15 to watch (Week of 7.11.16)
Rick Horrow's "15 to Watch"
CSN Bay Area Sports Business Insider Rick Horrow takes you off the field with his 15 top Biz Ball trends for the week of July 11.
San Diego's All-Star wallet
1. As news has just broken that the UFC has been sold to WME-IMG for an eye-popping $4 billion, the city of San Diego, home to this week’s Major League Baseball All-Star Game, is seeing a windfall of its own. San Diego should see an economic impact north of $60 million; overall, MLB has seen a positive impact from hosting All-Star events, earning an average of $85.7 million over the last five years. Tuesday’s game will mark the third time that the Padres have hosted the All-Star Game, having also done so at what is now known as Qualcomm Stadium in 1978 and 1992 (and home, albeit temporarily, to the NFL Chargers). MLB licensees are also having a good week in San Diego, reporting brisk sales of top shelf-items, including Majestic's Home Run Derby jersey and New Era caps. Baseball’s retail footprint in San Diego includes an All-Star Game merchandise store on the flight deck of the USS Midway and a 35,000-square-foot store at Fan Fest, operated by Aramark for the 18th consecutive year.
'Opened the floodgates'
2. Coinciding with the MLB All-Star Game at Petco Park in San Diego, Intel has signed a deal with MLB to become one of the league’s official sponsors, according to Ad Age. The deal has already "opened the floodgates" on Intel’s baseball TV ad spend and will see the tech giant participate in the All-Star Game broadcast.” Prior to signing the deal, Intel “hadn’t spent a dime on baseball broadcasts,” but "invested $246,855 in live MLB inventory" immediately after signing the deal. Fox Sports Executive Vice President/Sales Neil Mulcahy said that spots for Apple, Samsung, Dell, and HP "will be aired throughout the broadcast, a techie land grab that's in stark contrast to last year's game when Cisco was the lone standard-bearer for the chipsets and computers category." Other notable All-Star Game sponsors include MasterCard as a new presenting sponsor, along with Budweiser, Pepsi, and Chevy.
3. According to the R&A, the winner of the 145th Open Championship at Royal Troon will pocket £1,175,000. While that’s a royal sum, should an American hoist the Claret Jug on Sunday, he will take home about $226,732 less than he would have before the June 24 Brexit vote caused the British Pound to plummet against the Dollar. While this might seem bad news, the current Pound to Dollar exchange rate is a major plus for American golfers contesting the British Open and American patrons alike. Consider lodging. If want to live like a king, Craufurdland Castle is available for £20,000, or $25,798. A month ago, that castle would have cost you $29,600. A one-day Royal Troon grounds pass is £80 -- $103 now, $118 then. And when Phil Mickelson won both the Scottish Open and the Open Championship at Muirfield in 2013, he paid about 61% taxes on his winnings, in part because the UK collects taxes on endorsement income for non-resident athletes. Should Lefty prevail at Royal Troon this week, the savings wrought by the exchange rate would make his tax bill a lot less taxing.
Getting the bugs away
4. Not every Olympics has an official bug repellent sponsor, but the Rio de Janeiro Games certainly do. SC Johnson’s OFF! is now the Olympics’ first-ever insect repellent partner, with thousands of bottles set to be distributed as part of the agreement, according to Bloomberg. Despite the World Health Organization stating the risk of catching the mosquito-borne Zika virus is low during Brazil’s winter months, several notable athletes have cited the virus as their reason for dropping out. Top-ranked golfers including Dustin Johnson and Rory McIlroy have been among the most prominent individuals to withdraw from the Olympics so far, but more exits are expected this week as teams firm up.” Overall, insect repellent sales in Rio have sky-rocketed. Raia Drogasil, Brazil’s largest chain of pharmacies, reported repellent sales in December had jumped seven-fold from a year earlier.
