a16z Podcast: Eyeballs on the Game
Hi and welcome to the as sixteen z podcast. I'm Hannah. And in this episode we talk about the changing of the land in the world of sports media as audiences of the traditional sports broadcasts fall. What happens to how we consume sports? Where are the eyeballs going? How will it change the kind of sports content we consume, and how is it affecting the game itself? How are athletes beginning to cultivate brands in this new world of content? Joining us for this conversation are a sixteen z general partner, Jeff Jordan, Zach, Weiner co, founder and president of sports media platform overtime, and Yogi Roth Pac, twelve college football analyst, sports storyteller, and former athlete and coach. What do you think the sports media landscape currently looks like as we know it is a landscape that has been changing quite a bit in the last few years. I think sports media is at a mess of crossroads you've you kind of go back ten twenty years. It was a few channels doing the must see game that almost everyone saw in real time fast forward. You've got cord cutting happing, massively consumption of the linear. Broadcast is chain medically, the iconic sports media properties ESPN in Sports Illustrated or both in decline that Sports Illustrated. They're trying to give it away. I mean, it's it's now down to like a dozen issues a year, and literally they're trying to sell it and they're not finding any buyers. True, cultural. Oh, just a phenomenon. I mean, I grew up waiting for Sports Illustrated to come to the door and it would consume it cover to cover is that's now gone woods driven. Constantly escalating value of the sports teams is almost exclusively these media dollars at a flown in, but media dollars typically follow eyeballs in a vibe. Balls are declining rapidly, the media dollars disappear. What replaces them? It's an interesting overlay to the economics of the league's in the teams are eyeballs decreasing, or are they just kind of like fracturing until many different kinds of sort of niche interests or is that impossible to say the bundle of a game is declining in eyeballs, but then there are elements of that game that. Show up everywhere. I asked my friends at ESPN why you guys just have two heads yelling at each other. Now what happened? All these great highlights, they go, well, the highlights are everywhere. It doesn't differentiation use us saying them. Everybody's seen them. I think it's a really interesting time. You have all these organizations paying billions of dollars for these rights. And yet particularly the next generation are not watching additional live sports as much that to me is the crux of it because there is so much money there and there's so much potential audience that I think everything that we're seeing beneath the surface is caused by that. And that's just that millennials and younger are just not watching broadcast sports the same way. It's clear that the lie broadcast is not working for the younger generation and probably jen's even less than millennials. A friend of mine manages NBC universal and they have the Olympic rights and it used to be, you know, twenty years ago the audience all watched one channel. Now they estimate their audience is about the same size in spite of cord cutting, but they know Purdue. Use content on multiple channels as well as web in streams, and they think they're aggregate. Audience is the same fragmented across channel entering its splintering like crazy. You're not being forced to watch a one thing. They curate if you're into the lose, you know, you can watch a loser because there's demand for the luge and so therefore filling demand, not with one stream, but with tons of streams, I work with high school quarterbacks the off season. So a county is a high school guys research. What are you guys watching? How long should it be in the college space? But it's clearly dropping. I think what is increasing is the appetite. So I think for artists and creatives, what's really fun for us is like, okay, how do we get on your phone and how do we keep you there? Or how do we get you onto a link? Or God forbid onto a TV channel and keep you there. It's the greatest time right now for storytellers because we have to utilize the questions how and why obsessively you gotta. Come correct, like no longer. Are there three or four channels that were just by default on a watch and even no longer are there. Twenty-three bang in cable channels. Like there are millions of outlets in every one of us are outlet in our a production company, whether that's our Facebook page, our YouTube channel, Instagram, TV. I think it's gonna make the storytellers even better and hopefully make those stories even richer because now there's so much choice. It has to be all about the story. What does that actually start to look like? What are the different ways that happens? I think you hear this word thrown out all the time, but I do think it really has to be interactive. I do believe there is a way to do an MBA broadcast. That's more interactive game a fide that has other elements to it that gets kids actually watching. So we've spoken to a few teams and regional sports networks about how we can sort of bring our flavor of younger content and our younger audience to live sports. You guys did the little segment with k. d. dissecting the game of a bunch of. The leading high school guys. Oh, that's cool. So you got like the high school point of view? Yeah, and it's cool to see sort of like these professional athletes interact with high school kids, but I'm even talking like take a Knicks game, like, how can we bring our influencers to the table to call a game? How can we make it more twitch style? Think about when we get an alert after a game, it's so and so throws for three hundred and fifty yards and four touchdowns, right? I may have missed the game, but just looking at it the alerts and I have an idea in the vibe. So your point of making sure that you're hooking up is an analyst. Can