As commissioner of US college sport’s Pac-12 Conference, a role he has held since 2009, Larry Scott presides over a multi-million dollar business that comprises 12 of America’s most prestigious universities and more than 7,000 student-athletes.
It is a wide-ranging and demanding job that, like every commissioner role, requires a decent grounding in business leadership, media, diplomacy and reconciliation.
“As a commissioner, you can get a lot of advice from people - whether it’s your owners, your members or others - but oftentimes that advice is conflicting based on different perspectives and experiences people have,” says Scott. “When it comes to decision-making time it can also be very lonely. You realise that if you make a tough decision on a high-profile case, some people will applaud you, some people will criticise you.”
Scott’s nine-year tenure as Pac-12 commissioner has been marked by growth, innovation, and a willingness to take risks. Barely a year into the role, he oversaw the addition of Colorado and Utah to what was then the Pac-10 before negotiating the largest TV deal in college sports history, a US$3 billion agreement with ESPN and Fox. Soon after, he spearheaded the formation of Pac-12 Networks, the first and only member-owned conference TV network, and set about pushing the Pac-12 brand into overseas markets as part of a Pac-12 Global initiative that has seen the conference stage live events and distribute content in countries around the world.
Such expansionism has been the hallmark of a career in sports administration that began in tennis. An Ivy League alumnus who captained the tennis team at Harvard, Scott played professionally before a decade-long stint as president and chief operating officer of ATP Properties. In 2003, he stepped across from the men’s game to become chairman and chief executive the Women’s Tennis Association (WTA), where he earned his reputation as a personable leader with progressive views on equal rights and diversity issues.
In a wide-ranging interview, Scott tells SportsPro about his principled approach to leadership, the role of athletes as social influencers, the effects of media disruption and globalisation, and why, in this day and age, having an unwavering moral compass goes a long way.
Larry Scott has been commissioner of US college sport’s Pac-12 Conference since 2009
Making moves in media
More than a few eyebrows were raised when the Pac-12 Conference launched Pac-12 Networks, its wholly owned cable and satellite TV network comprising one national and six regional channels, in early 2012. Not only was the project a costly undertaking and unprecedented in college sports, but many observers considered the creation of an independent television business to be a risky move at a time of widespread uncertainty in the highly competitive and fast-evolving US media landscape.
Still, Scott spotted an opportunity. Intent on wielding greater control over the conference’s media rights, he struck upon a hybrid distribution model that would guarantee financial certainty, increase exposure for women’s and Olympic sports, and position the Pac-12 to take advantage of any future changes in media consumption. Pac-12 Networks now produces 850 live events annually as well as an extensive range of original programming, complementing a 12-year, US$3 billion national TV rights agreement with ESPN and Fox - a landmark deal that quadrupled the conference’s rights revenues.
While, on average, Pac-12 schools now receive less money than their rivals in other conferences, Scott believes this hybrid strategy will bear significant fruit when the conference’s current rights agreements are renegotiated beyond 2024. And having struck partnerships in recent months with Facebook Live, Twitter and other OTT streaming providers such as Fubo.TV, Sling and CenturyLink, he insists the Pac-12 is now ideally positioned - and sufficiently educated - to capitalise on the changes to come.
Has the gamble you took to create Pac-12 Networks - forgoing revenue in return for greater programming control - paid off?
I don’t think we’ll know to what extent it has paid off until all of our rights come back up at the end of 2024. But we’ve already derived significant benefits from owning and controlling our content, being able to programme and get exposure for sports on our campuses that otherwise wouldn’t get it. We are developing relationships with a lot of innovative media companies, technology companies that have the potential to be important future partners of ours, in addition to being a profitable business, as it has been since day one.
We have been certainly very pleased that we have this hybrid strategy. Most of our revenue and exposure comes from deals we’ve licensed with ESPN and Fox for our rights. But I think it’s exciting to be able to take an important piece of your intellectual property - your content - and treat it like innovation capital where we can test and pilot and develop relationships and learn.
Certainly, over time, if you believe that the value of premium sports is going to continue to go up and we’re going to continue to be in a world where there is more and more different types of partners interested in that premium content, I think history has proven that you’re always better off retaining control, flexibility and optionality in terms of what direction you may go in the future. That’s exactly what we’ve done.
You certainly have to have some tolerance for risk and challenges if you’re going to be an independent media company in this day and age
Do you think you’re now better positioned to take advantage of the changing media landscape?
