Will The Blue Wave Midterms Put A Damper On Ad Tech M&A?

0:08Welcome to The Big Story, a roundtable featuring members of the AdExchange Editor editorial team. Every week, we bring you an in-depth discussion of key developments in digital marketing and media.

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0:38Hey everyone, thanks for tuning in to The Big Story. I'm Ad Exchanger Managing Editor Anthony Vargas, filling in for our usual host, Sarah Sluice. We're recording this episode the day after Election Day, which saw the Democratic Party take control of the House and the Senate. The reason I bring that up is because the regulatory picture is relevant to the state of AdTech M &A. And today we'll be discussing two new deals that dropped this week. India-based AdTech Holdco AFL acquired Perion, a CTV, digital out-of-home, and retail media platform, for$420 million. And commerce tech startup Cord acquired AI data analytics startup Zenlytic for$5 million.

1:17Our editors Allison Schiff and James Herscher covered these deals and have been tracking the evolving M &A picture this year. Thanks to you both for being here to break things down for us. Now, neither of these most recent deals look like seismic news on the order of Skydance acquiring Paramount, Nielsen acquiring Double Verify, Publisus acquiring LiveRamp, or DoorDash acquiring Instacart. But they could be part of the last burst of M &A we'll see before the regulatory environment changes completely. The thinking goes, and the record bears this out, that the Republican Party is generally more friendly towards mergers and acquisitions, whereas the Democratic Party tends to be more heavily scrutinized deals between big companies due to antitrust concerns.

1:59And it feels like the politics of it all has been discussed particularly openly during the spate of M &A activity we've seen this year. A recent article by The Information covering DoorDash's acquisition of Instacart advised CEOs to get your deals in while you still can, folks. The joke being that the clock is ticking to get deals approved before the Republicans are out of power. And indeed, DoorDash CEO Tony Zhu confirmed that he backed away from acquiring Instacart in 2021 because he worried the deal would be squashed by the Biden administration. So we'll discuss. Is the M &A wave over just as it was gaining momentum?

2:33Then, with the midterms in the rear view, it's time for sports fans to put those non-stop political ads we've been seeing during games behind us, which leaves room for even more ads from sportsbooks and prediction markets. The proliferation of betting ads is just one part of how overwhelming the live sports ad experience has become, and James wrote an opinion column this week that feels like a definitive primer on the inshittification of sports. We'll dig into the implications for fans and players. But before we do, we have some of our own events to promote. Ad Exchanger will be hosting CTV World in New York City at the end of March.

3:07That's the place to be for everything CTV. And then in May, we've got Ad Exchanger Connect in Las Vegas. That's where all the industry talk gets real, and we'll be getting deep into the weeds with workshops and roundtables on the hottest topics in digital advertising. Use the code SarahMVL for a 10 % discount on your passes to both shows. That's Sarah with an H. All right, Allison, I don't want to say give us the TLDR because everyone should still click your story because we don't get paid unless you click the link. But yeah, give us the TLDR on the Apple Perion deal. What kind of jumped out at you when you were talking to their execs?

3:45Well, I don't know if everyone is familiar with Apple, but it's an India based mobile performance company. and this deal with Perion is pretty much just a page right out of their playbook just on a somewhat bigger scale because it's a serial acquirer kind of cut from the same cloth as Zeta, Global, Infileon, those guys. It bought a company called MediaSmart for CTV, AppNext for AppDiscovery, Jamf for user acquisition, UAPI for gaming-focused programmatic. Definitely I'm missing a few. And then in June, they picked up Ad Colony's tech from Digital Turbine, which is interesting because I've written about all of the different moves that Ad Colony has made over the years.

4:31They used to be with Opera, then they got sold to DT, and now part of their tech is owned by Apple. And that Ad Colony deal, I read somewhere that it was only 4.7 million. The Jamf deal back in the day, it was maybe four years ago, five years ago, that was 41 million. I don't have deal prices for the other ones, but 420. And we'll talk about whether that's a good price or not, but it is a bigger bet. And yeah, I mean, it's, you could argue it's not the best price because Perrion is also sort of a Russian nesting doll of acquisitions itself. But yeah, I mean, the rationale is that the two are pretty complementary.

