What Drove Yahoo’s Purchase Of Citizen Sports

Yahoo Citizen Sports Logo

To buy or to build? That’s the question that drove Yahoo’s decision to buy social sports startup Citizen Sports, which owns a series of sports-related apps on the iPhone and on Facebook, according to Yahoo (NSDQ: YHOO) media head James Pitaro. “When we really sat down and looked at what we were doing in the social space and where we were trying to get, we ultimately decided that what they already had is superior than what we would have been able to do in the short term,” he says.

Now, he says, Yahoo Sports—which is “doing a very good job on the PC”—will be able to bolster its presence on the iPhone—and also build a presence on Facebook. “We haven’t been as active on Facebook as we should be,” he says. “It’s a top priority for our media businesses.” During a discussion with Pitaro and Citizen Sports CEO Mike Kerns, the two men also talked to us about the future of fantasy sports online, the overlap between Yahoo Sports and Citizen Sports and also some details about the deal, which will see about 30 employees joining Yahoo.

Some highlights:

The new audience for fantasy sports: Pitaro says that Yahoo determined that in the fantasy sports market Yahoo Sports was no longer competing so much with the “usual suspects” (ie ESPN (NYSE: DIS), CBSSports) but rather with Facebook. “People have a finite amount of time to spend leisurely online,” he says. That time is increasingly being spent on Facebook, so the deal lets Yahoo reach new users who might not have time to consume “the fancy product” on the PC. It still hasn’t been decided, however, how exactly the Citizen Sports and the Yahoo fantasy sports platforms will be combined—or what the ultimate branding will be.

The two iPhone apps: Currently, Yahoo Sports has a fantasy football iPhone app—and Citizen Sports has one of its own. Kerns says that in areas like that, “the goal will be to collaborate on the best single application.” Those overlaps, however, are rare. For instance, Pitaro says that Yahoo had discussed building a broad sports app but hadn’t done so because of a lack of resources. Citizen Sports, however, does have an all-encompassing sports app (Sportacular). “It’s fantastic,” Pitaro says. “We don’t have to go out and build this thing.”

Deal terms: Kerns says his company—which has “millions” of users accessing its apps on Facebook and via their mobile phones—had been “intermittently profitable,” was growing and had recently built out its own ad sales teams. The company wasn’t looking to sell but realized that what it had built had “created shareholder value.” All of its 30 or so employees will now join Yahoo.

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Yahoo Buys Social Sports Startup Citizen Sports

Yahoo Times Square

Yahoo (NSDQ: YHOO) has hinted for several months that it would be buying more companies and it’s finally made an acquisition—buying up social sports startup Citizen Sports, which it says will compliment Yahoo Sports, the top sports site in the U.S.

And, indeed, the move immediately gives Yahoo clout in the social networking and mobile sports spaces, where it has been weak. Citizen Sports owns a series of popular sports apps on the iPhone and on social networking sites, including what it says is the most popular fantasy football app on Facebook. By contrast, Yahoo has long been the top player in the online fantasy sports market, but only last September did it release a fantasy football iPhone app and, as far as I can tell, it does not have any sports apps at all on Facebook.

In its announcement, Yahoo says Yahoo Sports content will be integrated into Citizen Sports’ apps. Together, the company says, Yahoo Sports and Citizen Sports will create a “more personally relevant experience, drive deeper user engagement and create opportunities for advertisers to interact with audiences in new environments.”

Financial terms of the acquisition were not released, although AllThingsD’s Kara Swisher—who predicted the deal earlier this week—put the price at between $40 million and $50 million. Citizen Sports had raised roughly $10 million in a funding round four years ago, back when it was operating under the name ProTrade Sports.

This is Yahoo’s third acquisition under CEO Carol Bartz. Going ahead, the company has said it is interested in three general areas—deals that would add “important technology and the people behind it,” content-related deals, and geographic buys that would let the company move into or strengthen its position in a market.

Here’s our earlier report on what Yahoo may buy next.

The release:

SUNNYVALE, Calif., Mar 17, 2010 (BUSINESS WIRE)—As part of its ongoing commitment to be the center of people’s online lives, Yahoo Inc. (NASDAQ:YHOO) today announced it has signed a definitive agreement to acquire Citizen Sports (http://www.citizensports.com), a company that brings the world of sports to fans’ favorite social networking sites and mobile devices through innovative applications. This acquisition will strengthen Yahoo!‘s social strategy of enriching, aggregating and distributing social content from across the entire Web, and offering a highly customizable social experience.