I get you lift you up off of the alert, even it'd be like, whoa, what did he just say? Again, even if it's just one thought or one one minute video. I think that will continue to build the tribe that may be old school networks, quote, unquote, allowed people drop into right. You gotta bring it to get you to stay. It's like, I got a cook, you dinner give you deserve, talk you in bed till you three stories and give you a gift and like wake up in the morning with like breakfast and bet how much time. Do you spend crafting the intro? Because when you go onto a game, you know the two announcers are there and they're trying to hook you. So what's the prep process for like the first five minutes you spend the whole week diving into the team. That's why college football to me is so much more unique than basketball or baseball because the amount of games is so less. I look for theme and I'm trying to set a theme and hook you with that theme and bring you back every single opportunity. It's a narrative arc, whether that's in fifteen seconds or three and a half hours. You gotta keep bringing me back. So I would hope if you tuned into our game, you could turn at any point but be brought back to the theme of what the hook was the game and check back in with us because I know you're not sticking around for three and a half hours. I think the audience has to be able to participate. So I mean, this is a wacky idea, but we've had thoughts about, okay, if you have two or three broadcasters, how can you make? It's that the audience votes. And then one of the guys has to be in a penalty box and then can't talk for five minutes. If you were. Something like that every five minutes during a broadcast, I think kids would want to watch for new fans. It's about the culture around the they wanna see what guys are wearing leading up to it. What are the fans thinking? So I think it comes down to engagement and game if occasion and making it feel digital first broadcast, or I think it'd be hilarious if Ted Robinson, I got voted off. But I think fans were just like they were just vote us off. Their team was losing told every week I should retire, and I'm the greatest based on whoever wins and loses. So I think that'd be hilarious to try it out. So maybe we can be your Test Dummies. I'll give you a good example of how storytelling just has to improve. So we publish a lot of content on YouTube and on YouTube. You can see these retention charts. You can see exactly what percentage of your audiences watching it every single minute. And that's like our bible. Like we look at every single piece of content and we see, oh, between minute two and two minutes and ten seconds, we lost twenty percent of our audience really do there. What kind of decision would result because of that knowledge that you would use something differently? I'll give you a very clear cut example. We noticed that about ten seconds into our videos. We were normally losing a little bit more than we should like. You know, it's a downward sloping curve because of course less people are watching five minutes in the national shaper. Exactly. But we noticed a little bit of a stark drop off at ten seconds, and we looked at our video and say, oh, around ten seconds is when we normally play an intro card. Yeah, and it fades to black for a second says over. Time, and then it continues the video, but you lost people. We lost people and every single second has to really count. When you think about digital content, if we start seeing all this play out, given these big economics of sports and sports media from you know the player contracts to the owners to the clubs to the investors. How are these deals going to start getting renegotiated when all these different models are coming? You know, when this earthquake is happening, sports is a business that big crossroads and they need to figure out how to go direct to consumer. They need to stream. They need to do a whole bunch of things, and I think they all know it, but there's so many impediments to doing it including these long term rights deals. This is controversial in there are lots of different points of view on it. I believe the leagues were betting that the viewership would go down. If you're going to cut a deal when you think you were ships going to do, what do you do? You cut a really long deal. And so all the major sports leads cut, you know, ten twelve year deals for billions of dollars, but it locks in an annuity of money. Oh, for some period of time. The interesting thing comes when these deals start. Having to be renewed. And so what happens if ESPN has half the Bure ship when the NFL deal comes up, are they going to? You know, can they bid? Are they going to bid? And that originally impacts values, sports teams down the value sports teams haven't gone down since I bet live and I've been, I'm a while. So I mean, people have been calling the top times and it hasn't happened yet. So I could be wrong to gaming comes in and replaces the media, the license rights and things like that. But it certainly creates a lot of turmoil alone the way. Do you think that more value will go to the live experience the same way we've seen in the music industry? I mean, you'd think so, except attendances also down on a lot of the viewership is down. I just read the number of unredeemed season tickets is increasing. They're selling the tickets if you're fans are showing up. So there's something inherent in, you know, a generational thing that gets back to your early question of how does the broadcast actually change because you could imagine a world where four or five years from now the broadcast looks very different and techniques. Is used to have ten different broadcasts and all of a sudden maybe more kids are watching. I don't think that it's predetermined that you ship will go down and there's some stats up the other way. The NFL his past weekend viewership was up compared to last year. So I don't think there is a one hundred percent chance that viewership continues