IBM Wants to Help Professional Sports Teams Enter The Digital Age
Say what you will about IBM, they are constantly trying new ways to generate business, and their latest initiative involves helping professional sports team modernize stadium operations and update the way they interact with fans.
The project is two-fold. The first part is the Sports and Entertainment Global Consortium, a group of companies coming together to drive infrastructure updates at stadiums and arenas. The second piece is the Sports, Entertainment and Fan Experience consulting practice, designed to help sports teams enhance and understand how fans are interacting with them.
IBM is bringing in Jim Rushton, who was the Chief Revenue Officer for the Miami Dolphins football team to run the show.
As Rushton explains it, the first piece is a consortium bringing together 18-20 partners to help teams update the infrastructure in an existing stadium (or build a new one), helping plan it in a way that maximizes the technology underpinning the stadium operations. This would include the scoreboard and big screens around the stadium, the wireless connectivity fans access in the stadium, concession areas, ticket booths and so forth. The partners may go to market en masse or in various groupings, depending on the circumstances, but they plan to share IP to offer a baseline personalized fan experience to the extent possible.
The second component involves helping teams bring together the the various fan touch points inside and outside an arena or even at home and maximizing the relationship with fans.
IBM wants to use its strengths as a systems integrator and bring various parties to the table to help solve these issues, which essentially break down to managing the IT portion of the operation and the marketing and sales portions.
When it comes down to it, sports teams face similar problems to any enterprise. On the back end, they are trying to make disparate systems work together. On the front end, they are trying to optimize the customer relationship when there are often multiple customer relationship silos, making it challenging to understand the the whole picture.
Sports Is Big Business
James McQuivey, an analyst at Forrester Research and author of the book Digital Disruption, admits this idea seems unusual for IBM, but he says there is a good reason the company is trying to build these practices.
“Sports is a massive business that is only barely beginning to experience digital transformation. The years ahead will be full of many opportunities to change the way sports are “delivered” as an experience in the stadium, near the stadium, or at home, not to mention outside of actual game time. All of those innovations are digital,” he said.
As with the high-profile Jeopardy game with IBM Watson in 2011, McQuivey thinks it will provide a useful test case for IBM technology and services that it can hold up as an example for less sexy use cases.
Sports is experiencing a dramatic shift, and as it does IBM wants to help teams through these changes and disruptions. Rushton says the primary drivers affecting the industry are dropping prices on HDTVs — why buy a season ticket when you get a crystal clear big-screen experience in your living room — the secondary ticket markets such as Stubhub and fantasy sports.
All of these factors are shifting fan loyalties and clubs need to work harder than ever to get to know their fans. When they do spend the money to come to the stadium to see a game live, the teams need to provide the best experience they can as a clear differentiator between the stadium and home experiences.
It’s Going To Be Tough
McQuivey says while the idea behind these initiatives is sound, the challenges are many. “What they’re trying to do will be difficult. When a new stadium is being built, that’s easy enough to bid on, but when it comes to gradually retrofitting existing stadiums and simultaneously increasing the digital IQ of the teams and the leagues, there is a lot of work ahead,” he said.
Pulling together a consortium of 18-20 companies is also going to be a challenge for IBM and making all those moving parts come together into a coherent solution will be too, but IBM sees a market opportunity here and it’s giving it a shot.
Sports is big business these days and IBM is hoping to get a piece of it as it looks for ways to turn the company around. After fourteen straight quarters of falling revenue, they have to keep trying new things. This is another attempt.
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