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BFD Expert Voices - Media Deals

BFD Expert Voices

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Viewership in women's sports is growing and catching up to men's leagues in certain cases, says investor Kara Nortman, a co-founder of Angel City.

Why it matters: Recent media rights deals and team sales have shown that the women's sports boom is not a moment but a growing movement.

Reality check: The NBA's new media rights deal underscores a wide chasm in the valuation of men's and women's sports, with the WNBA portion just 3% of the $77 billion deal.

Yes, but: That slice is still a big jump for the league. The WNBA is set to receive about $200 million per year, a source with knowledge of the deal terms tells Axios, up from $60 million annually in its last deal.

That could grow by an additional $60 million per year, as the league is expected to cut two additional deals.

What they're saying: "If you look at the data in the WNBA, viewership is essentially 3x, and it's not that far below the men's side anymore," says Nortman, managing partner of Monarch Collective, a women's sports-focused investment fund.

"But you do have different tonnage, meaning fewer teams, shorter season, etc," she says. "I think one of the saving graces or one of the positives ... [is] there are a lot of different opportunities and carve-outs on the women's side to do creative things."

Speaking yesterday at an Axios Pro event in New York, Nortman says the new deal is important not only for the dollar amount but also the distribution. Older fans may not be familiar with streaming platforms that have aired games.

"Your mom is calling you and saying, 'Sweetie, how do I watch your game on Twitch?' ... We need to create a way for people to come in where they already get content and live sports," Nortman says.

Context: Angel City agreed to sell itself to Disney CEO Bob Iger and his wife Willow Bay, dean of the USC Annenberg School, at a valuation of $250 million — another new data point of growth for the sector.

"I think a lot honestly of what I've realized about myself in the last five or 10 years in women's sports is it is really just finding one data point and a lever," Nortman says.

The bottom line: "Men's sports and women's sports are not the same at this stage," Nortman says. "We're building teams essentially from zero to one."

"It requires a different kind of owner and capital and work in understanding of mission and how to hold that in a way where you can make mistakes but not mistakes that you can't recover from," she adds.

Women's sports growth

Kara Nortman in a cream blazer and jeans and Tim Baysinger in a blue suit sitting on chairs, holding microphones in front of a backdrop that says Axios Pro

Monarch Collective managing partner Kara Nortman and Tim. Photo: Naomi Paul

Warner Bros. Discovery is crying foul over the NBA's new TV deal that leaves them on the sidelines, threatening litigation after the league rejected its attempt to match Amazon's offer.

Why it's the BFD: Suing one of the biggest sports leagues, especially if it loses, could damage WBD's reputation in any future media rights talks with other leagues.

Driving the news: The NBA and its commissioner Adam Silver announced the new deals, worth $77 billion, yesterday afternoon, just a few minutes after it said it had rejected WBD's attempt to match Amazon's deal.

Without getting into specifics, the NBA said WBD's offer "did not match the terms of Amazon Prime Video's offer."

In a blistering statement of its own after the NBA put out its press release announcing its new TV deals, TNT Sports argued that its offer was a match and that the NBA was not allowed to reject it.

"We think they have grossly misinterpreted our contractual rights with respect to the 2025-26 season and beyond, and we will take appropriate action," the company said.

Zoom in: The impasse between the two revolves around the differing understanding of Warner Bros. Discovery's matching rights. 

Amazon's deal is a streaming-only agreement, while WBD's matching proposal included both its Max streaming service and cable network TNT.

The league argued, according to CNBC, that the matching rights only work if the distribution mechanism is the same. Essentially, WBD would have to agree to put all of its games on Max, which has a smaller subscriber base than Amazon.

WBD and CEO David Zaslav believe its matching rights extend to any new deal including games that were part of its existing agreement, regardless of platform, a source with knowledge of the situation previously told Axios.  

What they're saying: Some analysts are perplexed by WBD's actions.

"Do they really want the Amazon package or do they just want some cash to go away? If it is cash to go away, this is an odd money grab, because it could be a signal to other sports leagues that WBD/Turner is a difficult and litigious partner," Lightshed Partners analysts wrote this morning.

🏀 Zaslav vs. Silver

Data: Nielsen, Sports Media Watch; Note: 2020 Olympics were held in 2021; Chart: Axios Visuals

NBC is betting on an Olympics-sized TV ratings rebound now that the Games are free of COVID-era disruptions, coupled with the scenic backdrop of Paris.

