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WME And CAA Rivalry Heats Up

William Morris Endeavor and Creative Artists Agency continue to be rivals. Photo via thewrap.com.
William Morris Endeavor and Creative Artists Agency continue to be rivals. Photo via thewrap.com.

When one in the sports and entertainment industry hears of a “mega-agency,” a couple of names come to mind: Creative Artists Agency (CAA) and William Morris Endeaver (WME). These agencies began as rivals in the entertainment industry representing talent (actors, screenwriters, directors, musicians, etc.) and have become power-players in the sports industry as well.

According to an article by Michael Cieply and Brooks Barnes,┬áduring the NFL’s opening weekend, a third of its starting quarterbacks are represented by CAA. The other major sporting event, the U.S. Open of tennis, saw WME in the stands cheering on their client and champion, Novak Djokovic. This shows the wide reach that each agency has in the sports world.

A major reason that the shift towards a focus on athletes and sports is that movie and television stars are having a difficult time capturing mass consumer attention, while the value of athletes as performers and marketers is growing. According to the article, big four accounting firm PricewaterhouseCoopers (PWC) estimates the world sports revenue at $145 billion for 2015, which is 60 percent more than the estimated filmed-entertainment sales revenue (not including some forms of television revenue) of $88 billion.

Chris Bevilacqua, a former CAA executive and co-founder of Bevilacqua Helfant Ventures, a sports and media advisory firm, said “If size is a weapon, sports is the area of entertainment that is growing the fastest.”

CAA Sports started in 2006 with the hiring of many prominent sports agents. Nine years later, it is a powerful player in representing NFL players and athletes in other professional leagues (MLB, NBA, etc.). It has also represented teams and marketers in corporate sponsorships and advised groups on the sales and purchases of professional organizations such as the Philadelphia 76ers and Texas Rangers.

William Morris Endeavor focuses on representing athletes with more individual careers, such as sprinter Usain Bolt, and MMA star Ronda Rousey. Additionally, WME owns more sporting events and distributes more than 30,000 hours of sports program annually, a venture that CAA does not have a hand in.

In 2013, Hollywood and the sports industry collided when IMG went up for auction after the death of owner Theodore J. Forstmann in 2011. Both CAA and WME were interested, but WME ultimately won out when co-chief executives Ari Emanuel and Patrick Whitesell were backed by private equity firm Silver Lake Partners and paid $2.4 billion to acquire the agency. The acquisition has began its transition phase becoming WME|IMG, but IMG still operates as its own entity.

Along with representing some of the top athletes in tennis and golf, IMG also negotiates and oversees big marketing deals, such as deals between VISA and FIFA, and between General Electric and the Olympics. IMG College is one of the company’s biggest divisions. In March, the company and the NCAA agreed to a 10-year deal which includes ticket sales and marketing for certain championship tournaments. Additionally, its Collegiate Licensing Company manages the brands for roughly 200 university and college teams.

CAA has started dipping into the licensing business with its acquisition of Fermata Partners, an Atlanta-based company started by former IMG Collegiate Licensing Company executives.

As the sports world continues to diversify, these agencies will continue to be neck and neck in terms of competing for clients, marketing opportunities, and other ventures.