to go down. And then you also have first of all new players in the market. You know the last time most of the big rights deals were up. You didn't have Facebook and Amazon Apple bidding for them. And then you also have new rights categories. You have VR which didn't exist fifteen years ago as a rights category too. Yeah. So I think there's too much going on to say that the meteorites will definitely decline in value, but that's why innovation needs to happen to them that works. We're in a really fun spot because we own all of our rights, and sometimes we'll be able to potentially make two deals by the time. Some of the other conferences are up just once said, there's been a lot of substantial shifts over the last year as in content from, you know how we find it to the way it's delivered to what shape it is. What size it is, what it looks like. I wanted to ask what you think the relationship between live sports and streaming platforms like YouTube, Netflix, and so on, how that will evolve, say in five years, like, where do you see that going that needs to evolve really quickly MLB their idea of broadcasting baseball game with Facebook was just put the broadcast and put it on Facebook. And I don't think that that works like the people that are on Facebook. They know that the game is on TV. There's just not turning on. You can't put the same product in front of them and expect them to watch it. And so I mean, and it gets back to what I'm talking about. You need to change the nature of the game in the actual content, more storytelling, more interactivity and look. It's risky like you may actually the first time you do that put out a product that's worse, but you need to take those steps in order to figure out what actually works the legacy businesses under siege. But then that does create opportunity in the tools are different. All of a sudden you have all these different tools you can bring to bear. You've got all these new formats on snap on YouTube on Instagram, going to wear the fan. Is you've got streaming all over the place. I'm Stanford football freak. I'm one of the biggest streamers off the Pac twelve app because the women's soccer teams on the road. That's the only place I can find it. We've tried to manipulate and sell and optimize so many parts of the game that maybe that becomes the niche thing of let me just tune in when it really matters. Specifically in the NFL were every game comes down to the last few minutes of the game or the NBA each sport will have to find their thing. You know, college football has a specific audience. You know, international soccer has a specific audience NFL clearly has a specific audience in NFL audience right now is kind of like, man, I don't really know if I want anything other than the game college football fans. We want the pageantry mall, the essence and every essence of a campus. I really think it goes down to the sport and everyone who watches the sport has a different palette. But that's four. I just wanna watch Aaron Rodgers, Tom Brady Russell Wilson, and Pete Carroll on Sundays. Those are my guys. Those are my teams. 'cause I want to see at all. I think. It'll be more things on the menu versus, hey, come to that high end restaurant where they kinda tell you a fixed menu, you'll be able to pick and choose what you want because Lee can download any type of option we want. It's interesting right, because not so much of what the internet has been in the very beginning little niche communities. And now it's sort of niche audiences or niche moments of the game. I mean with EBay, it was initially wasn't beanie babies like the babies where something like seven percent of all wise merchandise sales when he went public. In fact, that was not highlighted in the us one when it went public seven percent like that. Yeah, because it was heavily collectibles and beanie baby was the white hot collectible. So how do you see these niche communities sort of spilling over pushing out into the larger media landscape? If we're in the moment of like being babies, EBay for like sports media, like where does that lead to? I think that that relates to this idea of relating to athletes over teams like, you know, I can connect with fans of. Kyle Kuzma like in the pre digital age, you couldn't really do that. It was like, you saw someone in a Lakers z. okay, we're all Lakers fans. I couldn't find that many people that were obsessed with the same player. We're obsessed with a particular idea about analytic. So I think it allows your phantom to go a little more specific. Yeah. Let's talk about those fans. How do these new trends and content start to kind of trickle down and affect the fans, what they want from the game, what draws them in and what doesn't does it start to impact fandom in any significant way? And how? So? I think more than ever it's personality driven content. I mean, if you ask a kid, what team they root for, I would say most kids in America right now, say the Lakers because they're really a LeBron fan. We think about all the time what talent actually resonates with this audience, and it might be a nineteen year old. One of the keys to that has been focusing on this idea of the next generation of superstars who's next up. And I think that it's sort of a white space that a lot of traditional sports media companies have really ignored for a long time covering this next generation of superstars. First of all. You want that immediately. You don't wanna wait two days later for the coach to go through his fell, and then he sends it to that. I don't care anymore. Exactly. Part of it is we identify who the really influential athletes are. We have a technology that allows us to send one kid into Jim and send highlights to us in real time. So for instance, is I on Williamson, we know that we want to be the first one with every single one of his viral plays, right? So we will make sure the first one with that. And that's a level of sports coverage that isn't generally happening. It's not because that's