How do teams make money? They make money now in almost any way you could imagine, as long as it touches on something related to sports. What does that mean? It means that in the past, we looked at team revenues in terms of ticket sales, then in terms of merchandise, and some of the other ways that we think about going to the game.

Sports Management Education Examines Added Revenue Streams

But over time, certainly, over the past 50 years, we’ve seen revenue come in major numbers, in billions of dollars through television rights. Now we increasingly see it coming through all the ways we get to watch our games. As if that’s not enough, enter sports betting and all sorts of things online, including E-sports.

Television Revenue in Sports Management

Television revenue for the past 30 or so years has been a major driver of revenue for sports clubs and franchises anywhere in the world. Now what we’re starting to see, of course, is that it’s not just about watching them on television. We also watch on a second screen, which is kind of interesting, because it’s now for many people become the first screen.

Global Sports Access

Anywhere and anyway people are accessing sports, whether it’s a game, a behind the scenes video, or a little piece of the action that you didn’t even know existed, all of that is worth many billions of dollars to teams and the players who play on those teams, plus the players we watch in individual sports, like golf or tennis.

The relationship between athletes and the media has changed significantly. Nowadays, athletes don’t necessarily need to rely on the news media to share their stories, successes, or activities. In addition to social media, sports organizations and sports management have the ability to share their own news now. In the past, they were reliant on traditional media, television stations, and newspapers for these things.

Social Media Is the Future of Global Sports

In some ways, social media has given athletes more power of their own. This freedom has empowered them to tell their stories. But, in another sense, this has made things more difficult for them because they have to stay on top of social media all the time. They have to constantly check on what people are saying and posting. As a result, we almost see the media reporting on what happens on social media now, rather than, just covering breaking news stories the way they used to.

The Atlanta Braves’ facility is a good example of a ballpark that is very interactive with the fans. They offer their fans sports perks like renting a baseball glove or ziplining at the stadium. In addition, there are a number of other exciting things that fans can do when they aren’t watching the game.

Sports Management Education for Marketing Global Sports

The interesting thing about this interactive model is that it also benefits sponsorships. Sponsors want people to come to the game. Often, they have signs at any given arena or stadium. For example, Pepsi places advertisements all over the stadium, and they want as many eyes on those signs as possible in order to see a return on their investment.

Great Sports Management Leads to Great Sponsorships

These interactive experiences are a great way to draw people to the ballpark. Sponsors greatly appreciate this because more eyes in the ballpark mean more eyes are their sponsorship signs.

One example of the sports ecosystem is the Little Caesars Arena in Downtown Detroit. The community around this arena has always been vibrant. Even though it has seen its share of ups and downs, including more challenging times recently than in the past, it remains spirited.

We are looking at how sports can be used to grow a city through economic and social development. We are looking to take some of the things that aren’t working so well and use these events and venues to spur something new.

Sports Management Investments to Improve Development

Sports facilities have a unique way of helping communities come together. Part of this is due to the development of property that, otherwise, might not have a significant impact on the community for decades to come. It may be in a Brownfields area or an opportunity zone that would never see the level of investment if not for these facilities. So what we see in this type of ecosystem is the community coming to the downtown corridor to watch live sports.

Around 20-30 years ago, sports facilities were developed in the suburbs. People would trek out there or to areas on the fringe of the urban population to watch the games. Now we are seeing sports being developed more in the urban core. Along with that, we see transit and modalities that would never have happened if it weren’t for these investments.

This is not to say that sports are solely responsible for this kind of rebuild. It’s just saying that they helped accelerate the local government’s investments in the community. Sports helped bring more people to the local downtown market. It gets people to walk or take public transportation to the games, letting people spend more time in the urban core.

The Future of Global Sports Ecosystems

Whether these people live there or just visit, they are shopping there now. They are spending time and money there. They eat at the restaurants and see the events there. These people are crowding out money that’s usually being spent somewhere else. In addition, they are generating incremental income for the local community.

Let’s refer back to the example of Little Caesars Arena in the Detroit area. This building opened a year ago as the successor facility for the Joe Louis Arena. There has been a resurgence of putting sports in downtown areas. In Detroit, the Lions played out in Pontiac and the Pistons that played in Auburn Hills.

Even though the Joe Louis Arena was downtown, the Red Wings moved about a half a mile north to the Detroit District because there was a more modern facility there. It’s in downtown Detroit in a place called the District Detroit. It’s close to Comerica Park, where the Tigers play, and the Ford Field, where the Detroit Lions play.

Even in an area that has become a local sports hangout, you wouldn’t even know that the Little Arena was an arena if you walked up to it. Its facade appears to be offices, restaurants, and open spaces. It doesn’t look like the traditional arena of the past. However, when you walk in, you are greeted with videos and the history of the Red Wings and Pistons, who play there.

