Content Streaming and Social Engagement: A Conversation with Greg Butler, CEO of ZuCasa

00;00;06;29 - 00;00;36;27
Mark Conrad
Hello and welcome to the Sports Business Podcast with Prof. C, the podcast that explores the world of professional, collegiate, amateur and Olympic Sports. I’m Mark Conrad or Prof. C from Fordham University's Gabelli School of Business, where I serve as Professor of Law and Ethics and the Director of the Sports Business Initiative, Technology and Sports - can there be one without the other?

00;00;36;28 - 00;01;05;12
Mark Conrad
to paraphrase the old Sinatra song. Throughout the last century, sports has utilized present and new technologies as a way to draw fans and to monetize the product. From the early days of radio, to over the air television, then to cable, then digital, and now streaming, teams and leagues have had a symbiotic relationship to their media delivery systems to find and keep their audiences.

00;01;05;14 - 00;01;34;27
Mark Conrad
Today, we are in the midst of a technological transformation, as the traditional over the air and cable methods are giving way to the streaming universe. How will this affect the viewer? How will it affect the economics of sports? Will social media change and continue to be a large part of the media universe? With me to answer these and other questions is Greg Butler, the CEO of ZuCasa.

00;01;34;29 - 00;02;03;14
Mark Conrad
Greg came from a music background and before moving into technology, worked in the music industry, in record and TV production and then transitioned into computers and technology. He has led multiple startups in the U.S. and the European Union. He founded ZuCasa, a company that provides video streaming and social engagement solutions in the OTT gaming and medical space.

00;02;03;17 - 00;02;16;00
Mark Conrad
As an interesting bit of background. Greg's rock band opened up for Duran Duran. Greg, welcome to the Sports Business Podcast. And tell me, what was it like to open for Duran Duran?

00;02;16;03 - 00;02;51;27
Gregory Butler
Well, thanks, Mark, for having me on. And one of the weirdest things about the Duran situation is that it was actually 30 years ago last month that that tour started. And, you know, it's always funny because it was really at the very beginning of my career, but it did give me one of my most memorable moments because at when we played Wembley Arena before the show starts, all of the staff in their uniforms cover the entire floor and it looks like a military gathering.

00;02;52;00 - 00;03;13;14
Gregory Butler
And I was up on stage doing the soundcheck, and Simon LeBon walked in front of me, turned and saluted and then walked away. And it really just kind of changed my whole mood because I realized how absurd the whole thing was instead of being really tight about, you know, playing in front of a bunch of people and all that.

00;03;13;19 - 00;03;21;18
Gregory Butler
It was a really fun experience. And I'm I'm grateful for having that be part of my life.

00;03;21;20 - 00;03;31;21
Mark Conrad
And certainly you remember it 30 years later. So now moving to the present, can you describe what ZuCasa does and what is the sports connection?

00;03;31;23 - 00;03;56;08
Gregory Butler
Sure. At the heart of what we do is we have a compression called EVE that reduces video file size by two thirds without needing new codecs or anything like that. So it's pretty revolutionary. It's a proprietary thing for us and it allows us to, you know, in making the file size smaller, to reach a lot more people at a lower cost.

00;03;56;08 - 00;04;21;27
Gregory Butler
And then also we can do true watch parties so we can have, you know, ten people with audio and video in HD watching, you know, an HD broadcast at about again, about one third the size of just watching a movie on something like Netflix or Apple or something like that. Where that applies to sports, of course, is that it's the watching sports is a very communal activity, as we know.

00;04;21;27 - 00;04;56;26
Gregory Butler
And we’re recording this right before the Super Bowl. People get together, people like to watch sports together. So our ability to provide a watch party, although it applies to many areas, the sports side of it is has been very popular both in Esports and more traditional sports. In fact, our biggest accomplishment to date as a company is that we partnered with Zee Entertainment in India for the ILT20 cricket tournaments, allowing you know, viewers in India to be able to watch cricket on their phones or on their televisions or computers at a distance,

00;04;56;26 - 00;05;11;11
Gregory Butler
but together. And as you may know, you know, India, although it has, you know, good bandwidth in some areas, it's not quite as developed as other network. So the fact that we can do this in India is a pretty big deal.

