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tv   The David Rubenstein Show Peer to Peer Conversations  Bloomberg  September 23, 2017 3:00am-4:00am EDT

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♪ jonathan: from new york city, with 30 minutes dedicated to fixed income, this is "bloomberg real yield." ♪ jonathan: coming up, janet yellen brushes aside plans to unwind the balance sheet and entities up another rate hike before year's end. geo politics fuels the bid as north korea threatens to deliver a hard-line response to president trump. and beyond toys "r" us filing for bankruptcy, heavy debt loads continue to haunt retailers. we start with a big issue. why unwinding a $4.5 trillion balance sheet is apparently nothing to worry about. >> i imagine janet yellen is
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doing cartwheels behind the scenes at how well the market has taken the balance sheet reduction plan and announcement. to be likewants this watching paint dry for us. this will be very boring. it is all preannounced. it was all very transparent. there was no surprise in the announcement yesterday. and so, i think we will be watching quantitative tightening in slow motion. >> i think she is trying to do as little as possible. she introduced tightening in monetary policy, and she was trying to do as little as possible with the dots to keep them as unchanged as they could be in the next 12 months so beyond that they can make the policy changes. >> the crisis is over. we still have policy levers largely at their emergency crisis determined settings. so let's return on a methodical basis the policy levers to normal so we have the ability to control our economies.
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jonathan: joining me around the table today is greg peters, senior investment officer at pgim, priya misra at td securities, and colin robertson head of fixed income at northern trust asset management. great to have you with me. let's start with the fed balance sheet. the federal reserve has made making policy mistake after policy mistake for decades. this cycle we seem to have extreme faith that evening is going to be ok. is everything going to be ok? priya: if we look at every rate hike in this entire cycle, it was 90% priced in two weeks before. the market didn't react this week because it was the most widely telegraphed move. convinced the market is entirely priced in. they are starting very gradually. i think it is hard to price out a year out when there is 30 billion more in treasuries per
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month that will be issued. the second is, we don't really know a crucial point that the market cannot pricing, how will the treasury price in the fed? bullet be built issuance, in which case i can tell you there is no impact. if the market does not have that information, we cannot president. to start out with 6 billion per month, that is something the market can handle. it is the path forward, i think the effect might build more cumulatively over time. jonathan: what are your thoughts, greg? greg: i think the fed is trying to pull a fast one. it has to have some sort of effect. if you believe qe, the sole purpose was to tighten risk premium, to force people at the risk curve, affect a portfolio channel, then the reverse has to have some effect. it might not be one for one, but it cannot be zero. it cannot be watching paint dry. i think the fed is getting extreme cover from other central banks. i think that is the story. it is the ecb and the boj.
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jonathan: we can basically show the percentage that the federal reserve has of the overall stimulus pie. the ecbeen declining as and bank of japan have increased stimulus. that is slowly rolling over. is that what we are seeing here? it is not the market does not care, but the ecb has given them some cover. colin: i think the ecb is giving them a lot of cover. clearly, the balance that the central banks across the globe have on their balance sheets is significant. even dropping 4.5 trillion to 2.5 trillion over the timeframe the fed is talking about, i could see why investors are relatively calm about it. also, i believe yellen clearly gave herself room such as this is not done well, the fed may just stop and decide they will go ahead and stop the case of bringing the balance sheet down. priya: you brought up policy
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mistakes, i wonder how much of that is priced into the reaction. the fact that the market thinks this might be a policy mistake, there are a lot of clients tell me no more hikes, maybe one more, and if you really think the hiking cycle is over, then i -- portfolio runoff must continue. i think to your point is the view that this is the unwind of the smallest ever unwind, i -- therefore the market doesn't price it in. i think the policy mistake issue is on the markets mind. jonathan: another thing i am thinking about is on a demand-supply basis, there should mean higher yields. but if we look at this through the prism of the central bank responsible for inflation expectations, we know through history when they did qe, yields rose. and you didn't look at it from a demand supply perspective, you look at it from an inflation perspective. why is the reverse not also true? why can't we see a federal reserve that unwinds the balance
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sheet, but actually, treasuries get a longer bid. priya: i can see that if it is clearly a policy mistake. when the fed was doing qe, real rates were declining, inflation expectation was rising. nominal rates, the sum of the two, actually grows in all of the cases. look what has happened to real rates. ever since they started the portfolio unwind, real rates have been rising. i still think they are low and can rise some more, but inflation expectation, there is not a lot of inflation. the fed is telling you it is a mystery, but we believe it will show up. so we are still going to unwind. inflation expectations are not that attractive and rankings are still pretty high relative to where they could be. >> the curve is flattening. so something is happening. if you go back to christmas of last year to today, it is a pretty big move. 136 basis points, now down to
