F1 eyes Apple, Deltatre’s power play acquisition of Endeavor Streaming, and the media rights bubble

18:40Whereas he has the ability to be more forthright because of his company and his position, which just gives you an interesting perspective on what it's like running a media business. and also my confidence to put my neck out a bit further as well.

18:55Nick Meacham:Well, so one of the, you just mentioned YouTube and its growth, and I'm only mentioning this because I saw it pop up on my timeline over the last 24 hours, is the YouTube golfer that turned down the opportunity to golf on the PGA Tour because the PGA Tour wouldn't give him the opportunity to film, which I think is just incredible. A, as an athlete, I'm just going to say, Nick, and I shouldn't say this as someone that is a very, very amateur golfer. I think he's just a bit scared. but my you know the the more businessman is I think it's incredibly short-sighted by him I get him wanting to tell this narrative that his YouTube fan base is what gave him the opportunity but there's just no realistic world the PGA Tour was ever going to allow him to do that but on the other side like mate just like the what what you could do for your brand name by going out of golf and hell maybe you do really well like I'd be curious to know where you fall on that because i've seen some people take the other opinion which is oh the pga tour a bunch of old white guys that don't understand youth culture and things like that and i was like i kind of i i think the other guy's being short-sighted about what this could do for his career but yeah that's that's us going off piece talking about youtube well no it's a fair point because it links with youtube and we actually talked about that yesterday roger and on on stage he was the only interview i actually did on proper interview sit down interview the rest were um either brief q a with everyone else who were doing presentations um but we talked a little bit about obviously the fact that you are competing now with the creators of the world for attention and that's why it's important to differentiate but your example grant halvat is an interesting one i the skeptic in me is basically suggesting he didn't want to put himself on the line and you know if he shoots a 15 over round then it's not good for his brand if that's that's the case i don't think it could just be just that alone and i mean he's a very good golfer he obviously plays and his influencer plays with some of the best names but he's not that tier and he knows that so i'm not sure how genuine that that that is that's the skeptic in me i would say that i he was basically didn't want to put himself on the line though that being said i don't think they played a few tournaments but i think i've watched one of his videos where he was just

21:05Chris Stone:trying to get i don't know was it a tour qualifier maybe to get on the tour and he wasn't anywhere any of the marks so i think just basically sticking to his focus on being a good content creator is where he'll continue to focus that's what pays the bills being a really high level well-followed content creator probably pays him better than being a below par or fledgling uh or flailing uh to a pro or aspiring pro so not a knock on him he kicked my backside in golf every single day but I think it's just a smart business decision more than anything. I just don't know if the message was necessary.

21:46Nick Meacham:Yeah, and like I said, it's not a - I think it's more the messaging. I'll just be clear. It's not the decision to knock it back. It's like, everyone, I'm not doing this because they wouldn't let me have my camera crew there. I'm like, come on, mate.

21:58Chris Stone:It's like, you're going to get exposure in different places. You'll be able to do some great content around the edges of it. Like you can make it work if you wanted to.

22:08Nick Meacham:yeah and on that we're on agreement i think for me it's just some of the people i've seen talk about the pga you know not being open-minded to to you know opening up the window or it was like because like i mentioned bryson de chambaud the other day watching his youtube channel well they're gonna let some youtuber do why can't he do it and then all of a sudden the the hundreds of millions of dollars pounds you know from sky esp and everyone else why am i paying for this if you're letting these guys go do it like it just it doesn't work um so yeah i think my comments It's more the people that were yelling at the PGA Tour about it.

22:40Nick Meacham:It just doesn't make any sense. It's an easy thing to point out, right? It's an easy thing to say, oh, the PGA should do better. Should let them have access. But yeah, where do you start? Where do you stop? If he's going to start doing it literally in a couple of years, you would get half the tour doing it probably if they open up those floodgates. One of the things that has made Bryson DeChambeau so famous is obviously doing a lot of content around the Live Golf flexibility that he has. But it hasn't actually been loads of content from the live matches themselves that I have seen that he's broadcast.

