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SportsLine’s Levy: Market drop hasn’t affected us

SportsLine’s Levy: Market drop hasn’t affected us

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Q & A: MICHAEL LEVY

Michael Levy, founder and CEO of SportsLine.com and its growing collection of branded and "private label" sites, generated some of the most audible buzz at the recent World Conference on Sport and New Media, hosted in Lausanne, Switzerland, by the International Olympic Committee.

During an extended panel discussion about the virtues of building online "communities" of people with shared interests, Levy evoked approving laughter when he interjected, "We are out to make money. Nobody is talking about that much."

Street & Smith's SportsBusiness Journal correspondent Steve Woodward attended the conference and got Levy's comments on a variety of related topics:

On merchandise sales following CBS SportsLine's decision to end its alliance with MVP.com: "MVP did a good job during a period when it seemed like the market was conducive to that business model. But their money just dried up because, now, it's gotten so difficult to raise funds. But our sales have been strong. We did about $16 million in e-commerce in 1999. We've been most successful selling the fan-based products, along with memorabilia and golf. Golf does especially well because people who watch golf play golf."

On SportsLine's road to profitability: "The [tech stock] market downturn hasn't affected us. We had $140 million in cash at the end of the [third] quarter. We believe we'll break even in mid-2001. We most likely would have done that in this quarter had MVP.com made its payment, but they did not. Total Sports, Broadband Sports and Rivals are finding it tough in this climate, but, for us, it has been an advantage. The guys with the best chance going forward are the ones who have a television partner. Even CNN/SI does not have enough broadcast TV sports programming to make them a long-term force. ... We'll be turning positive cash flow as long as we continue the growth we've been having in recent quarters. We're running at about 70 percent margins."

On how television remains the indispensable medium: "It is still true that if you can watch something on television, you're probably not going to watch it on the Internet. We find that the most popular sports on the Internet are the ones people can watch on TV. That's when you attract your biggest traffic and most of your advertising sales. We always do better when we augment sports events that are also big television events."

On building online communities: "We consider our communities to be the 15 [million] to 20 million unique visitors to the sites we produce every month. That's our total when you roll up all the sites we produce, including sites for AOL, pgatour.com and majorleaguebaseball.com. Plus, we are producing the official fantasy league sites for the NFL, NBA and MLB, and superbowl.com. There is a massive audience out there for fantasy leagues that can't get enough."

On the future of individual team sites: "We built and maintain the official site for the San Francisco 49ers. This was the first team site we have done, and it probably will be the last team site we'll do. We find it difficult to sell enough ads, and difficult to get people to go there. When that term expires, I doubt we would renew it."

— Steve Woodward

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