traditionally one of the issues with high school sports. It remains very local and very fragmented. But now with technology, you're able to cover a lot more ground. So what is that technology play? The problem with highlights is you never know when the good play is going to happen. So we build the technology call flashback where the game is streaming through memory the whole time, it's not saving it because we don't live stream games, but when something happens, you press a button and it goes back twelve seconds and it lists it and it sends it automatically to our server. So if you're gonna Jim with low network, which is most gyms. Our clip will be the first one out of there, and then we can put it on social media right away. And then everyone is sharing that clip seven-hour going to totally date myself at it reminds me of when you use to try and make a mix of the radio, like hold on one second. Let me press play and you would, of course you never had the first ten seconds of any good song. Yeah, that's exactly right. You don't wanna miss that play. You don't wanna miss action. So this allows you to get sort of what you need to hit rewind on real life for a second particularly useful for sports. So one of the early Goto on overtime was the reaction shot. Joe one part of their businesses highlights to capture, highlights had previously weren't captured anywhere near the breadth they were captured in. So athletes, amazing, high school plays that you never would have seen you now see all the time. And one of the things that happens like after a brutal dunk, the fans, the camera scans, the fans and the fans, the reaction shots. Joe's? Aw, whatever it is. The crowd goes insane and you want it very raw. There's something about someone using an iphone. It just feels very immediate, like you're so close. There's some plays that we have that are shot both of an iphone and a real camera, and we've tested this on Instagram and actually performs better when you do with an iphone. It makes sense to me because it feels like it's like man on the street. Right, that's exactly right. So how does this new exposure on all kinds of levels to these younger athletes playing in games that didn't use to be covered before? How does that start to affect the way these athletes are perceived or even think of themselves Zion Williams, just headed what three million followers or something like that on Facebook. And so he's learned to market himself at that age and it does change. The dynamic sports media seems to be much more people driven versus just reporting or stories every summer. There's this event called the opening and we call it football heaven. It's the top hundred sixty six high school football players in the country, and we're on the practice field. And Larry FitzGerald is there which is a big deal. There is Jerry Rice. One of the greatest players have not the greatest player in the history of the NFL and then Odell Beckham junior's shows up and it was like Bieber showed up in front of like thirteen year olds. They were screaming and jumping. They surrounded as golf card like it was a flash mob, and it was a really interesting moment for me like you Jerry Rice. And Larry fits like on the practice field with you, and they were appreciative of it. But then here comes del who has done a lot of things, but not nearly what the other two have gone thus far on the field. And it was this moment of like, whoa, this guy's in love with him because of his because it was persona of course of how he plays. But that's just the barrier Venturi. And as you said, Yogi, it's not just about your skill. I mean, lamelo ball free point. Five million followers on Instagram might not even make the NBA. So I think this social cash shade at these guys have that's actually how we decide who we want to cover, not necessarily about who's the best. It's who's the most interesting and. Fenwick to this audience. Right? And a lot of these kids are being given opportunities because of this exposure, right that they would never otherwise potentially have gotten, oh, absolutely. Kids get more scholarship offers or some kids that may never even get to play in the NBA there. Now what I would consider a basketball influence or football influence or what you mean by that phrase? That's really interesting. So I'll use an example of a guy named MAC McClellan. This is a kid that had maybe thirty thousand Instagram followers. The beginning of this past season got a lot of coverage partially from us and now probably has six hundred thousand Instagram followers. I would say that most of the basketball population does not believe he's going to go to the NBA I do because I'm a supporter, but this kid is a legit celebrity. Now this guy can have a ton of brand endorsements. Once he leaves college there, a lot of different things that he can do because of what social media has done for him and it's a whole world of content. Yeah, that's exactly right. I mean, he's not the best basketball player in the country. No one would argue that, but people want to see. There's something about him both his play on the court and also who he is off the court that makes them adding Matic. And now I think you're finding athletes even college athletes, figuring out their brands if you're gonna, put continental there, don't just put it out there but have a purpose behind people who have great access to be popular or learning. They have to refine their craft and be like to what is my lens into this world of millions of channels because I better have one or I'm just going to kind of get lost in the shuffle. So that was what I wanted to ask about brand. Right? So if now high school athletes are starting to think about how they're perceived and whether their footage is ending up on overtime, and then you know, at ESPN might the end of the day, do kids have to start thinking about brand sixteen seventeen years old and how they're building their sports career. I mean, I know at sixteen I was not mature enough to manage