23:13Chris Stone:It's all around the peripheral. So maybe there's some flexibility in the future PGA Tour can give around broadcasting or creating content pre-matches and around practice rounds and so forth. But I think to have a massive goal, I think just an easy thing to do. But I'm more on the PGA Tour side than anything else, given the amount of plays they have in the competition and so forth. I think it is a Pandora's box if you start letting one do it.

23:40Nick Meacham:Agreed. Now, flipping back to the Nordics, you mentioned the story around ESPN launching in the Nordics and kind of the European take on that. Because as an American, I've always been slightly underwhelmed just growing up with ESPN that there wasn't a stronger presence over here. And they do have some ESPN stuff abroad, but it's not what it is in the States. but with Disney being the home of the Women's European Championship, not European Championship, sorry, Champions League coverage being on Disney, that now sounds like from what you heard is going to be placed under the ESPN banner in the Nordics?

24:15Chris Stone:Yeah, it was quite an interesting conversation. Now, I have to look down a lot because I haven't had a chance to transfer my notes. No, I didn't know if I made this clear. I was hosting the whole event. So I did every, and it was the most jam-packed program ever. but there was probably eight or nine sessions in three hours. So fast pace, I had to do a couple of questions for each one. So I didn't get much of a chance to sit down or even run to the bathroom. I have to say I had to leg in between, well, when someone kicked off their next session. Sorry, I haven't had a chance to prepare for this too much because I got back at like midnight last night.

24:49But I need one of those AI tools for the video

24:52Chris Stone:that keeps my eyes on the screen when I'm looking at this. But to give some context. So as you alluded to, They've got the Champions League. They've actually got a few other sets of rights for the Nordics now that I wasn't fully sort of come to grips with. So now the chap that was speaking was Hans van Rijn, who is the SVP of Walter Disney Company, country manager for the Baltics and the Nordics. That's his brief. And really impressive guy, really good presentation. There's one thing that I think was quite interesting, which I'll come back to later, about how they look at IP value. So the way they look at content is how do you get the most value out of it?

25:29IP leveraging is the maximum thing. You think about Disney, right? You think about the IP that Disney's created over the years. They don't just make revenue out of it from content consumption alone. They're finding other ways to make value out of it. And he made a point of that, which I think is a little bit contradicting with buying media rights for a period of time.

25:46Chris Stone:But anyway, I digress. So ESPN is coming to the Nordics. they are doing it with the Europa Europa League, Women's Champions League, with also with TGL Golf which was a bit random but I think that's because ESPN might be a shareholder in TGL so the UEFA League's NWSL didn't know they had that there as well so another women's competition, the Nordic Star Cup which I'd never heard of before but that is an influencer and ex-players competition so Interballer League or one of those types Yeah, that type of thing. So that's their set of rights that they're launching with. So they haven't spent a lot on that, right?

26:26Chris Stone:Let's be clear. That is what would they have paid serious rights for? I mean, probably none of them. They probably would be happy to get the reach, maybe something for UEFA Champions League. But I remember, if I remember correctly, with the Women's Champions League, the deal with DAZN and UEFA and YouTube was effectively, UEFA was paying the broadcast production on that deal This is what I heard. I was paying the broadcast productions. The DAZN was paying next to nothing for the actual rights themselves. They were just getting the feed, giving it the visibility. And that's why they would be very clear, like marketing it and promoting it.

27:00And YouTube was there to try and enable it, try and drive revenue from it. But we know that they had challenges in their approach with that Women's Champions League, DAZN did. And they had to pivot their business model to keeping it free to air right through the length of broadcast. So the thing that I found interesting there back to my original point is, okay, so they picked up the rights from DAZN. DAZN has put quite a bit of effort in to creating visibility for the Women's Champions League competition through the investment they made with time.

