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Issue 268 - Jan / Mar 2021
A global
perspective on the
business of sport
New York sees big The Premier League “We succeed or Beijing 2022
potential in online sports waits for sun to we fail together” Sponsorship activations
betting, but operating shine on chilly UK Inside CVC’s $100m disrupted but tech firms
model unclear – p36 media market – p56 volleyball deal – p72 add dynamism – p92
Betting Media Finance Sponsorship
We’ve got the business A global industry needs
Europe Editor
Ben Cronin
ben.cronin@sportbusiness.com
+ 44 (0)20 7265 4232
a global perspective
of sport covered
Global News Editor
Martin Ross
martin.ross@sportbusiness.com
US Editor
Eric Fisher
Welcome to the new quarterly magazine from SportBusiness eric.fisher@sportbusiness.com
Senior Analyst, Asia-Pacific
Kevin McCullagh
established a new consultancy kevin.mccullagh@sportbusiness.com
division to meet and support the
Sub‑Editor
exciting opportunities facing Suzanne Swaysland
the sport industry in a post- suzanne.swaysland@sportbusiness.com
pandemic world. Senior Designer
As we put the unprecedented Alex Smith
alex.smith@sportbusiness.com
events of the last 18 months
behind us and look forward to Head of Media Sales
Robin Hume
2021 and beyond, we wanted to
T
robin.hume@sportbusiness.com
produce a quarterly magazine + 44 (0) 2072 654182
he worldwide Covid-19 that would give our clients a
Commercial Director
pandemic created a new carefully curated selection of Paul Santos
the most engaging interviews, paul.santos@sportbusiness.com
reality for the sport
+ 44 (0) 2072 654183
industry, of which the insightful analysis and thought-
financial, business and regulatory provoking opinion from the Subscription/Information Sales
Scott Longhurst
impacts are still to be fully felt. people, organisations and info@sportbusiness.com
It is within this context that we governing bodies shaping global
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3
Contents
The most accurate and
6 News Analysis
18 Inside Track
Five of the most important news stories
shaping the industry you should read
Our Editors focus on a key issue shaping the
industry in their market independent coverage of sports
media rights deals globally
SportBusiness Media is an online database of 22,000 deals across 250
markets, in 100 sports from 1,200 broadcasters and 2,200 rights holders.
25 The View from…
Five long reads from each of our regional editorial hubs, taking an in-depth look at the dynamics shaping the
Our global team of analysts provide unrivalled accuracy, insight and
analysis of the deals shaping the industry.
business of sport in the Americas, Europe and Asia-Pacific.
New York
26 Landmark NHL deal amplifies strategic shift for ESPN, Walt Disney Co.
33 Peacock assumes more prominent role within Comcast
36 New York sees big potential in online sports betting, but operating
model unclear
45 US sports industry looks to retool executive search, vetting in wake of
Porter, Callaway incidents
50 Washington Spirit seeks new relevance with Clinton, Bush Hager
among new investors
London
56 The Premier League waits for sun to shine on chilly UK media market
63 VAR sponsorship included in Lega Serie A category revamp
72 “We succeed or we fail together” Inside CVC’s $100m volleyball deal
80 ‘The aim is to speak to a truly global audience’ Why Fifa is getting into
the podcast game
84 CVC will instil more collective mindset in Six Nations, says deal advisor
Singapore
92 Beijing 2022 Sponsorship activations disrupted but tech firms add
dynamism
98 “One big, complicated event” Cricket Australia’s CEO on its toughest
season
104 The Athletic seeks new markets for football and US sports coverage
108 India, Iran, Qatar and Saudi Arabia set out their stalls for 2027 AFC To request a demo or discuss a subscription to SportBusiness media please speak to
Asian Cup
a member of our team on +44 (0) 20 7265 4100 or email: info@sportbusiness.com
114 All Blacks Experience puts fans in the shoes of their rugby heroes
For more information please visit: www.sportbusiness.com/media
4 sportbusiness.com
News Analysis – Must reads from Q1
DAZN’s 2019
staff that the subscriber total divested various assets in 2020. departure of chief executive increase.
has recovered to above its pre- These included its 50-per-cent Simon Denyer, who was replaced The 2019 advertising uplift
pandemic total. shareholding in FC Diez Media, the by Rushton, and the addition of to a nine-figure US dollar sum
Any direct comparison, joint venture established with the Access Industries’ Ed McCarthy comes after advertising, media
revenues rose by however, must take into account
the addition of subscribers to
the new global OTT service at the
IMG agency to sell rights to the
club competitions of Conmebol,
South American football’s
to DAZN’s executive committee.
A further reshuffle followed in
August as DAZN also unveiled
partnership and sponsorship
advertising derived by DAZN
Media totalled £59.2m – or
76 per cent, loss
reduced price point of £1.99 per governing body, from 2019 to plans to develop more non-live $75.4m according to the backdated
month or less. Customers have 2022. It is understood that the content. currency conversion – in 2018.
also been added through recent shareholding was sold to IMG for DAZN’s boxing-focused global
widened to $1.4bn
German distribution deals with $37m in a transaction that closed Increased rights spend, global OTT platform went live at the start
telcos Deutsche Telekom and in March. OTT launch of this month.
