Unofficial Partner Podcast
Unofficial Partner Podcast
UP433 The Bundle - NFL and FIFA global ambitions; The Gary Lineker Question
Welcome to The Bundle, our regular series on the sports media and streaming marketplace with co-hosts Yannick Ramcke, General Manager of OTT at the streaming service OneFootball and Murray Barnett, founder of 26West Consulting and formerly of F1, World Rugby and ESPN International.
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they want to build. A new window, which would effectively give them a new package, which would be an early Sunday window. So another time slot that would be available on a, global basis. And one of the reasons why, you know, Godal has come out and said that he wants this 25 billion target by 27 is the recent announcement that private equity can take a minority stake in NFL teams. So, obviously, they're at a time where they wanted to talk up the potential for revenue growth and what that could do for the team's valuations.
Hello, welcome to Unofficial Partner. This is another episode of the bundle, our regular series into the media rights and streaming market with my co-hosts Marie Barnett. Who've just heard there. Founder of 26 west consulting, and formally of formula one world rugby and ESPN international. And he's joined as ever by Yanik Aramco, general manager of OTT at the streaming service. One football. This podcast is sponsored by. We are sweet helping you tell compelling stories in the moment as they happen from the heart of the action. We are sweet captures live biometric data from athletes. To uncover storytelling moments from key, major moments to subtle micro moments, you might not even know are taking place. These are crafted into captivating stories and transformed into stunning visuals. Ready for your broadcast live event displays and second screen fan experiences all in real time. From head-to-head heart rates to anticipate it overtakes. We are suite provides AI driven insights to fuel conversations, inform bookmakers, and predict future outcomes. All in the name of deepening fan engagement, enhanced your audience's understanding of the action. Like never before. By using live data from, we are sweet.
Richard Gillis, Unofficial Partner:So, welcome again to the bundle with long time collaborators. Should we call you that? Murray Barnett and Yannick Oramka.
Murray Barnett:Hello.
Yannick Ramcke:Hi guys.
Richard Gillis, Unofficial Partner:So myself and Yannick. appeared at Sportel this week, Monday morning, kicked off the whole shebang with our panel and the bundle live and Murray Barnett was at Amazon a couple of weeks ago where he was the star turn at the another bundle live, which I think he's gaining some momentum in the marketplace, let's put it that way. But we are going to talk about several Recent items of news and then explain or talk about what they actually mean or might mean. So we're going to go through and we've got, FIFA's club world cup. There's a lot of media related stories that are spinning off that as we speak. The NFL first and goal with even more media revenue. So we're looking at the international series and there's an interesting comparison there. between the NFL and the and FIFA's approach to growing their market. We've also got La Liga obviously out there, looking at a U. S. expansion as well. Then we get into what is a very congested American sports television market and looking particularly through the lens of the WNBA finals, when their attempts to, to find a space within the, What is effectively NFL season in the fall. Then there's a couple of other items. Does an on air talent matter, which is a really interesting topic, which I think is going to go, in lots of different directions. So I'm going to start off with Murray Barnett. I want you just to explain Or give us a bit of context for the Club World Cup, FIFA's new, tournament. It's not a new tournament. It's a sort of re up of the tournament that's been going for a while, but this certainly seems like a new, iteration of it and they're trying very hard to, sell it to the various constituencies of players and clubs and media sponsors and everyone's got, seems to have a point of view on it. What's yours, Murray?
Murray Barnett:Well firstly you're right it's a competition that's been around for a while but they're expanding it out to include 32 teams. And it'll take place in the U. S. from mid June to sort of mid July in 2025 with the theory being that it's a good sort of segue into the World Cup there in 26. And then after that, it will take place, I believe, in Saudi for a number of editions. So they've been out in the marketplace trying to. Generates sort of one and a half billion dollars worth of commercial revenue of which they expect about, or they wanted. 750 million of that to come from TV revenues or media revenues, but they're sort of approaching the market at quite a challenging time with obviously the expectation that a large chunk of that will come from the US, but then also sort of relying on the traditionally large markets to also ante up significant amounts of money if they can't get a global offer from a streamer.
Richard Gillis, Unofficial Partner:So I thought sport business and Inran Yousuf, I think we'll just give him a a shout out because I think he did some really interesting work on this and it's worth checking out their story because it's got some lovely little bits of detail. Before we get into some of that detail, Yannick, what's your just general view on the, on what's happening
Yannick Ramcke:I mean, I like the scene setter of from both of you. Okay. Is it actually a new, is it an enhanced, is it an expanded version of what has been there before? Yeah, but regardless of how fruitful. or not the process has been to date and actually translating this into revenues. I think the one thing that FIFA was successfully able to do is to reframe that competition. The sense of it's considered new. It's considered a completely different property than it has been before. How this now translate into commercial impact that is now the challenge ahead. And as Murray alluded to. It might be more challenging and less straightforward than initially thought. And just one note before we get into this. Also looking at it from the other side of things, which are the teams and players. I think you could not have missed, especially from the leagues, using that as a stalking horse. Also for the fact that maybe tenders, processes, bidding, bidding auctions for domestic properties have been in best case flat as of late due to the fact that they are arguing it is cutting into the appeal and ultimately therefore willingness to pay from broadcasters of the domestic competitions because you effectively carve out or put on top like a mighty territorial competition with the best of the best. So. Let's leave this alone, but I think it's a lot of controversy around it, including that it has been used as an argument by the leagues that this is actually detrimental, not only for the players, overload and everything, but also their ability to actually monetize their IP that they bring to market.
