By Irwin A. Kishner, Esq.
The song “Take Me Out to the Ball Game” seems to have become an anachronism today as the in-stadium experience is failing to captivate sports fans like it once did. In response, there has recently been a trend towards installing Wi-Fi capability in stadiums across the country. This article will discuss this trend within the context of improving fan engagement at stadiums.
Declining Stadium Attendance
The National Football League (“NFL”) generated nearly $10 billion in revenue in 2012, beating out the second-place Major League Baseball by about $2 billion.[3] Despite being America’s most popular sport for forty-seven consecutive years, ticket sales are noticeably down.[4] In fact, four-and-one-half percent fewer fans attended NFL games in 2012 than in the preceding five years.[5]
Notwithstanding this trend, one reason that the NFL remains so profitable is that it derives a substantial amount of its revenue from television. The league’s current broadcast revenue is about $5.1 billion, and is poised to increase to $7.1 billion a year in 2014.[6] Recently, Verizon signed a four-year, one billion dollar deal with the NFL that allows Verizon customers the ability stream all Sunday afternoon and playoff games on their mobile device beginning in 2014.[7] Broadcast contracts have become “the lifeblood’ of team finances.”[8] Each team receives more than double in broadcasting revenue than it makes from ticket sales.[9] The product delivered is remarkably well-made, and viewers have not failed to take notice: the average television rating is up fifteen percent from five years ago, and twenty four out the top twenty five most watched television programs in 2012 were football games, broken only by NBC’s coverage of the Macy’s Thanksgiving Day Parade.[10]
The At-Home Appeal
The prospect of a sixty-inch high-definition television with multiple camera angles, surround-sound, and the RedZone Channel that provides all of the most exciting parts of every game, to name just few advantages of staying at home, has become an increasingly attractive option for football fans. In 1998, ESPN reported that fifty-four percent of its fans would rather watch a game in the stadium than in their homes. Just twelve years later, that number fell to twenty-nine percent.[11] The rise of fantasy sports is in no small part responsible for this dramatic shift in attitude. Once relegated to obscurity, the continued rise in the popularity of fantasy sports has created a fundamentally different sports fan who is more often concerned with the performance of specific players, than with the outcome of a specific game. “Just ask Maurice Jones Drew,” wrote the founder of one sports-information aggregation site, “who created some controversy in 2009 when he took a knee on the goal line and was practically forced to apologize to his fantasy fans.”[12]
This new generation of sports fan has acquired an insatiable thirst for information, one that social media giants like Facebook and Twitter help fuel by providing coveted stats and updates. Whether it is following their favorite athletes on Twitter, checking their fantasy player’s stats, or interacting with their friends on Facebook, fans want to stay connected. More importantly for sports franchises, though, is that this desire to stay connected has become the deciding factor in a fan’s decision attend a game in person. Although the broadcasting deals alone generate more revenue for the NFL than both the National Basketball Association and the National Hockey League generate annually, local fans cannot be ignored.[13]
The Wi-Fi Solution
Recognizing that the steady decline in attendance is problematic, Roger Goodell instructed NFL teams to improve the in-stadium experience by “bringing technology to [their] stadiums [to] make that experience better.”[14] Teams are confronting this challenge by installing Wi-Fi in their stadiums to keep fans connected and engaged.