Vodafone, and in the rollout of That sale was followed by the While rights agreements in the likes The expansion of DAZN’s
DAZN’s commercial premises agreement to sell a majority of Brazil have been terminated amid streaming services into over 200
business in Japan and Spain. stake in digital football-focused DAZN’s repositioning in response to countries had initially been due to
By Martin Ross Brazil and Spain were both platforms Goal.com, Spox and Covid, the value of the group’s total take place in time for Saul ‘Canelo’
Published online 31 Dec, 2020 added to DAZN’s core markets VoetbalZone to Integrated Media rights commitments has actually Álvarez’s super-middleweight
in 2019 while the accounts also Company, a venture backed by increased. fight in May, but was delayed due
D
represent the first full year of US-based private equity firm At the end of 2018, the group to the impact of the Covid-19
AZN Group, the global The size of the loss posted during activity in Italy and the US. DAZN TPG Capital. That transaction had commitments to acquire rights pandemic and the resulting
sports subscription DAZN’s growth phase is sure to has since scaled back its operations valued the three brands at over to the value of $5.5bn. This figure postponements of boxing bouts.
service and media heighten wider industry scrutiny in Brazil and stateside to focus its $100m. The divestment of assets dropped to $4.9bn in 2019 upon the No numbers have yet been
company, generated a over the long-term viability of its operations there on the new global continued with the recent sale expiry of various contracts but has divulged for the take-up of the
76-per-cent increase in revenues model, especially in the wake of OTT service instead. of Sporting News, the US-based risen to $6.5bn in 2020. global offering although DAZN
in 2019 on the back of higher the Covid-19 impact. Nonetheless, The 2019 accounts mark only sports news website, to Hong Kong The acquisition of new packages executives have indicated that
subscriber numbers although the that model has been reworked the third full year of DAZN’s investment firm Pax Holdings. of Bundesliga and Uefa Champions the launch has “gone according
group loss rose to $1.4bn (€1.2bn), in response to the pandemic and direct-to-consumer business, Owner Access Industries this League rights in Germany from to plan”. The low initial price
SportBusiness understands. DAZN executives are thought having launched in German- year stepped up its operational 2021-22 onwards, along with the point has been designed to boost
The full-year figures for 2019, to remain confident that the speaking markets and Japan in involvement at DAZN with an extension of J. League rights in DAZN’s global subscriber total
which predate the financial hit of company is on a long-term path August 2016. executive restructure Japan to 2028 (albeit for a reduced although the pricing is expected to
the Covid-19 pandemic, include to profitability with hefty start-up In 2018, the erstwhile Perform undertaken in June. annual fee) are the main be revised in due course to reflect
revenues of $878m. rights, marketing and technology Group was split up as the data This included the contributors to the the content on offer. u
It is understood that higher costs to remain relatively flat as and betting sides of the business
subscription revenue coupled with subscriber numbers rise. became part of Perform Content,
advertising income that exceeded which then merged with US-
“
$100m for the first time helped based sports, data and technology
drive the revenue uplift. At the end of company Stats as part of a sale
to Vista Equity Partners, the US
DAZN had reached close to eight
million subscribers globally by the 2018, the group private equity and venture capital
end of 2019, around double the firm.
total recorded at the end of 2018. had commitments SportBusiness understands that
The accounts include the DAZN Group received around
financial statements for all
to acquire rights $700m in cash from the sale and
entities within the DAZN Group
to the value of retained a 20-per-cent stake –
”
and subsidiaries of DAZN Group worth around $200m – in the new
Limited. In 2018, revenues of $5.5bn. Stats Perform entity. Revenue
£372.7m (€433m/$517m) from from Perform Content is excluded
continuing operations were from the £372.7m total in 2018,
registered with this figure later The subscriber base was hit hard although profit of £61.5m from the
restated as $497.8m as DAZN earlier this year by the Covid-19 discontinued operations helped to
Group transitioned to US dollars sports shutdown as customers reduce the overall loss.
for the reporting of its financial terminated their rolling monthly In a further push to streamline
statements. subscriptions, but group acting resources and focus more intently
A loss of £485.5m was lodged in chief executive James Rushton is on the streaming platform TF-Images/Getty Images
2018. understood to have now informed business, DAZN Group also
6 sportbusiness.com A global perspective on the business of sport 7
News Analysis – Must reads from Q1
OneFootball rights
following OneFootball’s acquisition really look into aggregation and everyone,” he said. “We’re a do it that’s not my call.
of football-focused digital media collaboration. partner for the ecosystem and not “The challenge a lot of rights-
company Dugout. OneFootball’s “It’s the same as we do with the just one company. We worked with holders have is when they’ve
strategy focused
shareholders now include clubs [on content deals]. We are beIN Media Group for the Ligue 1 bought a certain portfolio of rights
Dugout founding clubs – Arsenal, here to collaborate, share revenues deal in Brazil. We’re constantly – whether it was too expensive
Barcelona, Bayern Munich, Chelsea, and customer access and data.” talking to all of them about the or not – and they have ten assets
Juventus, Liverpool, Manchester opportunities.” in one country for three years.
on markets with City, Paris Saint-Germain and Real
Madrid – as well as new shareholder
Olympique de Marseille.
Work with agencies,
OneFootball “will not overpay”
Having done business with Sportfive
In many of the deals struck,
OneFootball has adopted a model
of a moderate licence fee, the
Then they have to buy them again
for the next three years. And
obviously the rights owner knows
established
OneFootball raised around five months ago in a deal for payment of technical costs, plus a that.”
€50m ($60.6m) from existing Bundesliga rights in Brazil, along share of advertising revenues. As part of the monetisation
and new investors to help finance with rights in selected markets to The model remains flexible, strategy, OneFootball signed up
customer base
the agreement and fund future Uefa club competition qualifiers that however, according to the chief VBET as an advertiser around its
investment. the agency represents, OneFootball executive. live content with the Armenia-
Around 40 per cent of then expanded the Bundesliga “I don’t say that this is the based betting operator seeking
OneFootball’s user base stems agreement to cover Latin America. model so take it or leave it. Some to break into the Latin American
from South America, with the ‘big Since those deals with Sportfive, assets maybe are rights that are market. The long-term agreement
By Martin Ross five’ European countries (France, the Berlin-headquartered media very difficult to sell so that’s a also includes exclusivity over live
Published online 10 Feb, 2021 Germany, Italy, Spain and the UK) company has gone on to acquire different discussion in terms of streaming to the betting industry.
