How is technology changing the game for sports teams and their fans worldwide? On February 21, 2020, experts from across the professional sports world offered rare insights into the innovations transforming their field during a panel discussion at CHM. Panelists Daniel Brusilovsky, director of consumer products and technology for the Golden State Warriors; Tracy Hughes, founder and CEO of Silicon Valley Sports Ventures; Brano Perkovich, chief investment officer for the San Francisco 49ers; and moderator George Foster, Konosuke Matsushita Professor of Management at Stanford University discuss AI, data analytics, esports and more.
From 360-degree cameras that capture every block and dunk to virtual reality software that monitors athletes’ brain performance, the possibilities for sports tech seem nearly endless. Startups like 4DReplay and SyncThink as well as computing giants like Microsoft and Intel work closely with professional sports teams to bring cutting edge tech to pass.
But when entrepreneurs develop technology without understanding the sports world, they are likely to strike out. Brano Perkovich gives the example of a pitch the 49ers received for an algorithm that uses artificial intelligence to analyze data about football players. Though an exciting idea, it failed to acknowledge an important reality of the sport: NFL teams play only 16 games during a regular season, as compared to 82 for the NBA and 162 for the MLB. It would take many seasons of football to collect the tens of millions of data points that a machine learning algorithm would need to be effective. The technology turned out to be a poor fit for the sport.
Just as important as the rules of the game are those that apply off the field, on the business side of sports. Tracy Hughes says entrepreneurs often stumble because they don’t understand the complexity of sports teams’ business models, including the restrictions that venue ownership and tenancy, sponsorship deals and media partnerships can impose. For instance, a technology developed with Verizon cannot be implemented at an AT&T stadium. As Perkovich explains, understanding the sports ecosystem is crucial to successfully developing, selling and implementing a new technology for a sports team.
Brano Perkovich advises entrepreneurs to understand the sports ecosystem.
The most transformative technology for the sports business might be one that many fans take for granted: smartphones. When fans attend a Golden State Warriors game, for example, they can now use the Warriors’ mobile app for almost every transaction: purchasing and managing game tickets, planning transportation to and from the game, pre-ordering food and beverages, and buying Warriors merchandise. The app collects data points about those transactions to gain a comprehensive view of the fan’s experience. The goal? To improve that experience while also increasing team revenue.
As the Warriors have transitioned from tenants at Oakland Arena to the owners of Chase Center and the city block it sits on in San Francisco, called Thrive City, the fan experience has become more trackable and therefore more valuable to them.
Daniel Brusilovsky explains the importance of analyzing and acting on fan data.
The Warriors and the 49ers engage more deeply than ever with the roughly 750,000 fans who fill their arenas each year. But how do they connect to the millions worldwide who might never set foot inside Chase Center or Levi’s Stadium? For decades, the answer has been television. In recent years, it has become social media. As the Warriors’ presence has grown globally, Daniel Brusilovsky says, social media is the key to reaching international fans.
For many fans, interest rather than distance is the issue. Tracy Hughes says that some sports are on the brink of extinction because Millennials will not watch them. Social media can package sports content in formats that are more accessible to a younger demographic: short, bite-sized clips of the best plays; up-to-the-minute updates about injuries, schedule changes or line-up announcements; dialogues between athletes and fans. To meet users’ expectations, teams, athletes and brands are transforming the way they deliver sports content.
Tracy Hughes describes how athletes can use social media to increase their reach and influence.
In addition to transforming traditional sports, technology has given rise to a new kind of athletics: esports. Multiplayer video game competitions, long held on an amateur level, are now considered professional sporting events. While “professional gaming” is controversial to some, Tracy Hughes points to the commonalities between traditional and esports athletes: both have agents and coaches and undergo performance drug testing.
Of course, there are some key differences. Though esports can be played in arenas, games may also take place entirely online and be livestreamed to viewers across the world. Most esports players are 12 to 28 years old, making them younger on average than other professional athletes. And the rules of esports are still being written. These attributes could make esports a major disruptor to the sports world.
Embracing that disruption, the Warriors own two esports teams: the Golden Guardians and the Warriors Gaming Squad. According to Daniel Brusilovsky, the Warriors see involvement in esports as an opportunity to use the expertise they have gained from operating traditional sports teams to help esports teams navigate the complexities of the sports world. They also hope esports will help them reach a younger audience that may not traditionally watch basketball. Tracy Hughes expands on the rapidly growing esports market.
Tracy Hughes describes the opportunities and challenges of the growing esports market.
For sports created decades ago, the adoption of new rules is not always fast or easy. Some traditional sports teams must overcome what Perkovich calls “organizational inertia,” ways of doing business that have not changed in decades. Fans, meanwhile, may be accustomed or even attached to experiences that now have high-tech alternatives—for instance, using a mobile app to order a hotdog for pick-up instead of waiting for one in line.
As sports teams use websites, apps and social media accounts to collect data about fans, fans may also have concerns about privacy and transparency. It may be difficult for fans to keep track of when their data is collected and how it is used. Perhaps a greater challenge would be to opt out of data collection entirely. Offline transactions are still possible, if less convenient. For example, buying a ticket in person involves visiting the Chase Center Box Office between the hours of 10 a.m. and 4 p.m., Monday through Friday or on the day of an event. Compared to the ease of purchasing a ticket online, this might feel like jumping through hoops. Most fans would probably rather leave the hoops to the pros.
"Playing by the Rules: Technology Changes the Game of Sports," February 21, 2020.
