Diary of a Sports Cord Cutter: Coming True

By Brad Hubbard | @bradhubbard | 8.7.2017

In a post back in May I pointed out how the little guys were primed for big things when it came to over-the-top (OTT) services. I thought this might be six months off but I was wrong. Two months later The Big Sky Conference signed a deal to have all of their football and basketball games shown on Pluto TV which can be found on just about every OTT device (Roku, Amazon Fire, etc). It’s a trend that will continue and the time for your own private sports channel is finally worth doing.

While the Big Sky Conference isn’t going to bring huge numbers to Pluto TV, it is a niche group. The alumni from Eastern Washington who now lives in Austin,Texas can see their Eagles square off against Portland State. The Montana State Bobcat alum who lives in Sacramento, doesn’t have to make the trek to Bozeman to see them take on Montana in November. It may not seem all that impressive but it’s giving consumers what they want which means they will probably stick around longer which means you can sell more ads and generate more revenue.

The National Lacrosse League (NLL) is showing how to make your own network by using the right combination of platforms to reach your audience. As a recent Bloomberg article pointed out that the NLL is able to charge customers a $35 subscription to watch the league’s OTT channel but it also gives fans a game a week live on Twitter for free.

People are starting to see not just the economic benefit that moving to a straight OTT platform can provide but also the indirect revenue that it can generate.

Mountain West Championship 2016

One of the major topics of discussion that this years Mountain West Conference media days was the possible move away from traditional broadcast partners and to their own OTT channel. Why? Well one of the biggest complaints coming out of the conference the last few years has been the kick off times. Boise State currently has five games scheduled for kick off 8pm or later and three games on week nights. When you get into October and November, it’s not exactly getting any warmer in the mountains when the sun goes down and fans are starting to stay home. That means less revenue from tickets, concessions, parking, etc. Fans have been complaining about this for a few years now and by the sound of it, Commissioner Craig Thompson is listening.

Each conference and league looks at cord cutting a different way but in the end it’s all about one thing, money. Whether it’s about holding on to revenue or if it’s about generating more, each league and conference needs to come up with their own acceptance criteria of what’s best for them. The good news is that there are plenty of platforms and plenty of combinations to try to find out which one is going to suit them the best.

BAM is for Billions

By Brad Hubbard | @bradhubbard


BAMIt wasn’t a secret that Disney was looking to take a stake in MLBAM (BAM) but the end number may surprise some folks. According to Bloomberg Disney is buying 33% of BAM for $3.5 billion with an option to buy more in a few years. That is a valuation of over $10 billion. Not bad for an entity that doesn’t even turn a profit yet.

A few years ago Fast Company did a profile on BAM and within that article there was an estimated IPO price for BAM in 2005. That number was $2.5 billion so the company has essentially increased around $8 billion over the last 11 years. If you did some loose math based on that article you could see that BAM was more or less breaking even.

That’s not to say that MLBAM isn’t worth a $10 billion valuation. They are a white label solution as their CEO Bob Bowman would say. They are the streaming backend for MLB, WWE, NHL, Watch ESPN and have even done the Super Bowl. They made bets that paid off and with this purchase by Disney, it puts them in a position to stay in the lead when it comes to live video streaming.

Disney for it’s part made another shrewd investment. It’s no secret that their cash cow, ESPN, is having to adjust to the new realities of cord cutting. Enter an investment by it’s parent company and Disney has created an A to Z revenue stream when it comes to over the top video. It’s like selling the car and the gas that goes in it.

This is a very smart purchase by Disney. They have the cash to do it and it’s very well timed. It’s no wonder that the Disney board wants Bob Iger to stick around a bit longer. It will be interesting to see if BAM competitors like NeuLion look to cut deals or merge with CDN or network. In the meantime the only one doing better in this space is probably Amazon.com.

Bloomberg.com: The Digital Example for Sports

By Brad Hubbard | @bradhubbard

Bloomberg is a pretty big company. It’s founder, and current New York City Mayor, is Michael Bloomberg and the company itself has multiple units from Professional Services to News & Media.Those Media assets include Bloomberg TV and bloomberg.com. Telling the difference between the two is sometimes pretty difficult which is why sports leagues should take notice.