representing its other key markets. rights from other intermediaries, serving as a partner than if there OneFootball is looking to entice
T
Additional rights deals appear including pay-television are rights with 50 bidding parties. more advertisers with the promise
he strategy adopted by Bundesliga rights in Latin America likely in these markets and within broadcaster beIN Media Group, “You cannot say there is one of precise data on how many users
OneFootball in acquiring and Ligue 1 rights in Brazil with the categories that von Cranach the international rights-holder to model you have to go for.” are on the platform, for how long
live rights is firmly coverage streamed free to fans via classifies as ‘tier one’ and ‘tier two’, Ligue 1. With the OneFootball business and what they consume.
based on opportunities the OneFootball app. but definitively not domestic rights OneFootball also secured rights being a content platform first and Meanwhile, the integration of
in markets where the football- Speaking to SportBusiness, to a premium property. to Germany’s DFB Pokal in France, foremost, there is no pressure to the Dugout business will take place
based media platform has already von Cranach said OneFootball’s He noted: “We separate rights Italy, the Netherlands and the UK. overpay for rights, according to this year.
established a strong customer base approach to rights buying into premium, tier one and tier two. Despite the initial alliance with von Cranach. As a result of the acquisition,
through its traditional content prioritises markets where its media And then look at that segmentation Sportfive, which includes the He said: “The beauty of OneFootball can now boast 80,000
business, according to chief platform is already popular through for each and every market. joint management of advertising our business is it’s not purely archive videos and 4,500 new
executive and founder Lucas von its established non-live content in “Premium, such as the inventory around the Bundesliga connected to rights. So I’m not videos per month from its ten new
Cranach. native language, be it interviews, Bundesliga [rights] in Germany, coverage in Brazil, von Cranach forced to buy rights in a certain shareholding clubs and 125 other
Having first grabbed the news or statistics, chiefly through Premier League in England or Serie stressed that OneFootball is country to maintain my value clubs, federations and leagues.
attention of the rights market content tie-ups with clubs. A in Italy is not our turf. looking to work with all agencies proposition towards customers. Scottish Premiership side Celtic
in 2018 in a deal with German He said: “The fundamental thing “For us the rights in Germany and rights-holders. “I would not overpay. I would last week became the latest side to
sports broadcaster Sport1 to for streaming is customers. to the Premier League, Serie A “We’re not marrying not accept any terms which are agree a content deal with Dugout,
jointly broadcast the International “You could move into a country or LaLiga is the category that’s anyone. We’re dating with not fair. If others need to while Austria’s Red Bull Salzburg
Champions Cup, OneFootball has and buy a tremendous portfolio of very interesting to us. This is in signed up with OneFootball.
teamed up with pay-television rights then just create an app which connection with distribution deals OneFootball now claims to
broadcasters such as Sky only has streaming capabilities and or partnering with the leagues and reach over 85 million monthly
Deutschland and Eleven to deliver you suddenly end up a year later agencies to find the blank spots in users worldwide.
pay-per-view access to certain asking yourself why don’t have their global distribution strategy.” Reflecting on the Dugout
football events. customers. He surmised: “We need to pick acquisition, von Cranach said: “We
The live streaming, which von “A lot of the new players seem our battles and decide what you now have the possibility to take
Cranach describes as the “icing to think that just because they have don’t do, and not what you do.” all of this content and distribute it
on the cake” to complement the content, and also exclusively, Von Cranach also pointed to a into the OneFootball platform.
OneFootball’s “customer- that it means all the customers will future “evolution of the market” “We have a massive opportunity
centric” content business, has go there. Everyone forgets – and that will lead to those who can for each and every stakeholder
since been expanded to include it’s a challenge we also have – that afford it “moving more and more within the ecosystem to earn
rights to premium properties in there is a high fragmentation. That into premium” and subsequently money with us because it’s about
markets where rights-holders can lead to an increased frustration less money being spent on lower- the collective. Earn revenues
have struggled to find a suitable for customers.” tier rights. together and share them. Collect
Lucas von Cranach,
broadcast deal. Notable examples The non-live content was He said: “This gives us as data together and share them. And
OneFootball CEO and founder
include the acquisition of given a significant boost recently a platform the opportunity to share the access to customers.” u
8 sportbusiness.com A global perspective on the business of sport 9
News Analysis – Must reads from Q1
Priority sectors outlined for
when there is an allocation of rights There’s always half an eye to really stood out and showed a
that stay with the host and an making sure we build long-term really good understanding of what
allocation that stays with the rights partnerships for the UCI as well as our vision is for the event. And
‘purpose-led’ UCI Cycling World
owner,” Rigby said. “The confusion securing the commercial partners it was very international in its
that that can cause in the market to help us achieve the commercial outlook and offered a really strong
was something we wanted to avoid. objectives for 2023.” data-led approach, which I feel
“It was agreed from day one with Inside Edge has experience is increasingly important as the
Championships sponsors the UCI that we wanted a single
‘one team’ and aligned approach
to the market and we’re going to
in cycling through its work
with national governing body
British Cycling and has also sold
sponsorship world changes.”
Described as the biggest cycling
event ever to take place in the
achieve that.” sponsorship rights to the Six Day world, the championships were
Rigby, who, like Markham, also Series on behalf of event promoter conceived as part of the UCI’s
By Martin Ross
counts Manchester United among Madison Sports Group. ‘Agenda 2022’ initiative. They will
Published online 25 Feb, 2021 his previous employers, said that Markham, who founded the take place over two weeks in August
the intention was never to have agency alongside Jon Naspe, said 2023 and combine 13 existing
O
an “arm’s-length relationship” of Inside Edge’s bid for the 2023 cycling championships in different
rganisers of the 2023 commercial, marketing and only in making the sport of cycling with the chosen sponsorship sales Cycling World Championships disciplines.
