As demonstrated by high-profile deals with the National Football League and Cowboys Stadium over the past 60 days, few categories represent as much opportunity as wireless services.

The primary reason: industry consolidation.

Mergers and acquisitions have bolstered the sponsorship resolve at the four major U.S. players—AT&T Inc., Sprint Corp., T-Mobile USA, Inc. and Verizon Communications Inc.—all of which are increasingly using sponsorship to build consideration, preference, and ultimately, loyalty.
 
And some of those deals are driving rights fees to new heights.

In June, Verizon announced a four-year extension with the NFL in a deal reportedly valued at $1 billion. The deal—which kicks off with the 2013-2014 season—gives Verizon the right to stream every NFL regular-season and playoff game.

Not to be outdone, AT&T last month followed up the sponsorship with naming rights to Cowboys Stadium. The deal—which builds on an existing partnership with the NFL Dallas Cowboys—is reportedly valued at upwards of $20 million a year.

“Telecommunications is the most important category in the NFL, with the two major players making a huge investment at the league, team and naming rights levels,” said John Brody, the NFL’s senior vice president of sponsorship and media sales.

Wireless Service Provider Sponsorships By Number Of Deals
Wireless Service Providers Dial Up New Sponsorships

Most industry executives doubt the timing of the deal was a coincidence given AT&T’s long-running support of properties in Dallas (the location of the company’s corporate headquarters) and the number of years that Cowboys Stadium has gone without a title sponsor.  

“I don’t think AT&T suddenly came up with the idea that Dallas is a priority market,” said an executive close to the deal.

In another significant deal in the category, T-Mobile earlier this year inked a multiyear partnership with Major League Baseball. The deal represents the league’s first partner in the category in more than a decade.

And companies also are signing new deals with non-sports properties. AT&T this week announced it will replace American Express as the presenting sponsor of the 2014 Tribeca Film Festival. American Express has sponsored the film festival for the past 12 years.

Dust Settles On Industry Consolidation
In addition to reducing the number of players in the category, mergers and acquisitions have had a dramatic impact in how wireless service companies approach and use sponsorship, as well as the consumer experience at events.  

That includes the following:

  • More interest in content
  • A shift in focus from customer acquisition to customer retention
  • Enhanced in-venue consumer experiences

T-Mobile’s MLB partnership illustrates how wireless services companies are changing the consumer experience at sports events.  

The telco is activating the tie by installing an on-field wireless communication system in MLB ballparks that will connect managers in dugouts to pitching coaches in the bullpen. The company is expected to roll out the technology later this year; teams with existing partners in the wireless category can opt out of the program.

Wireless companies also provide another on-site benefit:  enhanced wireless connectivity. For example, AT&T uses Cell Sites on Wheels (COWS) to enhance network capacity at Com-Con, the Bonnaroo Music & Arts Festival and other events.   
 
Content Takes Center Stage
From streaming live NFL games on Verizon devices to listening to radio broadcasts of MLB games on T-Mobile phones, content is playing an increasingly important role in nearly every deal in the wireless space.

“It’s about content, content and more content. You have to have the necessary content to differentiate from the competition,” said Greg Busch, executive vice president at GMR Marketing.

The need for content has taken on increased importance as a result of industry consolidation and the need to retain customers, said Mike Goff, CMO at Premier Sports Marketing and previous vice president of corporate marketing at Sprint.

“Sports and entertainment platforms help provide value and increase stickiness.”

Wireless companies also use content to sell premium data plans, said Busch, noting that consumers need the plans to access content.

“They want to upsell customers so they can stream all that content.”

When offering content, rightsholders need to balance the needs of fans with the needs of marketing partners. 

The National Hockey League went down that road in 2010 after restructuring its contract with Verizon. While Verizon previously served as the exclusive wireless provider of NHL content, the company now offers premium content through the NHL Game Center app. Fans with competing wireless service providers can access the other content.

“There was a strategic decision to make sure the NHL is providing content to everyone who would like to access it. While everyone can access Game Center, Verizon still has a competitive advantage with premium content,” said Keith Wachtel, the NHL’s senior vice president of integrated sales.

The strategy has helped the league connect with fans while helping Verizon upgrade consumers to 4G phones, he said.

The NHL hopes to expand the tie into a larger technology partnership, said Wachtel, noting that Verizon could work with the sanctioning body and clubs to enhance the in-stadium experience through wireless infrastructure upgrades.

“There is a need for enhancing the in-arena experience, and technology plays a big part in that effort.”

Below, IEG SR highlights three other hot buttons in the wireless category.

Promote point of difference. Wireless service providers frequently use sponsorship to promote data plans and other points of difference.  

Sprint uses the NBA to promote its unlimited voice and data plan. The company supports the service by offering customers live audio feeds, statistics and other content through the NBA Game Time app.

Sprint also brings its “Truly Unlimited” positioning to life through TV ads that feature Kevin Durant and the Unlimited Access at the Half video series.

“Sprint’s activation starts with its unlimited positioning,” said Emilo Collins, the NBA’s senior vice president of global marketing partnerships. 

Gain social media content. Not surprisingly, wireless service providers frequently look for content that can be leveraged through social media.

Sprint activates the NBA with three social media platforms:

  • Playoff game highlights via the #NBARapidReplay hashtag
  • Player ritual video game series 
  • Sprint-branded backboard cam photos

Showcase product offerings. Wireless service providers are increasingly using sponsorship to showcase the breadth and depth of their offerings.

Companies accomplish that objective by using technology, as well as ancillary activities, to enhance the consumer experience. Those activities frequently include handset partners.

AT&T this year activated the Cotton Bowl Classic with the LG AT&T Huddle Up, a promotion that allowed fans to have their photos taken with the Heisman Memorial Trophy. The fan festival also included product display, concerts, autograph signing-sessions and other activities.  

The Cotton Bowl also uses AT&T products and services to enhance the team experience at hotels and hospitality areas around Dallas, said Michael Konradi, AT&T Cotton Bowl Classic’s senior vice president of external affairs.

“Our goal is to create unrivaled experiences. We don’t have Bourbon Street or beaches, so we have to create unique, one-of-a-kind hospitality. AT&T plays a huge part in making sure that teams want to come back for more.’

The 2014 AT&T Cotton Bowl Classic will be held in AT&T Stadium.