Full speed ahead for NASCAR Media Group

The NASCAR Media Group is not even two years old, but nowhere is the sanctioning body spending more money or more carefully plotting its future.

Over the next few months, the media group will start moving out of its cosy, well-worn offices just south of downtown Charlotte. Its new $45 million home - $30 million in state-of-the-art equipment, $15 million in construction - will be adjoining the sparkling NASCAR Hall of Fame building in the heart of downtown, where it will occupy floors two through five of the 19-story office tower.

Inside, the media group will have everything it needs to start its own network, from multiple studios and control rooms, to full graphics and high-definition capability. Even though the Hall of Fame won't open for another year, the office space adjoining the attraction will be ready for occupancy in June.

It will give NASCAR nearly limitless options when it enters the next round of media talks - its current deals for TV, radio, mobile and the Internet expire in 2014. And the idea of joining Major League Baseball, the NBA, NHL and NFL in starting its own network will be part of the discussion.

"We wanted more control over the process of creating and distributing our content," said Jay Abraham, NASCAR Media Group's chief operator. "This new facility will allow us to evaluate a broader range of strategic options for NASCAR, the industry and how we can best serve the fan."

Whether those plans include a NASCAR network remains to be seen, but it's clear that the sanctioning body is at least positioning itself to go in that direction.

"For NASCAR to consider its own network, I think that's a smart investigation," said Mark Lazarus, president of media and marketing for Atlanta's Career Sports & Entertainment and the former Turner Sports chief.

"It's smart, in terms of controlling their content, but also because of their fiduciary responsibility to the industry, to teams and tracks."
Speed, in more than 75 million homes, serves as a de facto NASCAR network already, with exhaustive coverage through the week and on race weekends.

NASCAR Media Group provides content for seven or eight shows a week and calls Speed easily its biggest client.

"With what we're building, with a very small incremental investment, we could become our own network if we wanted to," Abraham said.

"We've tried to look at the world in 2015 and see how we, as a sport, could be best positioned to add value for our media partners, TV, satellite radio, everyone," said Paul Brooks, NASCAR Media Group's president. "We've looked at the future of what those opportunities might be and tried to build backward so we can go in whatever direction to support our partners and the sport long term."
New possibilities

NASCAR Media Group, formed in January 2008 when NASCAR merged its broadcast, digital and Images divisions into one media powerhouse, does plenty of creating and distributing already.

The group has grown from about 50 employees five years ago, when it was solely NASCAR Images, to 175 employees today and produces 75 to 90 hours of content a week. That content ranges from network programming to mobile or web-based projects for its diverse set of clients, including teams, sponsors, networks, ad agencies, Internet sites and feature-film distributors, among others. It also has cameras housed in five team shops and other locations in the Charlotte area to better facilitate interviews and the distribution of news to a variety of outlets, from local news affiliates to websites.

But to Abraham, it's clear the media group has just scratched the surface of its capabilities, especially on the revenue-producing side. When the media group completes its move into the NASCAR Plaza office complex, which will connect to the Hall of Fame, it will escape the limitation of its former headquarters.

That means going from a single cramped studio to a 7,000-square-foot "News Centre" that will greet visitors as they enter the Hall of Fame. Another 15,000 square feet are dedicated to two other TV studios and a radio studio.

NASCAR Media Group also will gain significantly more space for its tapeless content storage, also known as Digital Asset Management System, which will be used not only for NASCAR content, but paying third parties, whether they are other sports leagues, teams, colleges, whatever.

In its old facility, the media group had gone as far as it can with its storage capabilities. Other limitations hamper the space as well. There's no backup power source, for example, so if a storm knocks out power in the media group's current office, it is down. The new facility will have 48 hours' worth of backup power.

The new space also will give the media group the ability to store content at a second site within the building and a third site away from the building.

In the old office, the media group has spent thousands to fire-safety the rooms where content is stored because the aging business complex simply wasn't equipped.

The things that have kept Abraham awake at night for years will evaporate with the move.

"With the old place, we've done it with duct tape and chicken wire, but it gets done," said John Martin, NASCAR Media Group's managing director of business development and strategic planning.

The new facility also will give the media group the flexibility to turn around the same content for several different delivery platforms, whether it's HD, web or mobile phone. The flexibility and storage capabilities will be revenue drivers for the media group more than they have been in the past.

"I don't want to say the (revenue) possibilities are limitless, but ..." Abraham said. "We're not going to be limited by the infrastructure to grow this business."
A broad sales pitch

With all of NASCAR's media rights - TV, radio, mobile, Internet - ending after the 2014 season, the sanctioning body is two to three years from beginning negotiations on its next round of contracts.

By that time, the media group will be fully up and running in the Hall of Fame and will have a better understanding of what the media landscape looks like when it's time to decide on creating its own network from scratch, buying Speed and its existing 75 million-home reach, or sticking with the status quo.

"The biggest benefit to NASCAR's timing is that they can see all of the different ways the leagues have gone about starting their networks and gauge the benefits," Lazarus said. "You can build, buy or partner and if I'm a sports league, I would investigate all three."

And if NASCAR does move forward with its own network, what happens to Speed?

Jim Liberatore, the former Speed chief who is now president of SportsTime Ohio, calls the creation of a NASCAR network "an eventuality."

"If NASCAR does their own network, which I think they will, Speed becomes extremely vulnerable," Liberatore said. "It would really give NASCAR enormous leverage. With all of NASCAR's feeder series, all of the programming it already produces, it could be a huge business for them."

While NASCAR's cynics are quick to point out that the sanctioning body is in the business of collecting checks, not writing them, the media group's new headquarters marks a significant investment by NASCAR in its media future.

"We know what we have," Abraham said. "The biggest issue is, what is the industry going to look like in 2014? There's a convergence of media going on. Internet companies are getting into other types of distribution and TV networks are relying on the Internet to help support their businesses more.

"You're seeing less delineation between the channels of distribution. Cable operators are acting more like networks. That's a key part of what we have to evaluate: What is happening with the industry and where are the opportunities?"

A significant part of Abraham's ongoing analysis includes a re-evaluation of the media group's sales arm and whether it should be reorganized. Among the objectives in front of the media group is educating the industry on its broad array of services.

The sales team is now split among its current client list, which include teams, sponsors, tracks, ad agencies, networks, Turner (for NASCAR.com), DVD distributors, other leagues and, soon, the Hall of Fame.

But what about when the media group is trying to convince a Charlotte production house to use its sound stage? Does the person working with the teams and sponsors selling NASCAR content also try to sell the sound stage?

The new facility will offer the media group revenue possibilities that its sales force isn't currently equipped to handle.

There will be other considerations, such as how much capacity the new studios will allow. At its current rate of production, the media group will likely have studio time left over and it will be Abraham's job to make sure there's enough new business to keep those studios busy.

"Now that the building is mostly completed, it comes down to asset utilisation," the media group's Martin said. "If a local production company needs a sound studio, if local radio wants to talk to Jimmie Johnson and knows that he's going to be at the Hall of Fame, if Fox News wants to talk to the president of Bank of America, those are all opportunities."

"Not everyone knows all that we can do," said Abraham, with an oversized trash barrel next to his desk, a reminder of the impending move. "It's our responsibility to get out in the marketplace and educate people about our capabilities. When I think of all the challenges we have, that might be the biggest.

"It's a year away before the Hall opens. But it's only a year away."
by Michael Smith
Michael Smith is a reporter with SportsBusiness Journal