The Geeks at Sloan, Part 4: The Singularity

For the second year in a row, the Box Score Geeks went to Sloan! Make sure you check out part 1part 2, and part 3 too!

Media Rights panel. My intellectual pants are already off #SSAC14

– The man with the #'s (@ArturoGalletti) March 1, 2014

Day 2 was fun look at the possible future of the North American sports industry. You can hear my thoughts on the matter on a podcast I did with RealGM (yes, I've been hustling). As always, the panel of the conference – this year it was the media panel – snuck up on me. It was full of drama and all sorts of interesting subtext. The headline for me is that the WWE Network and Vince McMahon just rewrote the rules on content delivery and distribution. The old media companies are really not ready for this. Google totally is. Be prepared for your new sport content overlords.

Let's expand on this a bit. The sports market field is expanding simply because live sports content is the most valuable piece of real estate in the media market today. This is why you see so many new players setting up sports networks. This is why everyone is scrambling for the rights to every sport and why no one is selling any NBA teams. This is why you can look forward to massive amounts of Soccer/Euro sports (cricket, rugby, and darts) on your TV or device of choice. It's this second part that the old media companies are having issues with.

In fact they are downright confused. The Lakers just signed a 20 year media deal that is going to look terrible in a few years. The NBA and NFL digital offerings have serious, serious flaws and are severely limited offerings. ESPN has John Skipper saying "media rights are worthless".

And into that room steps Google. Frank Golding, head of sports for Google, would not confirm any rumors about working on a deal to buy the rights to the NFL sunday ticket. However, when asked hypothetically about what Google would do, he went on at length about how to properly target ads to sports content by optimizing SEO and creating metadata to provide better searches for targeted content. A very well-thought-out and prepared answer.

Everyone on the room could clearly see that Google is about to get in the game in a very, very big way, and there was a dawning realization that ESPN and the old media companies need to get into a content providing war with Google. ESPN and the other media companies, who are paying scale for tech developers, are ill-prepared for what's coming.

You see, Vince McMahon just changed the game. When the NFL/Google partnership happens – and it's going to happen, trust me – will they follow the traditional broadcast model and share the wealth with the other media companies? Or will they follow McMahon’s path and sell directly to the consumer and maximize their profit? The sad truth is that right now, I can't purchase the sports content I want – even though I can afford it – because they choose not to provide. Google looks set to change that.

The writing was on the wall when Google compared the old media companies to the Sunday edition of the New York Times. My advice to students: become web developers. The media bidding wars are coming.

I suspect creator-owned distribution, straight to the client, is the future.

As for the rest of the day, the dominant storyline was Malcolm Gladwell taking a chunk out of NBA commissioner Adam Silver. It was basically as close as you will ever get to Professor Berri or any of the Geeks drilling Mr. Silver. He asked every question I would have asked. I can't wait until it's available for everyone to see. My key takeaways:

  • Gladwell went after corporate tax breaks and public funding for NBA teams. Silver proceeded to lie about the owners losing money before the last lockout (which I've explained before). Gladwell finished him off by bringing up franchise appreciation. Gladwell's best quote: "For the city to be forgoing revenue to billionaire team owners at this moment in 2014 seems to be morally awkward."
  • The owners and Silver want a higher age limit. Gladwell pressed him on paying college athletes. Sliver first tried to say they were compensated now (to which Gladwell riposted "not as well as James Dolan"). Silver then grudgingly admitted that the league should cover some cost. The system is about to be reformed folks. Something like Mark Cuban's suggestions may be in play (see the piece at our sister site).
  • According to Silver, the NBA has no PED issues because players don't like the PED "culture". Not like players fly to Germany to get iffy surgeries, right?
  • Silver said the word “gambling” in a positive context. My jaw literally dropped. This is the first time I can recall the commissioner of any North American sport saying something positive about gambling.

My impression of Silver was very good in that he seems very open to change and improvement. As he's the voice of the owners, there are some issues where he and I will always disagree, but he seems like an improvement over Stern.

And that brings us to the end of day 2. There are always other stories and tidbits to be told – I always learn a lot on the floor at Sloan – but those are stories for another day.

All in all it was a worthwhile experience. I look forward to next year.