Boxing clever CANELO ÁLVAREZ IS NO LONGER A GOLDEN BOY BUT WHAT DOES THE SPLIT MEAN FOR BOXING AND DAZN? - cloudfront.net
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November 2020 Issue no. 266
www.sportbusiness.com
Boxing clever
CANELO ÁLVAREZ IS NO LONGER A GOLDEN BOY BUT
WHAT DOES THE SPLIT MEAN FOR BOXING AND DAZN?
INSIDE THIS ISSUE
Euroleague strives to Sports-related Montagliani: Gold Cup Indian fantasy sports
regain momentum after SPACs rise in revamp to create a can overcome legal
losing a season to Covid prominence commercial lift hurdles
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CONTENTS
November | Issue no. 266
Worldview
4 Masters needs to come up with football reforms before
they are forced upon him
6 Asian industry set for a more local complexion as Western
power wanes
8 Disney stands at centre of sports industry turbulence
9 Technology, sport and a fresh perspective
Properties
14 Euroleague strives to regain momentum after losing a
11 season to Covid
18 Montagliani: Gold Cup revamp to create excitement,
unpredictability and a commercial lift
Sponsorship & marketing
22 DP World continues to see value in sports sponsorship
24 £6m kit provision in Macron deal supports WRU’s
community clubs
Media
11 Canelo’s split with Golden Boy was written in the stars
28 ESL’s latest deals show that esports and traditional media
18 can work in harmony
Finance & Law
36 Sports-related SPACs rise in prominence
40 Indian fantasy sports can overcome legal hurdles
Venues & facilities
43 AEG’s O2 Arena targets April comeback for London live
events
22
Hosting
50 Venue rivalry emerges as New York looks beyond Covid-19
Technology
54 How Content Arena is supporting sports media’s choking
rights market
58 Sapphire looking to uncover tech jewels
62 How AI is transforming video content and driving revenues
40 58
TWITTER@SportBusiness | www.sportbusiness.com 3
WORLDVIEW | LONDON
Worldview | London
Ben Cronin, Europe Editor ben.cronin@sportbusiness.com
Masters needs to come up with football
reforms before they are forced upon him
I
t’s become commonplace to observe
that Richard Scudamore was right to
leave the Premier League when he
did. The usual argument is that the
former chief executive of the top-tier
football league in England spotted the
diminishing pay-television returns and
exercised impeccable timing in stepping
down just as media-rights valuations
were perceived to have passed their
peak.
Yet to watch his successor, Richard
Masters, face questions during a recent
UK parliamentary hearing was to
appreciate that Scudamore swerved an
even larger array of problems than the
shifting media market when he exited in
2018.
Masters looked distinctly
uncomfortable as he was quizzed by
Richard Masters, chief executive, Premier League. (Alex Morton/Getty Images for Premier League)
the Department for Digital, Culture,
Media and Sport (DCMS) Select
Committee. The Covid-19 pandemic has top-flight’s predecessor, the Football EFL chairman Rick Parry – to some
triggered unwelcome political scrutiny League First Division, shared 50 per extent a poacher turned gamekeeper,
for the English top-flight and he was cent of its revenues with the three having been one of the original architects
summoned to address why it had yet tiers beneath it. But until now, the of the Premier League’s split with the
to agree a financial package to support Premier League has always shared a rest of the game – is now one of the
lower league teams through the crisis. much smaller proportion of its income. most ardent advocates for reform. He
Although the league has now agreed a The mechanism by which it distributes appeared to be pushing at an open door
£50m (€55.7m/$66m) bailout for League revenues through the rest of the game when he described parachute payments
One and League Two, and conditional has gone through various iterations in an earlier DCMS hearing as ‘an evil
support for the English Championship, since, without ever really satisfying other that must be eradicated’ and called for
questions about its place in the football stakeholders or the authorities. As it a ‘complete reset’ of the way football
pyramid are unlikely to go away. presently stands, clubs relegated from is run. When the issue has been raised
The UK government is holding a gun the league receive parachute payments previously, some MPs have called for a
to the league’s head, having promised a that share a decreasing percentage of minimum of 7.5 per cent of the Premier
“fan-led review” of football governance the top-flight’s media revenues to soften League’s income to be distributed to
in its election manifesto. Should Masters the drop into the English Championship. grassroots football and demanded a
not show a willingness to address some This is supplemented by a series of fairer distribution model for the entire
of its concerns, the Premier League could solidarity payments to other EFL teams football pyramid.
be forced to do penance for some of the that were introduced at the start of the Prompted by the threat of change
sins committed at its creation. 2007/08 season to offset the distorting being forced on the league from outside,
Before it was founded in 1992, the impact of the parachute allocation. Masters succeeded in getting all 20
4 www.sportbusiness.com | TWITTER@SportBusiness
WORLDVIEW | LONDON
Premier League clubs to commit to a pressure on Uefa to agree to even more
strategic review before the pandemic. radical Champions League reform from
But the united front has been somewhat 2024 onwards. While this is a more
Editor
undermined by the leading clubs’ own palatable outcome for the Premier Ben Cronin
Project Big Picture proposals. This League, it will hardly provoke rejoicing ben.cronin@sportbusiness.com
+ 44 (0)20 7265 4232
alternative reform plan, formulated by at its London headquarters. Led by
Deputy Editor
Liverpool and Manchester United with European Club Association and Juventus Adam Nelson
the support of Parry, shows how the EFL chairman Andrea Agnelli, teams from adam.nelson@sportbusiness.com
+ 44 (0)20 7265 4234
chairman’s background and connections less competitive and commercially
US Editor
(he is also a former Liverpool chief successful leagues are known to want Eric Fisher
executive), make him a formidable to increase the number of lucrative eric.fisher@sportbusiness.com
adversary, applying pressure from European games between the best sides Senior Reporter and Analyst, Asia
Kevin McCullagh
inside and outside the top flight. It also while reducing the number of matches kevin.mccullagh@sportbusiness.com
demonstrates how the collective thinking in domestic leagues. Agnelli was also Head of Content
that underpins the Premier League’s an advocate of a proposal to introduce Richard Welbirg
richard.welbirg@sportbusiness.com
successes has the potential to fray. promotion and relegation between + 44 (0)20 7265 4233
Assailed by government scrutiny and Uefa’s three club competitions last year Editorial Director
Kevin Roberts
club scheming on the domestic front, – a move that would have completely kevin.roberts@sportbusiness.com
there is little solace to be found on the undermined interest in domestic
Sub‑Editor
continent. Although reports that leading competitions had it not ultimately been Suzanne Swaysland
suzanne.swaysland@sportbusiness.com
European clubs are again hatching plans voted down.