“Yahoo! is in a unique position to combine our deep expertise in content and aggregation technology to offer a highly personalized social experience,” said Bryan Lamkin, senior vice president, Consumer Products Group, Yahoo!. “Sports has been among the earliest online categories to experience rapid social proliferation, and the combination of Citizen Sports leading products with our world-class sports experience on Yahoo! Sports is a win-win for sports fans globally.”

Millions of people across the globe use Citizen Sports’ array of social and mobile products to play fantasy sports, fill out brackets, check live scores and read up-to-the minute news on sports including football, hockey, soccer, baseball, racing, rugby, hockey and cricket. Yahoo! Sports’ content will be integrated into these products, creating a seamless experience for sports fans wherever they are. On Yahoo! Sports, users will be able to broadcast their allegiances, create or join a conversation with friends and fans and cheer for their teams through Citizen Sports’ applications. This integration will further transform Yahoo! into a more personally relevant experience, drive deeper user engagement and create opportunities for advertisers to interact with audiences in new environments.

As the #1 destination for online Sports with more than 39 million monthly unique users in the U.S.*, Yahoo! Sports provides people with the most timely, relevant and comprehensive sports news, information and programming. Citizen Sports’ network of popular applications for Facebook, MySpace (NYSE: NWS), hi5, iPhone and Android span professional, college and high school sports.

“Citizen Sports was founded with the intent to enable fans to access news, scores and fantasy games on the platform of their choice,” said Mike Kerns, founder and CEO of Citizen Sports. “We look forward to becoming a part of Yahoo! and bringing our social experiences to their 600 million users around the globe.”

Citizen Sports was founded by Mike Kerns and Jeff Ma in 2004. Since then the company has brought together millions of sports fans from around the world to enjoy sports and connect with their friends. Citizen Sports is based in San Francisco.

Yahoo! expects to complete this acquisition in the second quarter of 2010. Financial terms were not disclosed.

* February 2010, comScore (NSDQ: SCOR), U.S.

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World Golf Tour Gets $10 Million More For Online Golf Game

World Golf Tour

Popular online golf game World Golf Tour has raised $10 million in a third round of funding, which the company says demonstrates that “investors believe online sports to be a big growth area.” Have to say, however, that it’s been rare lately to see stand-alone game sites like World Golf Tour raise rounds; most of the cash being invested in the gaming space right now is going into startups that have built their games on top of social networks.

Granted, even World Golf Tour isn’t completely immune to the craze. CEO Yuchiang Cheng tells Venturebeat that the company will use some of the new cash to launch a basic version of its game on Facebook—although he emphasizes it’s designed to be a marketing channel for the game website.

The funding brings World Golf Tour’s total backing to more than $20 million. The startup had most recently raised a round in the “double digit” millions in May 2008 from Panorama Capital and Battery Ventures. This round is coming from JAFCO Ventures.

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Sporting News Today’s Paid Cross-Platform Digital Starts April 1

Sporting News Today March 17, 2010

More details on the The Sporting News switch from free to paid for its digital daily Sporting News Today, which was first announced by Publisher Jeff Price at our paidContent2010 conference last month. The Sporting News is partnering with its current digital publisher Zinio for the April 1 launch. A monthly subscription runs $2.99 and, unlike most publications, covers access on any platform or device Zinio and Sporting News offer including PC, Mac, and yes, even iPad. New features include video highlights from CineSport. The new edition kicks off with a 60-day free trial so it will take a while to see what kind of traction the pay strategy gets. You can hear Price’s rationale for the move in the video below.

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March Madness: Coming to a Laptop Near You

March Madness is kicking off with its opening round game today, and CBS  is getting ready to live stream all games online starting with the first round on Thursday. The network has already made $37 million and sold all of its ad revenue for March Madness On Demand, AdAge is reporting. However, other sites could also profit from the NCAA Men’s College Basketball Tournament, as almost half of its audience will follow games and scores online, according to a new report from Unicast.

As it turns out, March Madness is very much a two-screen experience for many viewers, with live streaming only being one of many parts to the puzzle. Eighty-three percent of its audience will watch it on TV, 44 percent will follow the tournament online and 10 percent will use a mobile device. Sports sites like ESPN.com and Yahoo Sports should see a lot of traffic from fans trying to keep track of the scores, but the official CBS live stream at NCAA.com will see its fair share of users as well: 54 percent of the March Madness online and mobile audience actually wants to watch games in real time.

