SBJ Morning Buzzcast

SBJ Morning Buzzcast: July 2, 2024

Start your morning with Buzzcast with Joe Lemire: A look at the Grousbeck era with the Boston Celtics; Texas Tech inks new apparel deal with Adidas; a look at some of MLB's mid-season business metrics and ex-Marlins GM Kim Ng to serve as senior advisor to Athletes Unlimited Softball.

Duration:: 8m
Broadcast on:: 02 Jul 2024
Audio Format:: mp3

(upbeat music) Top of the morning to you all on this Tuesday, July 2nd. This is the SPJ Morning Buzzcast, and I'm your host today, Joe Lemire. And I spent yesterday asking all of my large native New England family for contributions to buy the newly available Boston Celtics, whose valuation could well exceed $5 billion, meaning my past the hat strategy was more than 99.99% short. As for Whit Grouse Beck, Steve Pagliuca, Robert Epstein, and the entire Boston basketball partners, LLC, the ownership group announced plans to sell its shares, with Grouse Beck's family citing estate and family planning considerations as the motivation. The intention is to find a buyer by the end of 2024 or early 2025, with the second and final portion of the sale closing by 2028. Grouse Beck is expected to remain the franchise governor until then, a source told the Boston Globe that some members of the ownership group couldn't end up keeping their stakes or even adding to them. The ownership group acquired the franchise for $360 million in 2002, just as the Celtics were emerging from an uncharacteristically foul stretch in which they had eight straight losing seasons, including one in which they only won 15 games, and I can tell you I remember that one closely. During that time, they only had one playoff appearance, which was the first on exit, but then the Celtics hired Doc Rivers as coach and Danny Ainge boldly traded for Kevin Garnett and Ray Allen to join Paul Pierce in one of the 2008 NBA championship. Trader Danny's subsequent moves helped the Celtics acquire a bevy of first round picks, thank you Nets, that led to the picks of Jalen Brown and Jason Tatum, who were well complimented by subsequent moves from Brad Stevens to win this year's title. Celtics ownership was supportive of these big, daring personnel decisions, while also building a very professional business operation. SBJ honored the Celtics as the professional sports team of the year at the sports business awards in 2009. The franchise had grown revenue more than 300% going into the pandemic. I hadn't been back to the TD Garden in years until attending a Celtics game with my dad while in town for the MIT Sloan Sports Analytics Conference. Celtics senior vice president Jennifer Todd kindly gave me a partial tour of some of the upgraded premium areas, and I was wildly impressed. But certainly the owner's chief legacy will be their committer to winning. Scrausbeck told the Boston Globe last month, were fans who bought the team were doing this for love. He acknowledged that they were losing money because they had exceeded the salary cap and would be spending almost $48 million just in luxury tax dollars. That bill will only rise with recent extensions to Jason Tatum yesterday, on top of what the Celtics did for Jalen Brown a year ago. But whatever losses they took annually in pursuit of these titles will be more than replenished when the sale goes through, given how much the franchise value has climbed. Even if they fully divest themselves of the franchise, the owners will remain tied to sports in other ways. Grousebeck made a large investment in the PGA tour through the strategic sports group and is a co-founder and caused by media partners, an equity firm with investments in sports tech companies such as Seat Geek, Flow Sports, and Formula E. Peg Luka remains a co-chairman of the Italian Syriac Club at Atlanta, and Robert Epstein's daughter, Jennifer, is controlling owner of the new Boston NWSL expansion franchise. Other notable is to go out on top with the championship, include Peyton Manning, John L.A., Joe DiMaggio, and Celtics legend, Bill Russell. And of course, you can add your George Costanza jokes hidden here too. Late last night, the US men's national team fell one nothing to Uruguay and was eliminated from Copa America, which is hosting this summer. The US became the first host country to fail to advance out of the group stage of Copa America in nearly 30 years. It's a disappointing result on the pitch for the Americans, but it won't help sustain domestic interest in TV ratings either. The two most ardently follow national teams in the US, the US and Mexican national teams, are both out of Copa America. And what we've seen is one of two key warmup events for the 2026 FIFA World Cup, along with next year's proposed FIFA Club World Cup. Texas