The flow through the building makes it a wonderful place to watch a sporting event. They offer many different ways to consume the game through great restaurants, shops, and video monitors. In addition, the inside of the building is full of digital media to help viewers enjoy the games. The Little Caesars Arena is a wonderful facility that will probably be the hallmark for how arenas will be built for the next several years.

Now there is this area in the urban core that is sports-related. But if you walk around, there are also restaurants, shops, and parking in the same urban core. More people are moving into the downtown corridor, which may not have happened without sports being built up there. It could have taken many more years to succeed without this kind of influence.

The NCAA (NationalCollegiatee Athletic Association) is very complicated right now. We are only really referring to big-time college football, men’s football, and men’s basketball. Issues are revolving around the black market and the Adidas case where guys were arrested for handing money over. These things wouldn’t exist if there wasn’t pressure around young athletes on national television. Tons of money around them and they aren’t seeing any of it. These are enormous businesses, and these issues defy common sense.

One fundamental question asks if there is something to look at here or not. In 1984, a class-action suit was brought by the major football schools against the NCAA and Walter Byers negotiating to make their own television deals. This case, known as the Oklahoma Board of Regents V NCAA was a supreme court case where Notre Dame at the University of Texas thought that they should be able to make their own deals instead of going through the NCAA.

The NCAA responded to this by explaining that their actions were a restraint of trade and antitrust. They went to the Supreme Court and the court favored the NCAA, confirming that it was a restraint of trade and antitrust. The Athletic Director of the University of Texas, Frank Broyles, says, “These schools can now kill what they eat.” This began the proliferation of conference and school deals for the selling of television rights.

March Madness Keeps Schools Connected to the NCAA

Here’s the curious thing though. Around that same time, another significant college sports phenomenon started becoming extremely popular with the advent of cable television and ESPN. This is known as March Madness with college basketball. Many of the schools with excellent football programs also have excellent basketball programs. However, strangely, the now one billion contract for March Madness is still retained and controlled by the NCAA instead of the schools.

Why would these schools insist on having football rights but not basketball rights? The answer is that if they take basketball rights too, then they wouldn’t need the NCAA anymore. Without the NCAA and the student-athlete, their economic model falls apart. This beautiful thing that rakes in tons of money without paying anyone for it would be gone and there’s no justification for that.

Global Sports: The International Olympic Committee’s Rule 40

People who have no ethical or moral center are aggressively challenging sports business today. They don’t understand, and they don’t care. They don’t care if student-athletes are illegal or if closed professional leagues are illegal. They don’t care that the IOC (International Olympic Committee) has something called Rule 40, which doesn’t allow Olympic athletes to promote their sponsors while competing during the Olympics. The IOC controls all of the sponsorships for the Olympics, so they control the exclusive rights and make all the money.

These strict policies may be completely unfair, but they are what make them so brutally efficient and economically advantageous. They dispassionately, coldly, and clinically understand the models of profit.

Sports Management Education

Until you understand these types of sports business models, then you are just another guy calling up sports talk radio to give your opinion. You need to grow up. Do you want to run this thing? Do you want to own this thing? Do you understand what it means? Do you want to change this thing? If you think it’s a lousy system and want to change it, then maybe you need to join them to beat them because you have to understand it before you begin.

How would the issue of naming rights for a stadium be addressed ten years ago? According to online sports management education lecturer Chris Lencheski, maintaining regional clout and pride might have been the answers.

“10 years ago where it would have been was, we are a regional company. We are the largest. Maybe to take a US strategy approach, might be Bank of America and Bank of America Field in Charlotte.” he explains.

Charlotte-based Bank of America was making loans to and investments in the National Football League to build a charter program. Teams could go to the bank and get loans for their stadiums and team needs. Hugh McColl, the bank’s CEO at the time, was a strong supporter of the business of the NFL and the ownership group.

Indeed, there was an element of regional pride. There was also an ability to have measured media, with every game televised nationally and distributed internationally to global sports networks.

Bank of America and many other super-regional companies look at stadium naming as a corporate good citizenship strategy. It is a way to get their name in front of somebody. “And that’s where the strategy was very top line and top-level, but not a lot of analytics behind it. Just hey, it’s the right thing to do,” Lencheski says.

Data analytics is exploding. Sponsors want deeper information about how data is going to connect to a specific sport or region. In Lencheski’s time with Comcast, he evaluated data on behalf of commercial rights clients that the company might engage for naming rights on stadiums.

Questions he needed to answer were “What was the value of the stadium worth relative to its international media?” “What would the name look like on a signage standpoint from localized media?” “What would the impact for consumer brand-facing sides?” Each question represented a wide-ranging topic. The deal-making side is where the rubber met the road.