my own brand at all. Yeah, there's a meant pressure for some kids. It's a good thing and it makes them mature really quickly. And then you have other athletes that come in and they couldn't care. Less who they're interacting with. All that is magnified by what you do in social media. I mean, I've seen countless athletes, right? These really long, Instagram captions, and every other word will be capitalized and they'll be all these spelling errors. They are broadcasting millions of people, yoga. What do you think about this kind of new role of this athlete influence her? It's a different type of branding. I see the top twenty four high school quarterbacks every year that have hundreds of thousands of social media followers and our toll. They're supposed to be this and they're still trying to figure it out. So what I think is so critical for high school student athletes to help give them tools, but fifty things you wanna do in life, not necessarily win every Super Bowl or VP or Heisman trove. What if you things you want to do that is a step that gets missed when soon athletes get to college because coaches don't have the time and all of a sudden, what happens? You have an identity that is told who you are. You are paying us -ly you're the top quarterback in the country. You're supposed to be the dude. Then we've got major issues around anxiety, depression identity. And so for media's only ramping up in one of the character traits do you wanna share in? Are you sharing them should be required coursework every semester of student athletes, crew in college? Let alone when they get their first recruiting letter. I mean, even you think recently about the whole Colin Kaepernick you know these thirty years old and obviously has a lot of influence and is able to make a decision and stand by his word. But Zion when he was sixteen had almost as much influence as Collin did at that point and is a sixteen year old really ready to do that. I love the fact that student athletes have the platform at a young age. I think it's amazing. They've earned it. That's what sports are, but you gotta surround yourself or be given some tools to prepare for this. And a lot of times you get burned. You know, like, man, I didn't think that was going to be the headline for me. I didn't mean it to be, but that was the lesson. Let's talk about the game itself. Now there's all these different ways you can sort of consume content around the sport and around the game. How do you think this is impacting the purity of the game? Do you think that's something that gets changed by. This kind of different media consumption in the future. So it changes scouting, right. Does it change other things or the changes a lot? I think it changes with the student athletes start it all we ask every quarterback every season. We look at a thousand of them, whittle it down to the top twelve. You know ones the MVP, the other of the elite eleven. These are the top high school kids in America, and we ask them the same question which is do love what football does for you or what you can do for the game coaches are really struggling figuring it out because who doesn't like get loved up at sixteen with scholarship offers tweets letters, cool Jif, great images. You can post on your own platform. They're created by other institutions. I think it does affect the play on the court. I mean, Jeff, and I were playing bath all this morning. If someone had a camera out there, I would have noticed it and it might have affected how I played. As soon as there's a light on you, you're aware you're aware observed and for these kids, it's not just a camera, but that video is going to be seen by tens of millions of people, and it's hard not to keep that in your head and you hear coaches complain about it all the time. They're like, don't play for the Cam. Right? Don't play beyond overtime. Wow. Try to play. Fundamentally. What I've seen broadcasting games is that the games and the viewers are becoming even more pure. It's kind of like people talk about the violence in football specifically. I love the targeting penalty. I love when we're trying to clean up the game for my kids and their kids happening overall viewership, but you're only watching it if you really love it. Like if you love Stanford football, you're going to tune in this weekend on the Pac, twelve networks. If you are curious about Bryce love or Caja Costo, you'll see the highlights and I just think that's where we're at outside of the top two or three games a week. Maybe that are like epic games. Overall viewers are being like YoM role with my team. I even feel that ways of consumer. If I watch a game and I'm kinda like man, like giving me like the general stuff right now gimme two, three deep on the depth chart gimme the backstory's behind these guys. And I think as viewers by self included as a consumer, I want more expertise. I do think that. The purity of the craft of the game is only increasing, which I think is better for the game. As there become more opportunity to do things outside sports. I think you'll use right that there are some people out there that wanna watch the game more pure, but I've pretty strong conviction that the younger generation, there's very few kids like that. The kids do want the fanfare around it. They don't wanna just sit down for three and a half hours and put their phone away and just watch a game pure. And I think for a lot of it does come down to this idea of foam. Oh, like, you know, I think one of the reasons why live sports has always been so popular is like, you don't wanna miss out on that moment. I don't even DVR games anymore because I'm so afraid that I'm going to see the result on my phone. You want to have that moment that impact. And I think when you can see the highlights on Twitter, instantaneous, Sam, basically participating anyway. So there has to be something about the broadcast that doesn't quite translate to that might actually get me to watch. All right. Well, thank you guys so much.