USA Sports: A New Era in the Sports Rights Marketplace
USA Sports is making its mark as the latest contender in the evolving sports rights marketplace, establishing a pragmatic approach to its operations as an independent cable entity. With a clear vision and strategy, this new entrant aims to navigate the complexities of sports rights acquisition while maintaining a focus on profitability.
A Disciplined Approach to Rights Acquisition
In a recent podcast featuring USA Sports president Matt Hong, he emphasized the company’s intention to remain “disciplined” in its pursuit of sports rights. Hong articulated that USA Sports is keen on properties that promise a tangible return on investment. Notably, he ruled out large-scale leagues such as the NFL and NBA, stating they simply do not align with what USA Sports seeks to achieve. He remarked, “They obviously do for others, but just not for what we’re looking to do and how we’re looking to transform our core business.”
This candid acknowledgment of the competitive landscape underscores USA Sports’ realistic expectations and strategic positioning as it carves out its niche.
Highlight Shows Over Live Games
When discussing its potential interest in the NFL, Hong showed a willingness to consider secondary content, like highlight shows, rather than live games. This illustrates a significant shift in strategy, where rights to showcase highlights could serve as a more financially viable option. However, he noted any agreement would need to make sound business sense, hinting at a careful balance between strategic interest and financial feasibility.
Targeting Growth Potential in Sports Properties
Hong outlined USA Sports’ target properties as being those that exhibit a “mid-hockey stick” growth trajectory. This terminology refers to assets that show rising potential, particularly appealing to a market hungry for emerging sports. Hong pointed out that many of these growth opportunities are within women’s sports, emphasizing a commitment to supporting and broadcasting these increasingly popular events.
This insight is indicative of a broader industry trend toward recognizing the value in underrepresented sports, which often deliver passionate fan bases and significant growth opportunities.
The Genesis of USA Sports’ Rights Portfolio
USA Sports is inheriting a significant rights portfolio largely accrued from its long-standing association with NBC Sports. This relationship traces back to 2004 when NBC merged with USA’s then-parent company, Vivendi Universal. As USA Sports prepares for its impending legal separation from NBC, there’s a pivotal task of dividing the existing rights and talent contracts.
Hong indicated that most rights would be distributed between the two entities, with notable exceptions such as NASCAR transferring to Versant, while the Olympics will remain with NBCU.
Navigating Talent Contracts
The division of talent contracts is equally crucial, as Hong explained how some broadcasters, like Terry Gannon of NBC and the Golf Channel, will have separate agreements moving forward. Meanwhile, other personalities, like Golf Channel host Cara Banks, are making shifts to NBCU full-time, showcasing the gradual changes and adjustments within the new framework.
Such transitions underscore the importance of managing talent sustainably while navigating the complex backdrop of recent corporate realignments.
Streaming Strategy: Authentication Focus
In his discussions, Hong reiterated a key aspect of USA Sports’ strategy: a streaming model focused on authentication rather than direct-to-consumer subscriptions. This decision underscores a strategic pivot where the emphasis is on leveraging existing audiences and partnerships rather than creating entirely new subscriber bases.
By building on familiar platforms, USA Sports aims to effectively reach viewers while maintaining adherence to economical practices.
Balancing Revenue Streams
Finally, Hong expressed the vision for USA Sports to replicate the successful revenue mix of its golf business, which currently enjoys a balanced 50-50 split between broadcasting and companion businesses like GolfNow and Golf Pass. His focus on synergistic businesses suggests a forward-thinking approach to viewer engagement; the aim is to find meaningful ways to connect people’s time spent when not watching sports on TV.
This thoughtful strategy highlights the multifaceted direction in which USA Sports is heading, aiming for long-term sustainability and the cultivation of diverse revenue streams.
USA Sports stands at the crossroads of innovation and realism as it builds its athletic broadcasting future. With calculated growth strategies and a commitment to emerging sports, it’s gearing up for an intriguing journey in the sports rights landscape.