In 1981, the first music video to be shown on MTV was the Buggles hit “Video Killed The Radio Star”. In the book ‘I Want My MTV’ Trevor Horn said about the song, “It came from this idea that technology was on the verge of changing everything. Video recorders had just come along, which changed people’s lives. We saw people start making videos as well, and were excited by it. It felt like radio was the past and video was the future. There was a shift coming.”
The video and the song served as an accurate prediction of the future. MTV was born, and videos became a way music was consumed. The same can be said of talk radio. Nowadays, radio shows are simulcast on TV and internet streams, and a large part of the audience watches, rather than listens on traditional radio. But the idea of technology changing something that has been around for generations is nothing new. It’s happening every day.
Online wagering started in the mid 90’s with operations based out of the Caribbean. Within a few years, more and more outlets starting popping up, with major bookmakers like William Hill getting involved. There was the online poker boom of the early 2000s too, but it wasn’t until recent legislation, that the online sports betting boom really began. Some can argue, it’s still going on.
There are 17 states currently with some form of online betting. 9 have full mobile betting with no in-person sign up required. Look at New Jersey, which has surpassed Las Vegas in terms of handle, mobile wagering accounts for the majority of the sports betting revenue. The revenue from retail Sportsbooks actually went down from 2019-2020, surely due to the pandemic, but mostly due to online success. With mobile betting numbers expected to grow even further, the question becomes, is a physical space even necessary? Has the traditional brick and mortar Sportsbook become irrelevant?
We’ve seen a combination of things when it comes to mobile betting. Traditional retail outlets trying to get into the mobile space, and online providers trying to gain physical locations. Yaniv Sherman, Head of U.S. and SVP at 888 Holdings, which operates 888 Sport, says that its easier for digital companies to capitalize on retail opportunities rather than retail books attempting to digitize. He thinks if you want an in person location, it needs to become more than just a Sportsbook.
“The reality is once mobile or online is approved in a state, then it sort of changes the balance because everybody’s carrying their sports book in their pocket. So there, I think you have an opportunity to create something which is more of an entertainment destination that has a betting component to it, rather than a full fledged sports book. The reason why I’m approaching it that way is that we’re trying to position ourselves as a recreational destination, as an entertainment destination, as opposed to a hardcore betting or gambling outfit.”
We’ve seen this already, to an extent. Circa built “Stadium Swim”, with its multiple pools and large video screen. It’s an attraction, rather than just a place to bet. Even the Sportsbook inside Circa offers a variety of experiences separating itself from traditional retail outlets. But if Nevada, which has mobile restrictions such as in person set up, went full mobile wagering, would retail suffer? Probably not so much because Las Vegas is still a destination. But elsewhere? Absolutely.
“Once you can bet on your mobile device or online, there’s no real reason to get in a car and go elsewhere, unless it gives you other added value. Watch a game and bet if you’re going to hang out and have a social experience and do that as part of a betting experience.”
Sherman continued talking about retail locations for digital outlets and vice versa.
“It will become another marketing channel. It will be part of your strategy, but by no means will it be the core of your strategy. Any state that has only done retail, the effect is minor. Traditionally the existing brick and mortar casinos and gaming facilities took sort of a crawl walk, run approach. They’ve invested in infrastructure. Now, someone comes along with mobile and harvesting all the upside, I can understand why they want to make sure they’re part of that process.”
Sherman expanded on the subject, adding “Most of the large land-based venues or brands now have a digital strategy. I think they’re more inclined to move forward. But retail or brick and mortar is not a necessity. You can run pure online states and see the growth. Look at Tennessee. Look at Colorado where the venues are very, very small. Growth comes from online. This is how you reach. You have to come to terms that if you’re a successful digital operator, anywhere between 80 and 95% of the people playing with you, have never been to your property.”
So why invest in a physical location? Well, the answer comes down to your business strategy.
“You have to think about what would be the most effective way to deploy capital. Setting up something like Circa is amazing, but it is a very expensive exercise. If you have a physical venue today, that could be part of your strategy and also a point of differentiation. But when you set up something like Circa, you need to think if I had a full-blown online strategy, where should I put my capital? Should I spend these millions of dollars on these huge screens and this amazing experience, or do I put them online and acquire more customers? That’s your balance or tradeoff between what you can or should do if you’re publicly traded or generally we want to value your company. You get a better multiple running an online or putting your money into digital than you do on physical venues right now. But again, two different angles.”
