U.S. sports leagues eye digital for growth

By Ben Klayman

NEW YORK (Reuters) - The major U.S. professional sports leagues are looking to their digital assets, especially Web sites and television networks, to drive growth.

However, the commissioners of the National Football League, Major League Baseball and the National Basketball Association outlined different approaches at the Reuters Media Summit in New York this week.

The NFL emphasized expansion of its TV channel, while baseball is putting off establishing a cable channel to focus on digital media. The NBA is exploring partnering with a media company to drive growth in its digital media business or to build its presence in China.

"Each has to develop its own distribution and exploitation plan," said Neal Pilson, former head of CBS Sports and head of New York-based sports consulting firm Pilson Communications. "Each sport wants to build with its low-hanging fruit."

The leagues boast billion-dollar TV deals, with the NFL alone pulling in $3.7 billion a year, but are in the early stages of tapping into the Internet to build name recognition and profits. While international growth is another focus, the return on league TV networks and Web sites will be faster.

"Building the brand is important," said David Carter, executive director of the USC Sports Business Institute. "You can't expect people to consistently spend money on your product unless they believe in your brand."

The NFL Network already sports 41 million subscribers even though it does not have distribution deals with three of the largest cable providers. NFL Commissioner Roger Goodell told the summit the league has plans next year to top 50 million or even 60 million subscribers.

Some analysts say the network could one day challenge Walt Disney Co.'s sports cable channel ESPN. The league says its network's viewer base at three years is comparable to what ESPN, Viacom Inc.'s MTV and Comcast's Corp.'s Golf Channel had at six years.  Continued...