Richard Gillis, Unofficial Partner:What do we think about this idea that it's crowding out? I mean, this is a media conversation in terms of media rights and that, that market. What do we think about the real pain for the leagues and, Javier Tebas, La Liga has been particularly vocal about it. He's going after um, Infantino with quotes like, if you are going to use FIFA funds to finance the money that is missing from the promise you have made to the clubs, you are taking it away from all those federations or places that FIFA says it is there to help. We're talking about more than the one and Billion dollars that will have to be drawn from that fund. The one bit that I think is, I say not the one bit, but I when looked at in the round, the sort of Bocca Juniors question, which is the, these clubs that are sitting outside of Europe and for years have atrified because the talent has all gone to Europe. I've got a lot of Sympathy for that. And I think that a lot of people will have sympathy for that. Now, that's just one element of it. But then you get to the media rights question. So Murray, what's the reality of something like this? You've got this You've got this. New and inverted commas tournament. Okay. It's six weeks and it's, you know, but it's in a significant window. How do you think that impacts on, do you think it is impacting on the demand for football more generally? Is that part of any conversations that they might be having?
Murray Barnett:There's a few different elements to that, isn't there? I mean, you know, FIFA's argument is that it's a maximum of seven games that you play once every four years. So from a player load perspective, it's not sort of significant. I think the sort of Subtitles between behind what sort of Tebas and Di Servio have said from Serie A is very much also, they can't expand the number of games that they play. So they are operating within a restricted environment. And so they're naturally throwing their hands up on behalf of their clubs saying, Hey, you know, we, Pay these players to take part in events and they're valuable assets for us, and we're now asking them to play in yet another tournament. And you know, a small part of this is that it's still not 100 percent clear what the teams that take part will actually get in terms of participation fees or prize money. So there's an element of. You know, uncertainty around what's the real value, but then also, if you're a Tebas, you want a Real Madrid to be only thinking about what's happening in the league, right? You don't want them to be thinking about what they're going to do in a, in a FIFA competition that happens at the end of the, at the end of the tournament. So I think that there's a sort of a definite undertow to what they say. And then there's another side to that as well, which is they also want to protect their own international media revenues. So anything which is a club based competition, which is potentially taking money away from them is not a positive step. So there's a couple of different layers under why they are sort of saying what they're saying. Although I probably agree just in general, do we actually need a bigger extended club competition?
Yannick Ramcke:So you are saying that it's actually a concept of a plan, which is there and exists as of today instead of a fully baked proposition, which also potentially makes it more difficult for bidders to. Commit to a certain check if like the entire concept and ultimately implementation execution is a completely not completely, but to some extent still up in the air, including participating teams and we can when we outlook get to, okay, what might be potential buttons to push in order to, Make it whole or make it an attractive investment case. But back to the question. Okay. Why should players and or leagues care? I think players, yes, the player lobbying group and interest group has voiced concerns about player overload and everything, but at the same time, Murray, as you said, it's. Time constraint in a compressed period of the year, and it is only impacting a very limited set of teams. So where I think they are rather coming from is there's no direct impact or guaranteed impact on player compensation. It's not like that we are operating on a, I don't know, salary cap where players are guaranteed a certain fixed share of the overall sports related income. That's not the. Business model that at least European football and South American football operates on. So I think it's less than overload, rather using overload a point on the player
Murray Barnett:also, to your point, you know, it, it actually serves FIFA much better, that it's not a fully baked sort of format or style. I mean, yes, it, okay, it's supposed to be the best 32 clubs, but we've already seen, as they find the market challenging out there, they found a way to, you know, shoehorn the, a glamor club like into Miami and messy. Into the competition by saying actually that the quote unquote champion of America is the champion of the regular season. And of course, you know, into Miami may go on and win the whole thing, but they've doubled down to sort of say, well, look, we're gonna say that the. I think it's called the shield or something like that. The winner of the regular season is in because they know they can guarantee that being, you know, the drawer of messy. So, you know, there's certainly being able to think on their feet or make the decisions as they go along, which best. Suit the, their desire to maximize revenues.