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82. that is a pretty decent sized move. the expectation is if the fed continues along this path of tightening, the curve will continue to flatten. the yield curve is giving you a signal, i think, that the fed could be slowing down the economy too much and entering a policy mistake. jonathan: sterling at 92 basis points -- greg has jumped on it -- what is the message that comes from that? priya: it is a similar idea that all the long-term growth is still low. all the fed can do is move the front end up while the long end stays anchored. there are a lot of people saying is this time for a steepener because the fed is letting the portfolio runoff. i think a lot of that is going to depend on what the treasury does. if they do announce 50-year bonds, i don't think there is that much demand for long end paper. i think you get a steepening of the curve. if we get tax reform or tax cut , which is actually what it is going to be -- that as to the deficit, and we can talk about
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steepening, otherwise this will be a fed-led unwind without any fiscal easing. i think this curve continues to flatten. jonathan: getting a question from the bloomberg, given the fomc 2018 dots, where do you -- three hikes while bringing down a terminal rate -- where do you think the opportunity is, in the long end for term premium or the short and for more than two hikes? colin: long end. for term premium. i think with respect to what the like withe looks curve flattening, the fed could find themselves in a real dilemma if the curve continues to flatten and there is the thought process of more hikes in 2018, they will have to take them off the table because they will not be able to tighten into an inversion of the curve. jonathan: what is curious, that they trimmed their inflation expectation but maintain their estimates for hikes. this conversation could be redundant once we find out who will lead to federal reserve and who takes over the board position. to do that is hard to make sense
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of. greg: it is until you overlay financial conditions. i don't think they are really focusing on inflation. i think they are worrying about that very little, in fact. growth is strong, global, cyclical upswing, but financial conditions are as elusive as we have seen them. i think they are focused on that more than the inflation picture. jonathan: that is going to lead them ultimately to make a policy mistake. are they focused on the wrong thing? priya: that is part of it. they could continue to try to tighten financial conditions more. i wonder if it is the belief in nairu, what if arstar stay zero -- all of these unobservable criteria that is making them hike. what if arstar stay zero while the fed believes it is going to rise? i wonder if that results in higher rates. it goes back to greg's point. i wonder if the fact that this hawkish reaction function was
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also the function of them having a different reaction function because they are trying to normalize. what we are hearing from every central bank, we are trying to normalize, not tighten. i wonder if when they tighten, they will care about inflation more. jonathan: i think everyone is trying to understand the reaction function. everyone is sticking with us. we will come back with gregory peters, colin robertson, and priya misra. coming up on the program, the auction block. donald trump made waves at the this week with strong talk about north korea. that is next. this is "bloomberg real yield." ♪
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♪ jonathan: i am jonathan ferro. this is "bloomberg real yield."
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i want to head to the auction block. last week, we had tajikastan offering an opening from that country. this week, we had ukraine. the country received bids for in itsimes its offer first foray into the market since russia invaded crimea in 2014. the demand for 50 year bonds was so high that it knocked almost 40 basis points off the initial guidance. this quarter has seen al-shabaab -- offshore bond sales from south korea climbing to the highest levels since 2013. that includes a $1 billion sale by korea development bank. to wrap things up, the clamor for yield did not extend to south africa. the nation had to pay more to settle 10-year bonds, managing to only attract $2.1 billion in bids for the $1 billion offered. but the story of the week was in credit. toys "r" us, a quick descent
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into bankruptcy shocked deck traders this week. they are asking which other retailers will struggle to harness their debt? investors are left asking, why did no one see this coming? still with us is priya misra, colin robertson, and greg peters. , that chart is stunning. after theclose to par last 12 months, then within two weeks, we rollover to $.29 on the dollar. why? greg: i think people were surprised by the timing. you think about the toys selling business, the peak season is heading into christmastime. were thinkingors they had a little more runway and they found out they didn't. toys arrest story is an interesting one because it is a -- toys "r" us story is an interesting one because it is a holdover of what happened last cycle. as part of the lbo boom 2005
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deal that was extremely levered. it is less of a retail story and more of a too much debt story. i think you need to bifurcate and separate those issues and not paint retail under the same brush. jonathan: and colin, we can show that. the debt servicing costs of this company was phenomenal. they were pushing half $1 billion a year in some years in the past. we can bring that up for our viewers. is this a stand-alone story? i do wonder -- and if we know about this, i go back to the chart of the credit, why didn't people see it coming? it wasn't in the price at all. colin: right. i think people saw it coming in the sense that it was a when, not if. this was going to happen but there was a miscalculation on the timing. as greg said, the thought process was get through the christmas season until 2018, but clearly it was knowable, as you stated, and i think there are some other knowables out there of other companies that are
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overleveraged. it is not a total one-off, but you don't throw away the old -- whole sector because of this issue. greg: that was a one-year piece of paper you were showing. it was dancing between the raindrops, a little. jonathan: when you look at cvs -- and you and i talked about this, the bottom line is markets and investors failed to price default risk. it is not like we were trading in the 80's, we were in the high 90's. we were not pricing in anything. i just wonder why and where was asset panic? greg: it is hard to say. we saw this in the bank space with banco popular. the market seems to be more surprised by these events, but i don't think it is broad-based. i will go back, i don't think the market is categorically mispriced. i think this is an idiosyncratic issue that took the market by surprise. we have seen an increase broadly of idiosyncratic issues.