“I think the answer is physical venues need to keep partnering with online ones to create that experience. Speaking from our end and even the bigger operators, we don’t know how to set up something like Circa. This is something that’s not our core business. They are much better at it than we are. I think the key is how do you connect the two when you get the brand awareness, the experience, and they get more foot traffic through the door than your online channels? So you get the word out there, and when people arrive in Vegas, they go into it to bet with their recognizable brand, which happens to be at those venues.”
With Covid restrictions easing, and summer months coming up, retail sportsbooks could see a rise in revenue. However, unless they provide more than just a means to place a bet, and become an entertainment destination, they won’t even come close to the amount of money mobile wagering brings in. Even if they attract more in person betting, it still won’t come close to mobile. With more and more online outlets entering markets, it’s only a matter of time before Video Kills the Radio Star.
Keeping Premier League Games Shouldn’t Be A Hard Call For NBC
“Beyond its massive global fanbase, the Premier League offers NBC/Peacock a unique modern 21st-century sport for the short attention span of fans.”
NBC Sports is facing some tough, costly decisions that will define its sports brand for the rest of this decade. A chance to connect with viewers in a changing climate and grow Peacock’s audience as well. However, making the right choice is paramount to not losing to apps like Paramount+ (pun intended).
NBC is currently in the business of negotiating to continue airing the Premier League as their current deal ends after this 2021-2022 season. NASCAR is contracted to NBC (and FOX) through the 2024 season.
NBC’s tentpole sports are the NFL and the Olympics.
Negotiations for the EPL are expected to go down to the wire. Rather than re-up with NBC, the league is meeting with other networks to drive up the price. NBC has to then make a decision if the rights go north of $2 billion.
Should NBC spend that much on a sport that is not played in the United States? It’s not my money, but that sport continues to grow in the US.
If NBC re-ups with the Premier League, will that leave any coins in the cupboard to re-up with NASCAR? Comcast CEO Brian Roberts hinted that there might be some penny pinching as the prices continue to soar. This may have been one of the reasons that NBC did not fight to keep the National Hockey League, whose rights will be with Disney and WarnerMedia through ESPN and TNT, respectively.
“These are really hard calls,” Roberts said. “You don’t always want to prevail, and sometimes you’re right and sometimes you’re wrong, but I think the sustainability of sports is a critical part of what our company does well.”
Roberts was speaking virtually at the recent Goldman Sachs 30th Annual Communacopia Conference. He told the audience that between NBC and European network Sky, that Comcast has allocated approximately $20 billion towards these sports properties.
Comcast CFO Michael Cavanagh spoke virtually at the Bank of America Securities 2021 Media, Communications and Entertainment Conference and echoed that the company is in a good position to make some strong choices in the sports realm.
“The bar is really high for us to pursue outright acquisitions of any material size,” Cavanagh added. “We got a great hand to play with what we have.”
While the European investments involve a partnership with American rival Viacom, the US market seems to have apparent limits.
Last Saturday’s NASCAR Cup Series at Bristol Motor Speedway was seen by around 2.19 million people. It was the most-watched motorsports event of the weekend. That same week eight different Premier League matches saw over 1 million viewers. More than half of those matches were on subscription-based Peacock.
Beyond its massive global fanbase, the Premier League offers NBC/Peacock a unique modern 21st-century sport for the short attention span of fans. A game of typical soccer fan is used to a sport that is less than two hours long. The investment in a team is one or two games a week.
My connection to the Premier League began before the pandemic. When I cut the cord in late 2017, I purchase Apple TV. Setting it up, it asks you to name your favorite teams. After clicking on the Syracuse Orange and the New Jersey Devils, I recalled that my wife has family based in London, England. They are season ticket holders for Arsenal, and that family redefined the word “die-hard” fans.
I’ve long been a believer that sports allegiances are best when handed down by family. I love hearing stories of people loving the New York Giants because their parents liked them, and they pass it down to their children.
