Tokyo 2020 and the future of sport business

On the front pages of the Japan News, throughout my few days in Tokyo, the pressing matters regarding our future are laid out to me. Climate scientists are alarmed about the unprecedented ‘above average’ temperatures in the Arctic. Trump is threatening to unleash a trade war, even when this clearly will not benefit the US economy. Mr Putin proudly announces that his rockets can navigate around missile shields to get to the US and President Xi Jinping is showing his real hand by aiming to stay in power for, well, the next 30 years or so – China incarcerated.

I am in Japan to present on ‘the future of sport (business)’ at the final session of the Executive Masters in Sport Governance (MESGO, http://www.mesgo.org/) program. On the flight to Tokyo a few days ago I watched Blade Runner 2049. The movie imagines a grim picture of a future in which we have destroyed the earth and confused the boundaries between the human soul and artificial intelligence, to the extent that even the cyborgs do not know if they were born or created. Like any science fiction work of art, there is an unnerving connection between the imagination of the creators and the extrapolated reality that the work is based upon. The fiction in science is only fabricated, because it lies ahead of us, not because it cannot and will not be true.

So, on the future of sport business, it is important to consider the context in which the global sport industry is progressing. In 2004, I was privileged enough to co-author the Sport Business Future with Aaron Smith (http://www.aaronctsmith.com/book/the-sport-business-future/). Although some of the ‘radical predictions’ in the book turned out not to be too radical at all, the basic underpinnings of the book remain valid and very real.

First, those who command the power over economic resources will also drive the development and innovation (or destruction) of industry and society. Second, technological advances will allow for global mass communication and transform the way we do business and how we prepare (or create) elite athlete performance. Artificial Intelligence and nanotechnology combined will soon accelerate to create unprecedented advances in business and human performance. After all, during the last decade humans have generated as much data as previously was produced in the whole of human history. It is estimated that we will double this amount of data roughly every two years.  Third, culture will remain the main driver of a dominant (increasingly global) sport narrative; what is the dominant sport business paradigm; and which sports will (continue to) shape the mass participation and spectatorship. Trump, Facebook, Alibaba and right extreme ideologies are fuelling culture (re)creation by either facilitating or crafting ‘fake news’ and business and religiously inspired propaganda. This is also the context in which we look at sport, and how we envision what are the important sport(s), and what are ideal type athletes – both mentally and physically. There is danger lurking that it perpetuates ‘sameness’ rather than diversity of (sport) culture. Overriding all three of these driving perspectives is the matter of the integrity of sport. And that presents two questions in turn – what is integrity in sport and how does one maintain integrity…?

The above described context provides an exciting playing field for some solid sport business science fiction debate. So next I present just a few of the issues we debated in Tokyo with a group of 30 senior and executive managers in world sport.

The IOC has been slow to realise that the Olympic Games would not forever be a property that cities would compete for to win its hosting rights. Tokyo 2020 is already implementing necessary change by using existing facilities rather than build more white elephants. They are proudly building on a 1964 legacy, yet embracing the fact that the Games will predominantly be watched on second and third screens by those born in the 1990s or earlier. New sports will be introduced to attract a fresh generation of viewers. The Tokyo organisers predict (as per usual and of course incorrectly) a huge economic windfall for the organisers. If they were not overestimating the economic benefits there would not be a political platform to justify the expenditure that comes with being an Olympic host. So do the Olympic Games in their current format have a future? I think Los Angeles and Paris will have to provide the transformational platform that will enable the survival of the modern Olympics. If they don’t, the Games will die a slow and sad death.

