This article was produced in association with Perform Group
Ten years ago, as Simon Denyer and Ollie Slipper were in the process of merging their respective companies to create Perform, they “locked themselves in a room” to create a document which turned out to be more a manifesto than a detailed plan for the new business.
Rather than mapping out a specific route to growth and profitability, it defined an ethos which, a decade down the road, remains the driving force of a business which has consistently sought and found opportunity by challenging accepted thinking and finding new ways of approaching sports media.
Today Perform is established as a hugely influential digital sports content business with a turnover of £287m (€320m/$375m) in 2016. It manages and delivers the media output of rights-owners, including the WTA Tour and Fiba, and serves B2B clients right across the publishing and betting sectors. But, most significantly, Perform has become a sports broadcaster in its own right.
The company recently announced the launch of its DAZN (try saying “Da Zone” and you’ve got the pronunciation) OTT service in Canada, following on the heels of its 2016 roll-out in Germany and Japan.
In little more than a year DAZN has become a major player on the international sports scene, acquiring key domestic rights in Japan and, in a deal which announced its intentions and capabilities to the world, sharing the UEFA Champions League with Sky Deutschland through a sub-licensing deal running into hundreds of millions of dollars.
Founding principles
According to Denyer, the launch of DAZN was the logical next step in the development of the company and is perfectly in keeping with its founding principles.
“Our ethos has always been not to replicate things done by other businesses and not to do anything that isn’t digital. By keeping to that, we have moved up the value chain,” he says.
“Ten years ago there were already well-developed ways of making money from sports media rights. We just looked at where the industry was from the perspective of starting from scratch, with just some technology and some rights, and worked on how we would build a sports content business for the next 10 years.
“We knew that we didn’t want anything to do with analogue broadcasting, linear programming or print, and that we weren’t going to collect content in anything other than digital,” he explains.
Energy and commitment
The digital-only focus gave Perform the jump on potential rivals across the market in a way which went beyond simply understanding and implementing technology.
The company was run by young people with the energy and commitment unleashed by the promise of a start-up, people who were unencumbered by the past and the ‘way things have always been done’.
“In fact, it’s more or less a sacking offence around here to say that we’re doing something a particular way because that’s how we did it last year,” says Denyer with what is probably a smile.
“Every year we change the way we do things. We are always looking for more efficient ways to get more coverage and faster ways of getting the feeds out. Digital and IP (internet protocol) are getting more efficient, and there are always better ways of doing something.
“We are not hidebound by any existing business model and we have a pretty ruthless approach to the way we do things. For example, DAZN doesn’t have studios because right now we don’t need them, as we don’t do pre-and post-game programming. If we start the feed of a live event five minutes or 15 minutes before it starts, it doesn’t really matter to the audience and once the game finishes, we don’t want them hanging around when we have another 25 or 30 things on live which we want them to watch,” he explains.
The decision to launch DAZN was taken because Denyer and his team felt that the changing consumption habits and technical capabilities had reshaped the sports media environment, and created a demand that established sports channels couldn’t meet.
“I genuinely believe that the only reason sports channels exist in their current format is that linear channels have, historically, been the only way to get into the home. There’s no other logical reason, because, among other things, linear creates all sorts of scheduling problems,” he says.
“But consumer behaviour has completely changed and as we don’t have channels, we decided to go straight to OTT and show everything. When it’s on, it’s on and when it’s not, it is available on demand. We believe that in five years’ time that’s how almost all sports will be viewed.
“We understood that now the home and the mobile phone are really capable of receiving these services, it is time for us to push on to the next stage of our evolution,” he says.
“We launched in markets which had scale in terms of market size, but where, for local and historic reasons, there were inefficiencies in the market which had left sport rights under-valued.”
While the Perform business may have grown hugely over the years, the eye for opportunity and willingness to innovate, which is evident in the development of DAZN, has been one of the hallmarks of the company since its early days.
Whether it was convincing betting companies that the use of data and video stimulated business, doing advertising-inventory-based deals with publishers for content delivered through the company’s ‘e-player’ or delivering the first England football international exclusively online, Perform has consistently thought differently.
New model for sports production
And that approach naturally extends to its relationship with rights-owners such as the WTA Tour, with which Perform announced a 10-year partnership in 2014 and, in doing so, created what amounted to a new model for sports production and distribution. It also raised eyebrows because of its size; at around $500million, it was a huge deal in its own right and the biggest in the history of women’s sport.
“We were already producing the WTA Tour website and live-streaming service, and were asked to review the entire rights management and production strategy,” Denyer explains.
“It was clearly inefficient, because it was based around the needs of one broadcaster which only covered the games it wanted to show and then had an agency working to sell the coverage around the world. That was difficult, because broadcasters couldn’t be sure they were going to get games featuring players from their countries, which is what fans want to see.
“By taking a digital approach, we are able to produce every game from every court during the season. Among other things, that guarantees broadcasters access to games featuring their local heroes, but it means that all the content is available either live or on demand,” he says.
“Our focus is on properties which are premium, but which can really benefit from investment and the strategic and production input we can deliver. We are a natural partner for these rights-owners and there’s a higher return on investment at the back end.”
Fiba, world basketball’s governing body, has also formed a media partnership with Perform in a deal which covers three four-year cycles of international competitions and their associated qualifying competitions.
Beyond the company’s ethos, Denyer says quality of relationships with rights-owners and agencies has been central to Perform’s development.
“In the early days I remember signing a deal worth several millions for non-broadcast rights with Riccardo Silva of MP & Silva, knowing that we didn’t have the money to pay right then,” he says. “But Riccardo understood what we were about, had confidence in our business model and was happy that he would be paid. Other people including Barry Hearn at Matchroom, Jonas Persson (then at IEC), Seamus O’Brien (then World Sports Group) and Paul McGrath from Pitch have also been incredibly supportive over the years.”
Volume of coverage
While DAZN and rights partnerships are the two biggest sectors of the business, Perform Group is the sum of many parts. Its Omnisport news service, network of sports portals and data services Opta and RunningBall are successful, stand-alone businesses which contribute to the success of the group in different ways.
“They are all inter-linked and part of the masterplan. Before we launched DAZN, we significantly increased the editorial budget of our SPOX and Goal portals, so that they could up the quality and volume of coverage of the NFL, NBA, Premier League, LaLiga and Serie A, and other properties which we would be carrying,” Denyer explains.
“The number of unique users doubled from five to 10 million, and when we launched DAZN, we knew we already had 10 million people in Germany reading news articles about the properties we were showing exclusively. We are using them to build user bases in territories where we think we may launch DAZN,” he says.
MAIN IMAGE: Perform Group’s Simon Denyer (right) shakes hands with Fiba president Patrick Baumann (Richard Juilliart/Perform Group)