27:28Chris Stone:They lost those rights to Disney, but now they're doing the same in hiring sets of rights. How are they going to maximize the value like they say they do to the rest of Walt Disney's IP? Maybe they don't need to, but I just thought it was an interesting, slight contradiction in their approach nonetheless. Why are they investing in the Women's Champions League? His points were pretty straightforward. They have, so the Women's Champions League and the Europa, the UEFA Europa League and the Conference League, those leagues have the most local teams and the most local players. So that local value piece is actually one of the driving forces for that.

28:07Chris Stone:Not a huge surprise, but there's something like 60 players that come from those key markets that are playing in those competitions. So quite a lot of players they can point to and, um, and athletes and personalities they can point to. They also get access to some of the big teams, because if you think about it, um, you know, the conference league, for example, you actually get what Chelsea won it this year, if I remember correctly. Uh, what are you talking about this year? Oh, men's or women's men's on the men's side. Cause I had the men's conference league.

28:35Nick Meacham:Oh yes, that was Chelsea.

28:37Chris Stone:Yeah. So they get access to some of the bigger clubs who actually end up in the Champions League from the Premier League and a lot, which actually drives a lot of interest because the Nordics, a lot of the leagues, and I'll talk later about what I heard from the Danish League CEO, but they're competing with the Premier League in their market. That's their number one competitor, basically, for visibility and for attention. So to have the big Premier League clubs actually pop up in those cheaper leagues is actually a huge result for them. It's actually quite an audience driver. They've also, interestingly, because Disney Plus isn't synonymous with sports, they've partnered with Chelsea Football Club to actually use a sponsorship deal.

29:17Chris Stone:They've also done series of content with Jürgen, which is, I think it's a Stockholm team, if I'm not mistaken. And they've published that stuff on YouTube to get more, again, visibility and awareness of Disney Plus having sports content. They're also publishing supporter streams. So it's a bit like an old broadcast with supporters. They showed a couple of clips on that, which were highlight clips that they showed. I'm not sure if they do full version matches, but it's basically like the split screen with a live match and fans watching and commentating. So that was an interesting thing to see Disney trialing that.

29:53Chris Stone:And they were very clear to make the point that they don't limit rights use for highlights to just themselves. So they give it out to teams. They give it out to all the key stakeholders and make sure they're maximizing the use of that. So I thought that was a really interesting thing to highlight, to look at. The other factor is that the sports component is at no extra cost. So they've launched ESPN as this brand in market that they're going to have all of these sitting within on the platform, but there'll be no extra cost for access to that, which obviously is quite a different model to what they have in the US.

30:27Although no real surprises given the rights aren't worth a lot in relative value.

30:33Chris Stone:So I see it as very much a trial opportunity and exercise for them. It's a very well developed market for Disney plus Disney in the Nordics. And it gives them opportunity to see if they can make a destination that drives sports attention and activity. But obviously the ESPN name is a bit of a surprise. Too many.

30:54Nick Meacham:Well, that's my question is, I sit here talking about ESPN because I grew up with the sports center. You've been in the UK much longer than me. You've obviously spent time in the nordics is that just me because i'm american i think espn big bold you know letters like it's just synonymous with sports is that really the case in europe i mean is it is it one of those things and you almost have to take a step back nick because you you work in the industry so for you it makes sense but like you know would your wife's parents know espn if you mentioned it yeah so i mean a couple of things firstly uh you know we had a discussion about this a number of times with people through the event.

31:31And really the consensus, it doesn't make a lot of sense to them. The only thing we could, we could try to work out the why, like, why would you do it? I didn't get a chance to ask this question on stage. And our guess is basically they just don't want to add another piece of brand IP to the mix or like call it Disney sports and get a bit

31:47Chris Stone:cloudier for other types of internal branding and such. So just sticking with ESPN as their sports brand. It just makes it a bit easier, which makes sense to some extent. But to your point, my feeling of what ESPN is, it's an American sports brand. I would expect American sports available in ESPN if I was watching ESPN. I would not expect European women's football in there. It just doesn't make a lot of obvious sense. So if they're willing to play the long game here and build over the next decade, build ESPN as a different brand altogether outside of the US, maybe start to mop up global rights on a couple of these US sports and say, hey, MLB, how about we just take your rights and put it into our Disney Plus in the ESPN brand?