5:09Perrion has brand and agency relationships in North America. Apple has mobile performance tech that Perrion doesn't, a strong footprint in emerging markets also. So Perrion can start selling app installs to clients that it already works with based on outcomes. And yeah, I mean, Tal Jacobson, Perrion's CEO, gave me an example when we were chatting. He's like, OpenAI and King, we work with them. They would ask Perrion to help distribute their apps. It couldn't do that, but it could sell them out of home or CTV. It just didn't have the tech to drive installs. And now synergies. And if I had a nickel, what's that thing?

5:47If I had like a nickel for every time XYZ happened, then I'd have two nickels. So if I had a nickel for every time the word synergy or synergies came up on the call, I'd have six nickels, which isn't a lot. But it's weird that it happened six times. So, yeah, you know, play the skeptic for us then. Does the synergy story that Perrion and Apple were selling really hold up? Um, I mean, sure. Right. Look, I mean, Tal was joking when I kind of called him on that word. He said when he's writing emails or PR or whatever, Google will pop up and say, hey, maybe don't use that word. People don't like it.

6:24It's a cliche. But cliches can obscure a point, but people use them because they're concise. So I'll forgive it. But yeah, I mean, the synergy here is cross-selling, not integration. Perrion can use Apple's mobile performance tech for its brand clients. Apple takes advantage of Perrion's agency relationships, the presence in North America. Like I said, that's something that Apple really covets. They don't really have a presence in North America. And they just hired someone who used to work at Verve, which is another one of those roll-up ad tech companies to be their CEO for North America, Samir Santi.

7:01Yeah, and keeping these things sort of separate also sidesteps the Frankenstack question because it's more like a portfolio of independent entities. That's how they try to run it, is my understanding, rather than a stack. So I don't know. We'll see if that's the right approach, if that's a strength or what. We'll find out. I wonder what Google word processor Tal is using. Maybe it's like in his Gmail or maybe it's like. I don't know. Because like I'm wondering why like why Google Docs doesn't yell at me whenever like, you know, one of these guest columns has like the word leverage in it. Really should.

7:38We should personalize those suggestions. Yeah, right. Cut down on as much jargon as possible. But yeah, so another thing that kind of stood out to me when I was reading the story on this. both Apple and Perrion are all about outcomes. And when you asked Tal about his company's open web spending falling by 23 % in Q2, he had an interesting response. He said, we've been telling investors and clients that the open web is not the future. Forget channels, focus on outcomes. And we've been hearing that the industry is in its outcomes era for a while now. And this idea that the open web is dead keeps growing.

8:15The chorus are behind it kind of keeps like growing in volume. So does it feel like Jacobson's in line with the rest of the industry or is that still like a hot take? I don't think it's a hot take. It's it makes sense. Right. He also made the point that it's not as if CMOs, CFOs for sure not are obsessed with particular channels. They do want performance. I mean, maybe it's sexy to buy a certain channel, CTV, it's hot or whatever, but really you're trying to achieve something. So it's not about what you put on your media plan to make it pretty, it's what's the next step? What is helping drive a conversion?

8:55So I don't think it's all that hot of a take. I think it's a pretty rational thing to do. Whether things like CTV can drive conversions, that's another question. There are a lot of companies saying that, sure, yes, CTV is a performance channel, including Apple. They just rolled out a product with MediaSmart, which is now their CTV division based on an acquisition, which we wrote about pretty recently. And they're selling their media on a cost per converted user basis where they can. So a dotted line very clearly between the media and the action. But then you have other skeptics, speaking of skepticism, who don't think CTV should be a performance channel, including Benoit Viter, who I think we'll talk about in a little bit.