The New England Patriots were one of the early innovators of utilizing digital media to improve fan engagement, and updated their wireless infrastructure in 2012 by installing a complete Wi-Fi system for all 68,000 fans. In July 2013, the Patriots Game Day Live application will be available to season ticket holders complete with on-demand and live video, and a “new digital landscape” at the stadium that will provide fans with more instant replays, statistics, and fantasy football results. In addition, the Patriots are piloting a program that would allow them to track their fans’ activity and offer more individualized rewards for Game Day application usage within the stadium. Not coincidentally, the Patriots have sold out every home game since 1994, and have 40,000 fans on a paid waiting list for season tickets. [15]
The San Francisco 49ers are getting ready to open their new Levi’s Stadium for the 2014 season. The stadium will cost around $1.3 billion to complete,[16] but will host among some of its perquisites free Wi-Fi for all 75,000 fans and a dedicated fantasy football lounge. The stadium also recently partnered with Yahoo!, making the company the 49ers’ exclusive online sports content, social networking, and photo and video sharing partner to increase fan interaction.[17]
The Barclays Center in Brooklyn, New York sought to foster improved fan experience by making the stadium “one of the most technologically advanced arenas in the world.”[18] The stadium has full Wi-Fi capability designed to support a “packed house full of smartphone- and tablet-wielding fans.”[19] In conjunction with this Wi-Fi technology, both the Barclays Center and the Brooklyn Nets have released mobile applications designed to maximize fan engagement. At the stadium, fans have the ability to use their mobile devices to stream live video and choose from multiple camera angles, watch replays, order food from their seats, and even send a text to the scoreboard.[20]
Verizon has recently installed six hundred 4G antennae in M&T Stadium in Baltimore to keep up with ever increasing data usage demand. Over the next two years, Lincoln Financial Field, home of the Philadelphia Eagles, will undergo a series of revitalizations at an estimated cost of $125 million; among its features: new high-definition video boards, and stadium-wide Wi-Fi installation.[21] In Jacksonville, the Jaguars will be replacing EverBank Field’s two end zone boards with new screens that are nearly a football field in width each. [22] The screens will give the Jaguars five times more video space than their current capacity, and will allow them to distribute content such as the RedZone channel to improve the in-stadium experience.[23]
The importance of Wi-Fi has even trickled down to the college level. The Southeastern Conference’s Working Group on Fan Experience has recommended countering declining attendance by addressing poor reception in many of their stadiums, and installing Wi-Fi at a cost to the conference of around $28 million.[24]
Conclusion
The problem of stadium attendance is pervasive: attendance has been declining across all sports.[25] To reverse this trend, leagues cannot continue to ignore the growing desire amongst fans to stay connected to the internet. The Patriots and the Barclays Center, then, likely represent just the beginning of this trend towards Wi-Fi capability. Full Wi-Fi capability at stadiums satiates this desire, and provides teams with an opportunity to keep fans engaged and motivated to return for the next game.
Irwin A. Kishner, Esq., is chair of the Corporate Department and the sports and entertainment practice group at New York City-based Herrick, Feinstein. He represents a number of major and minor league professional sports franchises, including the New York Yankees, in general corporate matters; the sale, purchase and relocation of franchises; stadium and arena finance and development; media and new media contracts; naming rights and licensing deals; and memorabilia disposition.
[3] See Chris Isadore, Why Football is Still a Money Machine, CNN Money, Feb. 1, 2013, http://money.cnn.com/2013/02/01/news/companies/nfl-money-super-bowl/index.html (last visited July 17, 2013).
[4] See The Harris Poll: NFL Continues 47-Year Run as America’s Most Popular Sport, N.F.L. Comm’ns., http://nflcommunications.com/2013/01/17/the-harris-poll-nfl-continues-47-year-run-as-americas-most-popular-sport/ (last visited July 8, 2013) (according to the Harris Poll, the NFL is more popular than the next three sports combined and has seen a seven percent rise in popularity over the last decade); see also Kevin Clark, Game Changer: NFL Scrambles to Fill Seats, Wall St. J., July 2, 2012, http://online.wsj.com/article/SB10001424052702303561504577495083707417526.html (last visited July 8, 2013).
[5] See Clark, supra note 1.
[6] Curtis Eichelberger, NFL Sees Modest Revenue Growth as Sponsors Stay Shaky on Economy, Bloomberg, Jan. 31, 2013, http://www.bloomberg.com/news/2013-01-30/nfl-sees-modest-revenue-growth-as-sponsors-stay-shaky-on-economy.html (last visited July 8, 2013).
[7] Katie Lobosco, Verizon Inks Deal to Live-Stream Sunday Afternoon NFL Games, CNN Money, June 5, 201, http://money.cnn.com/2013/06/05/technology/mobile/verizon-nfl/index.html (last visited July 8, 2013).