32:36Chris Stone:It makes more sense than you trying to go direct to consumer yourselves or sell it market by market. I could see that being a play for them. So that might be a reason why to do it. But other than that, it doesn't make a lot of sense other than they wanted to create a destination with a defined IP that didn't need a lot of explanation, as in it's sports, but didn't need to create something new altogether. And that's really the conclusion that we came to. But for now, I think it's just a test case for them, a very low-cost test case. And they'll see what happens and then decide if they want to ramp it up or turn it off in a couple of years time.

33:11Chris Stone:So not much risk for them. But my final point on this is, I do think there's no risk for Disney+. I do think it's a little bit risky for those rights owners if there's some, I don't know to the extent of exclusivity, but if those deals are exclusive and you don't know they're there, Disney's pretty good at marketing, right? That's probably one of the special sources, so to speak. But those sports properties could just die off and be hidden away and people not watch any of it at all. So, you know, because they're not easily discoverable discoverable or my word that doesn't actually, it's not English, the stumbleability of something.

33:51Basically, you can't stumble across it. It's like discoverability, but it's like accidental discoverability. Unintentional. Maybe I should just stick with discoverability actually as the word I'm using, but it's a big challenge. I think if you're putting it away within Disney versus where they were looking before, you have to educate the market. I've been watching on YouTube. Now you've got to go to Disney plus to find it, that can take time.

34:14Nick Meacham:Well, that I think is a perfect segue into one of the news stories we wanted to cover, which is the Formula One rights in the US are set to expire. I believe maybe even after this season, but one of the entrants coming into the market rumored, although they've been rumored with just about everything these days, because that's just kind of how the sports world work, is Apple being one of the top contenders to come in and take those rights. Now, I don't know if this was proven, alleged that Amazon previously had bid when ESPN won the rights. And supposedly, Amazon had actually bid more for those rights.

34:49Nick Meacham:But at the time, the argument was Formula One went with ESPN because it's a full-blown media business. You're not just getting the distribution. You're also getting all the news channels. You're being included on ESPN Plus, the app, all the other side bits that came on. The argument at the time was that discoverability of being on ESPN, the editorial media coverage you were going to get would make up for any additional fees that you would get from a rights deal. Well, now enter an Apple, and it feels like that would be a very similar problem to your point, a stumbleability. I don't know if it's American, I can just pronounce that a little bit easier, but there's a few things to unpack with this.

35:29Nick Meacham:There's the Apple perspective as to why they would potentially be interested in Formula 1. There's the potential angle why Formula One may shift its opinion of going from an ESPN, a sports media home, to something more like an Apple. But at the moment, those are the rumors that Apple is interested in. There is some other background in terms of ESPN's general interest in the rights that we can kind of talk about how that contract has played out for ESPN. But yeah, Nick, just sort of that segue, stumbleability with Formula One. I think I should stop using that. It really does not. Yeah, I really can't say it either, which is the most embarrassing part of it.

36:08This is an interesting topic for a few reasons. One is I got a lot of attention when I posted my thoughts on it the other day. And then I noticed that Steve McCaskill's written a piece that basically says it makes sense for them. So we should have had a debate. I was going to bring that up. I was going to play Devil's Evacant.