On national and international governing bodies (of power), will FIFA and UEFA, as prime examples become irrelevant, as a result of resource power shifting to a few, very, very rich business moguls? Of course, there have been attempts by 16 or later 32 of the most powerful European clubs to break away from UEFA. UEFA responded accordingly and created the Champions League and FIFA has extended its championship portfolio across age and gender. But FIFA and UEFA do not own the workforce of football talent. The (owners of) teams do. Soon my beloved Ajax Amsterdam http://english.ajax.nl/streams/ajax-now.htm) with many other great European teams will have to qualify for the Champions League when finishing in second or third position in their respective domestic leagues. EPL, La Liga and the Bundesliga on the other hand, can send 3 or 4 of their teams straight into the CL. So will Ajax ever be like Real Madrid again? In my humble opinion, this can only happen if five or six billionaires decide that they will run their own competition, and in the process, buy the team and player properties that will play in that league. They will (and the City Group is) buy(ing) properties that cover spectator and merchandise markets, and be the owner of deep cultural intellectual property that generates value. That is why Ajax will be an asset in a football portfolio of a billionaire. Because their talent development expertise and performance culture remains world class. But under UEFA, Ajax and so many other former Euro football super powers will not revive their glory days.

Then let’s turn to the sport performance. Doping use is rife in the world of sport, epitomised by Russia, and largely ignored by the IOC. Money drives a win at all cost mentality. Whilst various authorities are struggling to combat ‘old doping’, in labs around the world where medical and sport science is advanced (https://www.vu.edu.au/institute-of-sport-exercise-and-active-living-iseal/research-programs/sport-science/genes-performance), a new dawn of performance enhancement is rising. Rapid advancement of knowledge about the genetic determinants of physical performance, and how to manipulate it, will raise the bar of detection of illegal use to a whole new level. The blurry line between recovery from illness or injury and illegal performance enhancement will become wider and harder to police. How and when to intervene in the genetic building blocks of humans, and what end does or does not justify which means, already is a huge issue. If the athletes of the former Democratic Republic of East Germany, Lance Armstrong and 100s of his peloton colleagues or Russian Olympic athletes are chemically enhanced human beings, what are we going to do with the sporting cyborgs that are being developed in (dark) labs around the world now? How can we prevent the creation of freak athletes in countries where the ethical frameworks are not accommodating for robust regulation and legislation?

Although there is so much more to consider, one final example. It is about the new generation of whizz kids who know more about mathematics and less about sport. Will data scientists and data analysts be the new sport marketing gurus? Data is at the centre of it all and of course legal betting agencies and illegal betting syndicates are all over this. In the recent past, the revenue generation in sport has largely been driven by collecting (consumer related) data by the sport organisation or marketing agencies. Stock standard market research. However, in the age of machine learning, big data analytics, and pimple faced kids creating predictive algorithms, the data is already out there. It becomes more a question of what behaviour one wants to predict and less an interpretation of past consumption. Tennis Australia and Victoria University have set up the Game Insight Group (https://twitter.com/TennisAusGIG). Data scientists have used open access facial recognition software and rewritten it to identify the range of emotions that (Roger, Rafa, Novak and Andy) express when winning and losing points (Emotion Tracker). The study delivered significant results in regard to predicting the outcome of the next point, given the facially expressed emotions of the players. This project should warn us that whatever digital fingerprints we leave, marketeers, and sport marketeers will use it, combine it, refine it, and then enrich it to sell us more sport, or indeed, predict the outcomes of sport and sport performance.

Here we are wondering about the future of sport. Frivolously if we can but with a healthy dose of concern about what seems a crumbling foundation of the community driven values of sport. Sport will only thrive in a world that offers fertile ground. The US, Russian and Chinese leaders don’t give us much hope to build on. We also continue to stick our head in the ever-warming desert sands of climate change. When walking past the gaming parlours around Tokyo’s Shibuya station, where neon lights and gaming noise aggressively compete for the attention of the passing crowds, I eerily find myself in a scene of Blade Runner 2049. Information overload, numbing my senses blocking out the real word. Not a world that I want my kids to live in. They may demand a future with real sport and real sport participation.

And for the heated toilet seats in Japan, they are overrated. They contribute to global warming, even if their focus is local.