Richard Gillis, Unofficial Partner:There's a bit of me that's thinking back to last summer and you had that standoff with FIFA and the broadcasters around the Women's World Cup and they were, they were trying to drive the price up and there was brinkmanship and there was talking in public about, you know, setting prices. Expectations on one side, value on the other. And it feels like, this story, and again, this sort of coming down in expectation from one and a half billion in terms of commercial rights and how much they now think they're going to take from the American market. I just wonder how they make that sort of error in, Estimating it because, you know, you've only got to be around the place around the conversation to know that people are worried about the, in terms of media rights valuations and, and all the things that we've seen over the last sort of 18 months or two years in terms of more inventory for the same money or leveling off. Is it possible that they made a bet on Apple and the Apple uh, playing with them, you know, in public, or is it possible that they've, they've, made a mistake strategically in terms of coming to the market with the expectation that there's others around in the, again, going back to Imran's piece, there's some interesting stuff there about, Fox and NBC have come in with, with bids that are below what FIFA want. So again, we are always aware of. Negotiations going on in public and people sort of making statements and storylines being landed and narratives taking hold and we're part of that process to an extent. But what do you
Yannick Ramcke:Yes, it might be a combination of the two things that you mentioned. I think one is certainly self awareness or self perception that may impact expectations on FIFA side. So what do they perceive as subjectively speaking as their value in the marketplace? But the other one is also, it's always a negotiation tactic, right? Just because you try to anchor the conversation Somewhere, given that more often than not, also rights valuation are more art than science. I mean, there is some science backed in, but it's always based on assumptions, including and specifically in a new enhanced or expanded version where there is no guaranteed built in audience that has inherently and historically been proven to work. So, I think there's nothing against anchoring the whole discussion and asking price somewhere as part of the negotiation, whether or not they nonetheless over shot with their asking price. Discussion for another day, but back to what you said, did they miscalculate this whole thing by having gone all in or having fully bet on Apple coming in? This is then where we get into the zero sum game and why leaks may be at least not fully proponing this this concept and idea, because if you don't bring incremental bias into the marketplace. It is somewhat of a zero sum game and it's sucking out budgets from the existing market instead of incrementing the market. If the buyers, and this is what will take place is they now move from a global opportunity to a market by market approach. There will be the traditional buyer that otherwise. At least partially allocate funds to existing properties because any expansion of rights fees in a marketplace would need to come along with expansion on the revenue side. And I don't think that this property adds to the overall market size what a broadcaster can make in the sports programming market, whether traditional television, OTT or a hybrid of both. So I don't think it will be incremented and therefore also won't expand. The willingness to pay, so the cost base of broadcasters, which as by definition makes it somewhat of a zero sum game, which can't be like, to the benefit of, or won't be to the benefit of the leagues, therefore their obvious displeasure that they voiced or communicated.
Murray Barnett:Also at fifa, you're, you're dealing with two dynamics. You're dealing with a political dynamic, which is setting an agenda of how much money that they can get. And it's kind of, you know, the slightly Austin Powers sort of we're gonna generate a billion dollars of, you know, media revenue. As opposed to, you know, a lot of the very smart people who are at FIFA, who are working on this day to day, who are able to build it up and sort of work out, you know, what's the real valuation of this? And I think there'll be a lot of, you know, revisionist history that will come out of this that will say, look, you know, if we hadn't put out a 750 million target for media revenue, we never would have got to the, 450 or whatever they end up with, you know, if they'd started at that, they would have got a fraction of that. And so you've got to set this expectation much higher. I think the truth is you're coming into, as we've talked about, you know, a very flat market with quite late to market with a competition like this as well. I think you need to have spent more time baking it in, especially if your desire is to get the stream is really heavily involved in it. And I think the other thing to remember is it's a tournament that only lasts five weeks, you know, so for a traditional broadcaster, you know, they've already said that they're looking at the highest bidders, if you like, they're not looking for exposure, and it's very difficult if you're operating in a pay TV market, whether that's, a streamer or a Sky. to really market something that is five weeks as opposed to a league which is nine months, right? So it's only happening once every four years as we talked about, you know, you're thinking about your investment decisions where you want something that you've got a much longer window to market, and so it just makes it much, much more difficult.
Richard Gillis, Unofficial Partner:And you've also got the Saudi question, I think, you know, that's because it's floating around the next iteration of this, they're hosting it next time, and then you've got the story of PIF, will they won't they buy into DAZN, which I'm all for two plus two equals four. And I'm like one that will actually I can join those dots and see that that would be part of it. Again, we get into a different ROI, a Saudi PIF ROI, which is a different one than the normal broadcast conversation. I'm assuming anyway. Okay.
Murray Barnett:I think that FIFA 1 or whatever their jet is, is going to be spending a lot of time in Saudi.
Yannick Ramcke:And that goes back to maybe why they communicated the asking price that they communicated, because you need to have the buy in and you need to have both from the end consumer and especially from the participating clubs, because it's a, if it's a subpar set of participants, then also the consumer interest won't be there. And I think it has been reported that. Promises and guarantees were made on one side of the market towards the clubs, which puts the pressure on FIFA to also generate the revenues that can serve those financial guarantees in terms of participating fees and price money to serve. And I think this is now where the pressure comes in, where they may or may not also look into alternative means. Of finance finances compared to traditional media, right? Sales, where then you can expand the conversation to, okay, what are the levers left to be pulled? One, you mentioned Mary, which they just put using the baked in flexibility into this concept where you can add an inter Miami and with that you're in a messy to the tournament. Another level to pull might be alternative means of financing with yeah. Severing investment funds or similar vehicles.