36:22Chris Stone:We should have gotten to give us a bit of a mano-a-mano debate on it. But no, I mean, look, the lens I took on this is F1 has been so focused on driving the entertainment factor, the awareness through Drive to Survive, just creating this excitement and trying to move into the mainstream. And it just feels like whenever you start to think about partnering with someone that has a really small, comparatively small, market share and visibility and distribution channel for you, i.e. like Apple does, you're taking the decision to take the check overtaking the growth of audience and fandom and given the amount of revenue they drive through sponsorship which they are heralded as one of the best in the world at doing that there's some there's a great piece of content on this actually on sports pros channels around how much on average deals worth and i can't remember the number but it is extraordinarily larger than anyone else who works in the global sports scene but if you're drawing revenue from hosting and from sponsorship as two of your major, major revenue drivers like they are, to then go with Apple, I think could have a real negative knock, the negative implications for their sponsorship momentum that they've got.

37:43Chris Stone:And they've got incredible momentum behind them. And for what price? An extra maybe 50 million, maybe 80 million US for the comparative deal that they're probably able to get from elsewhere. Is that worth it? I just don't, maybe for F1 or Liberty Media Group in isolation, but is it for the teams? Is it for the knock-on effects to the rest of stakeholders for that lack of visibility that they get through not only ESPN's channels, but indeed on ABC for those key events that are linear? I can't seem to make that work in my head. And it links a little bit like the comparison you have with Amazon and ESPN, but on a slightly different scale this time around.

38:23Yeah, well, one of the interesting things, I think it's just worth their context because we had Key and Brittle on our motorsports editorial writer.

38:32Nick Meacham:It must have been two, three months ago where we did a motorsports themed episode just going through some of the top leagues, some of the news that was going on. And I think sometimes the European mindset thinks of Formula One probably a little bit differently than the American mindset does. Because I think one of the points Keyan made was when you look at the two big races in the US, typically looking at the Daytona 500 and the Indy 500, that actually those audiences are significantly larger than the biggest races for Formula One. Now, it's worth keeping in mind, not every single race in NASCAR, the IndyCar series matches to those levels.

39:04Nick Meacham:But the idea being the two biggest events in those, they are significantly larger than what Formula One's doing on a race by race basis. And I think perhaps when we're specifically talking about the US rights, like they still have, as much as they have grown, they still are in a very competitive space in terms of even within the motorsports, you know, they don't necessarily, at least in my opinion, don't necessarily maybe hold as strong of a, foothold as they maybe do in other European markets. Yeah, it's a tricky position to know where F1 really stands in the stead of motorsports in that market.

39:41It feels like in many metrics, they're number three. And to then try to act like a number one is a tricky game. Now, the stuff that I have read, obviously Apple was one of the major backers and producers of the F1 movie. and I actually listened to Bill Simmons' podcast. He started talking about that and he was waxing lyrical about how great the film actually is, both him and the co-host on that. So I've not seen it. I was immensely skeptical when I saw a 60-plus-year-old in Brad Pitt being the driver and so forth. I was like, how is this going to play out? But apparently just the way it's produced is incredibly exciting.

40:23a really great piece of content and good for people that are not massive followers, but also for people who are interested in the sport will still find immense value out of it. Now, so with that, and the gross revenue so far that it's produced from movie ticket sales

40:39Chris Stone:has been really significant. So I could see why Apple might go, hey, let's ride that wave of visibility and excitement and revenue generation we've created through this film and see if we can turn them into something meaningful. through this potential partnership with F1. But again, I just think it would need to be, for me, a global F1 deal. And that's not what's being rumored. If they were talking maybe bulk of US rights plus F1 TV Pro wrapped all together in some major global deal where you now watch F1 TV Pro exclusively or near exclusively through Apple's platforms. So there's enough partnership synergies between them to go, okay, Apple's really part of F1 now, then I could see where that could play out well for them, both from like a brand alignment perspective as much as anything.