UCI Cycling World communications, and Andrew more engaging through second- agency. contract: “It was the first time that Ahead of Scotland being awarded
Championships and Markham, Inside Edge’s co- screen [consumption] for future A vision beyond Scotland’s 2023 we’ve undertaken such a detailed the hosting rights, it was forecast
the recently-appointed founder, stressed that top-tier generations, but also how it can hosting will also be adopted in the tender process so we learnt quite that the hosting budget would
Inside Edge agency have prioritised sponsors targeted should be help us to drive participation in commercial approach, according to a lot from going through it but we be £45.8m (€53m/$64.8m), with
‘purpose-led’ sponsorship deals as aligned to “key societal themes and cycling”. Rigby. really enjoyed it and it made us Glasgow City Council providing
they start to go to market with the outcomes”. Markham, meanwhile, said he He said: “This will be the start think about our business even more £15m in support.
commercial offering. Sectors including energy, could envisage a sponsor from the of an event that will happen every and how we approach the market. The 2023 event will feature
The UK-based Inside Edge was mobility and technology have automotive sector that provides four years so we, as the hosts of the “In our pitch, we decided to flip athletes competing across
last month named as the winner all been earmarked for such electric or hybrid vehicles and inaugural event, are working with it on its head and lead with the disciplines including road, track,
of a tender issued for the global sponsorships, as have ‘high-street’ would be looking to promote road the UCI to build this property. So purpose-led partnership model BMX, mountain biking and para-
sponsorship sales remit for the brands. safety. we’re looking at how can we take and the objectives of the wider cycling. Glasgow will not need to
event which will take place in Five main sponsors have been He added: “When you look at all the success of 2023 and move it organisation first.” build new venues in order to stage
Glasgow and across Scotland. targeted by the organisers and these different themes, they are forward to 2027 or 2031. Organisers began the tender the championships, although
While 25 per cent of the Inside Edge in deals likely to involve all interwoven and align with a lot “By all accounts the UCI has a process in August last year and events will be spread across
inventory is reserved for global a mixture of cash and value-in- of the things we are talking about plan to follow a similar approach to awarded the contract four months Scotland, with Dundee, Edinburgh,
sponsors of the Union Cycliste kind. in our society. There’s a genuine the Olympics where it will switch later. Fort William and the Borders also
Internationale (UCI), plus a further Rigby said: “Because we’re all place for brands to come in and not hemispheres moving forward. Rigby surmised: “Their tender playing host. u
25 per cent for institutional working together, what we’re just talk about their CSR [corporate
government, council and sporting now able to do is create a series social responsibility] but act it out,
stakeholders helping to fund the of innovative packages for global using cycling as a catalyst for that
event, the remaining 50 per cent is sponsors that not only provide societal change.”
available to take to market. additional rights around the event The sectors of UCI ‘World Cycling
The sale of half of the inventory itself but are tailored to enable Partners’ and ‘Official Partners’ will
by organisers and the UCI, together partners to help us with some of the remain protected. These include
with an agency, is a departure key societal themes that our vision chemical manufacturer Mapei and
from the model for standalone is helping to achieve. cycling jersey manufacturer Santini.
UCI World Championships. A “So if we want to get more people
‘joint partnership committee’ on bikes more often, then there’s a Joint inventory sales, looking
has been established comprising fantastic opportunity for a mobility beyond 2023
representatives of the international partner to work with us and identify The joint inventory approach was
federation and the 2023 CWC Ltd. how cars and bikes can co-exist in decided upon during talks over the
entity set up to organise, manage future cities.” host city agreement signed in 2019
and promote the event, and will An energy partner, Rigby and was put in place to avoid potential
work with Inside Edge on the sales outlined, could showcase clashes between the organisers and
strategy. sustainability and a carbon the UCI.
Speaking to SportBusiness, footprint reduction. Technology “Talking more generally
both Jonathan Rigby, the could also play a key role in terms within other properties, you can
Championships’ director of of commercial backing and “not sometimes hit a bit of a problem
10 sportbusiness.com A global perspective on the business of sport 11
News Analysis – Must reads from Q1
Canal Plus commits
to 17-per-cent
increase to retain
Top 14 rights
By Martin Ross
Published online 3 Mar, 2021
P
ay-television a package of near-live rights to
broadcaster Canal Plus French football’s Ligue 1, plus
has held on to one of a video-on-demand magazine
its flagship properties programme.
in France by retaining rights The first two packages
(Hugo Pfeiffer/Icon Sport via Getty Images)
to French rugby union’s Top 14 (Package 1 and Package 2)
from 2023-24 to 2026-27 in a offered by the LNR included
deal worth an average of €113.6m the live rights to matches and
“
($137.5m) per season. the magazine programmes. the Saturday 3:15pm match on the Top 14 a great competition”.
The Vivendi-owned The third package (Package the main Canal+ channel. Four Unlike its strained relations Canal Plus’ current contract runs
broadcaster has secured all three 3) included near-live and simultaneous Saturday matches with France’s Professional
packages auctioned by France’s highlights rights for digital at 6:15pm are then aired as Football League (LFP), Canal Plus from 2019-20 to 2022-23 and is
”
Ligue Nationale de Rugby (LNR) platforms. a ‘multiplex’ on Canal Plus’ has historically enjoyed close
in an invitation to tender process A reserve price of €75m per Rugby+ service. ties with the LNR. Following
worth €97m per year.
launched on January 21. season was set for Package 1, Canal Plus then rounds off the shutdown caused by the
The LNR has succeeded in while Package 2 carried a reserve its weekend with live coverage Covid-19 pandemic, the LNR
generating a 17.1-per-cent uplift price of €27m per season. The of the Sunday evening match at and its long-standing rights- Canal Plus’ trio of packages Saturday or Sunday slot.
on the fees currently paid by third package had a reserve price 9:05pm, preceded and followed holding broadcaster reached The first package secured by Canal Rights in Package 2 included the
Canal Plus. The average annual of €3m per season. by its flagship Canal Rugby Club an agreement over outstanding Plus (Package 1) in the 2023-2027 third- and fifth-choice regular-
rights fee value to be paid in Canal Plus will continue to programme. rights payments. tender included the first-, second- season matches each matchweek,
the new deal is also 8.2 per broadcast all regular-season Canal Plus’ current contract Within the new ITT document, and fourth-choice regular-season along with the sixth- and seventh-
cent above the LNR’s stipulated matches, including the two top runs from 2019-20 to 2022-23 the LNR introduced more matches each matchweek, plus choice match picks (matches that
reserve price of €105m per fixtures each matchweek aired and is worth €97m per year. stringent financial guarantee the sixth- and seventh-choice kick off at the same time).