9:44He had a hot take about Publicis Live Ramp, but he's been out there saying, no, guys, it's not a performance channel. Stop trying to sell me this nonsense. Yeah, we've been hearing a lot more of those criticisms. You know, a friend of the pod, David Nirenberg at Intermedia Advertising wrote a guest column for us on that exact topic recently. So check that one out if you haven't already. But it feels like, yeah, the pushback against like performance CTV in particular is like growing. But like, you know, there were also some like interesting just like kind of takes like when it comes to like the digital out of home channel, which I follow like, you know, pretty closely.

10:21when it comes to making performance digital out of home, like the mobile integration that, you know, these two companies can kind of do together is like mobile data is like the bread and butter for perform for, for proving any performance in digital out of home. So at least in that case, it feels like the synergies argument is like legit here, right? It's valid. Sure. And it's also not necessarily about proving a specific install in a specific instance all of that would be great it's also about having more of a performance mindset like really trying to think what is my media doing instead of just buying a bunch of stuff i think there's also sort of a just like a a value play here too because ad tech valuations have plummeted so much um so you know perry on was going for like a very low multiple on its revenue um a lot of these you know we talked about like instacart down a lot like live ramp way down on like a bad year for software so i think there are you know you have a lot of like big opportunistic buyers um or you know and like you know in moby and apple like there are some that are in like india and china that like maybe you don't know but are actually like huge businesses capable of, you know, easily making a hundreds of millions, billion dollar deal.

11:44And yeah, so like these ad tech companies kind of look like, oh, like, it's an opportunistic pickup. And, you know, I could put this to use, even if it's like borderline profitable as a standalone, like I could put this to good use. So yeah, there's a lot of that right now. I think like Criteo just reported this morning and, you know, Trade Desk a tenth of where it was like there's definitely a lot of companies like oh like hmm like that's worth a pickup i can just i can do that or like from the acquiree's perspective get me the heck off the public market yeah yeah and a little bit of that going on too um and yeah james i love that you brought up the valuation piece because i was just i was just gonna i was just gonna tee up the question related to that so uh perrion sold for 420 million uh which we should note the pitch we received to cover the story did in fact joke about the price being the weed number so did it i i think that was a little tip that came in.

12:37I got this email from like a Proton email that was like, hey, ask about 420. Like that doesn't seem like enough. I don't think they included it in the pitch, though. That would be a weird cell phone. Maybe I was maybe I was misinterpreting some some slack messages there. But yeah, anyway, so when you brought up the price with Tal, you know, he said he thinks of this as like more of a merger, not a sale. But, you know, Like we said, Apple's paying$420 million in cash. So how should people think about that number and what it kind of says about what James was just speaking to before, just like the idea that maybe some of these companies are selling for a fraction of their revenue?

13:17Yeah, I mean, Sal, Sal, Tal, Sal is his, I don't know, Italian doppelganger. I do get the point about wanting to frame this as a merger and not a sale. And the way they're going to interact makes it kind of more like a merger. But in practice, it's an all cash acquisition. So it is officially a sale. And his argument is that the public market never gave Perrion credit, which perhaps is true. I mean, ad tech companies don't fare all that well on Wall Street. And that's a tale as old as time. It's a tale as old as rocket fuel. I'm not making a comparison. But public markets have never really appreciated ad tech and some of the reasons why are valid.

14:04I mean, Luma, they're the ones that advised Apple on this deal. They had Parion at roughly like$390,$391 million market cap at the end of September, but only at like$124 million enterprise value. So a big chunk of what the stock was worth was cash. And the operating business traded at like 0.6 revenue. And a public-added company actually typically trades at 2.4 times. So, Apple isn't paying much more than what the market already thought Perrion was worth. Is Perrion going private now? I mean, I guess, right? I mean, it'll be nested. No, Apple is a public company. Oh, not Apple. Sorry. You said Perrion, right?

14:47Yeah, yeah, Perrion. Apple is a public company. So, it's going to be like it's nested within Apple. And maybe, you know, they'll report something related to Perrion. But we're not going to get Perion stock updates anymore. They won't have a stock. Right. So, James, switching to the core acquisition of Zenlytics, relatively smaller deal compared to some of these other deals we're going to be discussing today. But I was just curious, anything there that speaks to any larger industry trends worth pointing out? I mean, certainly the consolidation of all these startups that are sort of agentic, you know, something or other data infrastructure, marketing, technology, you know, sort of somewhere between like subscription software and sort of like usage based AI services.