41:31Chris Stone:But otherwise, I'm just not sure it really makes a whole lot of sense. I reckon you'll see a last minute, my prediction will be you'll see a last minute deal with one of the mainstream US providers. They won't go all in with Apple. I just can't see that making logical sense unless they actually ramp up their bid bid even higher. And final thing I would say, I wonder what the reaction would be of some of the major sponsors in F1, namely Android, if Apple picked up the rights. I don't know if they would kick up a stink, but Android, I'm pretty sure, is a pretty major sponsor of McLaren, the leading constructor at the moment.

42:07I'm sure wouldn't be too happy if Apple then took all the rights on, but that's another conversation altogether.

42:13Nick Meacham:Yeah. Not to put words in Steve's mouth, but just to play the devil's advocate, the two things you mentioned are both things Steve mentioned in his article. So go read it if you want to see the other side of the argument. But he did talk about if they could wrap the F1 TV Pro into the Apple package, it would make a ton of sense. And then he did also talk about just riding the wave of Apple being one of the key producers of that movie. Now, he did make the argument for Formula One, given stagnation of growth, cash in while you can. But I think your argument would be that would almost be kind of not waving the white flag, but sort of let's cash in while we can and whether or not that's the best move from a long-term perspective.

42:49Nick Meacham:So Steve has his own opinions on it. Some of the things you touched on are some of the reasons why he said they are pros. I probably lean a little bit more on your side, but you don't need to take sides, Chris.

43:00Chris Stone:It's okay. It's okay. But no, look, I think, but I do think, well, probably Steve and I are probably more aligned than it might sound like, even though he's saying they should and I'm saying they shouldn't. the business logic if you wrap in those extra layers makes it a much more appealing product I'm doing it under the theory that they're just talking about pretty out of the box media rights deal I like for like ripping out the ESPN deal and putting in Apple and if that's the case I just don't get it yeah well Nick it's always an exciting time in the

43:32Nick Meacham:sports media space particularly in the last year with the sheer amount of mergers acquisitions that we've been seeing. We just had the Sports Pro investment event the week prior to. And if you want to hear about how some of that went from our perspective in the media space, check out last week's podcast. But there was a big news. One of the companies involved used to be formally invested in... You know what, Nick? Let's just rip off the Band-Aid. The story is going to be about Delta Trey. Delta Trey used to be invested in by George Pine, who's one of the individuals you got to speak to and interview at the investment event.

44:04Nick Meacham:and we're now seeing, what is it, an acquisition of Delta Trey acquiring the Endeavor streaming business. So Nick, we've spoken about both of these businesses before. Obviously, Delta Trey, one of the leaders in this space, Endeavor being a part of the larger IMG group. We've talked about some of the IMG arena, mergers and acquisitions and the TKO and all the stuff they're kind of from a cost-cutting efficiency perspective. On the surface, it feels like two really large names coming together. You would think that there would be a large price tag, but you also had a LinkedIn post arguing. Actually, there probably wasn't too big of a price tag associated with this, just given some of the things we've seen.

44:49Nick Meacham:Because what was it, IMG paid? We used this example the other day. Who did they pay to take the rights away from them? They paid Spore Radar to take on IMG Arena. Yeah. So I think on one side, you see these two businesses that you're very familiar with if you work in the industry. You think, ooh, this must be some monumental deal. Your argument, or at least not putting words in your mouth with the LinkedIn articles, actually, this deal may be more strategic and less just financial than anything else. Yeah.

45:18Chris Stone:Look, I think when you see a deal like this, and this is pretty significant. I think in terms of big tech service providers that are dedicated and built around sports, they're two of the biggest, definitely on the sports media side. I'm trying to think of who would be comparable. I mean, Genius and SportRadio are coming together in that type of nature, but they're valued at a higher click than these two. But it's that sort of feel because they're so synonymous with the sports media landscape by streaming, OTT, and platform development. and obviously Endeavor's roots through the entire ecosystem before then were really pronounced.