season. on the premium Canal+ channel. Public-service broadcaster measures and altered the matches that are shown as part of a The second-choice play-off
Ahead of yesterday’s bid The Top 14 play-offs, semi-finals France Télévisions holds free- payment schedule, as reported multiplex. match and second-choice semi-
deadline, Canal Plus was widely and final will also be shown by to-air rights over the same by SportBusiness, in the wake of This main package also final match were also included,
regarded as the standout Canal Plus, as will the promotion period to the Top 14 final, a the collapse of French football’s included the rights to all games along with the Top 14 final. A
candidate to win the rights and match from the second-tier Pro match that must be shown on deal with agency and production on the final weekend to be aired weekly magazine programme
extend its long association with D2. It will also broadcast various French free-to-air television due group Mediapro. simultaneously. The first-choice (shown on Saturday or Sunday)
the competition. weekly magazine programmes, to listed events legislation. Securing the Top 14 rights play-off match was also included, was also included.
Bids were also lodged by including a free-to-air show. Paul Goze, the LNR president, until 2026-27 is likely to along with the two semi-finals Package 3 included the near-
free-to-air digital terrestrial At present, Canal Plus said that the “success of this strengthen Canal Plus’ and the Top 14 final. A weekly live rights to 182 regular-season
channel L’Équipe and telco broadcasts the 8:45pm (CET) invitation to tender is the result negotiating hand with the LFP magazine programme was also matches, the ‘Top 14 Access
Free, according to L’Équipe Friday evening match on its of many years of building and when its rights from 2021-22 are included, with the winning bidder match’ and the five final phase
newspaper. Free already holds Canal+ Sport channel and then strong political choices to make offered to the market. able to choose between the matches. u
12 sportbusiness.com A global perspective on the business of sport 13
HAMILTON ISLAND RACE WEEK, THE WHITSUNDAYS, QUEENSLAND, AUSTRALIA
QUEENSLAND IS THE HOME O F WO R L D - C L A S S E V E N T S
Bring your event to Queensland, Australia
Scott Collins, Sport & Lifestyle Events Director
Scott.Collins@queensland.com teq.queensland.com
News Analysis – Must reads from Q1
CSL seeks media
onwards. The CFA oversees the CSL,
although has plans to separate the
league and let it run independently. “ PP Sports is owned by Chinese
conglomerate Suning, whose finances
fee payment and it has been trying to
renegotiate deals for a host of other
properties. The broadcast feed from
rights solution after ”
Tencent and other major Serie A was recently pulled from PP
Chinese sports streaming have been battered during the pandemic. Sports over the non-payment of fees
platforms are understood to be to the IMG agency.
weighing their involvement in PP Sports, part of the multi-
PP Sports deal ends covering the CSL. A variety of
options are being considered for
the rights, including a series of
broadcasters have included
stations in Beijing, Shanghai,
throttled the funding from parent
companies for many teams.
genre PPTV platform, has been
loss-making for several years after
massively overspending on media
non-exclusive deals with different Guangdong and Tianjin. At the start of 2018, CSM rights. It was the biggest spender
media platforms. A domestic media-rights renegotiated its 10-year media on sports content amid a boom in
By Kevin McCullagh The CSL’s domestic linear arrangement that secures rights and production contract the broader Chinese sports and
Published online 8 Mar, 2021 television rights deals are being significant revenue is much- with the CSL. The original deal, sports media markets that has
reconsidered as part of the same needed for the CSL teams, given which was signed at the height since halted. Suning has in recent
T
discussions. the dire state of their finances. of the exorbitant spending, was years engaged in fruitless talks
he Chinese Super League (€142m/$170m) per year. CSM and The CSL has a long-term deal Many are heavily loss-making worth CNY1.6bn per year. with Chinese internet technology
is discussing options for Suning have a close relationship, with state broadcaster CCTV, after overspending on star foreign giant Alibaba about creating a
the exploitation of its having worked together on sports which shows between 30 and 40 players and coaches, funded by PP Sports’ demise joint-venture around PP Sports.
domestic media rights industry projects for several years. live matches per season free- wealthy corporate backers, during PP Sports had the biggest and most From Suning’s perspective, one
from the 2021 season onwards with The CSL and the Chinese Football to-air. A series of deals with several boom years for the league expensive portfolio of sports content of the motivating factors was to
several different broadcasters, Association are understood to be in regional broadcasters, who show that have now ended. The CFA has among Chinese sports streaming find a partner to share the sports
following the premature end of talks with CSM, PP Sports and other live, free-to-air coverage of their introduced financial controls to platforms and has been hit hard platform’s heavy costs.
a deal with troubled streaming potential domestic media rights respective local teams’ matches, rein in the spending and put teams by the pandemic. Last year, it lost Suning was able to underwrite
platform PP Sports. partners in order to figure out a have traditionally been renewed on a more solid financial footing. rights for the English Premier PP Sports’ losses until last year,
PP Sports held a long-term deal plan for coverage this season and on an annual basis. The regional The Covid-19 pandemic has League after failing to make a rights when the parent company’s
for CSL domestic rights under a finances were sharply squeezed
three-way agreement with the by the pandemic. Suning, whose
league and agency China Sports core business is in offline and
Media. online retail stores, has been
The platform offered live seeking to sell shares in one of its
streaming coverage of all matches, e-commerce subsidiaries to raise
among other types of CSL content, funds to help pay debts that fall
via a variety of subscription due this year.
options. It first acquired the rights Suning has exited, or is looking
in 2017 and it is understood its to exit, other major sports
current deal had several more investments. It is currently looking
years to run, but has been ended for a buyer for its Italian Serie A
early due to financial difficulties. club Inter Milan.
