ESPN all in on TGL; Golf for Barstool bros; Sport's Napster moment; Tiger = Goat + Whale; FTX ripples; Should endorsers get sued; DAZN and women; Olympic Succession; King Richard vs Air

Overthinking the sports business, for money

Nov 09, 2023

This newsletter is sponsored by Turnstile, the leader in the fair market pricing of sponsorships. Are you frustrated by decades of inflated and unrealistic media equivalency valuations?
Are you struggling to understand the value of your Intellectual Property, the real value of exposure and the detailed value of benefits in your sponsorship deals? There is a solution. Turnstile was built with a single-minded focus to help the industry solve the million- dollar question: how much is this sponsorship actually worth? Their approach leverages $billions of dollars’ worth of real-world sponsorship contracts to provide a fair market pricing approach that reflects the true value of sponsorship assets.
This approach is trusted by the world’s biggest rights holders, investors and brands because its credible, defensible and accurate.
So now you can know the fair market price and transact with confidence. If you would like to understand more visit turnstilegroup.com to contact the team.

ESPN is betting on TGL

What happened?

There was a big comms push from TGL this week.

TGL emerged in 2022 as Tiger and Rory’s anti-LIV play.

Or at least, that’s how it was positioned at the time.

No millennial cliche went un-mined.

Fast, noisy, short and tech infused.

Simulator golf for the Barstool bros.

The usual cast of sport celebrity investors have lined up, from David Blitzer, Steve Cohen and Fenway to Serena Williams and Steph Curry.

But are they betting on golf, or betting?

Why do we care?

Each big new sports property reveals what the money wants sport to be.

TGL is the latest playbook of received wisdoms.

It’s striking how overt is the focus on gambling.

This quote was attributed to Tiger Woods:

“It’s exciting that this group of guys is coming together for a two-hour window and we’re just going to basically hit balls, talk a lot of (trash) and people are going to be gambling on absolutely everything, each and every shot. Every shot there’s going to be a wager.”

A couple of builds on this.

First of all, Tiger’s people used to spend their time trying to keep his name out of paragraphs that included the word gambling.

He has considerable form.

At Augusta, they talk of Woods as the Goat.

In Vegas, he’s a whale.

“Sometimes the only people in the place were me, Tiger Woods, and Michael Jordan. Each of us sat at our own private table and played big. Tiger plays big. Up to 30 grand a hand…and when you’re playing splits and doubles, you can have 150 grand on one hand…Vegas loves celebrities, but very few of them gamble big. Tiger Woods and Michael Jordan are not only two of the world’s greatest athletes; they’re two of the world’s biggest gamblers. And when you post millions in the cage to gamble with, as Michael and Tiger do, every door in Vegas is going to be open for you. Because the casinos will do whatever it takes to keep you there and siphon as much money out of you as possible.”

And then we get to ESPN.

One network source told Golf Digest that TGL has the chance to do for golf what the “Moneymaker Effect” did for poker.

TGL feels like the first big convergence play following the launch of ESPN Bet.

You’ll have been following our podcasts and events on sports betting.

The word from the betting industry is that ESPN Bet is under enormous pressure from the start.

Disney may or may not be about to sell off ESPN.

A successful ESPN Bet would presumably increase the price tag.

Another story circulating this week sees Disney ‘discussing potential equity stakes in ESPN with US major leagues in exchange for content or preferential terms when it comes to rights – including the NBA. This could see the League Pass out-of-market streaming proposition added to the future ESPN DTC service’.

Again, if we’re searching for directions of travel, equity swaps between leagues and TV stations is one solution to sport’s expensive D2C adventure.

Transpose that to European football.

If and when the Premier League launch Premflix, do they build their own, or buy in to Sky, and let them do the heavy lifting?

Meanwhile…

One final line on TGL.

As golf goes full sportainment, the NBA made a move in the other direction, (back to the sport end of that portmanteau).

Adam Silver doesn’t like where the All Star Game is going.

He wants more proper sport, less big eventer shit (my words not his tbf).

“We love the sort of…sizzle around the league, but if basketball is what’s most important…then players should be able to go through their normal routines,” he added. Fans have often complained about the All-Star game being more of a skills show than a real contest between the best players in the league. The NBA is looking to remedy the situation next year by curtailing all the concerts, shows and fancy intros that affect the players’ preparation before the game. In exchange, they want a more competitive game from the stars of the league.

Should celebrity endorsement be a free hit?

What would happen to the sponsorship market if Tom Brady is sued for fronting FTX, whose owner Sam Bankman Fried just got done for fraud and faces a life sentence?

File under, things that probably won’t happen but pose interesting questions anyway.

What if, endorsers were held liable for the things they’re paid massive fees for flogging?

One for the due diligence crowd.

Given how much the company spent on sport sponsorship, the ripple effects of the FTX collapse will not go away anytime soon.

Who will pay for women’s football?

The women’s game continues to pose some of the most interesting questions in the sports business.

This week saw a shift in DAZN’s strategy around it’s UEFA Women’s Champions League rights.

Good piece by Martin Ross in SportBusiness:

Some questions arising:

Did the impetus to keep the UWCL free-to-air come from UEFA’s sponsors?
Is the future of this and other high profile women’s football properties closer to Formula E - a purpose driven brand play rather than eyeball seeking media property?
If so, what are the implications for broadcast partners - aka, how does DAZN make back its 8million quid rights fee if the games are on YouTube?

This was part of the conversation at the UP Women’s Football Brainstorm event at DAZN, featuring among a cast of thousands, DAZN’s Marc Watson and Alison Lomax, head of YouTube UK.