00;05;11;13 - 00;05;33;09
Mark Conrad
Great, and it, you know, when you talk about this idea about watch parties and basically streaming issues and connectivity issues, we know that the sports industry is going through many changes in a landscape that opens opportunities, but it also poses challenges. What do you think are the major opportunities for technology companies in sports right now?

00;05;33;11 - 00;06;08;07
Gregory Butler
Well, I think, you know, when it comes to sports opportunities, it's the fact that there are so many sports at so many levels that didn't have exposure before. And we've seen of course, and I think maybe accelerated over the last five years, you know, seeing different kinds of sports and obviously ESPN and many of the other sports broadcaster started doing sports that maybe weren't the, you know, first tier NFL NBA or, you know, Premier League soccer.

00;06;08;10 - 00;06;30;15
Gregory Butler
So you see more people being able to enjoy more diverse sports and where the technology portion of that comes in and not to be so specific to software technology, but the simple fact that the technology is good enough to broadcast from just about anywhere to capture these sports at a high enough quality that then they can be spread with other people.

00;06;30;15 - 00;06;59;08
Gregory Butler
I mean, we're having conversations about everything from, you know, drone racing to high school football for the use of our technology, speaking with, you know, groups in countries all over the world. So I think the opportunity is to be able to deliver sports that may not have gotten a chance to fans that already exist. You know, if you've got, you know, 8 billion people on the planet, you don't need 8 billion people to watch it.

00;06;59;08 - 00;07;09;23
Gregory Butler
You just need to have enough people that it makes sense and that's it. You know, on whatever metric that may be for the people who are capturing it.

00;07;09;26 - 00;07;14;10
Mark Conrad
What do you think are some of the rising new sports that could take advantage over this?

00;07;14;12 - 00;07;40;25
Gregory Butler
That's a great question. And you know, I guess, you know, one thing you could look at, I haven't played it. We all know it's taken over the mind share. But you know, pickleball I've noticed that, you know, there are now former pro tennis players doing tournaments. We've seen, you know, the big three basketball, you know, that started I think that you're just going to see lots of new sports as part of it.

00;07;40;27 - 00;08;13;26
Gregory Butler
And then if you know, you're talking about traditional, I think that maybe is more regional, but you'll see, you know, maybe sports that are popular in one section of the world coming to another country. And again now, you know, cricket, which is enormous in India really doesn't have much of a foothold in the U.S.. The tournament that we're helping to broadcast is a shortened version of cricket, because I'll be honest, I lived in England for quite a while and, you know, watching a sport that the game has played for multiple days is probably challenging for Americans.

00;08;13;28 - 00;08;39;12
Gregory Butler
But the ILT20 is a version of cricket that's only two or three hours, you know. So I think you're just going to see lots of modifications. I think you're going to see new sports developing. Come back to even when I lived in England, I used to watch Sumo Wrestling and Australian Rules Football because those were things that were broadcast there that you wouldn't see in the U.S.. And I think that it's just going to be more of that, more of things moving around.

00;08;39;14 - 00;08;42;24
Mark Conrad
And what do you think are the major challenges?

00;08;42;27 - 00;09;08;15
Gregory Butler
Well, you know, part of the problem, which, you know, we all have seen in within the growth and expansion of of everything from cable to streaming is that there's too much content. So how do you find the content that you want at the quality you want? And then for those who are streaming that content, how do you kind of manage this content in a way that is, you know, kind of best practices?

00;09;08;18 - 00;09;30;14
Gregory Butler
Obviously, there's also the licensing and payment aspect of it. So I think that there are a lot of challenges within this, but they’re more business challenges. I think what we - where we are is that the technology challenge is starting to fade away again. I would hope to think we're part of that solution, you know, and it's not gone.

00;09;30;14 - 00;09;40;07
Gregory Butler
Things will keep changing and growing, but I think they're more business challenges than they are technology based. And when I say business of course from your perspective, that's also legal, right?

00;09;40;11 - 00;09;58;27
Mark Conrad
Indeed it is. So when you back to the point about content, hasn't the history of [...] dissemination of sports, whether it's even on cable or stream, been not enough content that channels are desperate for content. So when you say there's too much content, I wonder how you come up with that conclusion.

00;09;59;00 - 00;10;23;05
Gregory Butler
Because we have to look at it through a few different lenses. There's not too much content if you're a person sitting there who wants to watch, you know, this game that might be happening in Sri Lanka and there happens to be someone streaming it on their, you know, Facebook Live channel. Okay. So there can never be enough content because somebody is watching it on that side.