PP Sports is owned by Chinese In February, Suning’s
conglomerate Suning, whose owner Zhang Jindong said the
finances have been battered conglomerate would be refocusing
during the pandemic. This has had on its core business: “We will
knock-on effects for PP Sports and focus on retail business resolutely,
Suning’s other sports investments, close and cut down our business
including Italian Serie A club Inter irrelevant to retail business
Milan and CSL champions Jiangsu without hesitation,” Zhang said.
FC. The latter ceased operations However, it is understood that
last week after Suning ended there remains an intention to keep
financial support, rocking the the sports streaming business alive.
Chinese football industry. The start date of the 2021 CSL
CSM manages CSL domestic season has not been confirmed,
media rights under a 10-year but there have been reports that
deal with the league, from 2016 it will be in the second half of
(STR/AFP via Getty Images)
to 2025, worth about CNY1.1bn April. u
16 sportbusiness.com A global perspective on the business of sport 17
Inside Track
NFL deal shows media power Bruin partnership burnishes
still comes from linear TV CVC’s appeal to sport
T P
he raw numbers and core elements best potential means for broadcasters to stem rivate equity fund CVC Capital with another source telling SportBusiness
of the National Football League’s that bleeding. Partners became a major the firm’s partners alone were enriched
recent set of domestic media rights “The bottom line in TV is that if you have powerbroker in two sports this to the tune of $1bn. When rival PE firm
renewals, while expected on many the NFL, you’re relevant, “ tweeted Fox spring as it consummated deals Providence Equity Partners bought a
levels, were certainly eye-catching and will Sports executive vice-president and head of to acquire a 14.3-per-cent stake in the 25-per-cent stake in Soccer United
be the subject of industry discussion and strategy Mike Mulvihill. “And if you don’t, commercial arm of the Six Nations rugby Marketing, the media and marketing
envy for years to come. you’re competing to be the least irrelevant.” tournament and a 33-per-cent share of the arm of Major League Soccer, it tripled its
More than $110bn (€92.7bn) in total While it was certainly a seller’s market International Volleyball Federation’s investment in the space of five years,
rights fees. Eleven years of commitment. Eric Fisher for the NFL, which was able to nearly (FIVB) rights management vehicle. Ben Cronin selling it back to the league for $450m
Future Super Bowls to be spread over four US Editor double its annual domestic rights haul In a sense, the Luxembourg-based Europe Editor in 2017.
major American broadcast networks. to more than $10bn, there is also plenty firm’s interest could be described as More contentious are the measures
@EricFisherSBG @croninbenjamin
A re-establishment of the NFL as the of need for the league to remain with its a backhanded compliment. While its PE investors might take to achieve
league with what is by far the richest set core broadcast television-based strategy. willingness to invest nearly £400m these sorts of returns. During CVC’s
of media rights in North American sports. For all the accelerating growth and industry interest (€464m/$550m) of other people’s money across both stewardship, Formula 1 disappeared behind a paywall
But beneath that flashy surface, there was also a deeper, in emerging streaming services – and the new deals properties spoke of its underlying confidence in their in some of its most lucrative markets and hosted races
more fundamental truth: the NFL and its four primary indeed will provide plenty of content and consideration to long-term ability to attract audiences, it also pointed to in controversial settings in search of bigger race fees.
television network partners – CBS Sports, ESPN/ABC, Fox platforms such as ESPN+, Paramount+, Peacock, and Tubi a belief that they had failed to exploit all the commercial It has also been posited that the firm underexploited
Sports, and NBC Sports – absolutely need each other. They – the NFL’s power still fundamentally comes from its mass opportunities available to them in the past. Sources say the motorsport on social media – and by extension its
need each other now more than ever, and that collective broadcast reach. the subtext to CVC’s rugby investments, in particular, is standing with a younger generation of fans – to leave a
need will likely grow even further in future seasons leading More specifically, that reach directly fuels the league’s the perception that the sport has been mismanaged and ‘nickel on the table’ to attract future buyers like Liberty
up to these deals’ 2033 completion. growing revenues, its accelerating national sponsorship that the PE firm can deliver a return on its investment by Media.
For the broadcast networks, the reasons for the urgent business, its ability to make seismic impacts with its introducing a degree of discipline and commercial rigour. The Six Nations and FIVB have clearly been persuaded
NFL need are simple and two-fold. First, there is simply no experiments in new technology, and its overall industry The calculation the Six Nations and the FIVB have that CVC’s ability to add value has evolved since this
other programming, sports or otherwise, on United States bragging rights. made is that the upfront capital injection makes it time, especially as some of these measures are ones they
television that even comes close to consistently generating There is simply no platform, at least for now, besides worthwhile handing over a share of future income. They could reasonably be expected to implement on their
the types of mass audiences the NFL does. The league, broadcast television that can consistently aggregate 15 feel the additional money, plus CVC’s involvement as own. Speaking to SportBusiness about the FIVB deal, Nick
though down 7 per cent in 2020 regular season ratings, million people, or more, around a particular piece of an ‘active minority partner’, will help them to fix the Clarry, the investment group’s head of sports, media and
still averages a per-game domestic audience of more than programming. And for the NFL, there’s nothing else that fundamentals of their businesses. In the case of the Six entertainment, perhaps hinted at the PE firm’s appeal
15 million viewers, well above the 8 to 10 million that even can help ignite all of these other facets of its business like Nations, the member unions have effectively invited when he pointed to CVC’s 2019 strategic partnership
popular entertainment series now often struggle to reach. its current media distribution strategy. CVC to be a seventh nation, sharing 14.3 per cent of with George Pyne’s Bruin Sports Capital – owner of OTT
And for all of 2020 – despite significant retreats in It’s why even with all the forward-looking streaming commercial revenues in return for £305m, split between solution provider Deltatre and the Two Circles digital
many sports ratings amid pandemic-related schedule components contained in the new batch of rights deals, the six members in differing proportions over five years. marketing agency. Through Bruin, he argued, CVC would
disruptions, a US presidential election cycle, and societal the league is keeping 94 per cent of its game inventory Volleyball has forsaken a 33-per-cent share of income in be able to plug volleyball into the sports tech capabilities
upheaval – the NFL still generated 20 of the top 25 and 42 available on linear TV, is confining its first all-digital rights return for roughly £73m upfront. and marketing know-how of the two firms.
