Wednesday, 24th January 2007

HEADLINES OF THE DAY

Sponsorship Spending to Rise and Rise

US companies plan to spend $14.9 billion on sponsorships this year, up 11.7 per cent from $13.4 billion in 2006, according to the IEG Sponsorship Report. This follows a 10.5 per cent increase in sponsorship spend from 2005 to 2006. The predicted 2007 increase is expected to outpace traditional media growth and IEG expects sports sponsorships to hit $9.9 billion in 2007, up 10.8 per cent from $8.64 billion in 2006.

IEG says that global sponsorship spend is also on the increase, predicting it will reach $37.7 billion in 2007, up 11.9 percent from $33.7 billion in 2006. European companies are expected to increase sponsorship spending by 11.6 percent to $10.6 billion in 2007, up from $9.5 billion in 2006.

Asia Pacific companies are expected to spend 15.6 percent more, from $6.4 billion in 2006 to $7.4 billion in 2007. Central and South American companies combined are expected to spend 11.1 percent more, from $2.7 billion in 2006 to $3 billion in 2007. All other regions are predicted to increase sponsorship spending by 5.9 percent, from $1.7 billion in 2006 to $1.8 billion in 2007. Source: Sport Business, 23rd January 2007

Nimbus Hails 'Landmark' Ruling on One-day Series

A dispute over coverage of the Indian cricket team’s ongoing one-day international series against the West Indies was resolved today after Nimbus Communications, the sports marketing and media company which holds the television rights, agreed to provide a terrestrial feed to public service broadcaster Doordarshan.

Following a ruling by the Delhi High Court, Nimbus accepted a proposal for Doordarshan to be allowed to show the remaining three matches of the series, but with a seven-minute delay. Nimbus chairman Harish Thawani described the development as a 'step in the right direction' adding that the company was looking forward to working with Doordarshan. The second one-day international takes place in Cuttack on Wednesday.Doordarshan has frequently clashed with pay-television broadcasters over rights to India's matches, which are regarded as events of national importance. Nimbus televises cricket on its Neo Sports pay channel and had come under pressure from the government to ensure the games are available throughout India.

There was an outcry on Sunday when most of the population was unable to watch the first match against the West Indies in Nagpur. Priya Ranjan Damsuni, the information and broadcasting minister, this week accused the company of having a ‘very unpatriotic attitude’ and vowed to press ahead with the introduction of legislation that would compel private broadcasters to share signals with Doordarshan.

Nimbus paid $612 million for the rights to India’s home matches for four years until 2010 and had been prepared to share a feed if Doordarshan agreed to carry the same advertising as Neo Sports but this was unacceptable to the state broadcaster. The court stated that the arrangement was temporary and would last until the next hearing on February 8. Nimbus is still seeking assurances that Doordarshan will encrypt signals to prevent pictures being available in neighbouring countries, where there are separate broadcasting agreements. Source: Sportcal, Indian Television, 23rd January 2007


INFO DIGEST

Info Box – The Asia-Pacific PC Market
* In Asia/Pacific, PC shipments reached 59.9 million units in 2006, a 17.2% increase from 2005
* In the fourth quarter of 2006, PC shipments reached 15.7 million units, a 13.3% increase
* In the fourth quarter demand was primarily soft as buyers were prepared to wait one more month for PCs installed with Windows Vista
* Consumers were also distracted by aggressive prices of LCD TVs.
* In Japan, PC shipments totaled 14.2 million units in 2006, a 3.3% decline from 2005
* Japan experienced a difficult fourth quarter, as shipments approached 3 million units, a 12.6% decline from the fourth quarter of 2005
* Both the professional and private market showed negative year-over-year growth in the fourth quarter.
Source: Info IQ, 23rd January 2007


