Prior to the Paramount decrees, studios dominated the Hollywood industry in talent management through contracts, production, distribution, and exhibition endeavors. Today, the newer model of studio and talent relationship and programming development is much more about long-term goals and partnerships. However, in both instances, business integration was a part the plan to control more of the assembly line between production and consumption.
In that vein, Endeavor now controls Endeavor Content, WME, IMG, UFC, PBR, On Location Experiences, and a long list of entertainment, media, and sports talent. Endeavor has several major investors. Endeavor also attempted an initial public offering (IPO) in 2020, but the now-ended dispute with the Writers Guild of America (WGA) and a downturn in the economy during the height of the pandemic caused what has turned out to be only a brief delay as the parent company seeks a second IPO. Going forward, Endeavor will be limited in its ownership of entertainment production companies and use of packaging with talent, but so will the other WGA signatories.
However, the media and sports talent and industries are not as regulated, which presents some sports production, distribution, and exhibition opportunities to Endeavor. Triller, for example, provides insight into how an entertainment, media, and sports platform can utilize the power of a network where more people and properties means more power and influence and is strengthened by the size of the network. DAZN and Amazon are making some noise in the sports content distribution space as well. The National Football League (NFL) just signed deals with all of its major broadcast partners for over one hundred billion dollars ($100b). Clearly, there is money and opportunity for Endeavor to continue its rise in media and sports talent, production, and distribution. The NFL is very much still a cable-business when it comes to broadcast rights with 99% of its partners offering cable, but Amazon’s exclusive streaming deal and the “+” streaming add-ons are a looking glass into the future that Endeavor can tap into.
With the growth of sports betting and partnerships among sports leagues and teams, including the National Hockey League’s (NHL) equity stake in Australian-based PointsBet, it showcases the importance of having a diverse portfolio of monetizable properties, especially where regulation in one or two areas limits opportunities like with Endeavor and WGA the use of packaging. It was indeed the WGA dispute and signed agreement that will sunset the use of packaging entertainment talent and place a cap on ownership stakes of larger than twenty percent (20%) in production houses where conflicts of interest can arise. The United States Department of Justice has indeed adapted with the changing business model of direct-to-consumer and streaming and has seen less need to regulate vertical and even horizontal mergers and acquisitions (e.g., AT&T/Time Warner) in entertainment, media, and sports. SPAC’s have also grown exponentially in 2020-2021.
Agents and talent lawyers will be the first to say that success in the business is in the talent you have signed and relationships that you maintain well. Diversification is important and focusing on talent management, although important, requires risk because talent representatives are providing a personal service. Talent can walk at any time and unions vigorously protect that negotiated right. Endeavor is endeavoring, pun intended, to seek to maintain an eye towards the future, while offering more opportunities to talent and properties.
The IPO, regardless of price or success, is meant to bring in more investors so larger plays can be made. Sports rights are expensive, so is putting on events. Name, image, and likeness (NIL) and sports betting opportunities are growing and in some ways just getting started. Streaming is growing. It is entirely foreseeable that when Endeavor heads Ari Emanuel and Patrick Whitesell pursued the IPO strategy, it was with history and the future in mind. With author James Andrew Miller’s book Powerhouse in the foreground, there are two distinguishable paths between the Creative Artists Agency (CAA) and WME. CAA added sports talent, WME has added sports talent and well-known entertainment, media, and sports properties and brands. The point is that where talent representatives used to leave the agency to join a studio or company (e.g., Michael Ovitz and Ron Meyer), agents are now executives at what is soon to be the first ever publicly-traded talent agency, but as demonstrated above, Endeavor is much more than that now. It may be the model for larger talent agencies to follow.