Richard Gillis, Unofficial Partner:Let's go into story two, because it's connected and we can just, it's a quite an interesting comparison. And I made the comparison in the newsletter last week that you've got the NFL, another billion quid, billion and a half rumored new thing. And by new thing, again, it's not new, but it's a, it's a packaging of the international series. We in London and you in Germany, Yannick, have seen the NFL come into town and. You know, they've been coming to London for a long time and there's all been, you know, each autumn we get this, this story rumbling along. And now actually what we're seeing is Roger Goodall, who is on a target of his own making of 25 billion by 2027. I think that's still the case. That's still his target. So in a marketplace, as we've said before, in the same way as FIFA is looking at new markets, new, a new product, suddenly the NFL appear and say, right, okay, well, here's a billion and a half quid we wouldn't have had before. And. Let's create that. So the difference obviously is the control of the product that Roger Goodall has, or the control of the marketplace versus the type of control that Gianni Infantino and the FIFA team don't have. They don't control the players in the same way, or they don't have leverage over the players in the same way. And, and likewise, the. The clubs. So it's different, but there's similarities. Let's just get into what we think is happening here. Murray, we get the big top line, which is international expansion, new markets, a new product, the hallowed step change in, revenue, anything else that we should be aware of?
Murray Barnett:Well, it's a little bit different, but it's also the same. They, they want to build. A new window, which would effectively give them a new package, which would be an early Sunday window. So another time slot that would be available on a, global basis. And I think the interesting lens to look at this through is. And one of the reasons why, you know, Godal has come out and said that he wants this 25 billion target by by 27 is the recent announcement that private equity can take a minority stake in NFL teams. So, obviously, they're at a time where they wanted to talk up the potential for revenue growth and what that could do for the team's valuations. They've also been very sort of platform agnostic in the way that they've looked at selling their rights. So they have, you know, three deals with traditional broadcasters. They also have had, they also got a deal with Netflix, with Amazon, with YouTube. So, You know that they basically set things up so that somebody could come along and buy this on a global basis by this window on a global basis or potential potentially carve it up market by market to a certain extent. I think that they would see this as obviously a US play, but then with something that add some interest internationally, but the real money is going to come from the US and the thought that they could give to a Netflix, YouTube, Amazon. A global offering, potentially even an Apple maybe, although I think that's a bit of a long shot, is something that's kind of interesting for all of those where they'd be able to amortize the cost of it across a much wider group than just the U. S. And, you know, just to give it like a little bit of contrast, you know, the NBA has taken a view that It only has got sort of three national packages in the US, which is you know, there's, it's not quite as powerful perhaps as the, as the NFL, but it, they're a bit more concerned about viewer confusion about where things are and also sort of subscription fatigue with multiple different platforms, which doesn't seem to be such a big concern for the NFL. And certainly in talking to, you know, our American colleagues who work in sports marketing at this, in the States, you know, there seems to be much more of an understanding that the NFL is, is. I was going to say fractured. It's not the right word. It is divided amongst a lot of different broadcasters. So you get used to knowing where each of those slots are. And so, you know, each, you know, Monday night football on, on ABC, now ESPN, you know, you've got this kind of traditional slots, which everybody's aware of. So I think, I think as usual, they've just been super smart at, you know, Being able to figure out, despite making, 77 billion in media rights for the next 11 years, a way to potentially, even increase that just when you think that they've actually got to the maximum amount of money that we can get to. And there's another really interesting part about this, about the ability. For NFL to opt out of all their broadcast agreements with the exception of Disney at the end of the 2028 season, which is another sign that they're putting out there that there may be yet another package that's available. And I think it's just helping to create a lot of market tension for them, which will no doubt be hugely positive.
Yannick Ramcke:Let me just piggyback on a few things that you mentioned maybe the first thing with those. Not fundamentally different rights, strategies between NBA and NFL. I really think that they will frame the narrative that fits the situation. I think the NBA is in a different situation where they are in with a limited set of media partners. But for sure not because having an understandable, navigable media distribution mix is their highest priority. I just think often rights owners retrofit the narrative around then what the market reality is. But leaving that aside, speaking of like every rights owner has the same, but different challenges, right? It's a lot of similar things also compared to FIFA. Actions are driven by the incentive structure, right? Godel has put out his revenue target. The FIFA has made their guarantees to clubs, which are then impacting their own asking prices. So there are a lot of yeah, similarities between them, but then also fundamental differences. Another similarity is go to strategy, expansion of inventory, especially adding more exclusive broadcasting windows has been a go to a strategy to increase. Media rights revenue in football by UEFA, now by FIFA forever, has been a simple strategy for the NFL. So, I think a lot of different rights owners with same set, but also different kind of, And also regarding the media rights wizardry that, I mean, the NFL is like the best of the best when it comes to slicing and dicing. And two years ago, we thought, okay, with the 11 billion contract, we were set for the next decade. Ever since, they carved out a playoff package here that is streaming exclusive. They carved out the Christmas package, sold it to Netflix. No, they have a full fledged international package in the making, so I think, no,
Richard Gillis, Unofficial Partner:I had black, was it Black Friday that they sold to Amazon? Is that right?