The Case of Reebok

Reebok Stadium was undergoing a transformation to being owned by Adidas, who wanted to move off of the stadium’s naming rights. Lencheski sold the rights to Macron, an Italian sportswear company.

One of the reasons Macron looked at acquiring naming rights was a deep-dive analysis. Macron accounts, particularly in the UK and with football fans, were not as well-known as Adidas or Reebok. It was an opportunity for Macron to actually put their name on the stadium.

Reebok was prepared to finance some of the rights because, in moving into participatory sports and away from team sports, they wanted to remove their name. Each aspect of the deal came about by taking a deep dive into social media, television values, and most of all, what would happen to the consumption of products.

“I know you would agree that, despite the fact we can go deeper on the analytics, we always will have those kinds of considerations, such as the community impact and so forth as part of a broader decision,” adds NYU sports management education dean Vince Gennaro.

Sports Betting and Data Analytics

Around the globe, sports betting has become an enormous business. As data analytics has progressed and evolved, it has really begun to change the game. Both analytics and digital technology have the ability to have information flow faster and help customers place bets in a more efficient way.

People who can code, who know analytics, and who can understand datasets about sports have the ability to assist both sides of a betting transaction. “The better, as well as the gaming companies, make the best bets that they can, either to spread their bets out or actually maybe make margin,” says Chris Lencheski.

Right now, those particular skill sets are things that a lot of people are looking at. As betting grows, it will come to the United States in a way that is transformational for many people in the sports business. It will also create vast revenue buckets for not just teams but actual local, state, and federal economies.

When you look at the data and analytics that organizations will need, however, it will really matter as to (for example) what NBA player or how many NBA players could hit for “X” points, and if they’re on the floor the night when the bet has been placed.

“That’s going to be a long algorithm,” Lencheski speculates, but he believes organizations will get to it.

When you’re now talking about taking bets from around the world on a basketball game, or potentially a baseball game, if you will, it will matter incredibly well as to who’s on the court, who’s pitching, and what the combinations are on the field.” People will follow these metrics no different than they do fantasy sports in the United States.

“Everything is a reaffirmation of how important the new data sources, the information explosion, and technology to deliver that information is, and how it’s absolutely changing the sports landscape,” adds Gennaro.

In Arlington, Texas, there’s an interesting example emerging. The Dallas Cowboys of the National Football League, one of the most recognizable franchises, with its five-point blue star, plays its home games in Arlington, Texas. Right next door, the Texas Rangers (Major League Baseball) play their home games in a current stadium and they’re going to soon move into a new ballpark. That’s interesting enough, just to look at that part of the ecosystem and those relationships. What builds on that is some development called Texas Live, which is really an entertainment complex that’s (in ways) connected to where the Cowboys play and where the Rangers play.

Part of this growing campus of sorts in Arlington, there’s also the city building, which will be the largest Esports stadium in the United States. We start to see the emergence of, not only sports facilities being connected, but the community connected in a different way. It’s sports. It’s entertainment. It’s really the way people live, and these developments signal a real shift. They’re not just about driving the economics of a community, but it’s really overseeing something driving the society and the social aspects – the reasons that you would want to live in a place.

A New Way to Look at Global Sports

The Esports stadium in Arlington, Texas, is a little bit due in part to some work that the NYU Tish Institute did with the United States Conference of Mayors, Professional Sports Alliance, and the city of Arlington. After looking at the Dallas Cowboys calling the city home, the Texas Rangers calling the city home, and other growth and development in terms of sports and entertainment, one of the questions the mayor of Arlington asked, “What’s our next play in sports? What should we do next?” The Tish Institute, in this project partnership with the conference of mayors, was able to send a project team of graduate students in a capstone nearing completion of their program (overseen by faculty), to work through this question that the mayor had. Working directly with the mayor’s office, the city staff, and the Convention Visitors Bureau, what came out, was Esports and video gaming.

In today’s times, especially with online sports management education, it would seem like that would be the obvious thing to do, the next natural thing to do. Esports seems to be so exciting. It’s hot. How could you go wrong with it? It wasn’t quite that simple. Of course, these things have to be thoughtful and thought out. You have to have the infrastructure and the financing as well as willingness and an interest to get involved in emerging activity like Esports. But what the mayor’s office and Convention Visitors Bureau saw, through this relationship between them and NYU Tish Institute and the conference of mayors, was that Arlington was, in fact, primed as a location for Esports. City leaders took that idea and the research behind it and the next thing you know, is the announcement of what will be the largest sports stadium in the United States.

Accessing Electronic Sports Management Education

Esports is actually a number of different activities across a number of different video game titles, across a number of different video game platforms. In a way, Esports and the excitement around it, is everything that we love about sports. Esports is really for everyone. Any city can do it because any business can be involved in it. The reason any business can be involved in it is because any person can be involved in it. Anybody can participate in Esports.