15:38um i think you know i think i think it's it's interesting it was it was uh sort of the first call where i was you know talking about like court like cord has its own agent which they call cord and zenlytic has its agent which they call you know which they anthropomorphize as zoe and it's like oh like zoe put our like cord agent out of work and you know we'll see how like zoe works with like are this rough out there for an ai agent it's like oh geez like these agents are putting each other out of work yeah um um i i i don't think it's you know it's definitely not on this kind of like macro scale i wouldn't you know make any like sweeping conclusions based off of it um but but yeah it was a it was an interesting deal um from a couple of companies that you know each of whom have been around i don't know five or six years so they sort of were before this like LLM revolution um have you know pivoted cord was a a different back then headless commerce was like the trendy term i don't even know if that you know that's like a real like d2c e-com shopify industry thing not necessarily programmatic one that hasn't maybe caught on yet yeah oh now it's and now it's done that was just like a year or two shopify updated its own like performance issues and then the whole headless thing became unnecessary.

17:02So now, yeah, they're all agentic commerce. So, yeah, that was an interesting one. We'll see where that ends up, too. What's funny is you can't use these agents as your therapist. I thought that was a funny point in your story. I'm asking that to everybody who talks about their enterprise, B2B, whatever agent. I'm just like, because he mentioned, too, a stat they all seem to bring up is engagement per minute or like how often they get a prompt or, you know, per day or something. And I'm always like, yeah, like what happens, you know, somebody is just like, oh, what's the closest McDonald's? Or like, you know, how do I, oh, like how do I spin this to the CFO?

17:42Like how do, it's like, oh, like you should be asking that question. Or just asking some like random, just like, oh, like I, you know, I can use your tokens instead of mine kind of question. Yeah, just for people I'm going to interview. know about that definitely want to keep in keep in mind uh and then you know when we're thinking about both of these like these recent deals they land after some other you know major blockbuster deals like uh stagwell freestar uh doordash instacart uh nielsen double verify pugilis's live ramp were really big ones um so let's kind of zoom out for a little bit is you know it feels like this is officially a wave so can we say that and are we going to see more edtech m &a in the short term or does last night's blue wave put the kibosh on all that?

18:29So it is a blue wave, but I think the M &A is more like a drumbeat than a wave necessarily. So I was looking at Luma's market report for Q3. They put it out every quarter. They track trends for M &A across AdTech and Martech. There were 101 deals across digital media and Martech in Q3, which is down 8 % from a year ago. And ad tech deal volume, like specifically, is basically steady year over year, way up from 2023. But like to say it's steady doesn't really tell the whole story because there are fewer big deals, like only nine over 100 million so far this year versus 14 at this point this year.

19:13And the big ones are like, whoa, things like Nielsen buying Double Verify for 2.15 billion like publis is buying live ram for 2.2 billion and those are really notable and kind of feel like outliers so like we were saying before i think some of the push is coming from the public markets plenty of names are trading like around or under 1x revenue so going private looks pretty attractive and like nova cap took is private right like it's just rough out there so like you know with the whole argument being like you know republicans are more friendly to M &A, got to get those deals in while you can. Does the lame duck period of the next two years for President Trump look like it's still a healthy environment for M &A?

19:58Or is the Democrats having subpoena power and being in control of all these subcommittees, being able to launch investigations into deals? Is that going to put a cramp on the M &A activity? Well, I mean, for the next two years, I guess it's just going to be the same as we've seen. I mean, the scrutiny is here, but in a certain way, like it's showing up as conditions, not blocks. So like the FTC, they put that five year set of neutrality commitments on Publicis and LiveRamp before they approve the deal. So you can't degrade service for customers or rival agencies. You have to put firewalls around different customers' data, regular compliance audits, all of that.