SPORTS SHORTS

* South America's Copa Libertadores, the region's equivalent of the European Champions League, kicks off with a preliminary round match on Wednesday and has been hit by controversy before it has begun. Peru's Sporting Cristal travel to Mexico to face America in for the first leg of their tie and are unhappy with the venue chosen by their opponents. America, who will complete a home ban on Wednesday which dates back to a crowd riot in 2004, have opted to play the match in Toluca, about 60km from Mexico City and about 300 metres higher at 2,600 metres above sea level. Source: Guardian, 24th January 2007

* North America’s National Basketball Association has inked a new marketing deal with a Chinese milk producer. The Mengniu Dairy Group, which is based in the northern province of Inner Mongolia, will be the official dairy product of the NBA in China as the league looks to capitalise on its growing popularity in the country. Mengniu will promote its products during NBA programming in China and participate in the NBA Jam Van, a touring promotion which visited 17 cities last year. Source: Sportcal, 23rd January 2007

* The Chinese Olympic soccer team will play three friendly matches in London during their upcoming two-week stay in the city. The Chinese Football Association has announced that Team China will play a Chelsea reserve side on February 5, Queen’s Park Rangers on February 8 and Brentford on February 16. China are currently training in France under coach Ratomir Dujkovic and are scheduled to arrive in London on February 1. Source: Sportcal, 23rd January 2007

* The National Association for Stock Car Auto Racing (NASCAR) has signed up pop singer Kelly Clarkson as official partner for the 2007 season. Financial terms of the deal were not disclosed, but according to NASCAR it is “the largest and most comprehensive” contract ever agreed with an artist by the organisation and will start on February 18 prior to the Daytona 500, where Clarkson will headline the Nextel Tribute To America. Clarkson will also serve as spokesperson and ambassador for the fourth annual NASCAR Day on May 18. Source: Sports Media, 23rd January 2007

* Turner Sports New Media has relaunched an enhanced Nascar.com Web site--its first redesign since 2002--that includes a 3-D application to follow drivers during live races, and a social space for fans to interact. Turner Sports New Media acquired all of Nascar’s interactive rights in October 2000 and became the exclusive producer of Nascar.com in January 2001. The 3-D feature, TrackPass RaceView, features animation similar to that in sports video games. The new online gathering place for fans is called Infield Community on Nascar.com. Source: Mediaweek, Sports Video Group, 22nd January 2997


MORE NEWS

WWE: Early Strong Ratings in US

World Wrestling Entertainment (WWE) announced that its US TV ratings started off this year in a positive manner. It achieved its highest household deliveries of the current season on both Monday Night Raw on USA Network and Friday Night SmackDown on The CW.

On 1 January, Raw’s feature of John Cena versus Kevin Federline delivered 3,564,000 TV households, its highest performance of the season, and the largest household delivery since August 21, 2006. Raw was the number one primetime cable programme during the first week of the year among households, total viewers, Male Teens (M12-17) and Men 18-34. Raw also posted season high ratings among Males 6-11, Persons 6-11, Adults 18-49 and Adults 25-54.

SmackDown on 5 January, 2007, delivered 3,371,000 TV households, its highest performance in nearly a year and the highest since joining the CW network. SmackDown WWE says was the number one primetime program on television Friday night among Male Teens (M12-17) and Total Teens (P12-17), and the top rated broadcast program among Males 6-11. SmackDown made CW the number one broadcast network among Males 6-11, Males 12-17, Males 12-34, Males 18-24, Males 18-34, Persons 6-11, Persons 12-17 and Persons 12-34.

SmackDown posted its highest rating among total teens (persons 12-17) since June 23, 2005 and highest among female teens (females 12-17) since November 13, 2003. SmackDown also achieved its highest delivery of the season among Persons 12-34. Source: Indian Television, 23rd January 2007

Elsewhere/Rights: Clubs Seek Cup Rights

French football clubs are flexing their muscles to try to get hold of rights to their home matches in the Coupe de France (French Cup) competition. The clubs already have the delayed match coverage rights of their fixtures in Ligue 1 Orange (sponsor), Ligue 2 and the Coupe de la Ligue. Those rights were reserved for the clubs when the packages for those competitions were sold collectively by the Ligue de Football Professionnel (LFP).