for a breakaway European Super League Change is clearly coming to football, Senior Designer
Alex Smith
should be taken with the customary and something will have to give. For the alex.smith@sportbusiness.com
pinch of salt, they can’t be ignored Premier League to retain its pre-eminent Designer
entirely. CVC Capital Partners, the position, Masters will have to balance Jacklin Kuneva
jacklin.kuneva@wedodigitalsolutions.com
leaders of the consortium that wants to demands for equitable reform at home,
Production and Distribution Manager
buy a stake in Serie A’s new media-rights while seeing off attractive commercial Craig Young
business, is sufficiently concerned about proposals from abroad and even within. craig.young@sportbusiness.com
the distorting effect such proposals As he put it himself in the DCMS Commercial Director
Paul.Santos@sportbusiness.com
would have on domestic European hearing: “I suspect if we don’t come + 44 (0) 2072 654183
competitions that it is reported to want up with a unifying plan, someone else
Subscription/Information Sales
a “breakaway” clause inserted into any will write it for us.” Somewhere on Scott Longhurst/Laurence Burton
contract its strikes with the Italian a golf course in England – lockdown info@sportbusiness.com
league. restrictions permitting – Scudamore Head of Media Sales
Others will argue that the real purpose will be thankful that the task doesn’t Robin.Hume@sportbusiness.com
+ 44 (0) 2072 654182
of the breakaway threat is to exert fall to him. Z
www.sportbusiness.com
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TWITTER@SportBusiness | www.sportbusiness.com 5
WORLDVIEW | SINGAPORE
Worldview | Singapore
Kevin McCullagh, Senior Analyst, Asia Kevin.McCullagh@sportbusiness.com
Asian industry set for a more local
complexion as Western power wanes
(Adek Berry/AFP via Getty Images)
I
t has been a year of upheaval for driven. This is coinciding with Asia, and K-pop, Korean, and Chinese television
the sports industry’s big Western particularly China’s, increasing ability dramas; locally-produced social media
companies in the old colonial to take control of their own destinies applications; and locally-produced
centres of Hong Kong and Singapore. and unhook themselves from Western gaming content are all crowding the
The cities have long served as staging economic and political support. In space for sport and whetting appetites
posts for sports organisations seeking the latest manifestation of this, last for locally-produced material.
footholds in Asia, and major agencies Sunday, 15 Asia-Pacific nations, including There is a desire across Asia to create
and rights-holders have built profitable China, Korea, Japan, most South-east home-grown companies and heroes,
businesses in them. But the pandemic Asian countries, Australia, and New and to see them compete and win on
and a longer-term slide in the media- Zealand, signed one of the biggest trade the international stage. Indeed, there
rights business has weakened the power agreements in history. always has been, but increasingly the
of Western agencies and rights-holders. In the competition for Asian eyeballs, resources and expertise are available
There is a sense of the sun setting the Western sports brands that have to turn these desires into reality. That
on a Western-dominated era for the been so popular for so long are facing a the region has played second fiddle in
sports industry in Asia, and that the powerful challenge from home-grown world affairs to Western powers for
next era will be much more locally- entertainment in a variety of genres. several centuries, and that this was not
6 www.sportbusiness.com | TWITTER@SportBusiness
WORLDVIEW | SINGAPORE
the case historically, is not lost on Asian back to London, with his duties taken confidence in the domestic league’s
audiences and consumers, particularly in over here by two long-serving, locally- potential, albeit one that has been
rapidly-ascending China. based sales executives. Senior executives recently reevaluated.
The shift raises intriguing questions also departed IMG offices in Seoul and There have been other notable
and possibilities for sports business Hong Kong. Sports streaming platform eastward shifts this year. For example,
in Asia. Can local properties emerge DAZN has pared back its Singapore office the Chinese influence in table tennis
to compete for audiences with the from 16 staff to just two. has grown, in the form of financial
big Western properties, and the other Asian media companies have in recent backing for, and senior executives taking
entertainment genres? Can Asian years balked at the big media-rights roles at, the new World Table Tennis
domestic sports properties build pan- fees that used to underpin much of the unit. China’s successful control of the
Asian audiences? Will the investments by agency business here. Some are instead Covid-19 pandemic allowed Macau to
Western properties in shoring up their turning to local properties that are be the base for the International Table
Asian fanbases be successful? How will cheaper, and over which they can have Tennis Federation and WTT’s #Restart
the roles of the big Western and global a greater degree of control to fashion series of events, currently underway.
agencies change? suitable content, as well as build long- These have welcomed players from
There have been notable downsizing term partnerships with. Indonesian around the world and marked the
and executive moves this year at some OTT platform Mola TV has halted re-emergence of table tennis from the
of the sports industry’s blue-chip, investments in media rights for overseas pandemic shutdown.
