RESOLVING THE LEDGER
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New Episode of TSA: Local Sports Media
The Sports Advisors podcast is a biweekly roundtable discussion for decision-makers, hosted by their peers, on the stories that actually matter and their second-order effects. It is actionable intelligence from senior operators who have actually built, bought, sold, programmed, monetized, and scaled sports businesses.
In the latest episode, The Sports Advisors talk local sports media.
The unraveling of the regional sports network model is forcing rights owners to rethink how local games are produced, packaged and distributed. The NBA and NHL, however, are taking different approaches.
Like MLB, the NBA is working toward an aggregated streaming hub that could bundle the local rights of many teams beginning in 2027-28. It is expected to create a one-stop shopping experience for fans and potentially restore some of the scale, leverage, and economics that clubs have lost with the erosion of RSN businesses.
The NHL, meanwhile, will centralize production for at least four clubs next season while allowing those teams to retain their rights, advertising inventory, and the flexibility to strike market-specific distribution deals.
We explore how the competing models are expected to affect team finances, reshape the buying and selling of local inventory, the role of emerging technology—and whether centralization is ultimately the inevitable end state across the three major leagues.
The cast for the seventh episode in a row includes:
Former Carolina Panthers CEO, former Verizon VP of Sponsorship, and current Encore Sports & Entertainment CEO Nick Kelly .
Former Washington Commanders Chief Strategy Officer, former Shop Your Way Chief Digital Officer, and current Next League Chief AI & Innovation Officer Shripal Shah .
Former Learfield CRO, former WWE Global Head of Sales & Partnerships and Head of International, and current DIRIGO Advisory, LLC Founder John Brody .
Former Fox Sports SVP of Programming, Research and Content Strategy, and current Crakes Media President Patrick Crakes .
As always, you can connect with a member of the JohnWallStreet Advisory team by sending a note to [email protected] . In fact, we encourage it!
Key insights and takeaways from the 50-minute conversation:
Recreating General-Market Economics Requires More Than Centralization
Discovery has become a challenge industry wide with programming scattered across an expanding number of platforms. But MLB’s and NBA’s efforts aren’t about making games easier to find.
“This is about finding the best economics one can. [Every team] once had one plan: the pay TV bundle and regional sports networks. Now, everybody's got their own plan. Even baseball, which has a unified approach to [distribution], everybody's not [taking] the same [strategy]. The Dodgers [and several other big market clubs still] have their own RSN,” Crakes said. What each of the leagues is trying to do, he explained, is “ take a highly segmented product, like local baseball games at 7:00 on a Tuesday in July, [that have] a small, very focused audience, and [find] the best way to distribute [them] to get the most [money] out of [those rights]. Because remember, when [the games were] connected to pay TV, instead of being segmented, [the clubs] got general market economics. Everybody got general market economics because the pay TV bundle was general market.”
The path back to a world that fully values local rights is uncertain. But aggregating them will not, by itself, resolve the underlying imbalance.
Crakes suggested the solution, “ probably [entails] being able to continue building upon national [inventory and] AI technology-enabled audiences…One of the paradoxes [of the current media landscape] is the explosion in national rights fees and the decline in the local rights fees…. Local rights probably will regain value eventually, just the route to that is unclear.”
DTC Platforms Can Be Built Through Partners
Team-by-team distribution has proven challenging to date, in part, because clubs have failed to leverage their largest sponsors when acquiring subscribers.
It seemingly reflected a lack of commitment to building a sustainable DTC solution.
“Everybody always preaches partnership. Well, when the biggest partners in the country are trying to help you, let them do it,” Kelly said. “ If I'm [a club] and I'm pushing my own streaming product, why not give Coca-Cola a chance to go to every retail [customer of theirs and offer up a promotion] to get them into the system? But for whatever reason, [we] haven't seen anybody do it.”
Fidelity is a Revenue Multiplier
Aggregation may simplify the buying process, but it won’t fundamentally change how brands purchase local sports media unless/until teams can first solve for a fundamental data problem: they are unable to accurately identify and/or size their fan base.
“This has been going on forever. In 2012, when I was at the Redskins, we had an email list for sponsorship, for ticketing, the app had an audience, etc. and [a fan] could be on three different lists. Now, is [that individual] three people or one? We didn't know, so we couldn't accurately predict audience size…[Teams] still struggle to do that [today],” Shah said.
Organizations must move beyond broad market estimates and develop a more precise understanding of both their existing core audience and the pool of consumers they can realistically reach to effectively sell in the current environment.
“You're not using Scarborough’s...
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