Yannick Ramcke:that's yet another one that they came up out of thin air. And all of this post the 11 billion dollar deal,
Richard Gillis, Unofficial Partner:But it's interesting, isn't it? That, splintering of audience doesn't appear to bother them as in they, I don't know whether it's just because it's an anomaly and it's, you know, that, that other sports don't enjoy that because if this was the Premier League, we would be having a right old conversation about, well, this will lead to piracy. This is going to be undermining the long term value of the property. And none of that appears to stick to the NFL. It might just be that the NFL is a, is a different, different thing. It's almost beyond the sports
Yannick Ramcke:it's, it's one property of maybe the one of one or the one of very few that can afford to do this. It's not applicable to the common, even other tier one or let alone middle tier players. Properties and back to the framing. Yes. What does NFL say all about this? We need to be where the fans are, right? This is how then an NFL frames their revenue maximizing strategy, because it's nothing else, but that compared to an NBA for which it's a better set up to have a limited set of partners. And then they frame it as, yeah, we want to keep it consumer friendly. So this is like retrofitting outcomes with With a narrative, but NFA can simply afford to do it. I think they are looking for additional revenue catalysts because main revenue driver is media rights. Big chunk of the media rights were gone, but the option, okay, let's come up with additional incremental inventory. There might be opposition of existing rights holders, whatever, but they are the one rights owner who can afford to do this. And I have my small little own theory when it comes to this international package in particular in the sense of we discussed before that the NFL network owned and operated by the NFL or more specifically by NFL media. It's on the shopping block or it's sold in the, it's offered at least in the marketplace. We I think we discussed before interest of ESPN and everything. I think NFA Network really has an expiration date and has, as of today, one and one main purpose only, which is like warehosing the international rights until it has reached critical size, which may or may not be the 16 game package, where then this can be brought properly to market for licensing purposes. And then I think the entire reason to exist for NFA Network has also. And
Richard Gillis, Unofficial Partner:Murray, just a quick one before we move on to
Murray Barnett:Yeah, so just two sort of quick points. I mean, firstly, it's a sort of virtuous circle of flywheel, whatever you want to call it, that because broadcasters are paying so much and they have so many different partners, it's very heavily marketed as well. So there is a ubiquity around how the NFL is in the sports market in the US in particular, in the sense that it is literally, you know, you can't escape it every day. It's got this great narrative because it happens over roughly once a week. And so you have a way to, for broadcasters to really build up to it. And they really invest very heavily. We're going to come along, come on to talk a little bit about sort of talent and what role that might play, but that. There's a heavy investment by all of those six different partners, which means it's everywhere all the time. The other sort of interesting thing is you've got sort of whatever it is, two, two and a bit seasons, three seasons before the existing deals come up to market. I think we're also seeing a massive acceleration in the way in the change in the way that people watch sports broadcasting. So it's going to be at a really interesting time about whether. Knowing that they're agnostic about whether it's broadcaster or streamers who's going to end up picking up an extra package and indeed if they do open up their deals, whether they'll, there'll be a lot of shifting around between, you know, what had been the traditional buyers and what are the sort of the newcomers, if you like, in Netflix, YouTube, Amazon.
Yannick Ramcke:this is the opportunity that FIFA missed, and maybe NFL, since they are the pros of the pros, takes advantage of. The big tech companies are primarily globally operating companies. To align the right cycles, like the MLS did, in order to bring a global, all encompassing package to market and sell it to big tech such as Apple, this is a different job to coordinate. Investing or inventing a new property out of nowhere, you have a greenfield opportunity like the new Club World Cup or the new international package where you can really give those all encompassing global rides. There you will be domestically, but for big tech, it's nice to have to then also Have it in all the other market that they are that they're operating in. So let's see if they actually pound on that opportunity compared to fifa, because I don't think the ad for FIFA is available anymore. And the other one is with the opt-out that you said Murray. I think there are a couple of nuclear options that they can pull if the absolute priority is to hit 25 billion by 2027. Including for example Paramount Global being acquired by another party. There are normally like transfer of ownership clauses to open up agreements again. But I don't think they need to be or they need to do those things since it's the NFL. And let's see how far and further the international package will get them to the ultimate revenue target, which by the way, they are standing at about 2. 2 billion right now as of 2023, four more years to go 5 billion more revenues to find, I guess. And
Richard Gillis, Unofficial Partner:find a space now in the American market, particularly at this time of the year, when you've got the NFL and we discussed what a monster that is, so, There's a good story of front office sports, Alex Schiffer and Colin Salao the authors. Several WNBA playoff games have aired simultaneously with the NFL Sunday Slate, cannibalizing viewership. Brianna Stewart called the quick turnaround in this year's playoff schedule insane. So there's a sort of calendar issue. Obviously, you know, you've got the Caitlin Clark question, which is again, it's a sort of very American story in many ways. It's, I don't think we quite understand what the significance of her entry into the WNBA has been or is going to be and, or hoped to be. Mari, kick us off, just take us through this, because again, there's a, there's a couple of interesting little nuggets in there.
Murray Barnett:Yes, this is probably going to be a much shorter story than the other two that we've had, but I thought it's kind of interesting how congested and difficult the US sports landscape is, especially when we talk about the likes of FIFA wanting to get in there, albeit in a slightly clearer time in the summer, but you've also got football. You know, Rugby World Cups, the women's in 29 and 31 planned to be in the U. S., which would be in a somewhat similar time slots to WNBA finals, and it just shows how something that is on a tear and doing extremely well is really up against it in a very, very congested Broadcast time. And it's not just WNBA, it is not just the NFL that the WNBA competing against. You've got MLB playoffs, you've got NBA, you've got NHL seasons. It's, it's just incredibly difficult to find any clean air. And also, WNBA is in a unique situation, at least for the next couple of years where ESPN is the exclusive home of the, of, of the playoffs now in 2026, there is a spread between. NBCU Amazon and ESPN and so it all sort of free up a little bit more time amongst them to do it. But I guess the interesting thing about this is that despite these challenges, the ratings have still been pretty strong. You know, Caitlin Clark didn't make the finals yet they've still broken, you know, broken their records for the most watched game. So it's certainly showing that there's a very. Strong environment for it.