00;10;23;09 - 00;10;49;19
Gregory Butler
But from a business perspective, it is an enormous challenge because if you are the one trying to stream that content out, you have to reach an audience, you have to monetize that audience. You have to you have to navigate so many things and you can reach a point where, look, I mean, this is, you know, this will go into more of my music and television side of this,

00;10;49;19 - 00;11;15;00
Gregory Butler
but the the ultimate challenge that has come up is we thought technology or at least the the story that was pitched about it, was that it was going to increase the size of the middle class of four creatives. Right. More people would have access. There would be more ways to have a distribution of funding that could reach lots of people.

00;11;15;02 - 00;11;42;13
Gregory Butler
But what actually happened was there was so much content that the the public is gravitating towards the biggest thing and what it's kind of destroyed the middle class. And I could see the same thing happening within sports. It's a little different, but it's not too far off, you know. So you have again, let's go back to the NFL's the Premier League's the things like that, you know, they're going to be giant behemoths that are moving around.

00;11;42;16 - 00;11;55;25
Gregory Butler
But how do you ultimately find and keep an audience when there's so much content and they're so rabid for that content that you can't create the consistency that is required to build a business?

00;11;55;27 - 00;12;21;07
Mark Conrad
And do you note that at this time, this issue of streaming in the last decade, it's become more ubiquitous both in the US domestic sports side and in international sports, as certainly you're doing, and streaming rights have challenged the more traditionally dominant cable TV structure, which has suffered consistent loss of subscribers. Do you think this trend is going to continue?

00;12;21;09 - 00;12;52;23
Gregory Butler
Yes, you know, but I also think that, like it's just a shift in model, you know, just as there have been shifts and models going along, I think it's very easy. And, you know, not to spend too much going back to my music days, but I was on the front line of that shift, you know, of watching people transition from purchasing a physical item that we had all become very used to in a business model we had all become very used to, and it really shifted truly overnight.

00;12;52;25 - 00;13;14;21
Gregory Butler
And you can see it now developing into a new model. It doesn't look financially like the old model, but it is a thing. And you could argue that prior to that. And this also equates to sports. There was no model at all. It was just something you did. You know, and it may have been a profession or it may not.

00;13;14;23 - 00;13;36;16
Gregory Butler
So I think we're we're seeing this movement away from the big dollars of cable TV when things could be kind of again managed, restricted. And if I look at it, you know, through the eyes of a of a lawyer, it was a golden age of being able to control IP and copyright because you only had so many means of distribution available to you.

00;13;36;18 - 00;13;58;25
Gregory Butler
And now as sports moves out into as everything that has to do with content moves out into a much more challenging space when it comes to copyright and containment, you know, the end user wants the content. It's not about the means of distribution. They're just going to go to the place that it is easiest and best to get it and that's it.

00;13;58;28 - 00;14;02;06
Gregory Butler
So there's no choice. But it took for it to move.

00;14;02;09 - 00;14;15;27
Mark Conrad
But do you find that copyright holders are going to start pushing back and seeking more enforcement in a situation where maybe they think it's more of a wild west of copyright distribute, of copyrightable material distribution?

00;14;16;00 - 00;14;46;24
Gregory Butler
Yes, but where the issues are there is that trying to hold on to a model that because it's how it worked before and how you made your money, is to ignore what is actually happening. And you can only do that for as long as people care about what the product is. I can go on at any time and find any NFL game streaming online for free.

00;14;46;27 - 00;15;10;22
Gregory Butler
The quality won't be there right now, but it will. You know, people are always working to find their way around it. And I'm not saying they should. I'm not saying that's how it should work. But the other portion of that is as new sports take hold, as things grow, you know, the best way to innovate is to be aggressive about how the payment structure works.

00;15;10;22 - 00;15;30;21
Gregory Butler
Right? So you're going to see that coming from the outside, that kind of pressure. And then the other portion of it is if you look at, you know, I'm, you know, based in Los Angeles, but I'm also very specifically a Clipper fan. And you have someone like Steve Ballmer who really wants to push how technology is used with sports.