Western-headquartered operators in properties, after a splurge on content Meanwhile, big Western rights-holders
the region. In Singapore, the Sportfive over the last couple of years to support ramp up local marketing activity and
agency shed a large percentage of its its launch. Thai production company seek to increasingly tailor their offerings
workforce and moved out of dedicated Zense Entertainment has made a large, for local audiences. And, as the relatively
offices and into shared office space. This long-term investment in Thai domestic young Asian sports industry matures,
was largely linked to the ending of the football, around which it plans to create increasing numbers of local staff are
company’s long-term relationship with a host of ancillary television programmes emerging in senior positions.
the Asian Football Confederation. Two for the local market. Malaysian pay- The days of big agencies and Western
of the Mediapro agency’s most senior television broadcaster Astro has been rights-holders running successful
Asia-based salesmen departed in recent reining in spending on international businesses out of regional, city hubs may
months as part of a cost-cutting drive sport, and has put a big focus on its not be over. But they are certainly having
by the Spain-based firm. Nielsen Sports esports and gaming channel eGG to work harder for their money.
shut down its entire Singapore-based Network, which features a large amount And the complexion of the Asian
operation, with the loss of around 10 of content created locally and elsewhere sports industry looks set to become
staff. There have been changes at IMG, in South-east Asia. Looking further back, increasingly local – determined by local
with the head of the agency’s Asian DAZN’s 10-year investment in Japanese trends and demands, local organisations,
media-rights business being promoted J-League rights was a massive vote of local culture, and local people. Z
(Costfoto/Barcroft Media via Getty Images)
TWITTER@SportBusiness | www.sportbusiness.com 7
WORLDVIEW | NEW YORK
Worldview | New York
Eric Fisher, US Editor eric.fisher@sportbusiness.com
Disney stands at center of sports
industry turbulence
W
hen looking at all the major the shift to a new type of Disney will
challenges currently facing be decidedly bumpy. In to addition to
the entire sports industry, the ongoing staff cuts, the pathway
particularly in the United to profitability in Disney’s streaming
States, all roads ultimately lead back to operations is not yet clear, and that
the Walt Disney Co., parent company of division in this nascent period is still
sports media giant ESPN. losing money.
Current issues with linear sports Even with recent encouraging news
ratings? Check. Pandemic-related staff regarding the development of a potential
cuts?. Check. Cord cutting and media Covid-19 vaccine, it’s also hard to see the
platform disruption? Check. An inability parks, experiences, and products division
to gather large numbers of fans together that includes the theme parks being
due to Covid-19 and the need to stage anything but a fiscal drag on Disney for
sports competition behind closed doors? the foreseeable future as attendance
Check. Forthcoming large-scale changes challenges remain, and potentially
in the next media rights cycle for major impact the company’s ability to pursue
sports leagues? Check. opportunities elsewhere.
Simply put, there is no prominent Much the same can be said for
sports industry trend that doesn’t (Eric Liebowitz via Getty Images) Disney’s movie production business
currently involve Disney in some while most cinemas remain closed. The
meaningful fashion. And it’s why progress of that historic conversion longer-term attendance issues during
the company’s ongoing efforts to every 90 days to a jumpy Wall Street as a the pandemic also will impact individual
fundamentally reshape its business to public company, and Disney’s situation teams and their ability to fill their venues
prioritize direct-to-consumer operations now represents as close to a real-time with fans and resulting energy, which, in
and survive in the age of Covid-19 are so barometer on the overall state of the turn, affects ratings for ESPN and sister
fascinating. sports industry as we might find. network ABC.
Disney and ESPN, of course, already And following Disney’s most recent And financial analysts are beginning
had an outsized role in shaping the entire earnings report, chief executive Bob to openly question the need to pursue
industry landscape given its perpetual Chapek said he intends to accelerate the expensive sports rights while Disney
presence as one of the foremost buyers company’s conversion. battles its various and serious fiscal
and distributors of sports content, both “By separating content creation issues. But Chapek insisted Disney is still
domestically and abroad. from distribution, we’ve been able to a fierce advocate for sports and will be
But arguably no other company is streamline our processes and better align going forward, ensuring the company will
looking to remake itself from a legacy the organization toward these important remain a foremost entity to watch both
media operation to a much more strategic objectives as we accelerate our during and after the pandemic.
nimble and digitally focused one at the pivot to a DTC-first business model,” “We continue to believe in sports,”
scale Disney currently is, or is doing so Chapek said. “We intend to build upon Chapek said. “As a matter of fact in 2019,
alongside large-scale businesses that the success we’ve achieved thus far. 93 of the top 100 programs in viewership
are entirely dependent on in-person “It’s very clear to us that new content on [American] television were sports.
attendance, as is the case with Disney’s adds subscribers. So I think you’ll see a And as you know, we’ve got the most
now-battered theme parks business. continued increase in investment in our trusted brand out there in the world in
Add in the existing and hyper-sensitive direct-to-consumer platforms,” he said. terms of sports. So we believe that’s a
pressures of needing to report on the It’s also apparent, however, that nice recipe for future success.” Z
8 www.sportbusiness.com | TWITTER@SportBusiness
INSIDE TRACK
Inside track
Michael Broughton, senior advisor, technology and investment strategy
Technology, sport, and a fresh
perspective
The major themes in the technology revolution are just starting. The reality of that is the information age has been
interesting and disruptive, but as new technologies emerge the speed of change will continue to accelerate.
(Marc Atkins/Getty Images)
I
am not a technophile. Seems a crazy that problem appropriately. Equally in our personal lives it would
thing to say considering what I have So, what is the data telling us? be challenging to find many senior
been doing for the past decade. In When we look down at the myriad sports executives who did not have
that time, I have spent eight years of information that we read and see a smartphone, iPad (or equivalent),
looking primarily at sports technology on a daily basis and take it from the and a laptop alongside their cable
investments, quite literally putting helicopter view, we can see a couple subscription, Netflix account, and all-
my money where my mouth is, and of macro changes taking place that we pervasive Amazon Prime membership.
then was responsible for the business should accept and embrace. Not everyone is as fortunate, but the
technology strategy at Fifa. On the The first is that we are already using data is clear that mobile and broadband
surface I look and sound like a tech technology. First it came in the form of penetration is now extremely high and
aficionado. radio, then broadcast, and more recently not about to go into reverse. Technology
The reality is I simply look at what via digital formats. This is normal is a necessary part of our lives and is
the information is and where the data is progression and is no different to the impacting our sports – not just the other
pointing. At the same time, I am a realist fact that we have gone from sending facets of how we live.
and understand that the world is only letters, to faxes, to emails, and for some The other key data point is that
headed in one direction when it comes now the progression to Slack and other people want to take part.