However, the Fédération Français de Football (FFF) failed to make a similar provision when it sold the rights to the French Cup. Last spring, France Télévisions and Eurosport acquired all the French Cup rights for a fee of approximately €14 million per season until 2010. For matches in the league and the Coupe de la Ligue, those clubs that have their own club channels (Olympique de Ma rseille, Olympique Lyonnais, Saint-Etienne and Lens) can show replays starting at midnight on the day of the match.

Other clubs are allowed to market them 24 hours after the final whistle. The FFF has indicated that it is not against letting the clubs do the same during the French Cup. France TV has indicated that it might go along with this idea, L’Equipe reported, but Eurosport is against such a move for now. The clubs, meanwhile, have given assurances that they will not allow the impasse to interfere with the next round of matches in the French Cup (round of 16). Source: Sports Media, 23rd January 2007

Elsewhere/Rights: Boxing Website Ups the Ante with Increased Live Streaming

Secondsout.com has signed deals with several promoters and a sports marketing agency to broadcast live online coverage of around 35 professional fights in 2007. In a deal signed with Sportfive to stream live coverage in the UK and selected other territories of IBF heavyweight champion Vladimir Klitschko’s next three title defences. The deal begins with Klitschko's bout against American Ray Austin on March 10.

Secondsout.com has also signed contracts with six boxing promoters for live fights in 2007: the USA-based promoters DiBella Entertainment, Seminole Warriors Promotions and Irish Ropes; Max1 Promotions in the Czech Republic; Ukraine’s National Box Promos; and Knockout Promotions / World Sport Promotions, two promoters that share close links.

Secondsout.com will be the only place boxing fans in the UK can watch the opening bout between Klitschko and Austin after an exclusive deal was signed with Sportfive. This signifies an increase of content available on Secondsout.com, which had one-off agreements with promoters to stream fights live. In 2006, fights featured on the site included Vladimir Klitschko’s title defence against American Calvin Brock and the IBF cruiserweight title fight between American Steve Cunningham and Poland’s Krzysztof Wlodarczyk. Source: Sportcal, 23rd January 2007

Elsewhere/General: Research Shows Premiership TV Figures Levelling Out

Viewing figures for English soccer’s Premiership appear to have stagnated over the last three seasons. Figures collated by the Broadcaster’s Audience Research Bureau reveal that an average 1.19 million viewers tuned in to coverage of the first 50 Premiership matches this season. This compares to an average 1.25 million viewers in 2005-06 and 1.23 million in 2004-05, although both these figures were gathered in April and therefore took into account a larger chunk of the season. The games were all aired by British Sky Broadcasting.

The BARB figures, supplied by media agency ZenithOptimedia, indicate that matches involving England’s ‘big four’ clubs – Manchester United, Chelsea, Liverpool and Arsenal – attract around 3 million viewers when shown in a prime slot. Other findings so far this season:

* Manchester United versus Chelsea on November 26, average 2.95 million viewers
* Arsenal v Manchester United on 21st January, average 2.9 million viewers, peaking at 3.4 million
* Least-watched game involved newly-promoted Watford v Sheffield United on November 28, average 486,000
* Champions Chelsea featured most on BSkyB with 10 appearances in the first 50 live televised matches
* Blackburn Rovers, Charlton Athletic, Middlesborough and Wigan Athletic appeared just three times each

BSkyB's monopoly on live rights comes to an end at the beginning of next season after rival Setanta agreed to pay £392 million ($775 million) for a package of 138 live matches over three years from the beginning of 2007-08. BSkyB retained 276 matches at a cost of £1.314 billion. In related research released last week by Virgin Money, it found 46 per cent of Premiership supporters going to fewer games this season. Virgin said that its Football Fans Price Index showed that the cost of going to games had risen by 17 per cent since the start of 2006. Source: Sportcal, 23rd January 2007

Elsewhere/Business: Have-nots Ask the Millionaires to Take Share Option

Members of the Football League's board have held meetings with the Premier League's chief executive, Richard Scudamore, to seek a fairer distribution of the Premiership's booming TV money which, following the £625m secured last week for overseas rights, will total £2.7bn over three years from next season. The Football League is so sensitive about the issue it is refusing to comment publicly but the Premier League confirmed that talks are taking place about a revised funding package once the new deal kicks in.