00;15;30;23 - 00;15;54;29
Gregory Butler
You know, and I say that across the board from the new arena that he's building, to the way he approaches streaming. And I think the only thing holding him back and I say this completely as an outsider just looking at it, is, of course, the rules of engagement. I think if he wasn't beholden to the NBA, you would see incredible innovation coming out from the Clippers side of this.

00;15;55;01 - 00;16;01;23
Gregory Butler
And once things are hit on that people like, that's the direction it moves. You just you cannot hold it back.

00;16;01;26 - 00;16;28;14
Mark Conrad
You know, you raise a really good point and let me throw a hypothetical out to you. You're now the owner of a team in a professional league. And let us assume there is no league wide TV deal. There's no cable deal. In other words, you can be Steve Ballmer and say, hey, I want to utilize technology the way I want to for my team could be, let's say, a soccer team, it could be a badminton team or whatever.

00;16;28;14 - 00;16;46;09
Mark Conrad
So what would you do? You know, you just bought the team, you paid for the team, you have a venue that's state of the art. So tell me, what would you do if you had the fantasy of coming up with a new series of technological distribution issues and methods? What would you do?

00;16;46;12 - 00;17;08;26
Gregory Butler
You know, I have to look at everything through the lens of a fan, and I am a fan as well. And you know what it all comes back to is, is community and the ability to access what I want when I want it. Part of the technology that we've built is based on the idea of being a fan and wanting that.

00;17;08;26 - 00;17;33;12
Gregory Butler
So it would all be about connection with the players and coaches kind of access. You know, I think that a lot more could be done with access in a in a respectful way. And really what I want and I believe this is what almost every fan would want, if not all, is just to be able to watch a sport in the mode that I want it with my friends or family.

00;17;33;14 - 00;17;59;00
Gregory Butler
And that would be my focus. You know, you have the multi-cam stuff, you have these sorts of choices, but it's, you know, we could go as far as looking at VR, which, you know, VR and AR will have their time. You know, right now we're still on the very edge of the beginning of it, even though I think, you know, we're in a cycle where people feel like if something's been around for ten plus years that it's old and it's not, we're just barely touching on it.

00;17;59;02 - 00;18;17;28
Gregory Butler
But I think that that's what it'll be about. I think it'll be, you know, if I could cut past all of it, I want to be on the court. I want to be on the floor. I want to be able to virtually put myself in a game. I want to be able to do all of those things. So if you took off all the barriers, you know, again, I think it can become overwhelming.

00;18;18;01 - 00;18;39;27
Gregory Butler
We're going to cross a lot of lines that will be, I think, confusing for our own brains. But it's about that access. It's just about being in it because at the end of the day, you watch a sport as part of your own, you know, hero's journey, right? It's like this is my army, this is my kingdom, this is this is that thing.

00;18;39;27 - 00;18;56;28
Gregory Butler
That's what you're attaching psychologically to it. And I think the more we pursue that idea of turning ourselves into that, just as we do in a video game where we create a character and and hit the shot, you know, that's that's what this is about. It's it's going to be a blending of worlds.

00;18;57;00 - 00;19;30;00
Mark Conrad
We have a battle going on, if you will, for the future of cable and streaming. And that centers on the Diamond Sports case. And for those of you do not know, Diamond Sports had a series of regional sports networks that covered a lot of baseball, basketball and NHL teams, hockey teams. And it's been in bankruptcy. And the major leagues, at least in baseball, want to take back the broadcast rights that have existed from Diamond and try to take control over those rights like the NFL does.

00;19;30;02 - 00;19;50;01
Mark Conrad
But Amazon is now willing to invest in a reorganized company and the latest is that the settlement seems to be that they will keep a lot of their sports properties, at least for the time being. But do you think that Amazon's investment in the traditional cable firm could lead to greater streaming opportunities?

00;19;50;04 - 00;20;14;24
Gregory Butler
I think that Amazon at the end of the day can do whatever it wants, the same as Apple or Google. And it's, you know, when it comes to streaming opportunities, I mean, the short answer is yes, but the long answer is every decision that is ever made is based more on controlling the IP and the flow of money.

00;20;14;26 - 00;20;40;27
Gregory Butler
So I don't know what the impact is to the end user, you know, and that's that's what it comes back to for me. So yeah, it'll be streaming, but I don't know what that means anymore because everyone, almost everyone is watching something streaming at this juncture, you know, So it's not as much about broadcast versus streaming as it is what you're watching, right?

