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Houlihan Lokey's Russo on Impact of Streaming at US Open(Audio) · Bloomberg Intelligence

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  Speaker 1: box in Japlin on Bloomberg Radio Live at the US
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  Speaker 1: Open here in Plushing Meadow, Corona Park coins the Tennis
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  Speaker 1: Center celebrating the very successful use of its retractable roof
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  Speaker 1: something that the U s t A worked on for
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  Speaker 1: many years, raised financing, raised money, had to get all
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  Speaker 1: kinds of special engineering. Rufa Nadal won his first match
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  Speaker 1: of anybody out here under Center Court last night, and
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  Speaker 1: it's been a very exciting event. But it's all it's
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  Speaker 1: so much about. It's not just the love of the sport.
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  Speaker 1: It's about the business, the money, so much that goes
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  Speaker 1: on here. Chris Russo is back. He's managing director in
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  Speaker 1: the Tech Media Telecom Group at Hula Han Loki. So, Chris, welcome.
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  Speaker 1: First of all, thank you for having me. Now I
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  Speaker 1: want to start right into this question of TV revenues.
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  Speaker 1: You know, tennis can kind of ebb and flow, and
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  Speaker 1: if you don't, you know, if Roger fetters out for injuries,
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  Speaker 1: people are wondering about Rafa Nadal's playing well so far,
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  Speaker 1: how does that affect TV revenues. Well, the good news
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  Speaker 1: for the US Open is last year they signed an
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  Speaker 1: eleven year deal with ESPN for over eight hundred million dollars,
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  Speaker 1: so that TV revenue is really set for a long
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  Speaker 1: time to come. Obviously, you'd rather have higher ratings than
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  Speaker 1: lower ratings. But I think the US Open and really
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  Speaker 1: all the other major tennis championships on very solid ground
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  Speaker 1: in terms of TV. How about sponsorships, there's you know something,
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  Speaker 1: we're right by the Heineken Building. You know, Uh, there's
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  Speaker 1: so many that are are perennial now are they are
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  Speaker 1: they still having to to uh bid up to be here.
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  Speaker 1: It's a it's a good market right now in terms
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  Speaker 1: of sports properties like the US Open securing sponsors, especially
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  Speaker 1: because the US Open has such a great demographic, a
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  Speaker 1: great audience, above average income, education, et cetera. So you've
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  Speaker 1: got the IBM s of the world, You've got American Express, JP,
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  Speaker 1: Morgan Chase and many others really eager to get in
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  Speaker 1: front of this audience and share information about their products.
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  Speaker 1: How about ticket sales? Ticket sales, again, numbers have not
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  Speaker 1: been released for this year, but they seem to be
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  Speaker 1: going very strong. I believe the number was more than
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  Speaker 1: a hundred million dollars in ticket sales last year. So
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  Speaker 1: it really is a popular event and and really, you know,
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  Speaker 1: an exciting part of New York City and in the fall. Well,
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  Speaker 1: let's take a look at Serena Williams brand. You know,
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  Speaker 1: it seems it's already so huge. You know in so
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  Speaker 1: many ways, right, Uh, such a champion, but this is
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  Speaker 1: her quest to tie Steffi Graf's all time Grand Slam record,
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  Speaker 1: and uh, you know this, this is a big deal.
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  Speaker 1: But how does it affect, you know, winning's endorsement deals,
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  Speaker 1: all of that in an interesting way? Serena is already
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  Speaker 1: doing so well. I don't know if one more championship
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  Speaker 1: necessarily is gonna make a huge difference on her earnings overall.
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  Speaker 1: But this past year she was the highest paid female athlete.
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  Speaker 1: She made almost thirty million dollars, including both on the
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  Speaker 1: court and off the court moneies. She's doing phenomenally well
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  Speaker 1: on the court right now. Would be exciting to see
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  Speaker 1: her win the twenty three. But she already has great
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  Speaker 1: sponsorship deals with Nike and Gatorade, JP Morgan and others.
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  Speaker 1: So she's doing quite well and I think that will continue.
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  Speaker 1: Do you think part of her appeal is that she
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  Speaker 1: doesn't just get out there she's on a machine. I
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  Speaker 1: mean she is, she's powerful, but still she's had her up,
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  Speaker 1: she's had her down. She can go to Grand Slam
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  Speaker 1: and get blown out right and then just come right back.