I’ve successfully given my allegiance to the Devils to my young daughters.
By telling Apple TV that I liked Arsenal, I get alerts from three different apps when the “Gunners” are playing. The $4.99 is totally worth it to see Arsenal.
Whenever I told this story, I was amazed to see how many other American sports fans had a Premier League team. Students of mine at Seton Hall University rooted for Tottenham Hotspurs, while an old colleague cheers on Chelsea.
This is not meant to say that NBC should sign the EPL on my account. The key for any US-based soccer fan is that between Bundesliga, Serie A, and other leagues, there will be no shortage of soccer available on both linear television and streaming services.
Besides, Dani Rojas did say that “Football is life.” NBC, originator of the Ted Lasso character, should make keeping its Premier League US connection a priority.
Media Noise – Episode 45
Today, Demetri is joined by Tyler McComas and Russ Heltman. Tyler pops on to talk about the big start to the college football season on TV. Russ talks about Barstool’s upfront presentation and how the business community may not see any problems in working with the brand. Plus, Demetri is optimistic about FOX Sports Radio’s new morning show.
6 Ad Categories Hotter Than Gambling For Sports Radio
“Using sports radio as a back page service for gambling will have a limited shelf life.”
For years sports radio stations pushed sports gambling advertisers to early Saturday and Sunday morning. The 1-800 ads, shouting, and false claims were seedy, and some stations wouldn’t even accept the business at 5 am on Sunday.
Now, with all but ten states ready to go all in on sports gambling, sports radio stations can’t get enough of that green. Demetri Ravanos wrote about the money cannon that sports gambling has become for stations. Well, what if you are in one of those ten states where it isn’t likely to ever be legal like California or Texas? Where is your pot of gold?
Or, let’s face it, the more gambling ads you run, the more risk you take on that the ads will not all work as you cannibalize the audience and chase other listeners away who ARE NOT online gambling service users and never will be. So, what about you? Where is your pot of gold?
Well, let’s go Digging for Gold.
The RAB produces the MRI-Simmons Gold Digger PROSPECTING REPORT for several radio formats. In it, they index sports radio listeners’ habits against an average of 18+ Adult. The Gold Digger report looks at areas where the index is higher than the norm – meaning the sports radio audience is more likely to use the product or service than an average 18+ Adult who doesn’t listen to sports radio. The report, generated in 2020, indicates that sports radio listeners are 106% more likely to have used an online gambling site in the last thirty days. That’s impressive because the report only lists 32 activities or purchases a sports radio listener indexes higher than an average adult. I looked at those 32 higher indexes, and I think we can start looking for some gold.
Using sports radio as a back page service for gambling will have a limited shelf life. The gambling companies who commit significant money to get results will continue advertising and chase the others away. So, the future of sports radio needs to include other cash cows.
If it is evident to online sports gambling services that sports radio stations are a must-buy, who else should feel that way? I looked at the Top 32 and eliminated the media companies. ESPN, MLB/NHL/NFL networks, and others aren’t spending cash on sports radio stations they don’t own in general. But Joseph A Bank clothing, Fidelity, and Hotwire should! Here’s your PICK-6 list I pulled together that’s hotter than sports gambling:
- Sportscard collectors, Dapper Labs, Open Sea- read about Sports NFT $.
- Online brokerage firms-Fidelity, Charles Schwab, Robinhood, Webull, TD Ameritrade
- Golf courses, resorts, equipment, etc.- we play golf at home and vacation
- Hotwire.com, Booking.com, TripAdvisor, Airbnb, Carnival Corporation, and Priceline.com- we’ve used Hotwire in the last year.
- FedEx, UPS, U.S. Postal Service, Venmo, PayPal, Zelle-we wired or overnighted $
- Jos. A. Bank, shein.com, macys.com, nordstroms.com- we went to Jos. A. Bank in last three months
The sports card/NFT market is 32% hotter than the sports betting market for sports radio listeners. Everything on the PICK-6 is at least 100% more likely to purchase than an average 18+ Adult who doesn’t listen to sports radio. All listed are at or above indexing strength compared to sports betting. The individual companies I added are industry leaders. Bet on it! Email me for details.
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