20:38I mean, as for the election, like the people running the agencies, like they don't change with the midterms. But Congress could use its tools in different ways, like hearings and letters and subpoenas and maybe more attention on data, like big data and identity deals. But most ad tech deals are kind of small, like 16 out of the 20 in Q3. And that's just stealing those numbers from Luma. They were under$100 million in this past quarter. So I don't think most of those would draw a second look or even a blink. Do you think there's a chance that some of the deals that have been recently approved get re-evaluated by subcommittees or anything like that?

21:19I mean, I don't feel qualified to say, but why not? Anything could happen. I know there's been a lot of talk about like, you know, investigating these close ties the business community has had to the Trump administration and concerns about potential, you know, what might have been a bribe or what might have been, you know, a contribution to a ballroom that influenced the decision by the FTC or something like that, you know, more to come there. But let's talk about.

21:48Good boy. Yeah, Oliver. He wants to talk about whatever you're about to bring up. Yeah, let's talk about, go back to Publis' live ramp for a minute, because that's kind of the big one that is on a lot of people's minds. The deal just closed. Backlash has shown up fast. We already have like some of our first angry LinkedIn posts coming in. Liquid Death's chief media officer posted that Publis' live ramp, quote, should be worried and that he's first in line to leave. So is he right that brands should be worried about this deal? I mean, I'm sure James has a lot to say, but just to weigh in first, a liquid death rep confirmed that they're planning to move away from live ramp and some follow-up coverage after that LinkedIn post.

22:32And one brand isn't a trend, but WPP, Omnicom, like they've been signaling for a while, for months, that they'd wind down their live ramp use. And I think it's a pretty simple and fair concern. Like, do you want a holding company controlling access to your data and your identity graph when your competitor's data is sitting on the same platform? I mean, Publisys has an answer for that. Like, clients get to keep full ownership of their data and IP. They're not locked into specific tech partners. And there's that whole FTC consent order that we talked about that's meant to preserve LiveRamp's neutrality.

23:06And you've got Arthur Sedun out there pitching it as the third option. something that's not a walled garden or from a walled garden and it's not an expensive custom build but like neutrality is a test and publicist has to to prove itself right james anything to add there um i mean i definitely think it's an opportunity for all the non-live ramps because all the you know everyone is gonna all the big brand marketers like their clients are going to be sort of considering it, at least I think, you know, and, and, and they're not all publicist clients, like if you're, if you're working with any of the other hold codes, then you're, you know, your agency account, who's like right in your ear, and a trusted advisor on all of this stuff is not, you know, is clearly going to want to go a different way, pretty clear incentive for them.

24:02So, so yeah, I mean, it definitely wouldn't surprise me, And it's also not like that's kind of fine from publicist's perspective. Like LiveRamp is sort of now a tool for their for their customers. You know, it's part of like the publicist stack. And so, you know, they've got that that's enough for them to work with. Like they don't need necessarily for like LiveRamp to be in the market doing its own thing. You know, we've heard this too, like after they bought like citrus ad and all. it's like okay so you you shed some business it's an opportunity elsewhere but it's not a big problem for publicists because they bought you to use for their clients um so so yeah it doesn't it really wouldn't surprise me and we have heard for a long time like live ramp is very expensive um they really do work up like they're very high up mark you know fortune 1000 kind of companies um so so yeah those brands move slowly we'll see how those accounts move if they do um but there certainly will be opportunities for other identity companies fapple doesn't wipe them out first and then uh yeah well said and then as we uh head into the break um any predictions or you know themes uh in mna to watch out for for the rest of the year i mean a few things pop to mind data and measurement, more of that.

25:28Nielsen, Double Verify, Infileon, and Foursquare, which we didn't talk about because buyers want data that they own and that they can prove results with, so outcomes. AI, obviously, but the deals there are also really about data and trust. So Zeta bought Senso and this other company. Senso's tech that helps brands show up in AI answers. PubEx bought Compliant. We covered that. So its agents have quality signals, built-in, cord bots and lytic like we just talked about um to build an agentic cdp whatever that means um yeah and then outcomes instead of channels like we touched on because the open web is not the future like sal tal said um and also like retail media and screens beyond the open web door dash and instacart um we didn't talk about this but national cinemedia the cinema advertising company they They bought Captivate for like a couple hundred million plus.