00;20;41;00 - 00;21;09;07
Gregory Butler
Because am I watching Netflix or do I have, you know, Comcast? But if I have Comcast or Spectrum or what have you, they're also delivering my my Internet. No difference to them. It's just stuff they're shoving down a pipe. So I think we're going to lose this notion of is it linear or not? Because especially when it comes to sports, that that becomes even less relevant because all sports is linear.

00;21;09;14 - 00;21;24;04
Gregory Butler
You know, it's all appointment viewing. If you look at all the statistics on it and it's only obvious people watch it in real time. They're not watching, you know, sports a day later unless they have to.

00;21;24;06 - 00;21;50;04
Mark Conrad
But do you see a day when cable will be extinct and it'll go to à la carte streaming services where people can choose what they want, as opposed to being handed a series of channels which one pays for that one doesn't usually watch, but helps subsidize the sports stream or the sports bundle, because the sports bundle tends to be the most expensive portion of cable TV rights.

00;21;50;06 - 00;21;50;14
Gregory Butler
Well, I

00;21;50;14 - 00;22;02;29
Gregory Butler
don't, I don't know if you saw that. You know, it was announced that I think it's it's all of the majors are, you know, trying to group now to just do a sports streaming. You know. Indeed.

00;22;03;02 - 00;22;04;05
Mark Conrad
I'm going to ask you about that.

00;22;04;05 - 00;22;35;27
Gregory Butler
Yeah. So I think look, I think that's what the end user wants, right? I think that's what the person who's watching wants. They want to pay an amount and just watch what they want to watch When we talk about it in terms of broadcast and streaming, for me, taking the economics and the companies out of the picture in terms of I know that DirectTV wants streaming or, you know, broadcast to continue because that's their business, right?

00;22;36;00 - 00;23;09;17
Gregory Butler
But the real question is, do users want to turn on something, to turn on a device and have a list of things that are playing in real time versus only having a choice of things that they have to select? And it is kind of you know, it goes back to a psychological thing like I've noticed, so you know, like if you you know, Samsung TV, it comes with their Samsungs, you know, kind of linear broadcast is going on in it and that's what turns on when it happens.

00;23;09;20 - 00;23;36;16
Gregory Butler
And I found that I'm a fan of watching Gordon Ramsay tell restaurant owners that their food isn't good. Right? And so when my TV comes on, it's one of his shows and I might sit there and watch for half an hour when I didn't plan on it. And there's a thing about that, of not having to make a choice, that is kind of refreshing because I think everyone can go online and actually get paralysis.

00;23;36;16 - 00;23;56;13
Gregory Butler
It's a known thing that you will spend half an hour clicking through, looking at things to watch and then never end up watching anything. You know, sports has a different dynamic to it because you get an appointment viewing. You know, last night, it's like the Clippers are on. I'm going to put on the Clippers, right? And just watch the game.

00;23;56;16 - 00;24;10;21
Gregory Butler
But in most you know, at the same time too, like that's kind of telling us that we do like just turning on and having something be on. There's plenty of times if, you know, the family's doing something else and I turn on, I just see a game is on, I just watch it just to go see what it's about.

00;24;10;21 - 00;24;38;06
Gregory Butler
And that that linear notion, regardless of who's the one delivering it or how they're delivering it, I think does matter to us. I think it is a thing. So I think it will continue to exist is the long version of that answer. I don't know who's delivering it or if they're delivering it via satellite or this or that, but I think there's something to just turning on and being served content and going, I'm just going to sit here and watch.

00;24;38;08 - 00;25;04;15
Mark Conrad
And with younger people less interested in traditional linear media, do you think that there'll be more of a shift to mobile devices to watch sports? It certainly happens now, but do you think that will become even more dominant simply because smartphones have been part of the, you know, media enterprise for about 15 years and so younger people like my students, use them and almost live with them.

00;25;04;15 - 00;25;09;17
Mark Conrad
So do you think that that's going to be even more dominant, say, in the next decade?