5. Despite an onslaught of problems that have plagued the competition buildup, Rio de Janeiro Mayor Eduardo Paes reassured the world that the city “will be ready” to host the Olympic Games next month, but visitors “should moderate their expectations,” according to the Wall Street Journal. Rio Games Organizing Committee President Carlos Nuzman stated that all competition areas will be completed properly and adequately to host the sporting events, though significant funding and construction problems surrounding multiple venues and sites have arisen over the past few months. On top of those problems, many observers are concerned with the safety of the coastal Brazilian city. Rio's violence is "deepening anguish and anger among residents, and it comes at a time when Rio's state government is broke and has slashed police budgets by a third," wrote The Washington Post’s Dom Phillips. But Paes “declared Rio to be a ‘transformed city.’” Only time will tell how next month’s Olympics unfold.
Shoe tension in The Bay?
6. Kevin Durant’s move west will certainly help the Golden State Warriors’ performance, but it is expected to undercut Under Armour’s grip on the Bay Area basketball market. Back-to-back NBA MVP Stephen Curry is arguably UA’s most popular athlete, but Durant is set to bring his signature Nike shoe line with him to the Bay Area. According to Fox Sports 1, Under Armour previously “owned this Warriors team" through its sponsorship of Curry, but the company will now have to share the market with Nike and newly signed forward Durant. Under Armour has had an exceptional growth year, headlined by stellar seasons from brand ambassadors Curry, Tom Brady, Cam Newton, and Bryce Harper. But more change is coming to the NBA in the coming years, as Nike will take over as the league’s official sportswear outfitter and jersey supplier in the 2017-2018 season. These factors combined take some significant momentum away from Under Armour in the Bay Area and around the league.
Bump in the road
7. Southwest Airlines has publicly opposed “building a domed football stadium on a 42-acre site” near Las Vegas’ McCarran International Airport – a site that could potentially house the Oakland Raiders, but one that could also impact airport operations, according to the Las Vegas Review-Journal. The site, known as Trop 42, is causing controversy between Las Vegas council and commission members. Clark County, Nevada Commission Chair Steve Sisolak said that a "stadium on that site could impact operations" at the airport. Southwest Airlines in the airport’s busiest commercial carrier, so neither the airport nor the airline want to decrease business there. Stadium developers are looking at other potential sites on which to build an NFL stadium, including sites from a UNLV “campus master plan,” the recently imploded Riviera hotel, MGM Resorts International Rock in Rio grounds, and Cashman Center.
Luck of the Irish overseas?
8. Notre Dame football coach Brian Kelly made it clear that he and the university are open to taking their annual Shamrock Series game against the United States Naval Academy out of the country, according to the South Bend Tribune. Kelly noted that the 2012 game in Dublin, Ireland, “was as seamless as making the travel across the country,” and that the logistical concerns were less daunting than had the game been held in Los Angeles. "I can’t tell you that we’re close to signing anything outside of the country, but we haven’t crossed that off our list. And the reason for it is because the Dublin game went so well," said Kelly. The 2012 game was held at Aviva Stadium and marked the first advance sellout for a sporting event at the venue, two years old at the time. The game drew significant media attention, airing in both Europe and the United States.
One for the troops
9. The MLB’s recent salute to the military went according to plan, as Commissioner Rob Manfred noted that he was pleased with the Marlins-Braves game played at Fort Bragg. While this weekend’s MLB All-Star break in San Diego contains many elements honoring our Armed Forces, the Fort Bragg game was unique in that it was primarily aimed at those who serve. According to the Fayetteville Observer, the Fort Bragg game was played “before 12,582 mostly active-duty soldiers and their families,” and the evening was all "about honoring the military personnel who protect our nation." Players took photos before, after, and even during the game, soaking in the special evening. Manfred "wouldn't say if another military-specific game would occur in the future,” but he did note, “We're very interested in the concept of taking baseball to parts of the country that don't ordinarily see professional baseball. I do think military bases provide a great venue." Some of the players even said that the playing conditions at the brand new $5 million Fort Bragg Field were better than some MLB parks.
10. Senior Executive Vice President/Programming & Production John Wildhack is leaving ESPN after 36 years of service to assume the AD position at Syracuse University. A Syracuse alumnus, Wildhack reportedly made the decision to leave on his own; “he was not part of ESPN's cost cutting that has seen hundreds of layoffs over the last year,” according to SportsBusiness Journal. University Chancellor Kent Syverud approached Wildhack about filling the empty position knowing that he was contracted to ESPN for years to come. But ESPN President John Skipper supported Wildhack’s desire to return to his alma mater. “His impact on our production, our unparalleled suite of rights agreements and our overall values and culture is immeasurable,” Skipper wrote in an email sent to company employees. The empty position at ESPN is expected to be filled from within after Wildhack officially leaves on July 28.