to technology and as such look to tackle instant messaging services. Technology has changed what
TWITTER@SportBusiness | www.sportbusiness.com 9
INSIDE TRACK
that means. We use the loose – and And nor should it stop growing. to seize the opportunity afforded to
increasingly irrelevant – term of Whilst some of this has felt disruptive us by the fact that audiences out there
‘fan engagement’ when we should and painful it has mostly been want to create and a become a part of
update our language to reflect what is incremental and supplementary to the our ecosystem?
happening in the world. Involvement or business of sport, in that it pushes the It is not that younger audiences are
participation is what is truly occurring. content we create to a waiting audience not interested in sports, it’s that we
This has not changed, though the which is keen to consume it. are not communicating with them the
format has. Watch children after any That has not changed even with way they want to be communicated
major sports event, the World Cup for social media or our growing acceptance with. Sport turns a blind eye to the vast
example, and you will see them in the of direct-to-consumer. Sports rights- majority of user-generated content or
back garden or parks mimicking what holders create content and push it via actively looks to dissuade it. It is not
they have seen on their screens. For me ever-increasing forms of distribution unlike the original conversation around
it was about holing a putt to win The whilst constantly trying to adapt the WiFi in stadiums where you often heard
Open, for my son it is celebrating like business model to suit. that the clubs did not want to distract
Cristiano Ronaldo. The approach to fan engagement has fans from watching the field of play –
Where we truly differ is whilst I could been much the same. Create content completely missing the point of view of
do it only with whoever was on the and push. Count the number of likes the consumer/fan.
course with me, our children can video it and engagements and tout the numbers As we see in the features and articles
and share it quite literally with the world. as success. That is not of course in SportBusiness, there is no lack of
Why? Well, the dream has not changed engagement and certainly is not at the ingenuity and entrepreneurship coming
but the distribution method has. level of involvement that we are seeing in the sports, media, and entertainment
We used to have the water cooler across all generations – especially Gen Z industry – much of it is coming from
moments, but now they exist in real- and Millennials. the Gen Z and Millennials we have
time and everyone wants their say. The It can seem odd but it is no longer apparently left so disinterested.
participation on social media around unusual to be in a place like an airport What we need to see next though is
major sports events shows that people terminal and see youngsters practicing real thought as to what the underlying
of all shapes, sizes, creeds, and places moves in front of a screen as they prep core technologies can enable in terms
want their voices to be heard, and they their latest TikTok video. Along with of the strategic shift that will need to
want to be more involved in what they the other social platforms we have seen come to enable sports to both engage
watch. emerge, and the ones yet to appear, the and monetise audiences.
And we are just at the beginning. ability for the fan to also be the creator 5G, Big Data, AI, and AR will all
The major themes in the technology is the single biggest shift we have seen enable us to bring interactive sports
revolution are just starting. The internet in sports and entertainment. In fact, coaching to the masses. Chelsea
may have been a mass consumer the amount of content created by our Football Club have launched their
product for two decades, but it will be audience is probably greater than that Perfect Play app, which understands
the next decade where we start to see created by the rights-holders. that people all around the world are
what it is truly capable of. How can sports adapt and solve the keen to learn to play like the pros
The reality is that the information overarching issues mentioned above? and that there are ways to have them
age has been interesting and disruptive With the use of technology of course. involved in a way that is not just
but as the internet finally comes alive Our audiences are embracing tech at an another sponsorship deal.
the speed of change will accelerate. This ever-increasing speed and are changing Blockchain and digital content can
is because the other major technology their behaviours accordingly. Yet the also be brought together to see how
changes are all accelerating and coming very same technologies enable sport to the fan as a content creator can be
online. These include: Big data, 5G, AI/ reach, engage, and involve more people brought together with the rights-holder
ML, augmented reality, the internet of than ever. as content owner to forge a new model
things, and blockchain. As 5G emerges Ignoring technology, or the changes where both sides can be rewarded for
and we have everything linked and on in the broader consumer environment their symbiotic relationship. Foundation
the internet, our speed of change will means we will get left behind. Labs, Dapper Labs, and others are
only accelerate. Technology is therefore a prerequisite. showing that both sides of the equation
So, what can we do about it? A foundation stone, if you like, to the can benefit.
The good news is that sport has future of the sports industry. I am not a technophile. Yet the future
not wasted the past twenty years. Far Technology should be seen then in will be dominated by technology. It’s
from it. The progress we have made two buckets. not about transformation, it’s about
in terms of broadcast technology, First is what technologies can be used acceptance that the strategic model will
including OTT and remote production, to continue to innovate and update the shift. Tech will simply be the conduit to
as well as with athlete data and betting current business model. our audiences and enable our wonderful
and gaming, mean the business has Second is what business models can industry to connect and profit in a way
continued to grow. emerging technologies empower sports that is as-yet untapped. Z
10 www.sportbusiness.com | TWITTER@SportBusinessCanelo’s split with Golden Boy and
MEDIA
DAZN was written in the stars
DAZN refused to pay Golden Boy Streaming platform offered the Canelo now a free agent after
full $35m purse for Saúl ‘Canelo’ Mexican boxer $20m plus upside; lawsuit; fault lines in contract were
Álvarez’s next fight about $3m for opponent clear from day one
Saúl ‘Canelo’ Álvarez. (Ethan Miller/Getty Images)
Callum McCarthy say De La Hoya wasn’t wrong about the an agreement, Golden Boy and DAZN
R
money. settled with Álvarez on November
elationships between Two decades on, the boot is on the 6, freeing him from his contract and
promoters and superstar other foot. Golden Boy’s Mexican effectively tanking DAZN’s US boxing
fighters rarely go the distance, middleweight superstar Saúl ‘Canelo’ ambitions – at least for now.
and Golden Boy Promotions Álvarez felt he had outgrown his Boxing industry insiders told
chief executive Oscar De La Hoya promoter and successfully sued the SportBusiness that DAZN was willing to
should know this better than most. promotion, freeing himself from a pay Golden Boy about $23m for an event
De La Hoya’s acrimonious split with 10-fight deal after only two completed headlined by Álvarez in December,
Top Rank Boxing and its chief executive bouts. designed to cover the purses of both
Bob Arum in 2000 was the catalyst for Álvarez filed suit in September Álvarez and his opponent. In that offer,
the creation of Golden Boy. De La Hoya after the promotion and its global Álvarez was set to earn a guaranteed
believed he could earn more promoting broadcast partner, streaming platform $20m plus a cut of subscription revenue
his own fights under the Golden Boy DAZN, refused to pay his $35m (€29m) generated by the event.