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but that doesn't taint the overall market. if you look at overall yield, the loan rate is up 7.5%, but the rest of the high-yield market is up 2%. i think these are localized issues. it is not endemic. jonathan: let's talk about a price. we can overlay the bloomberg high-yield index with high-yield energy and high-yield retail. there is quite a spread, 100 basis energy over the benchmark, 200 basis points over retail. but it did interest me that those two things are rolling over, getting tighter over the last month. greg says the price is justified. is what you are seeing on the screen justified? colin: i agree with greg. i think the market is fairly priced. as greg pointed out, you have some circumstances where maybe we have gone tighter than where -- than some believe in some
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sectors, but the bottom line is there is still a hunt for yield and still a reason to be confident in high-yield. i think the prices are fair, and i actually think spreads will tighten from here. jonathan: the price is fair, is conviction high? colin: conviction is not that high. that is probably the tougher spot and the better question. i think there is nowhere else to go in some cases. the central banks are a big part of this. they leave investors in the market with only limited choices, and this is an area where the choices a good one -- choice is a good one still. jonathan: from a macro picture, i wonder how many companies the fed is keeping in business that should not be in business? priya: right. and i might take the negative side of this. risk reward becomes a little stretched. the bif has been talking about this for a while. they have been talking about this for a while, the amount of dollars that outside of the u.s., and they had delivered fx forwards on that.
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there is a lot of leverage here on rates rising. not only do you have the fed and the unwind, if the ecb starts tapering, do we get a rise in rates? maybe it is idiosyncratic and not the entire credit market, but lots of these idiosyncratic events start coming up. from a systemic basis, i think the market will get worried. greg i think it is an excellent : point. i just don't know that it is now. ultimately, what we are worried about is that the ecb taking stimulus away but doesn't seem to be here and now. i think high-yield is very different than investment grade. the difference of the high-yield market versus the investment grade market is investment-grade companies have feasted on this low yield environment. masse,ve been issuing en each year is a new record in terms of gross issuance. they are levering up. high-yield is a different story, which makes toys "r" us interesting, because postcrisis you have this fed leverage cap
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at six times that is containing the high-yield market making it a much more rational market. -- market today than what we have seen in the past. jonathan: you are sticking with us. greg peters of the gim, colin robertson of northern trust, and priya misra of td securities. before we go, let's get you an update on markets. the treasury market, two's, tens and 30's. yields are higher on two-year. the 10-year the same amount. the 30-year by three basis points. it is still a flatter yield curve. still ahead, the week featuring mario draghi, janet yellen and carney next week. ♪ this is bloomberg real yield.
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♪ ferro.nathan this is "bloomberg real yield." coming up, and incredibly busy week. german election coming up this weekend. shinzo abe might call a snap election.