I certainly do. The pace of change and disruption has probably been greater than we could have anticipated. You certainly have to have some tolerance for risk and challenges if you’re going to be an independent media company in this day and age.
Again, ours is a hybrid strategy - we’ve de-risked a lot by licensing a lot of our content to ESPN and Fox on the one hand. On the other hand, we took a lot of risk by trying to be an independent media company without being part of the bigger package and having the leverage that comes with that. So we’ve learned a lot but fortunately our brand, and particularly American college football at the highest level, is must-have content enough that we’ve got over 75 different distributors.
Scott says that Pac-12 Network has seen a cumulative annual growth rate of five or six per cent per year in its first six years
How profitable is Pac-12 Networks today?
It’s been profitable from when we launched because we had strong distribution agreements with the biggest cable operators - Comcast, Time Warner, Cox, Dish Network, AT&T. I’d say we’ve seen cumulative annual growth rate of five or six per cent per year in the first six years of the network. It’s been solid.
As for the outlook, it’s very hard to anticipate the future in this world that we’re in, but I certainly expect to continue to grow our profitability. But there are certainly headwinds, short-term headwinds, in the video distribution business right now as there is some reduction in the number of paying cable subscribers, which is somewhat mitigated by new entrants like the ‘skinny bundles’ and the virtual MVPDs. We benefit from some of that but I’d say growth is going to be tougher in the coming years given the decline in the number of cable subscribers.
Generally speaking, how would you assess the value of sports content in future?
I think in a world where there is increased fragmentation and convergence between traditional media and technology, there’s going to be an increase in separation between the haves and the have-nots. The content that is most valuable, that can aggregate large audiences, is going to be increasingly valuable because there are more different competitors out there searching for killer, must-view content and trying to aggregate big audiences so they’ll pay a premium.
For partners to monetise the value going forward, that’s just really interesting, especially if you’re a technology player. It’s not just about subscriber income and advertiser income anymore - you’ve got Facebook as part of a bigger ecosystem with different monetisation models; Amazon has got an e-commerce monetisation model where they can rationalise a rights fee in different ways - they’ve got different ways to monetise. There are other forms of subscription models out there as well.
Thankfully, college football and the Pac-12 is part of that rarified group driving big audiences with a lot of passion, so I’m quite bullish. I think it’s going to be harder for scripted content. We’ve seen that happening for a while - it’s harder for traditional networks and harder for entertainment. And for sports that don’t command really big audiences, it could be become increasingly challenging.
Taking the Pac-12 brand global
Though a cultural phenomenon at home, US college sport has yet to export as successfully as other American sporting institutions. Scott is out to change that. Soon after taking the helm at the Pac-12, he set up Pac-12 Global, an initiative aimed at expanding the conference’s and its members’ footprint overseas through live events, cultural exchange programmes and content distribution.
China has been a focal point in recent years. In 2015, the Pac-12 became the first US sports entity - professional or collegiate - to stage a regular season basketball game in the country, with the Washington Huskies defeating the Texas Longhorns in the inaugural match-up. Building on the success of the annual Pac-12 China Basketball Game, Scott has since negotiated a multi-faceted deal with Alibaba, the Chinese conglomerate that now sponsors the fixture and carries Pac-12 Networks content across its linear and digital channels in China, showing around 175 live events and 100 hours of programming each year.
Pac-12 and ecommerce giant Alibaba partnered in 2015 to take conference basketball games to China
How has your partnership with Alibaba in China evolved over the years?
Live event basketball has been very popular in China - that’s been an anchor for us given the tremendous popularity of basketball in China and frankly the success the NBA has had there, leading the way. Chinese fans are now sophisticated, they understand basketball, they want to see the top schools where the stars of the future come from. But what we’ve found is US collegiate sport represents the pinnacle in terms of sports development and training, and we’re training hundreds of Chinese coaches and administrators every year at our universities.
Globalisation is an important strategic imperative for most of our universities. Most of our presidents and development people are travelling internationally frequently, trying to develop partnerships, stay engaged with their alumni, striking up research and other partnerships with universities outside the US. So there are multiple objectives our universities have in globalisation and what we’re doing creates reach and platforms for universities to engage in terms of their agendas beyond sports university-wide.
To what extent does the Alibaba deal serve as a blueprint for how you might look to approach other markets outside the US?