banner and sued Top Rank to extricate guaranteed purse for an upcoming fight This offer was about $17m short of
himself from the contract. It’s safe to in December. After failing to come to what DAZN had been willing to pay
TWITTER@SportBusiness | www.sportbusiness.com 11MEDIA
prior to the pandemic: $35m for Álvarez forced him to face top opponents. with Golden Boy and events promoted
and between $4m and $5m for his Whether or not the deal contained by Matchroom Boxing in the US and the
opponent. such a clause, DAZN wanted Canelo to UK. None of these events are considered
While DAZN and Golden Boy could face a ‘premier’ opponent and did not major subscription drivers in the US –
potentially have agreed to depart from want to pay the full amount for Canelo certainly not in comparison to an Álvarez
the original terms of their media-rights to face a contender that had limited fight – and the platform’s immediate
deal concerning Álvarez, the fighter’s appeal to casual boxing fans. future looks bleak should DAZN be
separate promotional contract with A separate five-year media-rights deal unable to resurrect a deal.
Golden Boy guaranteed a salary of $35m between Golden Boy and DAZN – in Álvarez will now promote his own
per fight. As DAZN wasn’t willing to which DAZN pays Golden Boy anywhere fights alongside long-time trainer
pay the full amount, Álvarez expected from $200,000 to about $600,000 per Eddy Reynoso and has multiple
Golden Boy to find another broadcaster event, depending on its quality – covers possible opponents. Sources say the
that would enable the promotion to a further 10 events per year and remains likeliest opponent will be IBF super-
honour his salary. valid until the end of 2023, when middleweight champion Caleb Plant
Álvarez’s suit claimed Golden Boy Canelo’s deal was originally set to end. on December 17. That bout would
“failed to put forth a single alternative If a reconciliation isn’t possible, appear on pay-per-view in the US,
plan by which it would pay Álvarez the the departure of Álvarez significantly a format DAZN publicly disavowed.
$35m it had promised him for each of weakens DAZN’s proposition in the US, Pay-television broadcaster Showtime
his fights”. Bound by its agreement with where it will now rely on its existing deal is understood to be in the driver’s seat
DAZN, the promotion had no way to to show the event, should the fight be
make up the shortfall. “I hope that the boxers that confirmed. Showtime declined a request
Another key stumbling block was the for comment.
come after me will realise that
quality of opponent Álvarez was set to Before Álvarez’s split with DAZN,
face. At the time the deal was struck, our rights as fighters have to be Showtime’s head of boxing Stephen
industry sources told SportBusiness respected.” Espinoza told The Athletic: “We did
they anticipated disputes over Álvarez’s some important fights in his [Álvarez’s]
Saúl ‘Canelo’ Álvarez
opponents unless the contract career, and we helped launch him
contained a legally binding clause that as a PPV attraction in the US. We’d
Oscar De La Hoya speaks to the Press during the Canelo vs. Rocky Grand Arrival/Welcome party. (Bill Tompkins/Getty Images)
12 www.sportbusiness.com | TWITTER@SportBusinessMEDIA
a lower-cost, longer-term subscription
package may have been a better option
for the fan, but it certainly wasn’t
favoured by top-level fighters that thrive
on the opportunity to earn more for
each bout.
Crucially, the anti-PPV stance
prevented fighters tied to DAZN from
competing against fighters signed with
other promotions and broadcasters,
which rely on the pay-per-view model to
strike deals with one another outside of
fixed-term broadcast contracts.
Another warning sign was the
duration of the deal – 10 fights and five
years – which leaned heavily on the
strength of Álvarez’s relationship with
Golden Boy and De La Hoya. Rumours
of a rift between boxer and promoter
began emerging in 2017, a year before the
deal with DAZN was struck, eventually
progressing to the point where Álvarez
and De La Hoya were no longer on
speaking terms.
Saúl ‘Canelo’ Álvarez. (Ethan Miller/Getty Images)
As DAZN’s contract was with
Golden Boy and not Álvarez, the
love to be in business with him again. announced. Álvarez’s $35m-per-fight streaming platform put immense faith
We’re obviously going to respect his guaranteed purse, regardless of the – and an immense amount of money
existing contracts. We’re not going to opponent, was the first sign of trouble. – in a relationship that was quickly
run afoul of that. If there’s a time when Guaranteed purses over the long term deteriorating.
he’s available, we’ll be very aggressive. create a dual problem: they offer a Even if that relationship had appeared
We have a lot of offer. But the time to fighter no financial incentive to face rock solid, boxing history indicates
pursue that is only after it’s clear he’s tougher opponents while also limiting a that bonds between superstar fighters
contractually able to do so.” fighter’s earning potential against those and promoters have limited shelf lives.
Álvarez’s other option – a bout against tougher opponents. Aside from De La Hoya’s infamous split
Matchroom Boxing’s Callum Smith – is This isn’t to say DAZN’s logic was from Top Rank, Floyd Mayweather Jr.
being touted by the promotion’s chief faulty. If Álvarez receives $35m for a and Bernard Hopkins are other notable
executive Eddie Hearn. That fight would fight against a lower-ranked contender, examples of fighters that split with their
appear on DAZN in the US, meaning the another $35m purse against another promotions midway through a deal. In
platform will have high hopes Hearn can superstar would balance things out, almost every eventuality, fault lines in
secure a deal. while providing long-term security that contracts are exposed and settlements
Prior to the split, Álvarez’s next bout couldn’t be offered elsewhere. are reached.
would have been the primary attraction But DAZN had no contractual power More than guaranteed income,
offered by DAZN’s new global boxing to force Álvarez into facing certain superstar fighters want control over
platform, which is set to launch in opponents. His long-time middleweight their careers at a time when their
December at a global price point of rival Gennady Golovkin was also signed earning potential is greatest. Álvarez was
€1.99/£1.99 per month. Instead, the to the platform in a five-fight, $15m-per- no different.