Unicast’s new 2010 NCAA Basketball Tournament Fever Report reveals that 58 percent of the March Madness online audience want to use the medium to keep track of scores while 49 percent want to watch game highlights online. Catching up on complete games after they air is something that only 19 percent are interested in. Most users said they will flock to ESPN.com (69 percent), followed by Yahoo Sports (42 percent), FoxSports.com (34 percent) and CBSSports.com (29 percent). The official CBS-powered NCAA.com site was on the mind of 26 percent of the respondents.

51 percent of the respondents don’t care about and won’t follow March Madness at all, which still leaves 49 percent ready to take work a little less seriously in the weeks to come. Out of those, 44 percent will go online. Put those pieces of pie into context, and you end up with the estimate that around 11.6 percent of U.S. adults are planing to tune into March Madness online. That’s a lot of eyeballs, even if not everyone follows through. Last year’s March Madness online coverage was seen by 7.52 million people, which generated a total of 8.6 million hours of live streaming video, according to CBS.

AdAge reported yesterday that CBS has sold as many ads online as on TV this year. Of course, TV ad revenue still outweighs online, which was estimated to be around $619 million for last year’s March Madness. Still, online revenue is up 20 percent, which validates CBS’s strategy to stream the games in real time without any of the restrictions NBC imposed on its Olympic coverage this year.

Related content on NewTeeVee: Where to Watch March Madness Online

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Roundbox Buys IP Of ‘TV Companion’ Dashboard Startup Jacked

Jacked

Heavily-funded mobile broadcast software firm Roundbox is buying the technology and IP of Jacked, a startup which provides web-based dashboards that aggregate info related to live TV broadcasts. Roundbox says it will integrate Jacked’s technology into its ‘mobile broadcast suite’—which is used by broadcasters to deliver content, like video and TV listings, onto mobile devices. The dashboards will no longer exist separately.

Jacked’s dashboards have primarily been used by sports fans to track stats and player information on their computers while watching live games (The company talked about expanding the dashboards to other types of broadcasts, although nothing seems to have come of those plans). Jacked was founded by former American Greetings (NYSE: AM) Mobile head Bryan Biniak, who is joining Roundbox’s advisory board.

The company had raised about $7 million in funding from Provenance Ventures, Core Capital Partners and Gabriel Venture Partners since its start in 2006. Roundbox, meanwhile, has raised at least $43 million, including $20 million in a third round in December 2008.

Financial terms of the deal were not released.

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Where to Watch the Indian Premiere League Cricket Season Online

Updated: Turns out, March Madness isn’t the only major sporting event starting this weekend: Cricket fans all over the world have been feverishly awaiting today’s start of the Indian Premiere League Cricket Season. In fact, the first game is already underway while I’m writing this story, with the Deccan Chargers facing off against the Kolkata Knight Riders, and the audience is going crazy on Twitter, posting tweets faster than a Cricket fan’s heartbeat.

So where do you turn to watch the Indian Premiere League Cricket Season? Not ESPN or Fox Sports. U.S. broadcasters tend to ignore the event, but cricket fans can turn to YouTube instead, where the complete season — with all of its 60 matches will be broadcast in real time almost all over the world. Missed a match? No worries, the IPL’s YouTube channel will also offer past games on demand.

The Indian Premiere League has only been around for three seasons, but it’s already been called “the world’s hottest sports league” by Forbes. The 2008 semifinals and final were watched by 62 million TV viewers in India, which comes to about 11 percent of the country’s cable audience. YouTube signed a deal with the league in January, which marks the first time the site was able to secure the online rights for a sports event of this scale.

YouTube will broadcast the Indian Premiere League games worldwide in real time, with one big exception: the U.S., where viewers won’t get to see the games 15 minutes after they’ve ended. That may be a concession to conflicting pay-TV rights, but it should actually help many of us to follow the league. Today’s game between the Deccan Chargers and the Kolkata Knight Riders started at 8 p.m. local time in Mumbai, which is 6.30 a.m. PST, and some games will get underway even earlier. Cricket fans can find the complete schedule for the season here.

Update: Subscription-based online sports site Willow.tv will stream the games in real time in the U.S., but cricket fans have to pay $60 to gain access to the live streams.

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