Yannick Ramcke:I think once you as a sports property has, have crossed over into the mainstream, You are there to stay. I think the resilience and how robust established sports properties are, even in that unprecedented or time of unprecedented competition for time and voluntary of the end consumer, I think sports, just looking at it positively for sports as a, as an industry has been probably the most robust and resilient programming video programming In the marketplace. And I think the WNBA with all the momentum that they have is. And then tipping point to be considered those properties that are entering the mainstream conversation where also casual fans are tuning in. And I think once you reach that state, I think with all the disruption that is going on in the media marketplace might be the best bets you can do also as a programmer and therefore the programmer. So the broadcasters. The one thing I think they need to be aware of is to not get ahead of themselves. I already know here, okay, we had record ratings, but what would have been if as you alluded to, they would have more effective and less competitive broadcasting windows. Right, but they can't get ahead of themselves. Okay, and ESPN, as a rights holding programmer, they, it's, they are not paying in advance in the sense of they, Not, they are not putting the WNBA at a super sought after programming slot if it's not proven, it does not start to prove its value as a property. And I think we can safely say that next year, the programming slot will be more attractive because it has proven it can draw in audiences. But before I hand it back to you, Mauro, of getting ahead of themselves. We have a huge discussion, I think, in women's sports overall, what is deemed fair compensation or equal compensation to the, to the men's game. Yes, the WNBA just together and in the combined fashion with the NBA locked in 3x of the media rights revenue. Reflecting not only the overall growth of the marketplace of basketball in the U. S., but also their relative importance, so they are capturing a bigger share of the total revenues and everything. But now the players can opt out of their collective bargaining. What do they want to have? A bigger share of the revenues. Why do they have 20 percent compared to the 50 percent of the NBA? Because the total revenues that you need to finance operation is much smaller. So you need a positive contribution margin. And here you need 80 percent of the revenues to finance. The operations compared to 50 percent do more than the trick for NBA owners to finance the operation. So this is, I think for me, a main theme that they have all the momentum in the world. They will probably pounce on it and realize the potential, but one step after the other. And I think the one mistake, whether it's valuation, whether it's. Cost base for players and everything, but they can't do is getting too far ahead of themselves.
Murray Barnett:We don't talk enough about what other sports are doing in terms of how their scheduling, you know, I know of a number of sort of, let's call them second tier sports certainly in the UK that's maybe just behind Premier League, who. Spend an awful lot of time forensically analyzing the scheduling of Premier League games and when they might be able to optimize viewing windows and so on. So I think it's becoming such a crucial part of the commercial mix of leagues and tournaments is exactly when they can play to maximize the return on investment for the, for their, their partners.
Richard Gillis, Unofficial Partner:The other bit to that, Murray, and that's something we talked about with Sam Sadie of LiveScore is the betting marketplace and the placement of inventory and why some sports are popular as betting sports and others aren't, and why tennis is a hugely popular betting sport except at weekends at the finals when football is on. And, you know, the question for. Lots of sports when, you know, again, it's an obvious question in terms of, well, is that what they want to do? How do they monetize that marketplace? Because that's not straightforward either. But I think there's a whole load of, load of things in there. And there's a lot of, streamers who are looking for inventory. It's the old 24 hour news. Problem, there's no news, you've still got to put a news program out and you know, the same with a sports channel. So you've got this issue and it, it becomes a television over live experience question. I don't want to go to a football match at 11 o'clock in the morning, but. If that's where the revenue is, and if a TV broadcaster is doing it, that's where they'll go. There'll be a massive outrage from fans, quite rightly, but you've got this challenge,
Yannick Ramcke:And there's no obvious solution to it, right? Simply as a function of this limited shelf space. One of the main suggestions I read about afterwards was, okay, let's put it, why don't they put it on Monday night? Like decoupling it from all the congestion that happens on a Sunday, first and foremost with an NFL. Yes. On Monday night where ESPN exclusive rights holding broadcaster of the WB WNBA finance has an NFA double header occupying E-S-P-N-A-B-C and ESPN plus, so WNBA on and ESPN two. For sure, would not hit against the NFA doubleheader, would not have hit the rating that it did on Sunday.
Richard Gillis, Unofficial Partner:I mean, I remember the Ladies European Tour, were quite innovative. This is a while ago now, putting that. Their inventory at the beginning of the week. So it doesn't go up against the traditional weekend sports. So it finished on a Wednesday or a Thursday. I think the prop, the issue is just consistency doing it over and over and over again, fans have to be given a chance to build habits. And if you can't do that over a period of time, if you, if it just becomes a stump, then the thing breaks down, right. Final thing on the WNBA, Nick Sprague, who is our, a friend of the podcast and the newsletter. From New York. He's, he wrote in WNBA data. Next year will be more interesting novelty of year one will be over and a couple of other big collegiate stars with huge social followings. Paige ERs and Juju Watkins will have a, had an CA NCAA tournament spotlight on ramp for their own debuts in the WNBA next season. So it'll be more indicative of whether we are riding a larger wave or whether this is a Tiger Woods phenomenon when he's relating to. Katelyn Clark.
