ChiefGritty
- Chicago, IL
I've been thinking about the dire forecasting of sports economics by @ChiefGritty a lot and the more I think about it, the less I agree.
Compared to 5-10 years ago it's precisely the reverse. There are ninety zillion TV shows, completely unprecedented quantity, but the golden age days of the Sopranos, Mad Men, the Wire, etc are behind us.The way things are going in entertainment media, content is king, and while quality of content is up, there's a quantity problem.
The other big advantage sports has is people watch it LIVE, which means commercials that your audience is actually captive for.Sports remain the pinnacle of cheap desirable content. Cheap you say? With the Big Ten media deal expected to reach $1 billion a year? Yes.
Example:
Thor: Love and Thunder had a budget of $250 million and a runtime of almost exactly 2 hours. That's $125 million per hour of content.
When the B1G goes to 16 teams, there will be 72 regular season in-conference regular season B1G football games a season. If you say each game runs 3 hours, that's 216 hours of content. There will also be 160 in-conference regular season basketball games a season. If you say run time of 2 hours on those, that's another 320 hours, for a total of 536 hours of content, and I haven't even included non-conference games the football conference championship, the basketball conference tourney or the possibility that the conference schedule gets expanded in either sport. It also doesn't include non-revenue sports which provide further niche content. Even without all those "extras," at a $1 billion price tag that's less than $2 million per hour of content. Add in all those other games and some documentary style content and recap/highlight shows and you can easily generate a few hundred more hours of cheap content (Yes, I know additional costs go into production but with sports the rights are the bulk of the cost).
Now, is a big movie in a huge franchise like Marvel higher value content than B1G games? Absolutely. But sports deals like this are like buying content in Costco sizes at Costco prices and provide tons of value in that sense.
Lots of flip sides to that. You see Thor on opening night it's $12, you see it three weeks later it's still $12. A sports game's IP value is close to zero the moment it ends.
I want to be very clear how much I totally agree with this and have never said otherwise. People like sports, and they like the incumbent major sports, that have strong brands and deep, deep roots in the markets where they've operated for decades. I live near Wrigley Field and depressing, star-less pile of garbage though the Cubs may be, they descend from Naperville in their thousands day after day after day.The cable vs streaming debate loses the fact that this content is valuable even if cable dies.
BUT. The enormous wealth and value of these sports teams and leagues have been built not just on the immense interest they generate, but also on charging customers for access to sports who aren't watching. 10 years ago that was an astronomical subsidy to the industry, and little by little that's bleeding away.
To me, that just means a bit of belt tightening for what remains a completely healthy, robust industry that can still generate BILLIONS in any content delivery mechanism through its deep connection to millions of passionate fans. But the owners and commissioners and AD's, drawn from the modern American business class and mindset as they are, cannot and will not accept revenue stagnation ever, under any circumstances. They will burn heaven and earth to the ground (literally, if I may get away with saying so) to squeeze one dime of growth out of the present tense, this TV contract, this fiscal year, this quarter.
All of the options to generate that growth impose tradeoffs. College and pro are different, fundamentally what the pros are doing is finding ways to water down the product to sell more of it at existing rates, whereas in college the game is to consolidate the existing value among fewer schools leaving the rest to wither. Making your existing fans pay more alienates some, and raises the bar for new entrants to fandom. All of it is robbing Peter to pay Paul. I go back to my initial framing, growing interest in sports versus harvesting interest in sports you've inherited over decades.
None of it is healthy, and none of it is necessary, and I shudder to think where it ends. Because you're right, the big legacy sports are the closest thing to a golden goose the entertainment business has. But even a golden goose can be killed.