I think China represents all aspects of our international model. We play football games in Australia. We’re in discussions about possibly playing football games in Mexico and the UK and other parts of Asia. We play volleyball games overseas. We’re talking about tennis teams and golf teams and other teams participating overseas, and we distribute our content in other key markets as well.
Every market is going to be a little different. I think China, because we’ve concentrated on it so much over the last five years, represents a more mature illustration of everything we can do with those three pillars of education/knowledge transfer, live events and media or content distribution. But it doesn’t necessarily mean that in every market we do all three of those things. There’s some markets where we just distribute our content - Canada is an example of that. There’s some markets where we might just play games, like in Australia, where we’ve played football games two years in a row.
When approaching an overseas market, how do you go about positioning the Pac-12 as a brand in its own right alongside those of your member schools?
Our schools are the hero brands. UCLA, Stanford are global brands known the world over with tremendous reputations as universities from an academic perspective. College, university sport at the highest level, with its level of interest, is a pretty unique US model that requires some explanation and education. We’re doing this for our universities so we lead with our university brands and the interest of sport.
We try to connect the dots for people. In the US, collegiate sports is the development league; that is where the stars of the future for the NBA and NFL are developed. That’s how we approach it. We start with what people understand. In a lot of markets, people are attracted to high-quality, prestigious brands to start with. We try to twin that with the passion for sport and the interest in sport, and try to present what we’re doing as a unique and novel model.
Our schools are the hero brands. UCLA, Stanford are global brands known the world over
The Larry Scott brand of leadership
Throughout his career, Scott has worked to promote the role of athletes and sport in driving positive social change as well as being a vocal advocate for gender equality and leadership diversity. At the WTA, he successfully campaigned for equal prize money at the French Open and Wimbledon, and he now sits on the boards of the Anti-Defamation League, a US-based civil rights organisation, and the Women’s Sports Foundation, among other entities.
Athlete welfare and sporting integrity have been top priorities for Scott. Late last year, he formed and chaired the Pac-12 Task Force in response to an FBI investigation that uncovered corruption, bribery and wire fraud in men’s college basketball - including cases involving individuals linked to two Pac-12 universities, USC and Arizona. The task force went on to propose a series of reforms aimed at preventing student-athletes from running afoul of NCAA rules governing the recruitment of players and the influence of commercial third parties.
What are you most proud of during your time at the Pac-12 and what do you still hope to achieve?
I guess what I’m most proud of is the pretty dramatic transformation of the conference - when I arrived in 2009, it was the Pac-10, now it’s the Pac-12 - and our competitiveness from a resource standpoint, an exposure standpoint and an athletic standpoint. If I look at the facilities across our schools, I look at the calibre of the coaches, I look at the types of support we have to provide to student-athletes, we are at the top of the pyramid and our schools are able to compete with anyone across the country.
I don’t want to take any credit for this because the conference was pretty prolific athletically before I arrived, but we continue to be the winningest conference in the country - we win more national championships than any other conference every year. We weren’t always this way but I think we’re providing great leadership in terms of the health and welfare of student-athletes, in terms of particularly brain trauma and time demands of student-athletes, nutrition, financial support. Plus the Pac-12 plays an important and leading role in affecting a lot of reform in collegiate athletics. And finally I would say I’m proud of the way we’re innovating and pushing the envelope and pushing others to reimagine the impact collegiate sports can have in areas like internationally, like in controlling our media.
Scott cites former National Basketball Association commissioner David Stern as big influence
You have a reputation within the sports industry as being something of a pioneer. Where or who do you look to for inspiration?
I’ve always been a pretty voracious reader of articles and biographies about other leaders inside and outside sport. I try to maintain relationships with the leaders of the major professional sports in the US as well as my colleagues in college. I think one of the great skills you can have as a commissioner is to be a great listener and observer, so I do try to take inspiration from others.
I remember ten years ago when I was at the WTA, I would get some time with David Stern, who was the NBA commissioner at the time, because I held him up as someone I admired as a pioneer in terms of what the NBA had done in China, the way he had embraced their athletes how he dealt with tough issues on discipline and the image of the sport. He’s someone who, when I was younger, I would reach out to from time to time to seek advice from and watched very closely as I developed my own style and my own compass in terms of the way I wanted to lead.
David Stern is someone who I would reach out to from time to time to seek advice from. I watched him very closely as I developed my own style and my own compass in terms of the way I wanted to lead
Is Adam Silver, Stern’s successor, someone you would call a friend?