The discussions centre on four areas: the amount the Premier League provides to Football League clubs for youth development, currently £4.2m a season; the possibility of funding clubs' community programmes; re-examining how the £17m which the Premiership will pay to the Professional Footballers' Association could be distributed; and a proposal for the Premier League to split with the Football League all money paid to the professional game from the Football Association.

Whether this will result in sufficient redistribution to prevent the Premiership disappearing into a different financial universe remains to be seen. So far there is no sign among the Premier League clubs of an attack of conscience, although an increased proportion of the £2.1bn domestic element of the next deal, around 7%, will go to grass-roots development, including the Football Foundation.

Within the Premier League, clubs share 50% of TV money equally, 25% is paid in "facility fees" to clubs shown live on TV and the remaining 25% is paid according to how high clubs finish in the table. The overseas rights are shared out equally and Scudamore says overall the Premiership's is the most even formula within any top flight in Europe. It does, however, still reward greatly the top clubs who finish higher and are shown on TV more. From next season Scudamore has said the top club will receive around £50m, the bottom club around £30m. Source: The Guardian, 24th January 2007


ARTICLES, COMMENTS & OPINIONS

Signing Beckham - Just One of Many Significant Developments

While the recent signing of Beckham represents the highest-profile announcement to date from the 11-year-old Major League Soccer (MLS), several other recent and important developments will also impact positively on MLS and the future of US football. In addition to allowing MLS teams to sign ‘marquee players’ like Beckham, during the past year:

* MLS announced its 13th team in Toronto with plans to expand to 16 teams by 2010. Several investor groups are vying to own those franchises, a prerequisite to which is the construction of a ‘soccer-specific stadium’ (six such stadiums will be owned/operated by existing teams in 2007; several more are expected by 2010);

* AEG sold its interest in MLS team DC United to a local investment group in Washington, DC. The deal drew the highest price paid yet for an MLS franchise and follows the sale of AEG’s NY team to Austrian company Red Bull;

* US-based media organisations responded to the potential of football in the US by signing television rights fee agreements for MLS and other US-based football properties. Four independent, multi-year deals were signed with MLS to provide regular football coverage in English and Spanish. These media companies – particularly ESPN, which has also invested $100m in FIFA properties – now have a significant vested interest in promoting soccer in the US;

* Major shirt sponsors were approved for MLS teams, the first for a major US professional sports league, with Real Salt Lake the first to announce a multi-million dollar sponsor. The LA Galaxy is now expected to earn shirt sponsorship fees in line with major European teams;

* Two European professional football teams – Crystal Palace FC (England) and Deportivo Alaves (Spain) – announced the creation of US teams in the United Soccer Leagues (USL). This foreign interest in the US market followed the 2005 launch of MLS side Chivas USA – expansion team of the famous Mexican side – and several affiliations between MLS/USL teams and international clubs;

* MLS announced a 2007 summer tournament pitting four of its teams against four professional teams from Mexico. The US-based matches are certain to appeal to the large and passionate Mexican-American community;

* Clint Dempsey, a 23-year-old US national team player, generated a MLS record transfer fee when he was sold by the League to Fulham FC of England’s Barclays Premiership. More than 50 Americans now play professionally in premier football leagues across Europe;

* From 2007, MLS teams are required to run academy-like youth development programs which are expected to result in the construction of several new football training facilities.
Excerpt from report Soccer in North America: The Commercial Opportunities on Sport Business, 23rd January 2007