00;25;09;19 - 00;25;33;18
Gregory Butler
Yeah, there's no question. And I think that there's a few things about the technology as well to to look at as it evolves around that. I mean, my 14 year old will sit there studying for school on her iPhone with her computer sitting in front of her unopened. I find it, you know, kind of fascinating because there is it's about like a comfort level where this is what you operate on,

00;25;33;18 - 00;25;54;22
Gregory Butler
right? And so she is more likely, both of my kids are more likely, to watch something on their phones and not necessarily, you know, do a television at the same time. You know, I have a Samsung Fold, which when it's folded out, is basically an iPad mini. And, you know, we see all of these screens that are being developed.

00;25;54;22 - 00;26;19;24
Gregory Butler
There's the roll up screens, the fold up screens. There's plenty of projection bases. And I think that you'll see more of a merger or an adapted version of devices that can give you more real estate to watch on. You know, and again, I'm but obviously, you know, older. So for me it's kind of like I would rather have this large screen.

00;26;19;24 - 00;26;46;09
Gregory Butler
But we also know, too, that these things move back and forth, right? I think we're going to see this weird combination of very small devices, but it wouldn't surprise me as we see the price drop continually on, you know, 100 inch LCDs and stuff. I do think we're going to move towards the future where your wall is just a screen and you walk in and the wall picks up from where your phone left off.

00;26;46;12 - 00;27;03;14
Gregory Butler
I think it's going to be more of a bizarrely seamless. And I say bizarre because you could be looking on a screen that's very small and we're not even touching on the idea of what's going to happen with headsets or glasses. So I just think we're going to have a future where people don't really think about the device that much.

00;27;03;14 - 00;27;06;28
Gregory Butler
I think it's just going to be you're taking in the content.

00;27;07;00 - 00;27;39;02
Mark Conrad
Although if you're on the legal side negotiating rights and in negotiating your real estate that has a value, that side may still be concerned about the various ways you chop up those rights, whether it is going to be over the air or it's going to be cable. I mean, that's what's happening with the whole Diamond Sports issue, that, you know, who's going to control this in the future and how. We also are going to think about and see what the NBA's going to do with their future broadcast rights, because they're negotiating that this year, I believe.

00;27;39;09 - 00;27;57;25
Mark Conrad
And how much of that will be going to stream and how much the Netflix of the world, the Amazons of the world, are going to, the Apples of the world will take heed. Now, on the one issue, though, let's actually talk about, since you brought this up, MLS and Apple - Major League Soccer and Apple - which has a pretty exclusive deal.

00;27;57;27 - 00;28;08;06
Mark Conrad
Isn't that sort of counterintuitive to what you've been saying? Because you really have to have Apple+ to watch most of the games. Well, it doesn't make it that fluid.

00;28;08;08 - 00;28;30;07
Gregory Butler
I think it's it's actually exactly in line with the control of IP, right? I mean, what we're going to see that I think is - I don't know if I'll call it the great unknown, but it's more how the challenge is going to be handled that I still feel is a little unknown - is that the groups that can pay and in some cases overpay.

00;28;30;07 - 00;28;52;24
Gregory Butler
Again, if you look at cricket in India and I think, you know, I know the what's the the NFL, the direct NFL one that YouTube has now - anyway that package, right, where you can get any NFL game. You look at all these things and you say right now major corporations are overpaying for sports because it can be a loss leader.

00;28;52;24 - 00;29;19;22
Gregory Butler
They can look at it and say, well, if you want access to this, we can lose some money on it, right? And that's not what the fan wants. The fan doesn't want it that way. They just want access to it. And Apple, YouTube in India, you know, I'll call out Disney ultimately, but the it's not just them. You know, they're willing to overpay because they're fighting against the broadcast notion.

00;29;19;22 - 00;29;42;24
Gregory Butler
They want subscribers and they're using sports to get it because they know, again, sports is - what do you call it - you know, it is that kind of destination. It's a thing that people have to watch as it's happening. If you love a team, you'll do it. I personally got Hulu specifically to watch the Clippers and then they they lost the rights.

00;29;43;00 - 00;30;01;21
Gregory Butler
So it was immediately like, “oh” and then it's like, okay, well then do I switch to YouTube so that I can then, you know, it's like you will chase your team and that's why they do it. But back to that, that monetary issue, I don't know how much more the NBA can charge. I don't know how much more the NFL can charge.

