NBA Teaming With Intel on Net Venture

The NBA on Wednesday unveiled a partnership with Intel Corp. that’s designed to sate the growing online appetite among fans who aren’t getting enough dunks, drives and foul shots from the league’s televised games. The NBA’s planned pay-for-play service eventually will give fans access to live video, streaming statistics and the league’s vast archives through their computers, hand-held devices and television set-tops.

The NBA is taking a 10% equity position in Convera Corp., a joint venture being formed by Intel and Vienna, Va.-based Excalibur Technologies to serve sports and entertainment ventures that want to sell their content online. Convera will develop technology needed to digitize content as well as safeguard copyrighted material to be sold online.

The alliance is an outgrowth of NBA Commissioner David Stern’s ongoing push to make NBA content available worldwide. “You imagine it and we’ll deliver it,” Stern said. Fans eventually will be able to “produce his or her own game feed from multiple cameras,” Stern said. “And they’ll be able to drill down and get anything from the [league] archives.”

Stern described the venture as augmenting broadcast arrangements with NBC, Turner Broadcasting and local league broadcast affiliates. But Internet analysts said the league’s game plan as part of a growing move by sports leagues to deal directly with sports-hungry consumers.

“Sports leagues see great opportunities in online ventures, and this ultimately will lead to broadband, online presentation of sports content by the leagues themselves,” said Eric Scheirer, a technology analyst with Forrester Research. “And it’s proof that the NBA continues to lead in the ways that sports leagues can use new media to enhance their brands.”

T.S. Kelly, director of Interactive Media Strategies for Nielsen/NetRatings Inc., said the NBA strategy is distinctly different from the International Olympic Committee, which refused to let other online sites have access to audio and video feeds from the Sydney Games. “That organization has a 19th century leadership running what should be a 21st century organization,” Kelly said. “The key is now to get as much of your content out before as many people as possible through as many avenues as possible.”

Stern clearly hopes fans will flock to NBA.com, Lakers.com and other league sites for their basketball fix. But he’s also content to sell NBA’s game footage, statistics--and video from the league’s extensive vaults--through other Web sites.

Broadcast partners won’t necessarily be shut out of the online action, Scheirer said: “Nobody is in a better position than NBC right now as far as being a destination where fans go to get the NBA. But it’s up to NBC to move aggressively [online] or wait for somebody else to go do it.”

The NBA’s deal underscores the growing importance of online revenue for sports organizations. Stern noted earlier this year that the 1999 network television contract, valued at $225 million, grew out of a 1979 contract valued at just $400,000. Although online activity now generates a trickle of the NBA’s overall revenue, Forrester predicts the Internet will account for 15% of revenue by 2004.

The NBA isn’t alone in courting the 25% of North American households with members who go online for sports information. Traffic at NFL.com, for example, spiked by 46% when the football league opened its regular season Sept. 3.

Fans want more pre-game, game day and post-game news and information, Kelly said, and as technology advances, they’ll be swamped with alternatives. “Maybe you want to buy the ‘standing room only’ package for $3, or the seat on the 50-yard line for $50,” Kelly said. “You’ll choose which commentary you want, which statistics and which video feed.”

Intel executives believe that technology being developed by Convera will have widespread appeal in Hollywood among companies with huge film archives. “If you’ve got high-value assets in the form of video or audio--say, old movies--you’ll want to get them on the Internet,” said Intel spokesman Bill Calder. “But it requires digitization of the files, making the searchable and retrievable. And then you have to protect your content. That’s where Intel’s technology comes in.”

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Sports on the Net

The NFL and NBA are most successful in keeping Internet viewers interested. Here’s a look at how three major sports fared online during months when they competed head-to-head.

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Visitors No. of page Time per Month (in millions) views (in millions) visitor NFL.com Sept. ’99 2.43 62.92 26:28 Oct. ’99 2.41 89.11 26:28 Nov. ’99 2.45 76.65 27:37 NBA.com Sept. ’99 0.38 2.61 7:26 Oct. ’99 0.63 8.74 10:12 Nov. ’99 1.10 25.56 16:00 MajorLeagueBaseball.com Sept. ’99 0.80 14.55 13:13 Oct. ’99 1.13 12.78 7:02 Nov. ’99 0.35 3.30 5:02

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Sources: Nielsen/NetRatings