August 21, 2024

Read in Browser [[link removed]]

POWERED BY

Netflix introduced ad-supported plans in 2022. Two years later, advertising is a major part of the company’s revenue—and sports is a huge part of its growth plan.

— Eric Fisher [[link removed]], Colin Salao [[link removed]], and David Rumsey [[link removed]]

Netflix’s Ad Revenue, NFL, WWE Deals Push Stock to Record Heights [[link removed]]

Stephen Lew-USA TODAY Sports

Already the king of the streaming business, Netflix is reaching even greater heights—thanks in no small part to a booming advertising business.

The company said it boosted advertising commitments from its recent up-front negotiations by more than 150% compared to the 2023 upfront, with its new three-year deal for Christmas Day NFL games [[link removed]] and 10-year agreement for live rights to WWE’s Raw [[link removed]] both playing significant roles.

The disclosure, though not including any information about total sales volume or pricing, helped push Netflix stock to a record close of $698.54 per share Tuesday. The stock then retreated slightly in Wednesday trading, falling 0.2%. But Netflix shares have still grown more than 48% this year, and the new company high surpassed a prior mark set in November 2021.

“Over the last few months, we’ve hit great milestones for our ads business, including closing another successful upfront market, building and implementing an expanded programmatic suite, enhancing our global measurement capabilities, and securing impactful global ad campaigns,” said Amy Reinhard, Netflix president of advertising.

A Market Force

Even before this latest news from Netflix, the company was operating from a position of unrivaled strength. Netflix reported 277.7 million subscribers [[link removed]] as of the end of the second quarter, a figure far above any other market challenger.

Within that top-line number, ads continue to take on much more importance for Netflix. In geographic markets where the platform is running ads—including the U.S.—those tiers of the service now account for 45% of all sign-ups, just 18 months after beginning that part of the business.

“To have the kind of primary revenue impact across a business that has been primarily subscription[-based] for a long time, that just takes some time. We’re scaling well through reach, through engagement, through growing inventory,” said Netflix CFO Spencer Neumann last month in an earnings call with analysts.

“That represents an opportunity over a multiyear trajectory to have a big and increasing revenue and profit impact on the business. … We feel really good about our position, our ability to sustain healthy revenue and profit growth. Ads [are] kind of one more tool in our tool chest here.”

NFL Boosts Betting Security in Response to NBA, MLB Concerns [[link removed]]

Jonathan Dyer-USA TODAY Sports

While building hype for the NFL season, which begins in two weeks, the league is also taking precautions against sports betting among its players, especially as the NBA and MLB have faced significant controversies this year.

The NFL will have investigators on-site during game days to scout for “suspicious activity,” according to ESPN [[link removed]]. What constitutes suspicious activity is unclear, though SVP of NFL security Cathy Lanier told ESPN that the investigators, which consist of retired FBI agents or executive-level police officers, are searching for behavior that could be an “anomaly.”

The NFL’s security team also monitors betting markets in search of suspicious activity, such as large swings in the odds of player props. This is what triggered the NBA incident involving the Raptors’ Jontay Porter [[link removed]] after DraftKings Sportsbook reported that his player props were the day’s top moneymaker on two separate occasions.

A similar report was received by MLB in the case that turned into a lifetime ban for San Diego Padres infielder Tucipita Marcano [[link removed]].

NFL’s Betting Guidelines

The NFL already has the strictest rules for sports betting among the major sports leagues. Players are banned from betting [[link removed]] on any games or related events, such as the draft or combine. Players are allowed to bet only on other sports, and staff members cannot bet on sports at all.

The NFL last suspended players for sports betting [[link removed]] in June 2023, with three receiving one-year bans. The most high-profile suspension the league handed out since the 2018 Supreme Court rule change [[link removed]] on sports betting was in March 2022, when receiver Calvin Ridley (above) was given a one-year suspension for betting on NFL games, including those of the Falcons—the team he played for at the time—while he was away from the team for personal reasons.

But the country’s richest sports league has yet to institute a lifetime ban due to sports betting, and it’s clearly trying to do all it can to stop it from happening even if most think it’s inevitable.

“It’s only a matter of time,” one league executive told Front Office Sports last month [[link removed]].

The Flip Side

Players have also faced pressure because they are the ones fans’ money is riding on.

Commanders running back Austin Ekeler told Bloomberg [[link removed]] that he sees how sports betting, or even fantasy football, can help enhance fan engagement and knowledge of the sport, but on the flip side, he also feels like it can turn “athletes into widgets.”

In the NBA, stars like Tyrese Haliburton have already complained about how dehumanizing it is to be bet on. “To half the world, I’m just helping them make money on DraftKings or whatever. I’m a prop,” Haliburton said in March [[link removed]].

The NCAA is also pushing to stop prop betting at the collegiate level, with president Charlie Baker saying that college athletes have faced “harassment” on top of how it poses a threat to the “integrity of competition.”

SPONSORED BY UPPER DECK

Enter Into Kerri’s Athlete Archive

Front Office Sports and Upper Deck have joined forces to celebrate the nostalgia of sports, shining a spotlight on the childhood inspirations, career influences, and life milestones of the world’s most notable athletes.