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  Speaker 1: And you know what, thirty years plus and she's still
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  Speaker 1: playing so hard with such determination. Well, she certainly is
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  Speaker 1: a fan favorite for those reasons. She also interacts and
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  Speaker 1: engages with fans on Twitter and social media. She's got
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  Speaker 1: over I think six million followers on Twitter alone, so
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  Speaker 1: I think she's very available and communicates and I think
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  Speaker 1: fans really love her. Speaking of social media, how about technology?
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  Speaker 1: Earlier today we were speaking with Danny Sausner, who's the
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  Speaker 1: CEO for the U S t A, and he was
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  Speaker 1: talking a lot about the you know, the various things
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  Speaker 1: you can do, like sit in your seat now and
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  Speaker 1: have your picture taken. They have a thirty because there's
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  Speaker 1: cameras all over. That is so cool. How important is that?
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  Speaker 1: And what are some of the innovations you're focused on
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  Speaker 1: this year? Well, I think there's interesting innovations happening at
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  Speaker 1: the venue, like the one you just mentioned. I believe IBM.
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  Speaker 1: Watson also has a feature where you can recognize celebrities
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  Speaker 1: in the crowd by using an app. That's kind of fun.
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  Speaker 1: There's other things questions you can ask to the app,
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  Speaker 1: where do I get the subway? Where can I find
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  Speaker 1: a hot dog? And really in real time you're getting
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  Speaker 1: those answers. But I think more broadly, what's great about
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  Speaker 1: this event is there are more and more cameras covering
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  Speaker 1: more and more matches, So fans all over the world
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  Speaker 1: via streaming can see hundreds and hundreds of hours of tennis.
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  Speaker 1: ESPN alone is is streaming more than hundred hours this year,
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  Speaker 1: which I think is fabulous. Do you think of the
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  Speaker 1: people who are tennis fans that the appetite has increased,
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  Speaker 1: because I mean I don't necessarily do you or do you?
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  Speaker 1: And do you see for people who aren't so interested?
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  Speaker 1: Is there any growth there? I believe what technology does
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  Speaker 1: is it lets fans see what they want to see
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  Speaker 1: in even greater depth. A lot more of the content
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  Speaker 1: is being geared towards your favorite player, so you can
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  Speaker 1: watch more of the matches that your players involved, and
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  Speaker 1: even if that player is not necessarily a top ten player,
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  Speaker 1: your serve more content around your favorite players. So I
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  Speaker 1: think the personalization piece is really helped helping drive engagement,
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  Speaker 1: both in terms of avid fans and more casual fans
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  Speaker 1: and instant replaying. They've had it for a while. Is
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  Speaker 1: it improved this year? Yeah? The instant replay is great.
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  Speaker 1: I think it helps in terms of of of the
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  Speaker 1: scoring and keeping the game at least people feeling like
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  Speaker 1: the calls are fair. But I think that's been around
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  Speaker 1: for a while. I actually don't think instant replay is
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  Speaker 1: the biggest innovation I see. I think more of the
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  Speaker 1: streaming and the making this content available internationally is really
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  Speaker 1: more in fat pactum. Are you a big tennis fan yourself?
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  Speaker 1: I am a tennis fan. Who are you picking this year?
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  Speaker 1: On the men's side, you know I'm gonna go with
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  Speaker 1: I'm gonna go with Murray. He's hot, He's had a
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  Speaker 1: good couple of months here, and he's striving to be
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  Speaker 1: number one. I just actually watched him under the roof.
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  Speaker 1: That was fun. So yeah, it should be a good,
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  Speaker 1: good US Open. Can anybody beat Serena? I don't think so.
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  Speaker 1: I think she's really on top of her game, and
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  Speaker 1: I think it's it's kind of her tournament. Well, Chris Russ,
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  Speaker 1: you're always on top of your game. Banks for joining us.
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  Speaker 1: He's managing director and the tech media Telecom group at
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  Speaker 1: cool Hand Loki consulting firm for everyone involved in sports
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  Speaker 1: Back here at the US Open tomorrow, same thing, talking
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  Speaker 1: to business at tennis, talk in the markets. Sam Langas
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