Yannick Ramcke:It will not reach the heights of this season due to the factors mentioned, but it will also be significantly above where it has been before. I think that's a common pattern, and then it builds from this new base the following years, but let's see.
Richard Gillis, Unofficial Partner:Okay, right. Does on air talent matter in sports broadcasting? Now that is a question that is going to, I think, be much talked about and I think there's some interesting sort of counterintuitive thoughts. Murray, what's your, view?
Murray Barnett:this all started with an article. In huddle up about how ESPN has been shedding a bunch of its us channel us talent and. The basic premise of the article is that there is now a direct correlation that ESPN is drawing between the amount of let's call it social buzz that their talent creates and who they have on air, i. e. you don't need to be good. You just need to be noisy. You need to be creating some kind of buzz. And of course, you know, there are some out there that have great social media followings and are, you know, the kind of people that are clipped up for things on Insta or, or, or TikTok or whatever, who are also very good. But then there are also some who are. highly controversial and are self aware enough to know that the more outrageous that they are, the more likely they are to generate those followings and create value for their personal brands, if you like. And that's kind of one aspect of it. And the other aspect of it is from a broadcaster perspective, how are they sweating these expensive assets that they've bought? The conceit being, if your NFL game is three hours long and you've got an hour each side of shoulder programming, how do you sell that shoulder programming to advertisers? And, You sell it by having big names. You know, there's a reason why Brady's hired by Fox. There's a reason why Bill Belichick gets a job is because regardless of whether these people are good or not, they are known superstars, if you like, who you can take to your advertisers and your sponsors as being a reason why. They should invest heavily in your programs.
Richard Gillis, Unofficial Partner:how much advertising inventory is there? Because you've got the, it's a really good point. It's something I never really think about is the game. And then you've got the other stuff, you know, the previews, the reviews and, and that whole package. So in terms of, The value at relative value of those bits of the broadcast. If you get someone in at the beginning, it's like a sky Sunday, you know, you've got football all day and so you've got this huge platform for, for advertising. How does that work in reality?
Murray Barnett:this is where there's a big sort of divide between the US and, and let's call it the rest of the world in terms of the way sports are set up because you literally have in something like Hockey in the States, NHL, a TV time out where the broadcaster is saying the game stops now because we want to have two minutes of advertising. You have enough stop starts in both NBA games and in NFL games to be able to drop advertising in. But if you contrast that with football, Where you can't put anything in except pre game halftime and post game, so you could argue that the talent becomes so much more important there because you're trying to ram as much value for your sponsors and your advertisers, especially in that pre and post, so you want to have that sticky talent, which is helping to extend the interest because you can drop in and out of the in and out of the studio shows almost as much as you like, obviously within Ofcom regulations. But I don't know about you, but I find it super frustrating because when you know a game is coming up, it seems like they're going to ads every five minutes because they're, they're compacting all of those advertising slots before they have the 45 minutes of the first half where they can't really have any advertising.
Richard Gillis, Unofficial Partner:Yeah. And on a very simple level, I mean, those, but you know, the NBA and the NFL, those games were created after television existed, weren't they? They were, they were built, they were designed for television with television in mind in a way that football never was.
Murray Barnett:Yeah, I mean, you know, the interesting thing when you look at the, the article is it talks about how ESPN has become completely data led in, in, in the way it considers talent, and actually even in which stories it has. They mention ESPN's show, First Take, talks about the Dallas Cowboys every morning, no matter how poorly they're playing, because data tells them viewers are more engaged when they do that. So it becomes actually, you know, completely commercial from a, certainly from, from the U. S. standpoint.
Yannick Ramcke:there's a lot in there. Maybe first, Richard, you were saying that NFL in particular, but also applicable to many, many other US sports, it's made for television, which is negatively impacting the in stadium experience, I think. As these also also have been to an NFA game game, are fully aware of that, that there are literally TV timeouts where teams are not supposed or allowed to interact because the point of that break is different than game or team strategy. It's to accommodate the inventory that needs to be.
Richard Gillis, Unofficial Partner:Yeah. I wasn't saying it's a good thing. I think, you know, I'm just saying it's a, I agree. I've been to a, you know, NFL game and I find them really dull, you know, because, you know, It's just the stop start nature of it. And that, you know, likewise, the NBA, it's just not for me. I get that why people are are into it. The structure of it, I find really difficult. I just can't get beyond it. I don't think, but that that's irrelevant, but it's, there's a sort of the, the advertising slots in it are so embedded and you know, that's, again, it's, there's cultural stuff in there as well in terms of commercialization of
Yannick Ramcke:It's just incentivization right back to incentive structure driving actions. But back to the thing of on air talent. I mean, let's not kid ourselves what video distributors are willing to pay for and what advertising brands are willing to pay for is for taking place within the game environment, the live game environment. This is where in pure absolute terms, the revenue is made, but in relative terms, in order to create high margin revenue, yes, less in absolute terms, but high margin revenue, there's probably not a more attractive business and having. A studio show where you have a top throwing talent that you may pay a couple of millions in order to how this cost base relates to the revenues made. This is, relatively speaking, a more attractive business, I assume.