00;30;01;21 - 00;30;27;19
Gregory Butler
They currently can. But there's a day coming back to your whole point about broadcast. They're able to to do that because there is competition. They're able to do that because they're building a market. We're still in, theoretically, in transition At some point, the ad dollars, the subscription dollars, all of these dollars are not going to add up to being able to overpay for these things.

00;30;27;21 - 00;30;39;01
Gregory Butler
Again, we've seen it in every portion of media and sports, too, will have their day, which is why they're all chasing international so badly. The NFL has to play these games.

00;30;39;04 - 00;31;02;08
Mark Conrad
Well, it's true. One thing, though, that the traditional networks had to deal with was building their audience for programming after the sporting event or before. Yeah, this is why Fox got the NFC in the mid nineties, overpaying from CBS, which had it for many years. And CBS thought like, “Hey, we don't want to lose money on it.” Fox said,

00;31;02;08 - 00;31;18;24
Mark Conrad
“We're willing to lose money on the Sunday afternoons to make us a viable network.” And the other thing was that CBS lost affiliated stations to boot. So many thought that even though it was overpaying, it becomes a subjective definition of what's overpaying.

00;31;18;24 - 00;31;19;08
Gregory Butler
That's right.

00;31;19;14 - 00;31;33;04
Mark Conrad
The speculation is now that the NBA is going to get three times the television deal they just had. So the question is, when are we going to get to the point of no return? And so far we have not at least in the major sports.

00;31;33;10 - 00;32;01;04
Gregory Butler
That's right. Yeah. I don't I think right now sports as a as a general thing is going to benefit greatly from this battle. And this battle is a worldwide battle. It is no longer about, you know, the U.S., Netflix, Prime, Apple+, all of these. They're fighting for the entire planet. And that's a, you know, a very broad reach.

00;32;01;07 - 00;32;26;11
Gregory Butler
You know, but the question becomes at some point, you know, back to, you know, viewership, if cricket doesn't expand where, you know, it's India, England and a little bit else, New Zealand or what have you feel like it's a huge sport, but at some point you have your last viewer. And by the way, you know, you know, let's talk about MLB and their challenges for younger viewership.

00;32;26;13 - 00;32;48;03
Gregory Butler
Not that, you know, other sports don't have it as well, but we know that MLB is is maybe in a more desperate position while they're, you know, giving people, you know, half billion plus dollar contracts. You mentioned younger viewers. It's like how many 18 year olds are turning on their phones to watch the Arizona Diamondbacks? I don't know.

00;32;48;06 - 00;33;08;11
Gregory Butler
I don't think it's, you know, it isn't like, you know, watching the Mets in the fifties when there was, you know, less going on. But nonetheless, you had a very captive audience. So there is a day, there is a day out there. That's all it is. You know, I think we'll still get to see the heyday. We're still going to get a lot of exciting sports and a lot of things happening.

00;33;08;14 - 00;33;13;24
Gregory Butler
But diversification and this this battle will eventually run its course.

00;33;13;26 - 00;33;19;03
Mark Conrad
Now, do you think there are some areas of growth that are untapped in sports media?

00;33;19;06 - 00;33;45;07
Gregory Butler
I think if I roll back this conversation to the AR, VR kind of more tech side of it, I think there's an enormous amount untapped. But, you know, that is also going to take time for that, for both the proliferation of the technology and the, you know, the kind of openness to the the ways the IP is approached.

00;33;45;09 - 00;34;12;18
Gregory Butler
So so it boils down to at the end of the day, the rights holders. I think if the more interested the rights holders are in moving things around, I mean, again, if you had looked at, you know, when Mark Cuban had the Mavs, obviously a much more forward looking owner in the space, you know, again, back to the Ballmer, I mean, people who will look at it in a different way, those are the ones who will push that and find it.

00;34;12;21 - 00;34;41;13
Gregory Butler
I simply don't know what's happening around the edges in sports enough to say, this sport or that sport, as we know, that can also change on a dime by just having the right superstar too. The NBA wasn't the NBA that we know today until Michael Jordan. And you know, and I can love, you know, Bird and Magic dueling and all the greats from the past but he completely changed it from a superstar perspective.

00;34;41;16 - 00;35;07;22
Gregory Butler
And, you know, is there a superstar in some sport? You know, which again, could be MLS, could be anything. They've certainly tried. But it's it's going to be that, you know, could be a dynamic player. You know, I think the WNBA hasn't had its day yet. It's been great to survive through challenges and it's had some superstars. But will it have that player that transforms the game that you just can't ignore?