platform is currently set to launch with a fight deal, appearing to smooth the path “I hope that the boxers that come
bout involving Golden Boy fighter Ryan to a third fight between the two. But it after me will realise that our rights as
Garcia and Matchroom Boxing fighter is understood Álvarez had no interest fighters have to be respected,” Álvarez
Luke Campbell on December 17 – a bout in facing Golovkin for a flat fee of $35m, told TV Azteca. “For me, the important
with rather less appeal to casual boxing starving DAZN of the event it needed to thing was that I’m a free agent, not
fans. generate a critical mass of subscribers. the money. This is one of the most
DAZN intended to disrupt boxing important periods of my career. Eddy
Doomed from the start with a model focused on long-term Reynoso and I will be the co-promoters
For many boxing industry veterans, commitments and fixed payments, of my fights. What I want is to make
alarm bells were ringing as soon both for the customer and the fighter. good fights, which is what people want
as Álvarez’s deal with DAZN was Replacing expensive pay-per-views with to see.” Z
TWITTER@SportBusiness | www.sportbusiness.com 13Euroleague strives to regain momentum
PROPERTIES
after losing a season to Covid
Euroleague Basketball overall revenue Double-digit growth on 2018-19 Key sponsorship renewals kept under
about €70m for 2020-21, should shows that competition is rebounding wraps due to Covid layoff sensitivities
season be completed after cancelling last season at brands
(Pedro Salado/Quality Sport Images/Getty Images)
Callum McCarthy from media rights refunds; sponsorship understanding ours, we came to healthy
B
losses were stemmed by providing conclusions with our partners. Across
efore the pandemic, partners with added inventory and deal the board, we were able to manage very
Euroleague Basketball extensions. low cash rebates. On the sponsorship
executives were delighted with Jose Luis Rosa-Medina, Euroleague side of things, the rebates were below
the figures coming out of the Basketball’s senior director of corporate pro rata, even though we missed the
competition’s 2019-20 season. Overall partnerships and marketing, tells most important games of the season.”
annual revenue was expected to increase SportBusiness that the competition’s While Euroleague Basketball’s media
from €62m in 2018-19 to just under long-term commitment to its brand business was hit hard, the competition
€70m by the end of 2019-20. Attendance partners paid off in a show of relative has taken stock of the damage and
was rising at most EuroLeague clubs, as leniency and loyalty. repaired it as well as possible. Rosa-
was engagement across league and club “A suspension became a cancellation Medina says that, should the 2020-21
social platforms. and, much like all crises, it started season be completed, Euroleague is in
In February, Euroleague Basketball with small panic attacks. But things position to secure a small increase on
was hopeful that Covid-19 would have a improved quickly and, in the end, went 2019-20’s expected annual revenue,
minimal impact on Europe. By March, much better than we’d anticipated. It’s indicating that the competition has not
matches were being postponed. In something I will absolutely remember: suffered lasting damage.
May, the body was forced to cancel the this crisis proved that we have very “We were two-thirds of the way
remainder of the 2019-20 season, losing committed partners.” to what would have been the most
about 30 per cent of its overall revenue He continues: “In the process of successful season in our history,”
in the process. The biggest losses came understanding their problems and them Rosa-Medina says. “The wish of
14 www.sportbusiness.com | TWITTER@SportBusinessPROPERTIES
all stakeholders was to keep that “There’s absolutely no chance that I see stability.”
momentum alive and that’s literally our future without Turkish Airlines, at The three-season deal with LRT, from
what has happened.” least in the mid-term.” 2020-21 to 2022-23, will see every game
A new media-rights deal with of Lithuanian club Žalgiris appear on
Quiet renewals Lithuanian public-service broadcaster the broadcaster, along with the season-
In order to keep revenues on track with LRT and a sponsorship deal with ending Final Four. It marks a significant
original expectations for this season, tractor tyre manufacturer BKT have departure from the strategy originally
Rosa-Medina and his team had to secure been announced. The BKT deal was outlined by IMG executives in the joint
key renewals while minimising losses completed via Italian agency Dao Spa venture’s early days.
for 2019-20. One of those renewals was as opposed to agency IMG, its joint Then, IMG Media’s top executives
the title sponsorship of the top-tier venture partner in a deal that runs for were opposed to deals with free-to-air
EuroLeague with Turkish Airlines, a an initial 10 seasons, from 2016-17 to broadcasters as a mode of increasing
company in an industry hit harder than 2025-26. exposure, preferring instead to secure
most by the pandemic. Euroleague exclusive deals with pay-television
Basketball also had to renew a premium “This crisis proved that we have broadcasters and use digital platforms
partnership deal with sportswear to gain exposure and reach.
manufacturer adidas.
very committed partners.” “That theory may be true in
SportBusiness understands that Jose Luis Rosa-Medina | senior director some territories, but it depends
multi-year agreements were completed of corporate partnerships and marketing, on the territory,” says Alex Ferrer,
with both companies, but no official Euroleague Basketball senior director of marketing and
announcement has yet been made about communication at Euroleague Basketball.
either deal. Brands are currently wary “In Lithuania, basketball is like a religion.
of celebrating new sponsorship deals “Looking at the partnerships we’ve Obviously, the numbers made sense, but
at the same time they are making staff closed and renewed, we’re actually the reach LRT has is most important. It’s
redundant and cutting pay. above projections compared to where in almost every household in Lithuania
“What we can say is what has already we thought we’d be in summer,” Rosa- and that offered both Euroleague
been said in the press,” Rosa-Medina Medina says. “We’ve cemented six Basketball and Žalgiris an incredible
says, referring to Turkish Airlines’ premium partners and they’re all set opportunity to grow revenue on the
admission the deal had been extended. for the long term. It gives us a lot of sponsorship side of things.”
(Regina Hoffmann/Euroleague
Basketball via Getty Images)
TWITTER@SportBusiness | www.sportbusiness.com 15PROPERTIES
(Tolga Adanali/Euroleague
Basketball via Getty Images)
Clubs supported, but rules remain “The biggest concern we had asked fans if they would be willing to
While the league’s central revenues was what to do about the lost make a contribution to the club to cover
have been shored up for the near player and staff wages. Making this work
future, its clubs face a far more ticket revenue.” is all about communication and being
uncertain future. Unlike in top Roser Queralto | chief business transparent about the situation.”