Yes, I got to know Adam. I remember those early visits to David Stern and Adam would often be in the room as deputy commissioner so we’ve had a relationship for a long time. I’m a great admirer of him as well. I would say he got off to a great start as NBA commissioner in large part with the way he dealt with a very serious challenge and controversy early on related to the LA Clippers owner Donald Sterling and around some racist sentiment and bigotry that was exhibited there. He really stood on principle and dealt with it very strongly in a way that people really admired and respected. That really resonated with me.
Where do you stand on the debate around sport’s role in society and politics? Given the reach and influence of today’s elite athletes, do you see sport as having a bigger role to play now than ever before?
As someone who has been in sport my whole life, I don’t like to see sport become politicised for politics sake. Having said that, I’ve always seen sport being an important part of our culture and athletes as role models for young boys and girls. Sport enjoys huge benefits and opportunities, and with those opportunities comes responsibility to be leaders and therefore to weigh in and show a social consciousness.
A few months ago, with the CEO of the Anti-Defamation League, we launched the Sports Leadership Council. It has about 25 or 30 members, including the commissioners, team owners, other prominent people within the world of sport - Karim Abdul Jabbar, leading female executives and athletes. The purpose of this council is to come together as a sports industry to talk about some of the social and political issues that are involved in sport, and look at how we can work to better educate and train the athletes, and to more effectively lead and make a positive impact in our communities when issues arise.
Another organisation I’m involved with is the Women’s Sports Foundation because I have a passion for equal opportunity and equality for women. In fact, in the Pac-12, we have as many female athletes as male athletes, we have as many TV broadcasts of women’s sport as men’s sport, and our schools are deeply committed to it.
Scott helped launch the Sports Leadership Council to discuss some of the social and political issues that are involved in sport
You’ve previously described college sports as a pressure cooker environment that rewards short-term thinking. As a conference commissioner, how do you go about rallying people behind your long-term strategic vision?
Two of the biggest challenges any commissioner has, and certainly those leading a college conference, is the tension between short-term pressures and long-term benefits, and then, when you’re a membership organisation with many different stakeholders, finding the balance between making sure you’re listening and understanding each of the different perspectives. You can be responsive to those on the one hand, but on the other hand moving everyone forward in the same direction and aligning everyone around a common vision. It’s a very delicate balancing act.
You have to be very empathetic when there are folks on college campuses and coaches that can get fired after two or three years, or athletics administrators that, if they can’t raise enough money or win, may not feel like they’ve got job security. By the same token, the institutions themselves have been around for 100 years, and for the collective benefit it’s really important not to make short-term, expedient decisions that might put you in a competitively or strategically weaker position down the road.
Last year’s FBI investigation uncovered some serious crimes involving individuals linked to Pac-12 schools, prompting you to set up the Pac-12 Task Force. What was your personal reaction to the revelations?
I think every sports league, every commissioner, looks at whether there are issues with the integrity of what they’re doing. You have to focus in a laser-like way, and that’s how we responded when the FBI uncovered bribery and other cheating when it came to the rules in terms of funnelling money to prospective student-athletes, their families and cutting deals for financial managers in ways that flouted the rules.
That is a concern and so we are very action-orientated about that. We formed a task force of real experts and we’re diving deep into understanding the youth basketball culture, the role of shoe companies like Adidas and Nike and Under Armour, the role of private promoters and agents. We’re going to reform some areas to minimise the influence of third parties that may be encouraging some of the illicit behaviour that was uncovered.
Is the college sports model - whereby student-athletes are unpaid despite the massive sums involved - inherently at risk from this particular type of malpractice?
Having worked in professional sports, now working in collegiate sports, there are issues across the board. There’s plenty of challenges to the integrity of professional sports. When I was in tennis, I dealt with all kinds of issues around officiating and gambling. I think every sport, unfortunately, has to deal with temptation for people to cheat because there is so much at stake.
In college sport, it’s unique in that there are students participating - they are not professional athletes yet. There’s a tremendous popularity when it comes to basketball and football, there’s a huge passion of desire and incentives to win for people, and there is a lot of money at stake based on TV contracts, on coaches salaries. So you also see temptation to cheat to win. The environment might be different, the rules might be different, but the underlying flaws in human character cut across all sports I’ve seen.
Pac-12 schools were implicated in the recent FBI investigation that rocked US college sports