastern seaboard at Microsoft.

On this episode, Cesar takes Rayde, Luis and Vedran through the shifting tides in the advertisement and media world, and where opportunities can be found in the new world of digital media.

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