26:26They run video screens in office and apartment buildings. I mean, if there's a screen or you can put a screen somewhere, there will eventually be advertising on it, which is the only thing certain in this life other than death and taxes. And I think that's a good segue to the inshittification of sports. Yeah, definitely. So, yeah, we'll leave it there. We'll take a quick break. And when we get back, sports inshittification is up next. stay with us.

26:59All right, we're back. Time to talk sports. So what are we all seeing that's pissing us off in sports advertising these days? Allison, why don't you go first? So listeners of this podcast might know that my mother is obsessed with the NBA. I talk about it sometimes her team is the nets for her sins and when we would watch the nets on broadcast television although she recently got rid of her cable package which is a sign like cable is all screwed um we would get these um like the the live in broadcast marketing integration things where it would be like multiple minutes of some guy from fanduel talking about all the parlays and putting up a bunch of numbers on the screen that made literally no sense to me like my mother and i would just immediately we couldn't get to the remote fast enough to mute this yeah and it just it i don't know it just bothered me it was so distracting and i also really dislike the um the little screens you get at the bottom of the screen like the play and play where they're doing some kind of ad or whatever like the dunk of the game or whatnot when there's actually action happening on the court and you can't really see the players are minimized like why why are we doing this we're here to watch a game and i can't see like the game what if someone scores yeah i don't want to watch it and replay well they could show the replay in the lower third and that's true and then maybe like another screen and then another screen and then another tiny screen yeah just a little bit ad infinitum yeah um what about you james what's like you've got a litany of egregious things i I know there's a whole it's really been going on like forever.

28:41I feel like there's definitely is like the NFL red zone, I think is one good example. People have it's this like fan thing people love, particularly for fantasy football. And it's just kind of you don't watch any particular game, but it gives you like streams of games a few minutes at a time. And they sort of show all the the scores, anything like that. So, yeah, and like forever, this whole like literally this opened with like seven hours of commercial free football. And they were really over careful about avoiding marketing. I think that's like sort of the NFL, like giving any of their broadcasters like preferred boosts to promotion.

29:21So like they would care they would cut away before like that game got to an ad. and there's as you ads have started to like penetrate in like it's it's really like you can see how now the fans are furious because the nfl red zone like runs its own ads like they'll actually like cut the commercial break and they'll have like a picture and picture ad playing and you know people hate that they've stopped like saying commercial free whatever um but you can see too how it's like impossible to cut away now because ads will just like like you said it'll drop in like you're watching the replay of a catch and it's like the odds brought to you by like aws and it'll be like the you know the announcers like they have all these like options now we're like in the commentators booth they do it a reading for something or like procter and gamble has some kind of like weird integration that's like it's not an ad it's like during the gameplay they sort of drop in and you know they like you could feel like red zone trying to like figure out how to like cut away from these things and then at some point they're just like nah like we can't like we cannot avoid all the ad like the marketing that has penetrated through the like skin here like and we can't we just can't avoid it not only are we not going to avoid it we're going to start serving ads um so i feel like that's like a really poignant one um i also feel like there's you know a lot of leagues in sports like make decisions that are bad for fans and bad for players like bad for player like they really are knowingly compromising player safety for like a sponsor, like an advertiser's interest.

30:58There's like a, you know, one of the things I bring up that people don't really think about in the U S cause it's not a big thing is like these walls around soccer fields you see all the time. And they are so close to the fields, shockingly close to the fields. And it's because that's how you get the ad. That's how you get the sponsor in the TV broadcast. Like these people aren't buying in stadium signage. Nobody wants that. Like this is an in broadcast constant background. And you can't do that if you push the screens back. And so you just have to accept that like, all right, some people are going to like break their arms.

