#Sportsbiz Recap — August 7, 2016

NBC’s Rio Plans: A Focus on Prime Time and a Flood of Streaming by Richard Sandomir

Excerpts:

  • Most-streamed sports event ever, NBC will also offer 4,500 hours of coverage online.
  • More people are watching live sports on mobile devices.
  • Research found, streaming all day does not hurt viewership of the critical, lucrative broadcast in prime time.
  • NBC reported that it had sold $1.2 billion in advertising for the Rio Games, about 75 percent of which was targeted at prime time…10 percent of the revenue is from streaming, which is up by a third from the 2012 Summer Olympics in London.

My opinion is that NBC Sports is smart to realize the full value of their Olympic rights. Giving consumers access to all events in real-time (with exception to the Opening Ceremony). Rights-holders still need to figure out a way to capitalize on the streaming rights, with over 4,500 hours of coverage pulling in only $120 million in revenue.

ESPN Front Row: ESPN operating within video usage restrictions for Olympics coverage 

Excerpts:

  • SportsCenter and other ESPN news programs cannot air any Olympic highlights until the conclusion of NBC’s prime time coverage on the west coast, roughly 3 a.m. ET. Also, no news conference video can be used until 30 minutes after the conclusion of the conference.
  • ESPN may air Olympic video in all ESPN news programs, with a maximum of six minutes per program, and up to 72 hours after the window of opportunity opens.
  • ESPN will link to NBC’s live streaming coverage from ESPN.com and the ESPN app during the Games, in exchange for 10 daily digital video highlights (available 30 minutes after the conclusion of an event).
  • The 10 a.m. edition of SportsCenter, hosted by Hannah Storm, will air daily from Rio Aug. 8-12, the first week of the Games.

All non-NBC networks will be affected by the rights agreement exclusivity. ESPN joins many others with some type of digital rights agreement. ESPN supplementing their coverage of the Olympics games with live coverage and interviews from Rio will have to cover their highlight shows without the use of highlights.

Buying an MLS Franchise just got a lot more expensive by Scott Soshnick

Excerpts:

  • Major League Soccer is preparing to nearly double expansion fees to about $200 million, MLS Deputy Commissioner Mark Abbott said in an interview.
  • Owners of the L.A. Football Club paid $110 million to put a second franchise in Los Angeles.
  • MLS teams are worth an average $157 million
  • Target is to expand to 28 teams

MLS will continue to grow due to the growth of the game in the United States along with the high get-in price of the other professional sports leagues in North America. My only concern would be that the league may be looking to expand too quickly.

Want to Sponsor the NFL Season on Snapchat? You’ll Need $7 Million by Garett Sloane

Excerpts:

  • Asked for as high as $7 million for season-long deals.
  • It may be a steep price, but it fits Snapchat’s business ethos, which is to never undervalue its itself.
  • Many advertisers are interested in the platform, because of its young audience that’s hard to reach outside of their mobile phones.
  • Snapchat is taking the lead selling NFL sponsorships, the agency executive said, and some deals could include Super Bowl marketing on the platform.

Snapchat’s young user base along with the success of campaigns such as the Gatorade filter during the super bowl attracts brands. As the article discusses, the high price for exclusivity is similar to the NFL content on Twitter’s platform due to the large avid fan base. Snapchat as an advertising platform was questioned up until about 18 months ago. Since then, the platform has proved to be a highly interactive, engaging platform for a hard to reach young demographic that are often on their mobile devices. I’m not sure how many advertisers they will lure in at the $7m price tag but they will inevitably do very well as they unveil other NFL ad packages.

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