Wow! I struggled with how big a move this is initially. The fact that Yahoo! Sports Fantasy Baseball ’10 Named Official Online Fantasy Game for MLB.com indicated that it is much more profitable for MLB Advanced Media (MLBAM) to partner with Yahoo for its fantasy baseball game than produce it themselves.
MLBAM is easily the most technologically advanced of the professional leagues, is easily top five companies for digital sports capabilities, and has a ton of awards to provide it. Running fantasy baseball leagues is something that it can easily do (and has done in the past), yet it is choosing not to do this year.
Yahoo! is by far the most popular site for fantasy baseball, and it also makes the most money. As a partner, MLBAM could not have picked a better partner. The financial nature of the relationship is unclear, but MLBAM is either getting a share of the advertising revenue, a sponsorship fee from Yahoo!, or possibility both of these situations.
From a competition stand point, it is always disappointing to see one fewer company in the mix. While MLBAM has not been known for its leagues, the fact that it was competing in the past was always a good sign. Fewer options always mean less innovation.
The underlying question here is how exactly profitable is free fantasy baseball if Major League Baseball finds it better to outsource its game? If you are operating a free fantasy baseball game, how much scale do you really need to make it profitable, and how achievable is that scale?
What are your thoughts? Am I completely off my rocker?
3 Comments, Comment or Ping
Randy Burgess
I think it’s a matter of resources. Running a fantasy league system that can compete with CBS, Yahoo!, and ESPN takes a good number of people that are good at what they do (i.e. they get paid). MLBAM is probably just choosing to focus their resources on other projects–projects that have less major-media competition (such as HD Sports Video or something)–and let the media corps manage the games.
Making Yahoo! the “official” fantasy league manager is probably just for cash.
Mar 11th, 2010
Ed
Building a high-traffic commissioner game is a totally different beast than building one for a few thousand leagues.
In the early days of Open Sports we had speced out tech plans to use some (new at the time) open source technologies to be able to build a fantasy game platform that operates cheaper than anyone else at the time. Coming from Fanball (before the recent meltdowns) we know what it takes to operate these games. Needless to say Open Sports went a different direction and ended up getting married to Fox, however, Yahoo has implemented some of these techniques already. It’s possible to run a commissioner game with ads only but ONLY with enough scale and effective use of sharding, precached static DB documents instead of traditional RDBMS, light AJAX interface, etc.. Yahoo, obviously, has that scale and tech savvy to do this and it looks like they have.
Good job.
Mar 11th, 2010