11. The Miami Dolphins are currently on a very tight schedule to finish planned renovations of New Miami Stadium, but their process has a direct impact on other teams besides the Dolphins. The University of Miami plays its home games there as well, and rumors have been circulating that the university will be forced to play its home opener elsewhere if the renovations are not complete. Athletic Director Blake James denied a report that "lagging renovations" at the Dolphins' stadium have already forced the school "to move its September 3 opener against Florida A&M to FAU Stadium," according to the Miami Herald. The Dolphins still expect to host their September 1 exhibition matchup with the Tennessee Titans at the newly refurbished venue, but the team has discussed potentially moving that game. As for Miami, James said that he will "have a contingency plan should the Dolphins be unable to complete" renovations in time.
12. Dwyane Wade is heading home to Chicago after signing a two-year $47.5 million deal with his hometown Bulls. The move from Miami came as an abrupt ending to an otherwise great 13-year relationship between Wade and the Miami Heat. According to the Miami Herald, this coming season will "mark the first time in Wade's career he's the highest paid player on his team." Wade originally told the Heat that $50 million over two years was the number that would keep him in South Beach, but when the team only offered $40 million, Wade went looking elsewhere. While it may not be exactly $50 million, Wade’s new contract is a whole $7.5 million more than what he would have gotten had he stayed put. CSN Chicago noted there was a "lot of bad blood" between Wade and the Heat from "previous contract negotiations," particularly between Wade and Heat president Pat Riley.
Voice of the players
13. The Players’ Tribune (TPT), a website started by Derek Jeter that posts first-hand stories and narratives directly from athletes, saw its highest traffic ever when it broke Kevin Durant’s story about his move to Golden State. The piece reached more than five million total content views just a day after it posted. So many people viewed the website at once that it crashed – though all tech issues were fixed relatively promptly. The day after Durant’s decision to leave the Thunder to join Steph Curry and the Warriors helped TPT reach its most traffic in a single day – more than double the website’s second-highest traffic day, when Kobe Bryant announced his retirement a year ago. Observed TPT Executive Vice President/Partnerships & Business Development Raphael Poplock, “Kevin’s announcement is yet another example of how players are using TPT as a trusted platform to share news and stories and control their message.”
State of the art
14. The Minnesota Vikings are set to open their state-of-the-art U.S. Bank Stadium this upcoming NFL season, and the franchise has an advanced parking model in the works that aims to mitigate game day traffic around the venue, according to the Minneapolis Star Tribune. Fans will be able to "enter their ZIP code and find directions to the geography-based parking zone that corresponds to the route they will most likely take." Season-ticket holders will be given the advanced option of buying parking passes for the entire season, while others will be able to buy passes for single games only. The parking plan will be announced on the team’s website in the near future, and will include directions for "taking public transportation, ride share services, bicycles, taxis and other forms of transportation." The area surrounding the stadium has been completely reworked since construction began on venue years ago, and despite former tailgate areas being repurposed, the team has designated new areas for Vikings fans to hang out.
Celebration for Bolt
15. With Usain Bolt looking to make history at next month’s Rio Olympics, Virgin Media has launched an advertisement that pays tribute to the world’s fastest man. According to the London Guardian, the ad is 100 seconds long and is narrated by fellow sprinter Michael Johnson. It debuted during the knockout rounds of the Euro 2016 championships on ITV and uses "a series of sequences that are 9.58 seconds long – the world record 100m time" Bolt set in 2009. The ad surprisingly does not directly promote any specific Virgin Media package, as Virgin Media Chief Marketing Officer Kerris Bright said, "It is designed to be a celebration. A celebration of speed. We wanted to tell a different type of story about Usain Bolt." The Guardian noted that Virgin Media’s “Be The Fastest” campaign included a “100-meter long video screen to recreate his 9.58 second sprint” in London.