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and then we have these big three. mario draghi, janet yellen, and mark carney all speaking and a possible health care vote in washington, d.c. to throw in there as well. still with me is greg peters of pgim, colin robertson of northern trust, and priya misra td securities. the fed speak, is that a good thing or a bad thing? priya: given that central banks are driving a lot a price action, i think it is a good thing when you have to much, the confusion, i think there will be with the leadership at the fed. apart from janet yellen, there are 11 other fed positions -- officials speaking next week. our toes andus on probably within a range, but we want to understand long end rates, inflation, what gives them confidence on inflation. i will be watching mario draghi little more. it is definitely autumn, or the fall -- jonathan: that is the guidance. it doesn't look like they have a clue what they are going to do
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yet. greg: it does not look that way. the last meeting, the market interpreted that there is something to do in october. i think all eyes are on him to clarify that statement even though he did not say anything. the markets are looking for him to clarify. jonathan: what is your base case for october now? greg: i think it is steady as she goes. the challenge, if you look at the inflation numbers, that are lower today, i think there are real challenges that are structural. they are running out of bonds to buy so they have to do something. announce something, but they may extend it at the same time. i don't think they are willing to give up yet. jonathan: has janet yellen made mario draghi's life a little more difficult executing this story now? colin: definitely. there's no doubt about that. i think she makes my life more difficult because within the fed we have no idea if they think inflation is structural or transitory. until they come to a consensus on that, they are making draghi's life difficult and all
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of ours, too. jonathan: the bias is still to hike. the bias is still to maintain interest rates and expectations for them as they are. are we surprised the next time we get the summary of economic expectations? colin: i think that is possible. i wouldn't be surprised, but i would say i'm not sure. given what the fed has projected they're going to do next year, i think a lot of things need to hit on perfect cylinders for that to happen. jonathan: is it possible you get to the end of the year, and the story has changed for the fed on inflation expectations? priya: i think it is a little quick for them to capitulate on the entire phillips curve. if the labor market turns and we see worse later, sure. a lot of faith is based on the fact that the labor market tightens, but if it is still chugging along, to locate a year -- to locate a year from now and we are not seeing inflation, i think she is taking a lot of faith in the fact that half of
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cpi was wireless driven. when that is out of the data and inflation is still not picking up, i wonder if the fed things they are in a bit of a catch 22. they think inflation will pick up, so they want to hike, but by hiking too soon they prevent inflation from rising. jonathan: we will have to leave it there. a special thanks to greg peters of pgim, priya misra td securities, and colin robertson of northern trust asset management. that does it for us from new york. we will see next friday at 12:00 new york time. 5:00 p.m. in london. of course, we will bring you a week full of fed speak with draghi carney as well. this is "bloomberg real yield." ♪
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>> welcome to a bloomberg television special. dla sports summit in los angeles. i am cory johnson. some of the biggest names in sports and sports business. .eople like luke roba tire stan caston, the ceo of the l.a. dodgers, media titan michael isner, all gather here to talk about the biggest issues in sports business. ♪ cory: michael isner has a storied career as a media executive in los angeles, running paramount, running disney, but as an investor, he has invested in all kinds of businesses. most recently, buying a soccer club in u.k.
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i would rather go into a situation where you cannot fall off and you build it up, rather than spending all that equity for the premier league and getting relegated to losing all your equity. it is a big spread between what united is worth and what we paid for portsmouth, like a $3 billion spread. upside and it of is a very famous team, it is a naval, the only island city. cory: what is the business opportunity there? what is the model that will help you make money? >> the spread between portsmouth and united. i've got three sons that are interested in it, no interest in selling it ever. investment outside the united
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states is a good idea. frexit created a discount to the dollar, i think the premier league and even the championship league, but especially the premier league is the best world league in sports. maybe even bigger than the nfl. it doesn't face the problems some of the other leagues have, it is the world sport, and the u.s. is becoming more and more entrenched. msl will play the the same season the rest of the world place. it just seemed to me kind of a no-brainer. legends of sports business, stan caston, a very special place, once running in nba team and a great baseball team, the atlantic raves. -- atlanta braves. but his turnaround of the dodgers has been phenomenal, but the secrets of the business of the dodgers have yet to unfold. >> wii and unseated a plan the
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day we got here. we have an ownership group that was committed to that and have allowed us to really pursue that plan. we were going to build the product on the field first through scouting and product development. we are going to invest in the meantime, but the long-term plan was scouting development. >> how long does that take? three, 4, 5 years. particularly if you are focused on international. it does take time. it is happening, we are online for our second straight rookie of the year and we have more coming in the pipeline. that was the most important thing. at the same time, we invested money to completely provide a fantastic dodgers stadium and we spent a lot of money through southern california for community relations. those were the three elements and we had luck along the way and a lot of our decisions were