45:58Chris Stone:Now, we have talked quite a detail about, again, that there's pretty much a whole pod dedicated to the IMG Arena sale to sport radar where we talk about that. And I do think this probably, I'm going to, all hypothetical here, this is just my view and my take, but some things I've heard from people around the edges who've got in touch with me, we're pretty close to the mark is what I've heard. But basically, firstly, the sale of Endeavor streaming was inevitable. The reason it was inevitable was what we talked about with IMG Arena. So Endeavor's business was basically sold and the core of the business was sold, which they had packaged up to maximize its profit value.

46:38Chris Stone:And then they sold that for an absolute several billion dollars, Ari Emanuel and his leadership. And then what they were left with is a couple of the quote unquote peripheral businesses being the IMG Arena business, Endeavor Streaming, and maybe one or two more that I can't think of. Because they cashed in the bulk of it, the basically next step for them was to just move on these businesses as quickly as possible. They didn't want them sitting around. I don't know if they're profitable or not. I'm guessing not from what we saw with IMG Arena. The commitment to media rights probably exacerbated their financial situation.

47:12Chris Stone:So in that instance, it was as quicker to just move it on and step away because they cashed in so many billions in that deal to sell on the core of the business with TK Group Holdings. In this instance, I don't know enough about the financials. All I know is that, and what I do know is Endeavor Streaming has incredible clients, UFC, WWE, and the like that are big major deals linking with the original relationship with Endeavor. They have a relationship with LFP, Ligue 1, and they'll be the ones powering the platform. They're already doing that in the UK, but they'll be taking on that responsibility in France itself.

47:51Chris Stone:And they do more than just the platform itself. They are really helping to work out the commercials and the strategy behind that. So they've really got a great pedigree of what they can deliver. Entwin, I've had some conversations with UFC before about the work than Endeavor does. And they have one of the most intricate, complex, and deep strategies and approaches to using OTT in the industry. And they've done a great job with what they've done there. But you had the situation where they needed to be moved on quickly. And who else would really be of the size and scale to take on that responsibility?

48:24Chris Stone:If you think similarly, again, to like the IMG Arena Sport Radar conversation, in that instance around sports betting and data, you're probably only talking the three big ones in Sport Radar, Genius Sports, and maybe a Stats Perform, who would be able to take on that sort of burden and put up with, I guess, the burden of taking on a business of that scale. I was going to say paying the check, but obviously, it was the other way around. So, it's a little bit more complicated. But you still got to take the burden of paying for those rights in the future, right? So, where am I trying to get to here?

48:58Chris Stone:I'm trying to basically, I'm getting to the fact that like this deal was inevitable that Endeavor was going to be sold. Delta Tray was the most likely, most obvious partner, unless someone else could have come to the table with some private equity money from somewhere and try to wrap up in another OTT business to try and blow away the market with a new big player in the space. But instead, we now just have one big super player. Now, this deal is the worst kept secret in the industry. I think that's the first line I used in my post because I've heard everyone has come to me and talked about this deal happening and they're wondering when's it going to be announced.

49:33Chris Stone:And I heard from people within both respective organizations that was actually having a negative impact on them just because when there's uncertainty in a business's future, clients start getting a little bit twitchy as well. So they just wanted to get it settled, get it sorted, and now they can move on. I don't think it's like this huge transformation for the industry. I think for Delta Trace perspective, it is to solidify their position in the market. They will have the number one roster, most likely, of top tier sports properties. And if they can find other ways to expand the relationship with that client base, then that's where the growth is going to come from, I think, by and large.

50:11Chris Stone:Because underneath that top tier, it's a really congested marketplace. And they've been trying to, what would I call, expand their products to filter through the lower tier of the industry. But it's really congested with a lot of other players. So this, in essence, allows them to double down on being the leading provider for tier one properties. And now I think they're in a great place. I predict that Endeavor Streaming's brand will probably just disappear and be aggregated into the Delta Trade brand. like a few predictions as well. But I think it's an exciting one because of the scale, not necessarily with the big price tag, that if it happened organically, that you would expect.