[8] Clark, supra note 1 (quoting Andrew Brandt).
[9] Darren Rovell, Best Seat in the House, ESPN, Nov. 16, 2012, http://espn.go.com/espn/otl/story/_/id/8636927/nfl-taking-note-many-fans-watching-games-tv-beats-going-stadiums (last visited July 8, 2013).
[10] Joe Flint, NFL Dominates TV Ratings, L.A. Times, Dec. 12, 2012, http://articles.latimes.com/2012/dec/12/entertainment/la-et-ct-nfl-ratings-20121212 (last visited July 8, 2013).
[11] See Rovell, supra note 6.
[12] Warren Packard, How Digital Media is Changing the Sports Experience, Mashable, June 17, 2011, http://mashable.com/2011/06/17/digital-media-sports/ (last visited July 8, 2013).
[13] Chris Smith, The NFL’s Most Valuable Fans, Forbes, Sept. 05, 2012, http://www.forbes.com/sites/chrissmith/2012/09/05/the-nfls-most-valuable-fans/ (last visited July 8, 2013) (“Without fans rooting from home, teams don’t get wealthy local radio and television deals . . . the local fans remain a core revenue driver. In fact, the average NFL team generated 43% of team revenue from local sources.”).
[14] Sean Leahy, HD TV and Technology Pit NFL Stadiums vs. Fans’ Living Rooms, USA Today, Sept. 1, 2010 (quoting Roger Goodell).
[15] See Vala Asfhar, NFL is Improving the Fan Experience, and the Patriots are Leading the Way, Huffington Post, June 25, 2013, http://www.huffingtonpost.com/vala-afshar/nfl-is-improving-the-fan_b_3499577.html (last visited July 8, 2013).
[16] Mike Rosenberg, 49ers New Stadium Cost Goes Up Again, Mercury News, June 8, 2013, http://www.mercurynews.com/southbayfootball/ci_23414780/49ers-new-stadium-cost-goes-up-again-1 (last visited July 8, 2013) (reporting that the new cost was not due to “cost overruns” but rather to install new technology features).
[17] Ira Boudway, Why Yahoo! Partnered with the New 49ers’ New Levi’s Stadium, Businessweek, June 18, 2013, http://www.businessweek.com/articles/2013-06-18/why-yahoo-partnered-with-the-49ers-new-levis-stadium (last visited July 8, 2013).
[18] Jeff Zillgitt, Tech at Center of Barclays Complex, USA Today, Sept. 29, 2012, http://www.usatoday.com/story/sports/nba/2012/09/28/barclays-center-to-cater-to-high-tech-fandom/1600169/ (last visited July 8, 2013).
[19] Id.
[20] Katie Linendoll, Brooklyn Nets and Barclays Center Debut New Apps, ESPN, Feb. 25, 2013, http://espn.go.com/blog/playbook/tech/post/_/id/4295/brooklyn-nets-and-barclays-debut-new-apps (last visited July 8, 2013).
[21] Timothy Rapp, Philadephia Eagles Reveal $125 Million Plan for Lincoln Financial Field, Bleacher Rep., June 9, 2013, http://bleacherreport.com/articles/1666955-eagles-reveal-125-million-revitalization-plan-for-lincoln-financial-field (last visited July 8, 2013).
[22] Dan Muret, Video Screens to Give Jags ‘Huge Palette’ For Stadium Content, Sports Bus. J., July 1, 2013, at 14.
[23] See id.
[24] Paul Myerberg, The SEC May Spend Millions So You Can Check Twitter During Games, USA Today, May 28, 2013, http://ftw.usatoday.com/2013/05/the-sec-may-spend-millions-so-you-can-check-twitter-during-games/ (last visited July 8, 2013).
[25] See, e.g., Paul Kennedy, Looking Under the Hood at MLS’s Attendance Decline, May 1, 2013, http://www.socceramerica.com/article/51461/looking-under-the-hood-at-mlss-attendance-decline.html (last visited July 17, 2013).