00;35;07;24 - 00;35;14;06
Gregory Butler
You know, and I think, by the way, I mean, just women's sport in general has enormous growth potential.

00;35;14;09 - 00;35;40;04
Mark Conrad
I was just going to ask you that question. Given the popularity of the National Women's Soccer League, the new rights fee agreement, the cost of new teams coming in, you know, we definitely have that possibility of expansion there as a challenge and interest and people are going to these games. So I think one area to look in the future is indeed going to be on the women's sports side.

00;35;40;06 - 00;36;04;23
Mark Conrad
Yeah, women's golf as well could be, which used to have the deals they were time by deals in many, many respects for the LPGA and that could be changing, too. So there could be some real optimism expanding women's sports and actually, I was curious, moving on, what opportunities are there for those who have tech backgrounds who wish to enter into the sports industry?

00;36;04;26 - 00;36;33;11
Gregory Butler
Look, we can talk about gaming. And by gaming I mean, you know, video games as opposed to betting. You know, there's obviously, again, AR VR. And, you know, one of the things that happens in tech, of course, is rule breaking. Right? So I'm not suggesting rule breaking as much as kind of saying if you have an idea that hasn't been tried or done, I think that's a place if you can code or do that.

00;36;33;11 - 00;37;01;12
Gregory Butler
I think that's a part of the process. I also think that being able to really just dive into how people want to interact with sports and come from from that perspective, from a more standard side of it. Look, I mean, actually being able to capture, stream, move sports around, innovate around, you know, on the Ballmer side, you know, it's it's the camera angles.

00;37;01;14 - 00;37;37;09
Gregory Butler
I mean, is it not Let's put it this way. It is fascinating to me to see the NFL adopting stylistic choices from the Madden game, starting to put bokeh around players so that, you know, you have a focus and using camera angles that are have become popular in video games. And I just think that, you know, as people entering this space or looking for jobs and doing things like that, I, you know, I think it's just about the melding of the technology with the experience is is where the opportunity is.

00;37;37;11 - 00;37;40;29
Mark Conrad
And what future do you see for your firm ZuCasa?

00;37;41;02 - 00;38;14;18
Gregory Butler
Well, if I break it down, it it all comes back to community for us. And, you know, maybe it's it's a it's a buzz word thing, but we love seeing people being able to access video and each other in a way that is different. You know, when we started the company, our kind of thesis was, hey, we've done as a tech society a great job of replicating eyes and ears and a horrible job of replicating the experience of being with other people.

00;38;14;20 - 00;38;46;17
Gregory Butler
So what can we do to improve that? And, you know, we're working very closely with a company called the debut Group Neuroscience Group out of Canada, and we found a lot of common ground with them about how we had been doing this and their research. And what we want to do is look, you know, the compression as a widget, it makes it so that we can reach more people at a lower cost with more stability and have features that others don't have.

00;38;46;17 - 00;39;10;24
Gregory Butler
And we don't do this like we're a platform like Facebook. We provide this as technology to other companies for them to do this. So when I look at our future, I just see us growing that experience and trying to find more ways to deliver a better experience to people. You know, for us older types, you know, it's 3M, it's the old 3M commercial.

00;39;10;27 - 00;39;35;23
Gregory Butler
You know, we don't make the things you use, we make the things you use better, you know, to paraphrase. And that's what we're out there doing. And my hope, especially because, you know, although we're doing business in the U.S. and, you know, North America, whatnot, it's also about, you know, where we're working in India and doing things in Africa and making it so that people can just have this video experience with each other. That's our future.

00;39;35;23 - 00;39;37;13
Gregory Butler
That's what we do.

00;39;37;15 - 00;40;05;25
Mark Conrad
Well, on that note, we do have to come to a close on behalf of Fordham University, the Gabelli School of Business and the Sports Business Initiative. Thanks to Greg Butler for an engaging and informative and clairvoyant discussion on the future of technology, media and sports. And thanks to my producer, Victoria Ilano for her great work. And thanks to all of you for listening in. For the Sports Business Podcast with Prof.

00;40;05;25 - 00;40;11;13
Mark Conrad
C at Fordham's Gabelli School of Business, I’m Mark Conrad. Have a great day.