European football leagues, clubs in the development officer, Euroleague Basketball While there are many similarities
EuroLeague and second tier EuroCup between European club basketball and
rely on matchday revenue for the European club football, Euroleague
majority of their income. clubs followed the recommendations Basketball is not following Uefa’s lead
In addition, the centralised revenue and in other cases, clubs had their in suspending its Financial Fair Play
Euroleague Basketball pays out to clubs own proposals for engagement that we regulations.
has been cut by 14 per cent in 2020-21 helped shape.” The league brought in its own
as the competition looks to balance its Much as in European football, Financial Stability and Fair Play
books for the future. As a result, the restrictions on attending sports events Regulations in 2019, aiming to reduce
organising body is regularly meeting vary from country to country. Some team owners’ ability to inject cash into
with clubs to assist them with creating clubs such, as CSKA and Khimki in their clubs every season. Currently, 65
new revenue streams while arenas are Russia, are allowed to host fans, while per cent of a team’s overall budget can
part-filled or empty. others have had to ask fans to purchase be provided directly from the owner’s
Roser Queralto, Euroleague season tickets on a speculative basis. pocket, rather than from revenues.
Basketball’s chief business development Queralto says that most clubs were The competition is reducing that
officer, says: “The biggest concern we successful in appealing to their fans for percentage each season until 2022-23,
had was what to do about the lost ticket support. when an owner will be able to provide
revenue. Most of the clubs sell complete “Each one of the clubs did something only 40 per cent of a club’s budget.
season tickets covering EuroLeague and a little bit different. Some clubs Queralto says there will be no relaxation
domestic league matches, so it was about sold season tickets with certain of these rules due to economic
finding creative ways for clubs to speak commitments about what would happen hardships brought on by Covid-19.
with their fans about that. Most of the if they couldn’t attend matches. Others “Despite the fact that Covid-19 has of
16 www.sportbusiness.com | TWITTER@SportBusinessPROPERTIES
course changed our reality, we need to right now. The league understands the “We never had talks with them about
keep up with the project. We cannot go need to be flexible for a short period of cancelling the joint venture,” Ferrer
backwards, and we should not change time to make sure we are all in the best says. “IMG shared what was going on
the plan.” position possible once this pandemic (regarding the company’s financial
However, Euroleague Basketball ends and people are back in the arenas. status) but our conversations were
will not stand by and watch a club just about managing financials, cash
go bankrupt for the sake of its own IMG still invested flows and minimising the damage while
bureaucracy. Clubs can apply for special Managing relationships with brand and continuing to plan for the future.”
dispensation to break these rules, but broadcast partners was essential for Ferrer says that Euroleague Basketball
only if they can prove that Covid-19 is Euroleague Basketball to mitigate the and IMG have drawn up a new five-year
the cause of their issues. damage, but the continued commitment business plan which details how they
“If they cannot do that, we are not of joint-venture partner IMG was just as will increase revenues and audiences in
changing the rules. We will look to see important. and outside Europe.
whether Covid has caused the problem, IMG’s parent company Endeavor “We also have worked on a digital
then make absolutely sure that this is was hit hard by the pandemic, having transformation plan over the next
the case. If so, the rules will be modified its credit rating downgraded to ‘junk’ three years, as well as a new brand and
for that specific club, during this status in April. In May, Endeavor positioning strategy. All of that has
specific moment. Otherwise, everything secured a $260m term loan at an happened in the background with IMG.
remains the same. The clubs know what interest rate of just under 11 per cent It proves that they never thought of
they are enrolling themselves to.” to shore up its cash flow and prevent leaving this partnership.
Queralto says clubs have reduced the need for any premature deal “I am crossing fingers and touching
their budgets by just five per cent for cancellations. wood for the future, but the numbers
the 2020-21 season, emphasising that Back in 2015, IMG agreed to pay we are seeing now confirm that IMG
clubs are confident about their financial Euroleague Basketball a minimum weren’t wrong. Our figures are very
situation. guarantee of €630m over the 10 seasons good for this season, much more than
Ferrer adds: “The owners are very from 2016-17 to 2025-26 – a significant we expected in July. Hopefully, we won’t
solid. At some point we might face outlay for any business. However, have a catastrophe like last season, we
some discussions around Financial Euroleague executives say the agency’s will complete the season, and everything
Fair Play but that isn’t of concern to us faith in the project never wavered. will go back to a new normality.” Z
(Moritz Eden/City-Press
GmbH via Getty Images)
TWITTER@SportBusiness | www.sportbusiness.com 17Montagliani: Cup revamp to create excitement,
PROPERTIES
unpredictability and a commercial lift
tournament expanded to 24 teams, while format tweak enables Mexico part in the 2021 and 2023 editions as
including 12-team preliminary round and US to meet before final guest participants
Live draw introduced for first time, Asian Cup champions Qatar to take
Concacaf president, Victor Montagliani. (Photo by Omar Vega/Getty Images).
Bob Williams Between 2017 and 2019, the Gold Cup centralised location in the States from
R
expanded from 12 to 16 teams. Next July 2-6. These are: Bahamas, Barbados,
egional governing football year’s tournament will feature 24 teams Bermuda, Cuba, French Guiana,
body Concacaf has given its from the region, including 12 teams that Guadeloupe, Guatemala, Guyana,
flagship tournament, the Gold have already qualified for the group Haiti, Montserrat, St. Vincent and the
Cup, a comprehensive revamp stage and 12 teams which will take part Grenadines, and Trinidad and Tobago.
in order to expand participation to in a new knockout preliminary round. Three of these teams will qualify for
member nations and to provide more Teams qualified for the group stage the group stage, which begins on July
excitement and unpredictability for via the inaugural Concacaf Nations 10 at yet-to-be-decided venues in the
players and fans alike. League group stage, which took place US. Due to the Covid-19 pandemic, it is
It is hoped that the moves, which in late 2019. These are: Canada, Costa unclear if fans – or how many fans – will
have been driven by Concacaf president Rica, Curaçao, El Salvador, Grenada, be allowed at games, which run through
Victor Montagliani, will lead to a spike Honduras, Jamaica, Martinique, Mexico, the Gold Cup final on August 1.
in interest both in terms of stadium Panama, Suriname, and the United Notably, Trinidad and Tobago are only
attendance and television ratings and, in States. provisionally in the preliminary round
turn, improve the commercial fortunes The 12 teams competing in the following a suspension of the Trinidad
of the biennial international men’s team preliminary round will take part in a and Tobago Football Association
tournament. two-stage knockout competition in a imposed by world governing body Fifa.