31:31Like players are going to like, you know, a couple of times in the past year, pro players have broken their necks going head first into those walls. One of them even died, right? Yeah. Yeah. Like a promising young soccer star died, like playing for a pro team. Like, you know, people were hurt in the world cup. Like an English star was forced out of the World Cup. He has surgery on his wrist. Like you can't, you know, people try to jump. You see a lot of players jump and try to like land on it, but they're in like metal tipped cleats and they always just go like skittering off. You know, the U.S.

32:04Open too, like fans were really angry about like, just the sort of like bad vibes and play like talk going over the play. And like, that's a marketing decision actually that the league made to sort of invite influencers and like tell the umps to allow a sort of different level of like ambient noise than they normally would have um i think that's one of the things like players were furious about it like they're used to the umps sort of being like please quiet down and they clearly were not doing that can't get awarded because james is on a roll well i mean yeah this is it's just a litany of things but like even just on that last point like we're seeing the same kind of thing with the influencer play in uh in professional golf lately too where like you know like golf is trying to court the young crowd they're getting more involved with like these like influencers and you know golf youtubers and stuff like that and it ends up you know getting to the point where like you know rory's being harassed at like you know like tournaments and different things like that so it's just like like what are we even doing you know and like yeah i think like a lot of like the the marketing itself is just kind of just like brain dead and just like disappointing in that way like the the thing i was gonna point to is just like how stupid some of like the the actual just like pitches to fans feel like when i was watching the nba playoffs for the next like you know championship run i like i just kept seeing the same stupid draft kings commercial where it's like draft kings lets you get into the game at the speed of sports and i'm just like what are you talking about what does any of that mean like can you not like speak like a human like this is sports like it's supposed to be relatable stuff you know like i just don't get it but yeah like you know i obviously there's like a lot of these things that would like contribute to like why you wanted to write this column uh on the intitification of sports here james but like you know what was there anything in particular like you know was it maybe like the recent influx of like gambling ads or just like you know was it like a confluence of all these different things i feel like it was definitely just things you know adding up across sports over time i have been like angry for a while about like i feel like you know leagues and broadcasters just kind of like failing on sort of oh like almost like the sort of sacred obligation of having these sports like you know the way the nbc used to think of like having the olympics as you know not just like a prize not just like a captive audience or something but as this like obligation it was like this right you had to uphold responsibility yeah um and i feel like that's i mean just clearly like totally toast like oh like you know comcast we're just like, oh, we own the Premier League and we'll make a decision that's bad for the Premier League if it's like good for selling Peacock subscriptions or something like that.

34:44And yeah, you know, it's just it's also like like college sports, like, oh, I have kids are going to be coming up and, you know, all these problems with like, not just like the private equity of vacation of kids sports or getting more expensive and all that. But but also like as you go up, you know, all these states have huge funds now for attracting high schoolers, like teen players, because now there's like NIL laws, like that's all marketing. And these are, you know, funds that they, you can't just say like, oh, I'm going to pay you$15 million, like star quarterback, come to the University of Texas.

35:20But you can say like, come to the University of Texas, we have a$150 million NIL marketing fund, and we are going to guarantee you $15 million in marketing from this fund. You can't just pay them, but you can promise them ad dollars. You could give them a part of your marketing revenue, which you know you're going to spend. That's huge. These states and schools have$100 million funds now, some of them, for that. This is a whole thing that society is not prepared for, how these schools are going to put that to you, attracting and retaining 15, 16, 17, 18 year olds. Luckily, we don't live in a society, so it's fine.

36:04Yeah. So I don't want to wrap this podcast up without giving like, you know, the gambling ads. So like much has been said about the influx of gambling ads since the Supreme Court gutted sports betting laws. I think it was back in 2018. For example, there was this study from last year that found NHL fans see a gambling company logo every 13 seconds when watching a game. Now we've got prediction markets like Calci and Polymarket getting into the mix. And competition for attention between sportsbooks and prediction markets could lead to$7 billion being spent on betting ads next year, according to Fnatic CEO Michael Rubin.