In this episode of Athlete Archives [[link removed]], Kerri Walsh Jennings shares captivating stories about the key figures—both past and present—who have inspired her, her most memorable career moments, and her hopes for the next generation of athletes.

Check out [[link removed]] the full episode.

ONE BIG FIG Blank Checks

Kirby Lee-USA TODAY Sports

$6.5 million

The total amount given by Falcons owner Arthur Blank to four historically black colleges and universities to improve their training facilities [[link removed]]. Three of the schools are in Georgia (Albany State University, Clark Atlanta University, and Savannah State University), while the other is in neighboring Alabama (Miles College). The gift is another sign of his support for HBCUs [[link removed]]. In 2022, Blank, who cofounded Home Depot, donated $10 million to Spelman College [[link removed]] to build an on-campus creative hub.

STATUS REPORT Two Up, One Down, One Push

Gary A. Vasquez-USA TODAY Sports

Stewart-Haas Racing ⬇ The NASCAR team is shutting down Dec. 31, prompting layoffs of 323 staff members [[link removed]] starting Nov. 11. The team was founded in 2002 by Gene Haas (above, right) of Haas Automation, who also owns the MoneyGram Haas Formula One Team, and is co-owned by three-time NASCAR Cup champion Tony Stewart. One of the two owners will purchase the partnership interest from the other [[link removed]], but it hasn’t been determined which one will take over.

Elevate ⬆ The prominent sports consulting firm made its third major acquisition this year, buying New York–based Zinc Agency, which develops high-end experiences across many major events, including the US Open in tennis, the men’s and women’s FIFA World Cups, and the Big East basketball tournament. Following prior buys of Fenway Sports Management’s consulting group and the executive search firm SRI, the latest deal allows Elevate to further expand its range of capabilities. Zinc Agency’s entire staff of about 30 will join the existing Elevate Experiences division.

WNBA ⬆⬇ The Connecticut Sun hosted the Los Angeles Sparks in the league’s first game played in Boston’s TD Garden, home to the NBA’s Celtics and NHL’s Bruins, and sold out the arena with a franchise-record 19,125 fans in attendance. However, the Sun’s DiJonai Carrington called out the league [[link removed]] because the game was not televised nationally.

Women’s Elite Rugby ⬆ The league announced three new markets for its inaugural season in 2025: New York, San Francisco Bay Area, and the Twin Cities. The other three markets that have already committed to hosting a team are Boston, Chicago, and Denver. The WER is the first professional women’s rugby league in the U.S. and aims to be a training ground for the national team, which is coming off its first podium finish in the Paris Olympics.

FRONT OFFICE SPORTS EVENTS

3 Reasons You Can’t Miss Tuned In

Join Front Office Sports on Sept. 10 in NYC as we bring to life our inaugural Tuned In [[link removed]] sports media summit.

Led by senior media reporter Mike McCarthy, Tuned In will feature engaging discussions with leaders within the sports media space—ranging from athletes and on-air talent, to media moguls and league executives who are instrumental in shaping the future of how fans view sports.

Why attend?

Hear exclusive conversations with representatives from ESPN, NBCUniversal, Roku, Scripps Sports, Improbable Media, TelevisaUnivision, and the Big Esst Conference. Explore emerging topics from sports betting and athletes-turned-media moguls, to streaming, media rights, and more. Participate in elite networking with like-minded individuals across the sports landscape.

Space is limited. Register now [[link removed]] to secure your spot.

Conversation Starters The Bills released renderings for the premium spaces inside $1.7 billion Highmark Stadium, which opens in 2026. Take a look [[link removed]]. The Mets hold a Kidcaster Contest every year, which gives a young fan the opportunity to call an inning. On Monday, 9-year-old Kingston Nahm-Korn made a perfect call on a fourth-inning run. Watch it here [[link removed]?]. ESPN named Mike Greenberg the new host [[link removed]] of Sunday NFL Countdown, which resumes Sept. 8. Editors’ Picks Dartmouth Basketball Players File Charge Over School’s Refusal to Bargain [[link removed]]by Amanda Christovich [[link removed]]Dartmouth has said it has no intention of meeting players at the table. LIV Golf Signs With CAA—Is PGA Tour Merger Getting Closer? [[link removed]]by Michael McCarthy [[link removed]]A notable move suggests the sides could be moving toward an agreement. Chelsea Claims It’s ‘Not a Mess,’ ‘Not Irrational’ After Wild Offseason [[link removed]]by Margaret Fleming [[link removed]]The club has spent more than $1 billion in the past two years. Advertise [[link removed]] Awards [[link removed]] Learning [[link removed]] Video [[link removed]] Podcast [[link removed]] Sports Careers [[link removed]] Written by Eric Fisher [[link removed]], Colin Salao [[link removed]], David Rumsey [[link removed]] Edited by Matthew Tabeek [[link removed]], Or Moyal [[link removed]], Catherine Chen [[link removed]]

If this email was forwarded to you, you can subscribe here [[link removed]].

Update your preferences [link removed] / Unsubscribe [link removed]

Copyright © 2024 Front Office Sports. All rights reserved.

460 Park Avenue South, 7th Floor, New York NY, 10016