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good. not all of them, but enough so that we are here. we should contend every year, because we are the dodgers. cory: you guys have notoriously, one of the most difficult situations. most of your fans can't see her games because of the cable deal going on now. but it has brought billions of dollars to the franchise. is it going to be this way for the length of this deal, another 20 years? >> it might. the last administration called out directv for antitrust laws. the case was settled with a wrap on the wrist. right now, other jurisdictions are looking into their daily legal -- illegal activity. the attorney general of california is looking into this. >> the point is, that is what has kept us off the air, it is a shame. but business has never been
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stronger. we have never had more attendance, more gate receipts, more sponsorship, etc. our business remains strong because there is a native appreciation for the dodgers because of 50 years of history. cory: is it possible you don't need to fix the tv deal? >> we do because it is hurting too many fans that deserve to get the games. they are paying a lot of money through their systems. we are in 93% of the market, it ofjust those people in parts town have directv and would like to get it, and they should. but for these violations of the law, they probably would have already. yes, they deserve it. cory: is tv the business model for sports in the country? a lot ofe tv bringing your revenues, with local fans, currently the most important part of your revenue pie? >> it will be an important
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delivery of our product by whatever mode is important. was very dogmatic about never investing in hardware. he was always a believer in software and content and if you on the software, the content, you will find a way to optimize the return from that. we have great content, we have enormous support from a tremendous market here of dodger fans built up through 60 years now. as long as they are still here and the team is still playing, we will find a way to optimize the revenue from that and i think that goes across the sport, as well. all ofou can check out these interviews in their entirety at you can download podcasts at bloomberg/audio. up next, the l.a. clippers and the price they put down. we will talk to an nhl hall of famer and then focus on the esports.
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♪ cory: welcome back to bloomberg television's special. i am cory johnson in los angeles for the bloomberg l.a. sports summit. hall of famer luc robitaille had career for the la kings as well as playing other places. new york, detroit, pittsburgh.
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but as an executive, he has found a way to focus the team of the la kings. >> the first thing the players don't know is there is a lot of people working for. you think they will be there and then nothing else is going on, you don't realize there are 100 get theeople working to organization going. he really don't know that and that is the biggest shock, when we bring players, whether they or guys that sit in our meeting, their faces always -- it is funny to see their reaction because you really think as a player, as long as we win, everything is ok. cory: and it is not. luc: there is a lot more going on than that. it is a great learning curve for a lot of them. cory: the way the fans connect now is very different. are doingre -- through social media, talk about your efforts there and how you
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are trying to get fans closer and more involved with the team? think it was 2011 when we hired a couple of kids and we basically told them, we don't want to be one of those boring teams that are just showing the score. in those days, six years ago, every team was just showing the score and getting some news. we told them have a personality on behalf of the organization, but be respectful. we were lucky, we made the playoffs and had a good run and kind of made a fun of the opponent and it just took off. a life of its own and ever since then, i think a few teams have taken that route and i think it makes it fun. i remember the san francisco giants were really good at it. there are a few other teams, but we believe we should have a personality as an organization. it is just sports. we are not doing anything special, so we should have run with it. cory: when steve ballmer paid $2
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million -- to buy the l.a. clippers, people shook their heads. that is the problem facing gillian zucker. >> the whole problem has been about transformation. when steve took over the team, he came in with energy and this revitalization effort that has filtered down through the organization. you see it on the basketball side and the business side in the scope of talent we are attracting and the types of partners we are bringing in and attracting and really, it has attracting great talent, great partners and really expanding both the business prospects and the basketball prospects. cory: talk some specifics about other revenue. when you look at the business of sports -- sports and the price paid for this team. other than selling it for more , it is hard to investing because the intrinsic value
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might be there. what could add to the intrinsic value of an nba team? gillian: you have to look at the nba. really, taking the lead to a place where it is attracting a lot of fun fans and penetrating a lot of brands. cory: so you think advertising the advertiser will pay more and more to do that with existing products? gillian: the nba is already attractive and you haven't seen concerns about the price of these teams. a keep going up as evidenced by what houston will be selling again recordill be priced. in addition to that, the landscape of especially regional broadcast is changing pretty dramatically and we have been investing a lot of time. cory: dan kassel was in that seat crying -- regional sports
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networks have not gotten all that great all that time depending on deals struck. gillian: when steve bought the team, people wondered what his mindset would be and that is where he has invested his mind in a lot of years. how do you utilize technology and some augmented reality and change the viewing broadcast? cory: you think revenue opportunity is there for the clippers. gillian: absolutely, and later this year we will be unveiling the first phase, the beta, and it show directionally where we are heading. cory: which will look like what? gillian: there is a product that is already out there that is used by a lot of gm's throughout does isue, and what it using artificial intelligence, it tracks every move of every athlete in the game and because of that, a six-year-old could do it. you could say, i want every dunk by lake griffin. you could deliver that in a matter of seconds.