50:55Nick Meacham:Yeah, for sure. And I think maybe my one follow-up on this is just off the investment event. George Pine and Brewing Capital originally invested. Isn't it now Bain? Are they the ones that have taken over? What do you think, given just what Delta Tray is going to have to prove to its investors the money that they put into it. To your point, they're obviously trying to find growth. I think one of the issues is there's only one NFL, there's only one NBA or the clients that Endeavor have, there's only one UFC, one WWE, well, not even WWE. But the point is there's actually only so many of those eggs in the basket.

51:31Nick Meacham:And to your point, having to go down in terms of the two tiers, tier threes for growth, how is this merger acquisition going to help Delta Trade from the perspective of proving ROI to its investors? Well, the main thing it's going to be able to do is it's a typical merger of this scale.

51:50Chris Stone:Let's call it a merger in terms of you bring two business together, but it is an acquisition, is where are the synergies? Synergies are often related around technology and around personnel. I would be very surprised if you didn't see significant optimization in personnel, meaning people getting cut quite significantly across the business to save costs pretty immediately out of either either or of those businesses to basically improve the bottom line pretty quickly. And by doing so, instantly that business becomes way more profitable than it was yesterday just because the efficiencies can make a huge impact to the bottom line very, very swiftly.

52:30Chris Stone:So that's a big starting point. Then if there's anything the others are doing, might be able to expand how their existing relationships on both sides are with those clients. So it might be, for example, that Delta Tray is doing a certain aspect of delivery. Let's say it could be just delivering an OTC platform, but it might be missing one piece of the ecosystem or the services that another rights owner might be doing elsewhere. And they might be able to say, hey, actually, now with this new expansion of our services, we can do that for you better than we could before. So it might allow them to get more value out of existing partners.

53:03Chris Stone:It might allow them to expand their reach into lower tiers. I think that the next step will be is that Delta Trey will probably push heavy outside of sports. I'd heard that from a few corners that that was their goal. I think that's a tricky game to play because it's a much more established industry with a lot more technical expertise that just the need for someone as comprehensive as a Delta Trey or the type of relationship it typically provides, is less prevalent in media and entertainment than it is in sports because of the relative immaturity of the sports media landscape doing it themselves.

53:41Chris Stone:But that is one way to potentially drive. So new verticals, new sectors, expansion of relationship with existing clients, and efficiency basically on probably headcount, maybe tech count as well. They might be able to save some costs on various tech stacks and services they're using currently to operate as well.

53:59Nick Meacham:Well, it's a big move. It is something that I'm sure will have unintended consequences. We're not even aware of yet that over the course of time, this won't be the last time we've come back to this story. And I will say for anyone that maybe catches video across this podcast, apologies if you see me wiggling, moving around. I'm recording the podcast on the road. I'm at my in-laws. They've got builders in. So I'm having to record the podcast from my wife's teenage bedroom. So I'm not very comfortable right now, Nick. So if anyone catches any video in this podcast, you see me wiggling around, you're just going to have to give me a bit of a break.

54:32Nick Meacham:I'm focusing on delivering high-quality content and audio. But if I'm moving around in the video, apologies. Anyone is going to have to watch that? Oh, good, mate. I just realized that I move around way more than I should be, and I think if I bump to my desk, it moves. So I think I need to get one of those stabilizer mics as well. I think people are going to get seasick or a car sick if they watch this episode. But we're doing our best. We're doing our best, but thank you again, everybody for tuning in. We'll catch you on the next episode of Streamtime Sports. Thanks everyone.

55:01Chris Stone:Now, before you go, if you liked what you heard today, be sure to rate and review and just let me know what you think on social. You can find me on most social platforms at SportsProNick. And please do spread the word of the podcast. There's no better way of marketing than word of mouth, whether that be in person or on social media. And if you don't like what you've heard, or you think we should be doing more or less of something, then reach out and let me know as I'd love to hear from you. Thanks, Streamtimers. Until next time.