of the top 50 American television audiences. Super Bowl package with Amazon to less-regarded Thursday night The overriding question is whether this a case of sport If CVC is indeed able to draw on these relationships
viewership, often around 100 million, typically is about four inventory that wasn’t particularly coveted by the broadcast selling off a share of the family silver or entrusting it for to create direct-to-consumer businesses around both
times as large as any non-NFL program. networks, and is still choosing to base a key part of its short-term keeping to a partner who knows how to add assets, enabling it to build up a detailed dataset of their
Second, cord-cutting continues to slice heavily into future on a medium now often derided as a dinosaur. some additional polish. respective fanbases, it will leave them in a far healthier
traditional television audiences as viewers increasingly “While digital is growing, the traditional TV ecosystem There is no mistaking PE’s unerring ability to drive the position than they find themselves now. More to the
embrace a mushrooming array of on-demand streaming is still incredibly rich, incredibly deep, incredibly broad,” overall value of sports properties and generate a return point, having accumulated the most valuable resource
options, either on a subscription (SVOD) or advertising said NFL Media executive vice president and chief operating on its investments, as other examples from the industry in the new digital economy, it wouldn’t need to worry
(AVOD) basis, or both. Having NFL rights represents the officer Hans Schroeder. u attest. Formula Money reported CVC generated a nearly about leaving a nickel on the table when it eventually
563-per-cent increase in its investment in Formula 1, comes to sell. u
18 sportbusiness.com A global perspective on the business of sport 19Inside Track
UFC deal shows how the terms of Where next for an agency sector
engagement in China have changed facing up to a new threat?
T T
he terms of engagement with health and fitness of the Chinese people o squarely blame the agency sector’s tough one to sell into.
China for the international is an explicit aim of government sports current predicament on the In hiving off the juicy US territory
sports industry have changed. policy. As a state-owned company, Migu pandemic would be blinkered. by awarding rights to CBS, Serie A has
If overseas organisations want is particularly attuned to government In truth, the agency big boys adopted a route that other rights-
to get a return from the world’s second- policy. had already suffered pre-2020 collateral holders will surely follow. Pick off your
biggest economy in 2021, they must be All this investment means the UFC is damage and those focused chiefly on rights best markets and turn to an agency for
prepared to invest in it. unlikely to break even in China for a while trading were already overhauling their everything else. World Rugby, which has
This month’s wide-ranging media yet. But it is a longer-term play for business models to add more weapons long worked hand in hand with IMG on
rights deal by the UFC with video Kevin-McCullagh the company in a market it considers to their armoury. Wind back 18 months Martin Ross international rights sales, appears to be
platform Migu is a best practice case Senior Analyst, Asia-Pacific the most important in terms of its and Wanda Sports – now delisted – Global News Editor moving in that direction too.
study. The UFC managed to get an international expansion. had disappointed on the Nasdaq stock To counteract market volatility,
@kevinmccullagh @martingrantross
increase in the value of its rights, an Besides investment in a local exchange and Endeavor’s IPO – now agencies had long since re-invented
extraordinary outcome given the dire presence, an appetite for risk will also back on the table – had been pulled. themselves before the private equity
state of the media-rights market. be useful for international sports organisations in the Margins on minimum guarantee rights deals had been rush. Those who earmarked the betting streaming and
How did the UFC do it? The groundwork was laid with Chinese market of 2021. increasingly squeezed and the ‘adapt or die’ mantra was data rights sector early on are reaping the rewards.
targeted and significant investments in its presence in Economic risks are at all-time highs. Partners in China well in place. Sportfive/Lagardère Sports was one such For years agencies boasted about ‘full-service’
China. The deal was supported with further significant must be more carefully selected than ever before. Some of agency to see what was coming down the tracks years ago offerings. Those ranges of services have become
commitments to content and in-market activity. the country’s biggest companies and sports investors have and lessened its media rights dependency. Although that increasingly important. Be it broadcast production,
The promotion has had a slice of luck in the been caught out by the economic crunch caused by the move was ultimately reflected in the agency’s heavily- sponsorship activation, digital solutions or athlete
emergence of a Chinese champion, women’s pandemic. The plight of Suning, owner of Serie A football discounted €110m ($130m) sale price. representation. Pitch International’s ramping up of its
strawweight title-holder Zhang Weili. But the team Inter Milan and streaming platform PP Sports, has The obvious financial impact of Covid has heaped sports films and documentaries business – headlined by
importance of those background investments cannot be been one of the most damaging developments. more pressure on margins and led to downsizing and ‘Pelé’ and ‘Kenny’ (Dalglish) of late – has offered it the
ignored. Suning’s withdrawal of support for Chinese Super redundancies, prompting agencies to resist putting down protection of a solid income stream in the Netflix era.
The UFC spent $14m (€12m) to build its Performance League champions Jiangsu FC was a particular surprise. hefty numbers for top rights. In turn, senior staff exits have Agencies now face re-inventing themselves again
Institute in Shanghai, which opened in 2019. This Football is a politically important sport in China – expedited the trend of new consultancies starting up and given the return of private equity onto the scene –
training facility for Chinese and other Asian MMA Suning got into it in the first place for the political creating an increasingly disparate rights trading landscape. previously the guardians of Formula 1 and investors
fighters is three times the size of the promotion’s gain to be made from backing a sport whose growth Serie A, which has been swithering for months over in agencies themselves. Burnt by dramatic ticketing
facility on home turf in Las Vegas. It will invest millions is considered a national priority. To pull the rug from its own proposed €1.7bn private equity investment, has revenue shortfalls, rugby union’s stakeholders have
of dollars more each year in the facility and its linked under the Chinese league champions, causing headlines been the latest battleground for agencies bereft of some of turned to CVC, as has volleyball’s FIVB. A string of others
talent academy. The goal: to produce a flow of Chinese around the world and questions to be raised over the their previous firepower and swagger. There has been no remain on the hunt for their own pot of gold to stem the
fighters that will secure a domestic audience for the future of the elite game in the country, indicated the shortage of agency bidders for the international rights but, tide, ranging from the Bundesliga to World Table Tennis
property well into the future. depth of Suning’s problems. unlike previously, there is zero appetite for a loss leader and the EFL to Cricket Australia.