18 www.sportbusiness.com | TWITTER@SportBusinessPROPERTIES
(Concacaf.com/Straffon Images)
They will be replaced by Antigua and “Our strongest link on the pitch has been tweaked so that the top-seeded
Barbuda, should the suspension not be teams – namely Mexico and the US –
lifted by December 18. has been the duopoly of the US will be able to meet before the final for
Tying together the Concacaf Nations and Mexico.” the first time.
League and Gold Cup ensures that Off the field, the Gold Cup has grown
Victor Montagliani | president, Concacaf
participation in the tournament is no steadily over recent years, with the 2019
longer guaranteed for any of the 41 final – a 1-0 victory for Mexico over the
Concacaf member associations. As US at a sold-out Soldier Field in Chicago
such, the move ensures that Gold Cup while Concacaf is the host federation of – generating an audience of 8.5 million
participation will now be based on the 2026 tournament, which is being co- viewers across the region. This was an
merit, not Fifa world rankings or even hosted by the US, Mexico, and Canada. increase of 116 per cent from the 2017
commercial considerations. Qatar is the second team from Asia to final.
The new-look preliminary round play in the Gold Cup after South Korea, And it is hoped that the tournament’s
replaces the Road to Gold Cup which participated in the 2000 and 2002 revamp, coupled with a brand refresh,
Qualifiers, which were scheduled to editions before co-hosting the World will help drive the tournament forward
be played in the suspended March and Cup with Japan in 2002. Qatar also in the build-up to the 2026 World Cup
June Fifa match windows this year. It competed in the 2019 Copa América. and beyond.
gives more teams from the region the Meanwhile, Concacaf introduced a SportBusiness spoke to Montagliani
chance to compete in the Gold Cup live draw for the first time in order to about the strategy behind the changes,
and, as mini-tournament, it is likely to add excitement in the build-up to the both on and off the field.
generate further interest and excitement tournament and to remove a long-
to the competition as a whole. standing perception that the group Why exactly have you made these
In another change, Asian Cup stage was put together with mainly changes to the Gold Cup?
champions Qatar have been awarded commercial considerations in mind. It’s a product that has been growing
a guest spot in the 2021 and 2023 The showpiece event, which was held every year, our numbers grow with every
tournaments. The move follows a on September 28 in Miami, Florida, edition, not only from an attendance
memorandum of understanding signed was aired on TUDN in Mexico and standpoint but also from a TV audience
in 2017 between Concacaf and the Asian the US cable network FS2 in the US standpoint. We have blue-chip sponsors
Football Confederation designed to and Caribbean, streaming service One that have come on board with this
share learnings and best practices. Soccer in Canada, as well as other local product, which have activated really
By coincidence, Qatar is the host partners in the region. well. So it’s been growing on and off the
nation of the 2022 Fifa World Cup, In a similar move, the knockout stage field, with good organic growth.
TWITTER@SportBusiness | www.sportbusiness.com 19PROPERTIES
We were in some ways fortuitous in It’s not so much they were looking for out. But this edition, we don’t have
taking advantage of the situation with a change, these were ideas that were international venues – it is something
the pandemic. Our qualification was brought up in our new vision of ‘one we will look at in the future – but
going to be home and away [ties] as Concacaf’. Once we started socialising because of the situation we’re in with
with the Nations League but as we were these changes and opportunities at the pandemic, it was important for us
not able to play those [games] because both the membership level and then the that we keep things tight.
of the calendar, we decided to play this commercial and broadcasting level, they Right after the 2019 Gold Cup, I
preliminary round, which for me is a saw an opportunity here for themselves made it very clear that we were going
stroke of genius and really adds to the as well. It wasn’t something that they to have a draw. It’s just the right thing
value of the tournament. I know our were asking for, or looking for, but it to do. I think at some level there was
member associations, the ones who was something that we brought forward. nervousness by some of the member
are playing in it, love it. They love the associations because they just don’t
whole concept and the idea that their “When you have a product that know where they are going to be. Now,
players get to experience a Gold Cup [depending on] how you do in the
environment when some of them have
gets better on the pitch, you tournament, you could have two of the
never had that experience before. have more drama.” perennial favorites [Mexico and the US]
Tying the Nations League to the Victor Montagliani | president, Concacaf meeting before the final, depending on
Gold Cup has been to us a tremendous how they do in the groups.
outcome because the Nations League in If you look at some of the groups,
and of itself has been very successful. there are some really competitive and
Now that there is a real qualification One of the big changes is a draw intriguing matchups. There is a debate
process to get into the Gold Cup, even for the first time, why have you which is the ‘group of death’ and those
teams like the US and Mexico have introduced this? are discussions that never used to
to qualify, I think it underlines our My first Gold Cup was in 2017 and... happen in Concacaf and now they are
football-first mentality since I walked in one of the things I found a bit strange happening.
the door four years ago. was there was no draw, it was done for
reasons of putting teams, for instance, There has been a sense in the past
To what extent did you discuss where ticket sales would go well. In that Mexico and the USA were
these changes with the national 2019, we had two international venues, purposely kept apart until the final.
federations, broadcast and in Jamaica and Costa Rica [as well as How important was it to change this
commercial partners? Were they the US], so it was a bit difficult to do a perception and allow them to meet
looking for a change too? draw because we wanted to help them potentially in the semi-finals?
“As the sporting governing body,
we’re supposed to be providing
the answers.”
Jon Ridgeon | chief executive, World
Athletics
(Matthew Ashton - AMA/Getty Images)
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