and Oklahoma both left for the SEC as of Monday morning, but one of the rival schools still in the big 12, Texas Tech, made their own headlines later in the day by announcing a new 10 year contract with Adidas, who replaces Under Armour as the official footwear uniform, a parallel accessory partner of the Red Raiders. Under Armour, which had supplied the school for 18 years, reportedly had been paying Texas Tech nearly 13 million over the past five years. The Dallas Boarding News cited sources that the new agreement with Adidas is an increase of more than 100%, so that revenue will double for the University in Lubbock. Central to this deal is the role of Chief Superstar quarterback Patrick Mahomes, who of course is a proud alum of Texas Tech and has been an Adidas ambassador since 2017. His own signature of power line launched in 2021. Mahomes first shared the news last October when he wore a Texas Tech shirt with the word Adidas written in tape and placed over the Under Armour logo. Mahomes' stylized gladiator logo will be on home away in alternate football uniforms. There will even be a Patrick Mahomes themed alternate uniform. Intex AD, Kirby Hocut, has previously credited Mahomes as a key reason for the shift in suppliers. This follows a select group of other alumni Superstars whose prominence directly led to brand deals for their alma monitors, following of course, UNC in the Nike Jordan brand, as well as Davidson and Under Armour's Curry brand. Keep an eye on others following suit in the years to come. Major League Baseball, meanwhile, is just two weeks away from its annual All-Star game, and while that event is known as the "mid-summer classic," the clubs all passed the 81-game midpoints of their schedule over the past weekend. That prompted me to take a look at its business and metrics so far for the 2024 season for this week's magazine. The full story is online, but I wanted to share some of the key findings. Major League Baseball attendance is up almost 2% on last year's numbers, which were already a huge game. While national TV broadcasts on ESPN, Fox, FS1, and MLB Network are all up between 5 and 11%, depending on the channel. Demographic data shows that the average age of fans attending and watching both getting younger too. Local ratings, however, are a challenging comparison given the Comcast carriage dispute with Diamond Sports Group, but in markets such as San Diego and Arizona, where MLB is producing games and offering in-market streaming packages, the number of subscriptions sold have totaled about 38,000 for the Padres and about 30,000 for the Diamondbacks, a healthy start for something that's been around for just about a year. As they called around for the story, what emerged to me and became the thesis of the story was this idea of how to capitalize on opportunities that present themselves. Surging on-fuel results capture excitement and provide a natural bump, Arizona sold more tickets in the two weeks after the World Series than it did the entire previous off-season. But the challenge then becomes maximizing that interest and building upon it rather than letting it plateau or recede. Boiled by the rule changes, MLB had a great 2023, and at the club level, both the Rangers and Diamondbacks surged to the World Series after each endured losing season streaks of several years. So I spoke with Commissioner Manford, as well as DMACC CEO Derek Hall and Rangers Chief Revenue Officer, Jim Cochran, and what became a case study on how to prop open that window of success. Hall and Cochran both noted that regardless of recent on-field results, retaining first-time season ticket buyers is an age-old industry quandary. Both teams have played numerous events and giveaways while also emphasizing fan experience. The Diamondbacks, for example, invested in new lighting and a new sound system for Chase Field. The Rangers gave custom Air Force ones and team colors with an all-star logo to ticket members in premium sections, as well as extra monthly tickets they can use or resell. One last baseball-related note, former Marlins general manager Kim Ng has signed on to Athletes Unlimited as a senior advisor for its planned softball league that will launch in 2025. That's an expansion of the shorter format version of the sport that Athletes Unlimited has been playing for the last five years. Ng's extensive experience also includes an executive role with MLB, and assistant GM jobs with the Yankees and Dodgers, not to mention that she was a college softball player. Ng's edition is clearly a big get for Athletes Unlimited. That's all for now. This is Joe Lemire signing off. A mad core will be back tomorrow morning. Have a great week, everyone. (upbeat music) (upbeat music) (upbeat music)