For a long time, IMG stood alone as the behemoth in an industry made up of smaller boutique agencies. Athletes were not making near the money that they make today, and agencies were making a fraction of the commission dollars that they now earn. IMG had an advantage, it was a mega sports agency that also had its hand in a variety of entertainment opportunities. The company has continued to expand, because it must. It has dropped its team sports representation wing to focus on its individualized (tennis, golf, etc) sports ventures. IMG has not given up acquiring many entertainment, media, and sports entities, though. But the company that once dominated, now sees a handful of competitors on the rise. They are acquiring more and more business every day, and are a threat to the old guard. They are also a threat to the smaller boutique agencies, just hoping to survive (unless the small agency is bought by one of the new conglomerates).
The old guard of sports agency conglomerates was founded with IMG. Soon, William Morris Agency (WMA) and Wasserman Media Group (WMG) would enter the fold, and bring a new dynamic to the world of being a sports agent. No longer was it enough to just be an agent who was well versed in contracts, collective bargaining agreements, endorsements, etc., but now, if you wanted to sign a big time athlete, you needed an entertainment wing. The Big 3 re-shaped the sports agent world. New agencies have continued to sprout up (and still do) with Insert Name Here Sports & Entertainment. All of them are trying to offer a similar product to the conglomerates, but few have truly succeeded in marketing themselves as a true Sports & Entertainment powerhouse.
The old guard still exists and thrives based on its continued growth and stature in the industry. There have been additions to the conglomerates, however. The Big 3 turned into a party of 4 when Creative Artists Agency (CAA) decided that it would expand into the sports agent industry. After signing some of the best agents with the best client sheets from all around the world (including IMG), CAA has become one of, if not the biggest and most powerful conglomerates in the industry.
Smaller agencies quivered at the thought that there was another conglomerate in the mix. Fighting against the old guard was hard enough. With CAA now in the mix, getting marquee clients would become even tougher. But now there is a new player looking to become the newest member of the conglomerates. The party of 4 has been crashed. The 5th pillar has been established, and Blue Equity has become a force to be reckoned with.
Blue Equity owns SFX Sports, Blackwave Media Group, Worldwide Football Agency, and has just purchased Game Seven Sports Marketing [Blue Equity buys Lexington sports agency]. Now Blue Equity can add representing top college coaches to its list of achievements.
Is the door now closed for a while on potential conglomerates? Will we see more acquisitions from the conglomerates that already exist? How will the old guard react to the new entrants? And will smaller agencies be able to survive? The industry is changing right before our eyes.
-Darren Heitner
6 replies on “An Industry Of Conglomerates”
I believe that the industry has a bit more wiggle room than we often think. For starters, the door isn’t entirely closed on potential conglomerates as some of the agencies just under the ones you’ve mentioned in size and stature including, CSMG, Octagon, Priority, Athletes First, and BDA Sports could always either join forces (as unlikely as that may be) or add the client list and workforce of an independent agency. There are still quite a few powerful agents who are not on a conglomerate payroll; ala Aaron Goodwin, Drew Rosenhaus, Matt Sosnick and Scott Boras and it is possible that any number of these agents could be cajoled into selling their agency or combining efforts. That being said, it would be naive to think that the conglomerates you mentioned aren’t also looking to add to their client rosters and armies of athlete reps by swallowing the practices of these influential agents and others.
The other important thing to remember is that though Jerry Maguire was essentially laughed out of the office for suggesting that his agency pay better attention to its clients by working with a less extensive roster, a good number of athletes realize and are beginning to realize the benefits of smaller agencies. Like Matt Leinart who left CAA, many athletes want more personal attention and some sort of individuality and uniqueness to the way they’re marketing initiatives are designed and approached. After all, Leinart was a Heisman Trophy winner himself and he also even had an impressive rookie season, though he was overshadowed by another rookie QB: Vince Young, but it seems he was still feeling slighted by CAA. Additionally, he figured he wasn’t getting anywhere near the attention that Peyton Manning and Reggie Bush were getting from the CAA family. As more athletes begin to understand that sometimes the agency or agent with the most clients just isn’t right fit for every athlete, there will be room for smaller more personable and ‘nimble’ agencies to maneuver their way through the industry by leveraging business relationships, continuing to shake the right hands and working better, longer and harder than their conglomerate counterparts. This is how all of the notable agencies that don’t happen to be conglomerates, thrive and even continue to grow.
Great points.
One thing – Leinart still is represented by CAA for his contract negotiations with NFL teams. He moved to CSMG for his marketing.
Uhm…..Samyr?
Sosnick? Powerful? An oxymoron if ever there was one…
Haha, ouch; well the man does have quite the successful practice in Sosnick and Cobbe so he deserves some respect as I’m sure others would agree. But mix and match names as you please: Leon Rose, Seth Levinson, Steve Loy, Donald Meehan, Mark Wetmore, etc. There are many agents with lengthy, high profile client rosters and blossoming agencies.
I suppose that any victory over a conglomerate is one worth celebrating; so though Leinart is still with CAA for contract negotiations, perhaps he still realized that there are some aspects of representation that a conglomerate is well equipped for and others, for which they may just be too cumbersome.
[…] at the conglomerates that cast a shadow on the smaller boutique agencies in the sports agent world [An Industry Of Conglomerates]. IMG is listed under the old guard, but still maintains a strong presence in sports like golf and […]
[…] July 16, 2007 (almost 2 years ago), I wrote a piece titled, An Industry Of Conglomerates. Since then, IMG has completely removed itself from representing athletes other than the […]