Bloomberg

Bloomberg.com streams live TV and has on demand original shows like C-Suite. Other networks do this too, sort of. The difference, with Bloomberg is you don’t need any kind of TV subscription. It’s just out there and free for anyone to watch.

That’s right, free for everyone.

Bloomberg Video Page

Not an add on or free with your subscription. Just free.

To watch ESPN3 or use their WATCH ESPN App you need to sign in and prove you have a cable or satellite subscription. Even then you may not get complete access to all the live games (ask DIRECTV users about that). Bloomberg on the other hand is the complete opposite. They give total access to everyone regardless of cable or satellite subscription status.

The NFL, NHL, NBA and MLB all have their own TV networks yet not one has free, live streaming. They all have highlights from their broadcasts but none offer 24 hour live streaming of their studio shows much less their games.

Why not?

In a word, money. They feel they can make money doing it the same old way they’ve been doing it. They also probably fear that if they did something similar to Bloomberg then they’ll upset the cable or satellite operators.

As a man once said, ‘fear is tissue paper disguised as a brick wall.’ Make no mistake cable and satellite providers need content and the more live content the better. Sports is pretty DVR proof which means that people need to sit through ads. Why sports leagues continue to do it the same old way is beyond modern thinking.

To be fair, Bloomberg makes most of their money through their professional services division where they sell financial software tools, analysis and an actual Bloomberg terminal. So they are diversified within the financial world. However, this should mean that they would protect certain assets vs. opening them up to everyone. According to the old game plan that the sports leagues and ESPN are following is, ‘protect the TV and continue to charge the cable and satellite providers more per customer.’ But Bloomberg goes the new route. Open up as many revenue streams as possible by going where your customers are.

Yet here we are. In a world where a financial services/news company live streams their video content 24/7 for no charge and sports leagues and networks don’t or make you verify your paying status.

A word to the sports folks, from leagues to networks, follow the Bloomberg model. You’ll be amazed by the fan support, the young demo’s you’ll attract, and the new ad revenue streams. Or continue do they road you’re going and hope for the best. As one of Rumsfeld’s Rules states, “If you’re coasting, you’re going downhill.” (L.W. Pierson).

Bowl-ed Over: The plethora of bowls and why there should be less of them.

It’s Bowl season in College Football and we do mean season. Between Saturday December 15, 2012 and Monday January 6, 2013 there will be a total of 35 bowl games with a grand total payout of $260,673,125.

That’s right, over $260 million is going to the teams that play in the bowl games and their conferences. The biggest payout is the BCS National Championship game which pays out $18 million to each team and the cheapest is the Famous Idaho Potato Bowl which pays $325,000 to each team. In any event, this is big money.

But should there be so many games? When this kind of money is on the table the response is usually an unequivocal YES! Yet if you remove the dollar amounts think about this; in some cases they are rewarding mediocrity.

12 .500 teams will play in bowl games (2 games will actually feature .500 teams against one another) and 1 sub-.500 team. Georgia Tech will get paid $2,000,000 to play USC in the SUN Bowl on New Years Eve Day. A team with a 6-7 record is getting $2,000,000.

Virginia Tech by all accounts had a down year. They have played in 5 BCS Games (which have multimillion dollar payouts) in the last 10 years. With high preseason expectations they find themselves at 6-6 and heading to the Russell Athletic Bowl in Orlando, Florida. While a 6-6 season is a down year for Va Tech it is an exceptional year for their conference rivals Duke. Duke is going bowling for the 1st time since 1994 (the game was played on January 2, 1995) in which they lost to Wisconsin. So a 6-6 season to Duke is a success.

Even with this perspective is it appropriate to award a post season game and in some cases millions of dollars to a team that didn’t even have a winning record? If the answer is ‘no’ then there should be less bowl games. If the argument is for the current system then please this Bloomberg article from 2010. Just because you go to a bowl game doesn’t guarantee a financial windfall for the teams or the conference. It also doesn’t teach college athletes to strive to be better.

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