The USC Marshall Sports Business Institute (SBI), in conjunction with the Los Angeles Lakers and the Los Angeles Clippers, held the most recent installment in its “Business of Sports” series over breakfast on the morning of February 14th. The event, titled “The Business of the NBA,” was held in the Founders’ Room at USC’s Galen Center. SBI Executive Director David Carter moderated the discussion featuring NBA Deputy Commissioner & COO Mark Tatum, as well as the NBA’s EVP of Digital Media, Melissa Rosenthal Brenner.
The event was an interesting look at how the NBA has grown internationally, approaches digital media, and takes on topics such as gambling and eSports. Tatum and Rosenthal Brenner laid out how it’s been possible for the league to have success in such challenging and rapidly evolving times.
According to both Tatum and Rosenthal Brenner, the strong working relationship between the NBA, its owners, and players has been at the forefront of their success. Whenever things arise, there’s an open dialogue that helps the league navigate issues that might otherwise create friction. The partnership approach highlighted by Tatum and Rosenthal Brenner isn’t necessarily unique, but it has served to set the NBA apart when it comes to player-league relations.
Because of this, the NBA is able to execute on myriad new initiatives, most notably using digital to leverage their connection with the NBA fan base, whether they consume NBA product in the U.S. or abroad. Advanced analytics also provide the opportunity to hyper-target the league’s digital content to engaged fans. To that end, Rosenthal Brenner discussed how data and analytics have helped the league grow and continue to find new fans throughout the globe.
The NBA knows that the domestic audience is important, but also has an eye on international markets. Tatum reinforced the importance of China as a global market, but also stressed the importance of expanding into India. The NBA now has grassroots programs looking to build the game in the world’s second most highly populated country. Other Asian markets are extremely important and the Philippines was one that was signaled out as a great growth market for the NBA.
Rosenthal Brenner and Tatum also discussed working with startups and newer technologies. Key to the league’s reputation as being at the forefront of innovation is its open door policy. Rosenthal Brenner conveyed to the audience that she is willing to take any meeting about new products and technology that could be beneficial to the league. She and Tatum both recognized that a company with the next “big thing” could contact them at any moment. It’s this openness that has allowed the NBA to create strong and beneficial partnerships with companies both in the United States and abroad.
Also addressed was the issue of legalized sports gambling. The NBA has been at the forefront of this movement, and Tatum explained that the league knows that fans are more engaged with the game when they are able to wager on not only the outcome, but fun side-bets as well. The NBA wants everything to be transparent and out in the open as doing so will assuage the concerns of its many stakeholders. Currently, there are billions of dollars flowing illegally through the system. Legalized gambling hinders that, and the NBA wants to help make sure that nothing illicit is going on as any nefarious activity would harm not only the NBA’s brand, but also those that conduct business with it. Tatum also addressed the one percent fee that the NBA is reportedly seeking when it comes to sports gambling. Those revenues would be put toward ensuring the integrity of the game, as well as shared with ownership and the players.
Overall, the event was extremely insightful. There aren’t many situations where leagues allow their decision makers to answer questions in such an open forum. The crowd appreciated that NBA leadership is focused on continuing their growth through the leveraging of new technologies and working with their players to increase the popularity of the game.