Why it matters: If the Olympics audience keeps dwindling, NBC's $7.8 billion rights deal to televise the Games through 2032 starts to look like an albatross. 

By the numbers: The Tokyo Olympics, which were delayed by a full year and held without any spectators due to COVID restrictions, were the worst-performing Games since NBC took over in 1988.

Perhaps more troubling is that it was the second consecutive Summer Olympics to see viewership decline.

What's next: This time around, NBC is leaning into the fact that most people now watch Olympics events live, regardless of the time zone. 

The network is carving out two primetime windows on broadcast network, one in the middle of the day in the U.S. called "Paris Prime" (Paris is six hours ahead of the East Coast), and a revamped tape-delayed broadcast during the U.S. prime time window.

Every event will also stream live on Peacock. 

Charted: Hoping for Paris gold

Go deeper in our full database in the Axios Pro Deals Tracker.

• Igloo, the Miami-based parent company of NFT collection Pudgy Penguins, raised $11m in funding led by Founders Fund, with Fenbushi Capital, 1kx, Everest Ventures Group, and Selini Capital, Axios Crypto's Brady Dale writes. Go deeper

• AppMagic, a Tampa, Fla., mobile app market research startup, raised $3m in Series A funding led by GEM Capital, with Vibranium also participating. Go deeper

• Stix, a New York-based Web3 platform for meme promotions, raised $1.8m of funding from Presto Labs, Selini Capital, Mythos Group and various crypto KOLs. Go deeper

• ITV Studios acquired a majority stake in Hartswood Films, the U.K. production company behind such hit scripted series as "Douglas Is Cancelled," "The Devil's Hour" and "Sherlock." Go deeper

• Cyabra, an Israeli social media disinformation monitoring startup, plans to merge with Trailblazer Merger Corporation I and list on Nasdaq. Go deeper

• Launch Two Acquisition, a blank check company targeting tech and software infrastructure businesses, filed for a $200m IPO. Go deeper

Deal flow

• Lee Jae-sang is expected to be promoted from chief strategy officer to CEO at HYBE after CEO Park Ji-won resigned from the BTS label. Go deeper

• Rich Kennedy was named SVP, head of U.S. partnership for Axel Springer and will continue as chief business development officer at Business Insider. Wendi Daniels, formerly of Google and Yahoo, was hired as VP of U.S. group sales and Tina Wu, formerly of Vox Media and Group Nine Media, as director of portfolio management and investments. Go deeper

• Jason Cho, formerly EVP, strategy and corporate development at Eldorado Gold, joined Metalla Royalty & Streaming as president. Go deeper

• Jillian Longnecker and Brendan Countee joined 20th Television as EVP of production and head of comedy development, respectively. Go deeper

• Brian Eule was named managing director of PBS and GBH's "Frontline," reporting to EIC and executive producer Raney Aronson-Rath. Go deeper

• ⚾ Mookie Betts joined the board of GrowthLoop, a customer data platform. Go deeper

Movin' on up (or out)

✨ Altman urges U.S. action to beat China in AI race (Axios)

"[OpenAI co-founder and CEO Sam] Altman told Axios that state governments must do more to ensure 'physical infrastructure — data centers and power and water and manufacturing.' "I realize how difficult that is, and that it takes a long time. But all the more reason to get going," he said," Mike Allen writes.

💸 Group Black falls short (Business Insider)

"Three advertisers told BI that Group Black didn't have the reach — with only a few publishers in its network to start — or low-enough prices to meet advertising goals. Beyond that, some ad buyers said it wasn't clear how Group Black was adding value that couldn't be better achieved by buying directly from the publishers," Lucia Moses and Lara O'Reilly report.

💥 Comic-Con is "finally back to normal" after years of setbacks. But could it leave San Diego? (Variety)

"With no obvious impediments in sight for this year's event, which runs from July 25-28, the largest fan gathering in North America is finally set to mount its first regular convention in five years," Adam B. Vary writes.

Channel surfing

Illustration of a remote control in the shape of a surfboard leaning against a VW bus.

@tim_bays: Summer Olympic opening ceremony on NBC. I'm a sucker for the Parade of Nations and all things Paris. 

@kerrymflynn: "Deadpool & Wolverine" at AMC Theatres. There are few things I love more than Hugh Jackman and the X-Men. 

✏️ Thanks to Michael Flaherty for editing and Katie Lewis for copy editing this newsletter.

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July 25, 2024

1 big thing: Women's sports growth