Murray Barnett:to bring it back to the Gary Lineker point, right, is, and this is the bit that I don't get, is, as a license, and sorry Yannick, this is very U. K. centric, but, like, as a license fee payer, I don't believe that some of my money should be going towards paying Gary Lineker a million and a half because I do not believe that the, that it makes one iota of a difference to me watching Match of the Day if he's presenting it.
Richard Gillis, Unofficial Partner:So can I just build on that? Cause I think there's a, again, this is a bit UK ish, but You've got a new head of sport at the BBC. So Alex K Jelsky who has come from the athletic and you've got to assume has been given a mandate for change. He doesn't need my advice by any means, but I think one of the smarter things he might do is not renew Lineker. Because just the way in which the Lineker brand has sort of evolved over time, I'm a, you know, I'm an admirer of Lineker and I like him and you know, et cetera, as everyone does the David Attenborough of uh, football, but I think he made a mistake in this, you know, what you've got essentially is, A highly paid, probably the most highly paid piece of sports talent that the BBC pays for, has built a competitor product in the marketplace with his podcast group to the extent that in the summer, you know, he is creating news lines. He's criticizing Gareth Southgate on his podcast and the BBC then has to chase that for a news story themselves from someone they're actually paying. So I think. I agree with you on the, difference, because obviously it's not an advertising question. So the value of the talent is less tangible. You could argue it's not, it's not as easily data quantified. And I think politically, to give himself a bit of room, because I think the Daily Mail are after Alex, you know, or the BBC all the time, throw them a bit of red meat. Get beyond that and say, right, let's start again. It's a new era. It's a post Lineker era, and this is what it looks like. That's a podcast of talking and it's a very big job. The head of, you know, head of sport at the BBC. And we've, we've had Alex on the podcast, you know, and he's, when he started it, the athletic, very, I've got a lot of time for him. Big admirer, big creative, you know, brain. And I just think it's a really fascinating question and it's, must be high on his inbox and that was number one question at the interview, I imagine,
Yannick Ramcke:But I think this is where the industry is heading, trying to quantify the impact. Is it or isn't it moving the needle? And I think business decisions will be made and ESPN might be at the frontier of that that development. And then often the intuition or opinions are, okay, why does an E-S-P-N-B-B-C or whatever. Take a cast about a couple of million more or less spending on on air talent When you compare this to the right fees that they paid for the programming in the first place And if you now would be a sponsorship person the person would tell you need to put as much into the activation than in acquiring the right to sponsor something. But I think this is simply not applicable here because I am tending towards especially around live sports. It is the property itself that drives the far majority of the audience. It's not the talent. Outside of the live sports broadcast, when it comes to studio shows and so on, as said, I think there's value, but why doesn't ESPN care? It is because there is margin pressure of the on the industry. Margins are super thin, whether you go break, even profit or loss can be like a couple of millions can be the difference. And this also shows where such layoffs Cater to, or why are they done? It's like speaking to the investment community because the cash outlay for an ESPN laying off, I mean, I think, I think Zaglow was a recent example, an NBA reporter slash insider earning a couple of million per year. He was laid off, right? He would get his money for the rest of his contract duration. So the cash out is the same for ESPN. But then it's about bookkeeping exercise and accounting procedure that they can just write this off as an impairment and show bigger adjusted income in the profit and loss statement. So I think it's just also what is the audience and it might be the investment community.
Richard Gillis, Unofficial Partner:just to finish this little segment off. You mentioned at the beginning, Mary, that sort of desperation almost, you can sense the desperation of the individual presenters to build a personal brand. It's really quite tiresome and you hear it across sports presentation and it's the sort of creator, Question coming into sports, present presentations, and I think some of it will work really well and a lot of it won't. And in terms of the way you pointed out there, it's obvious that, in the same way as, what gets follows on social media is. Controversy. And, the stupider and nastier, the better, you know, in terms of the rate. So if you are being data led, good luck with it, because I don't think that's the route. I think it's a, there's a question there, which, and this is, this sounds Stupidly Romain, I might as well be wearing a monocle as I say this, but I do think television talent. There is the intangible, there is a gut element to it, which I think is considerable and I think coming back into fashion, but we'll see. Bold talk.
Murray Barnett:Well, let's hope so.
Richard Gillis, Unofficial Partner:Let's hope so. Right, listen. Thank you both, as ever, for your time, and Yannick, thank you for your time at Sportel this week. saw you moving around, moving and shaking, you were a blur going around the exhibition hall, people shouting his name as he goes past. That's Yannick Ramper off the bundle, they said, and and I, I think I saw him give autographs, but I wasn't completely sure about that, but we'll I'll have to check. Is that true? Is that true, Yannick?
Yannick Ramcke:Can't we say whatever happens in Monaco or Monte Carlo, wherever it comes from or came from good chat today and then let's see what rumors, news or stories can share once we are back in the office.
Richard Gillis, Unofficial Partner:And we'll, we'll send Murray a postcard, obviously, if, if postcards still exist, because he's not coming, but he's let us, you know, he's given us a good steer in terms of where the parties are, so, you know, we'll miss you this year, Murray, next year, perhaps.
Murray Barnett:be back again.
Richard Gillis, Unofficial Partner:The return of Murray Barnett, that could be next year's theme of uh, Sportel. Right, till next time.