36:41so like you know we're looking at all these things and then like you know at the same time like we have like all the major leagues like partnered with like these like sports books and like prediction markets and then at the same time they're turning around and going to congress and lobbying congress to crack down on betting apps that you know don't take action against users that harass players who like you know cause like a bet to not hit or like whatever the case maybe so like you know we're hearing like all these reports of like pro pro players getting like harassed getting death threats their families are getting threats and as a result we've got this big lobbying push is this lobbying push now just like kind of like a part of the cost of doing business with these like these gambling companies is that how like these leagues are seeing it they probably don't even see it as like you know directly related like okay they sign a marketing deal like they all have them like you said now our strategic partner is like vanduels or draft king or fanatics or whatever um but you know like oh like how is that related to the fact that like our you know pitchers are being like horribly harassed and you know the u.s open golf had like a big problem this past year because the champion was being just absolutely like bombarded like you mentioned the rory mcelroy ones which were sort of like i don't know like go google it but it was like really gross and over the top yeah kind of like you know xenophobic vitriol whereas this was like towards a you an american and was much more kind of like about like betting like people out with their like phones and you know trying to throw them off and stuff so so yeah like this is definitely something that's just happening it does really you know disappoint me like i see like lebron signed a big deal with polymarket and it's like oh like you really needed that like what you know 30 40 50 million dollars like whatever they're giving like you know you're like bankrupting some of your fans i like it's um i feel like you know david stern old nba commissioner that's my boy he would never he would never have stood for it like david stern like come on like that's what i want to go tell like adam silver current nba commissioner and gary bettman nhl commissioner old like you know they're like protégés of his of david stern's and like you know i feel like they know in their hearts they should never have crossed this rubicon like i feel like all the leagues regret it that they sort of opened it they let the fox into the coop or whatever um yeah huge mistake and hopefully they all sort of cut back on those and it's not just the gambling companies like as you also point out like it feels like these like major leagues have been like you know opening their ad inventory to just like some so many just like low-hanging fruit kind of advertisers like you know like Now it's the gambling companies.

39:19A couple of years ago was the crypto exchanges. We're also seeing more of these GLP-1 ads in there. And you raised the point where it's just like, can they not get more ads from the McDonald's or the Cokes or the Pepsi's of the world? What's going on? This is sports. It's like it is. Yeah, it is. It does feel like it calls into judgment, though, like, you know, if you look through the past five or six years of who have been who's run the Super Bowl, it's, you know, there's FTX did a big push. timu big push timu ran like you know i don't know 10 12 ads in the super bowl over the course of a couple years ftx like another crypto exchange that just got like hammered and the celebrities that were involved got sued for sort of like promoting these things that turned out to be like larry david yeah like ftx they became like stadium sponsors of course now we have a streaming series about about him yeah right and freed we've reached that point of course because that's a whole genre I mean, I think all these companies realize the affection and legitimacy that being a sports sponsor bestows on them.

40:30And like we said before, these leagues are not doing a good job of holding themselves to a line of decency or something. Even if Timu is willing to pay more and fill six spots, it is worth it. Like you can go find better advertisers to fill those spots, even if they maybe pay a little less or something. Like it's going to be better for the NFL in the long run. I promise you. If your ads are not just like GLP one, you know, crypto ad, like all just like cynical ads, Timu ads, like something else. And it's, you know, it's not like a beloved consumer brand. Yeah. So it's like, yeah, it's not just LeBron, like, you know, signing these like baffling, like marketing deals.

41:13It's also it's these major pro sports leagues and major broadcasters that are just like, you know, maybe selling their their reputation a little bit too short. And it just feels like across the board, the concept of selling out just feels dead. Yeah. If you watch international soccer, too, like there's a lot of Jersey patch sponsors and they're always, you know, it's not like American brands there. Like if you're watching, you know, the German league, like they have, you know, Eastern kind of sponsors you haven't heard of, North African sponsors. but it's all like bizarro betting companies, like some random like betting app.

41:49It's all gambling. It's like, uh, like the other ones paying. Yeah. The other ones paying. Well, at least we don't have to worry about the political ads during sports anymore, at least for the next couple of years, uh, or a year and a half as it were. But yeah, we'll leave it there. Thanks so much everybody for, for listening. And, uh, we'll see you next week on the big story.

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