Last year, the company agreed a deal with the Political risks are also at all-time highs for many deal. Yes, the beIN/Mena piracy impact has altered the Infront has been quick off the mark in responding
Chinese Olympic Committee to make the cutting- overseas rights-holders in China, with political tensions landscape, particularly for Serie A, but the market softness to the threat. Its eight-year deal with the Professional
edge training resources at the Performance Institute with the West rising. Some properties are already is plain to see. Squash Association not only includes a remit to sell the
available to Chinese athletes preparing for the conducting their Chinese business more quietly than Look no further than agencies turning to revenue- commercial rights, but also invest in a new company set
upcoming Tokyo Summer Olympics and Beijing Winter before, without the usual press releases marking their sharing deals with OneFootball in markets where linear up to house those rights. A case of an agency tackling the
Olympics. activity. broadcast deals were previously commonplace. This private equity approach head on.
Among the raft of content and event commitments To prosper in China in the year of the Ox, overseas provides further evidence of the continuing shift from The agency investment model is, of course, not new,
included within the Migu deal, the UFC will create rights-holders may be well advised to adopt the head- linear to data-driven digital offerings. Broadcasters are with IMG’s EuroLeague joint venture one such historic
health and fitness content for the company’s Migu down diligence of the zodiac animal, treading carefully still willing to pay a premium for long-term security example. But the need for such investments has become
Fitness app. Leveraging sport to improve the public and investing wisely. u over top rights, as the NFL’s recent $110bn, 11-year more acute. And if the agencies don’t provide the
windfall will attest, but the market remains generally a financial security, then private equity surely will. u
20 sportbusiness.com A global perspective on the business of sport 21In association with Agora
What is RTE? Twenty20 cricket tournament. platform, or sitting on top of
RTE in the digital space operates Additionally, a ‘fan wall’ allows a broadcast platform, is that
in the same way as face-to-face hundreds of remote fans to be shown brands can activate commercial
engagement in the physical world. in the background screen during a partnerships more effectively, which
Sitting next to a fellow fan at a break in a game, bringing the offline should in turn lead to a positive
stadium, for example, allows for a experience to an online setting. This impact on sponsorship revenues.
deeper and more personal one-on- solution has been used widely in the However, most rights-holders
one conversation than an exchange concert sector already. remain unaware that, for example,
of messages between mobile devices. Therefore, in sport, RTE can allow live interactive video and social
Similarly, the instinctive ability a fan to become part of a virtual media features can be combined to
to recognise the body language community before, during and after create an enticing and profitable
and tone of voice from a fellow an event. This community is fuelled proposition, enabling powerful RTE
viewer on a digital platform by real-time interactivity and the and revenue growth.
adds context to their words, feeling of being virtually together, It is unlikely that such a lack
enabling swift reactions to drive just like the most popular social of awareness will be tolerated by
further engagement and a richer media applications. However, there sports fans in the future, though,
experience. For this reason, the are also opportunities to personalise with genuine RTE set to become
concepts of ‘social video’ or ‘social the offering for individuals, ensuring an expectation for viewers in the
audio’ have become increasingly a truly dynamic experience by near future, accelerated by evolving
renowned elements of RTE. allowing fans to watch games with consumer habits resulting from
With digital RTE, dozens of their friends or even celebrities. Covid-19.
friends can be invited to join a As a result, those at the cutting
‘watch party’ for a game, allowing edge of RTE believe that it can Why RTE matters
viewers to mingle like they would if become an established fifth pillar The results speak for themselves.
How real-time engagement will
they were in the stands. Indian over- of revenue, sitting alongside media Clients of Agora, an interactive
the-top subscription streaming rights, licensing and merchandising, and live-streaming technology
service Disney+ Hotstar offered such sponsorship and ticketing. provider, have reported a 1,800 per-
social watching experiences during Additionally, a byproduct of cent increase in user time spent, a
reshape the sports industry
the 2020 Indian Premier League having the fans on an in-house 1,000 per-cent increase in the fan
Real-time engagement is becoming an increasingly essential tool for sports rights-holders,
broadcaster and brands that are seeking to build fruitful relationships with key target audiences.
However, many in the industry remain unaware of the opportunities and challenges.
T
he task of maintaining holders have struggled to attract
fan engagement with an and retain younger viewers since the
increasingly demanding release of the first Apple iPhone in
audience via digital to-human interaction, sports 2007 triggered a sharp increase in
channels has taken on extra rights-holders have continued to the global use of smartphones and
significance over the past year. plough resources into attempting social media platforms. Between
Even before the pandemic though, to open up unsynchronised two- 2007 and 2017, the average viewing
it was clear that fans were craving way conversations via social age increased for 23 of the 24 most
a deeper level of social interaction media, retrospectively measuring high-profile professional sports.
during sports events that real-time ‘engagement’ through numbers of Therefore the challenge for rights-
engagement (RTE) can bring. likes, retweets or comments. holders is to adapt their approach and
In 2018, a PwC study found However, it is no secret that bring social media elements in house
that 56 per cent of fans wanted relying on third-party social so they are able to learn more about
more interactive features during platforms is imperfect, especially as their audience and generate a new
sports coverage. With the they own the user data. revenue stream, especially among
pandemic having starved human- Additionally, sports rights- younger demographics.
22 sportbusiness.com A global perspective on the business of sport 23You can also read