What led Arlington to Esports and to move forward on it is, first and foremost, a willingness by city leadership to ask questions about where they might go next and a willingness to look at the entire sports landscape. They were willing to look at the entire landscape, travel and tourism, and the way businesses work.

We look at it and say, “Well, they must have been taking quite a risk, or at least an educated risk.” But it’s no different than any other decision to do something. In this example, what Arlington has going for it, and the big reason that it went for Esports and to build a large Esports stadium in the United States, is because the leadership there could see how connected it was. They could see how connected Esports is to what people are looking for as residents in the community and as travelers to a community.

New developments in neuroscience is opening up new ways for athletes and coaches to monitor sports management. It’s something essential to today’s sports management education or online sports management education.

Neuroscience allows sports teams to gain an edge. Monitoring brainwave activity while athletes are practicing their craft can give teams real insights into a player’s strengths and weaknesses. Now, in addition to being an evaluative tool, it can also be a valuable coaching device and development tool.

One example of the application of this technology is a company called deCervo, which is helping teams assess baseball players’ reaction time to identifying pitches. One of the most important skills a batter can have is the ability to quickly identify pitch type, balls and strikes. Some players have a natural ability to make quick accurate judgments. Those players are in high demand. We’ve also learned that other athletes can hone those skills through training.

Many sports organizations have invested in tech startups. Sports teams have joined forces with venture capitalists to create accelerators, incubators, and other early-stage platforms for new technology and ideas to grow into viable businesses.

One of the pioneers in this area is the Los Angeles Dodgers. They were one of the first to do this. They formed an organization called Global Sports Venture Studio. It’s led to the development of more than a dozen companies, including two that have become forces in the sports tech space: Kinduct and ShotTracker.

Major League Soccer is also in this accelerator space, hoping to develop companies that take fan engagement or even player development to the next level.

Wearable technology is really becoming an important aspect of data capture for sports teams and for the athletes themselves. And where it really comes into play is in the continuous flow sports like basketball or soccer. What you’ll find is that in these continuous flow sports, you’re monitoring a lot of the biometric data and information. And you’re measuring levels of hydration. You’re measuring fatigue. You’re measuring stamina. You’re measuring heart rate. You can look at a soccer player as he or she runs up and down the field of play and understand how all of these measurements I just mentioned change with their exertion level.

And this is a way to catch fatigue when it’s going to occur. It’s also a way to build stamina. We understand where the limits are and where the decline comes. How do you push past that and build stamina in these athletes?

There are several issues with wearables and the biometric and health data that it captures. There are the HIPAA regulations which prevent, without the athletes authorization, the open sharing of that information. So, it’s not like teams can freely pass it to one another. Secondly, from an athlete standpoint, he or she may feel that they own that data.

It’s about their body and their personal biometric data. This is a very sensitive issue in sports management. And, in global sports, it’s an issue that players’ unions are very involved in. They’re involved in negotiations with leagues and are trying to implement standards to protect the athlete.

This information is something a reputable sports management education will cover.

Let’s talk about one of the most dynamic areas in all of sports today. That’s the media landscape, which is changing constantly. One of the things we’re seeing is that linear TV is really plummeting, while over-the-top, or OTT, is rising dramatically. As we all know, sports is really the last major holdout that is saving linear TV. By linear TV, what I mean is sitting in front of your TV set at a specific point in time, watching live broadcasts.

In 2005, 14 of the top 100 telecasts were live sports. 10 years later, in 2015, 93 of the top 100 telecasts viewed were live sporting events. Instead of watching linear TV, people are now consuming broadcasts online, on mobile devices or from non-networks like Netflix, Facebook or YouTube. As opposed to the go-to source for content, a TV has simply become a bigger screen to view video.

In some cases, though, the exception is for major sporting leagues and events. Those are the things that still attract eyeballs on a live basis. Now, over-the-top, or direct-to-consumer, is where the growth really is. Many sports leagues are on linear TV, and they also have an over-the-top offering. Major League Baseball, for example, has their MLB At Bat app, which is a direct-to-consumer offering.

The NFL, of course, has their role in broadcast TV, but they also have streaming with DIRECTV. About one third of Americans say that they watch more streaming TV than actual linear television.

In many ways, streaming matches up so much better with our modern on-the-go lifestyle. Plus, the quality of our smartphones, especially with ever-increasing bandwidth such as 5G, will allow for even greater efficiency for streaming video. Netflix is subscribed to by over half of US households, and they’re also the source of some of the best award-winning content. So, as you can see, the media landscape is changing dramatically and rapidly, and it has major implications for the world of both national and global sports.

Online sports management education is a great place to start if you want to learn more about how media has changed and evolved in relation to sporting events. It’s also a good way to learn many other sports management concepts and lessons to form a complete, high-quality sports management education.