Intresting extracts due to a (soft) paywall
Dallas Mavericks owner Mark Cuban is a tech billionaire who is all-in on blockchain and NFTs. He doesn’t, however, place much significance on whether or not fans will shift from traditional cash to cryptocurrencies like Bitcoin or Dogecoin. Instead, he’s more interested in the wider business applications of all the technology.
An NBA team owner/co-owner committee was recently formed to study blockchain technology and it includes Cuban, Ted Leonsis (Wizards), Joe Tsai (Nets), Steve Pagliuca (Celtics), Vivek Ranadive (Kings) and Ryan Sweeney (Jazz). All come from tech or finance backgrounds, indicative of a common denominator for sports team owners in the modern age.
**One area that team owners are expected to try to apply blockchain is ticketing. Most entry into sports events now is done via digital applications rather than paper tickets, for both front-end retail sales and for the resale market. Putting tickets on blockchain theoretically allows teams and leagues to get a slice of secondary market sales when a buyer sells their ticket to someone else.**
**“You made $850 and I didn’t share, the player didn’t share, the league didn’t share,” said Leonsis, a former AOL executive who also owns the WNBA’s Washington Mystics and NHL’s Washington Capitals.**
He also said he’s interested in the technology to expand the global footprint for his teams beyond their local markets.
**“I’m really interested in how to get out of the notion that I own a sports team and I have local media rights and a local market and I’m only as good as the size of my market. That to me is what is so interesting here,” Leonsis said. “There are eight billion people on the planet; six billion connected to high-speed internet; 500 million with interest in basketball. I have the Washington Capitals and I have 20,000 seats that I can sell to people 41 times a season. My market seems finite. A global market seems infinite.”**
He theorized that could include selling NFT tickets to fans who’ll never attend a game in person but are willing to pay for digital keepsakes.
“A buyer can hold onto the memory, then resell the ticket,” he said. “I can sell a ticket to eight billion people. Previously, I could sell a ticket to 800,000 or 10 million, whatever is in your market. When people start to wrap their heads around this, it will be astounding the sea change this represents.”
**NFT collectibles & NBA topshots**
It also could apply to merchandise and apparel sales that traditionally have been physical if enough fans are interested in buying virtual items.
**“When we reveal a new jersey and it sells for $300, people can buy it online or in the arena. But if it becomes a collectible globally, that could be a much bigger business,” Leonsis said.**
He likened the blockchain, crypto and NFT trends to the mid-1990s internet explosion. There is a lot of money to be made, he said, and that’s important to him because he estimates the pandemic effects on his business will take three years from which to recover financially.
“It feels to me like when we first got people in America online and the internet became open via the Netscape browser in ’94 and the world was your oyster in terms of innovation and creating new apps,” Leonsis said. “We see (blockchain) as a profound move from analog to digital, from unaccountable to transparent. From a way to know who is buying and to turn episodic revenue into reoccurring revenue. That’s a long and subtler story in building value.”
**And speaking of value, he said NBA Top Shot as a business could be worth more than most NBA teams — thanks, in part, to the league’s backing of the NFT technology to help fuel a boom**.
“It’s possible that Dapper Labs is now one of the 10 most valuable NBA teams,” Leonsis said. “It’s stood behind, it’s trustworthy and the marketplace is real. They have that magic right now.”
He did express some skepticism over some NFT efforts and acknowledged that the new technology will not be a windfall for everyone. That said, the underlying blockchain tech is here to stay, he said, and the winners will be those that are patient as markets sort themselves out.
“There is going to be some losses, some companies that don’t make it, people will lose money. That’s what happens,” Leonsis said. “A few people make money who are in early and it disappoints other people. Not everyone is going to be a winner in this short period of time.
“This isn’t just about the LeBron card trading up, the Jordan rookie card selling for $700,000. This is much, much bigger and I believe will be looked at as the birth of this next generation of value creation for many businesses but especially sports and teams and leagues,” Leonsis said.
“No one knows how the movie is going to end. It’s just starting. These are like coming attractions. I’m sending out the warning signals — don’t get overwhelmed by the theater, the noise being generated.”