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i think that by putting in the consumer, that very powerful tool, that is our goal. to me about the opportunities for creating other media away from the game itself where the rights have been sold to the major networks. gillian: we have a relationship with fox which is enabling us to do this in partnership with them in the broad sense you look at that. if you can make the pie bigger, there is enough room for everybody. cory: finally, the new stadium. what are the -- i read a story that referred to the possibility of negotiating with inglewood was a promise ring, that you might look at it as a new place to build a stadium. is a veryhe mayor colorful guy and we have really enjoyed the relationship to explore the possibility of building an arena there, but we continue to have a relationship with the staple center, we
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intend to honor our seven-year lease there. there is a possibility to work out the situation where we can remain in the building. can find these interviews archived on you can listen to them on and everything else that happened here, the los angeles bloomberg sports summit. up next, rick fox from the l.a. lakers and esports and the new focus for activision and blizzard. ♪
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cory: welcome back, i'm cory johnson in los angeles for the bloomberg l.a. sports summit. carried live on bloomberg radio, also can be found at rick fox had a terrific career in college, terrific career at the celtics, but at the lakers, he made himself a name as a power forward. but as a businessman, he is thinking about esports. rick: in my retirement, i never lost my fire for competition and that led me not only to discover what i think is the next generation of professional sports, which is today's videogame athlete that has found a way to not only compete out of joy but also make a career and living out of it. and closerng closer to what mainstream america would recognize as traditional sports and along with my partners, on the forefront of forging this
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conversation forward and continue to grow this industry. myself today talking to a lot of team owners and people about business models in sports and i wonder how the business model in these sports -- what you imagine the revenue will come from? rick: we are pretty bullish because coming from sports, my , youers are from sports have a couple of gentlemen and jake's all who helped build warner bros. interactive, we all saw what we believed was a parallel track to traditional sports are you have owners and -- coming together to create a league. this is what is happening in coming, publishers are together with owners and creating leagues, those leagues will to players and players can
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have fan bases and young become thoseant to players someday so they start tracking their careers and following them, which creates meteorites. when those meteorites start to happen, you have the data and analytics and sponsorships. cory: so a typical business model minus the tickets and the seats. gillian: and those are on their way. when you see the world championships of these sports being played in the staples center and madison square garden and the arenas they are feeling. we have seen numbers in terms of viewership globally, they rival and surpass some traditional sport numbers we see in the nba or major league baseball and other leagues, but yes, you are seeing actual esports venues pop up in vegas. blizzard will create one in los angeles for their overwatch league. riot has a studio in santa monica here. cory: it is an amazing
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phenomenon. people watching other people play video games. this growing business is the focus of activision blizzard. in thehat has happened last year or so, it has been a fairly recent phenomenon, we are approaching a cultural tipping point where now, as many people are watching videogames as are playing them. it is not a new phenomenon, but what is new is the scale. now streaming and the scale of events, all the ways to create fans are causing people to come into gaming for not playing the games, but watching other people play the games. others happens, we and in the industry can look at what and thoseng opportunities look more like those you would see in traditional sports. in other words, when was the last time you strapped on a helmet and played football? people don't play football -- kids do, but most people who watch football don't play football. we are watching a pointing
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gaming were that is true of certain games. manus: what kind of games? caroline: the categories tend to be shooter -- cory: call of duty, one of the best selling games ever. gillian: -- overwatch, which is a hybrid of a shooting game mashed up with a battle arena game, the genre games like lee jones -- will give legends fall into. genre, another popular team-based strategic games where there is a lot of drama, a lot and thets of intensity game could go either way at any moment. and then there are genres that people are more familiar with like sports games, which tend to amonglly popular games players, but maybe less popular among spectators.
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cory: interesting. leagues, isop these there going to be a limit as to how many game leagues there could be? because franchises and video games, there are so many. but new ones come up every once in a while that develop popularity. will there be so many that there will be 20 different leagues or will it be limited to a handful of major games? this in acan think of similar way that you would think about traditional sports. not one sport everyone watches. there is one sport that is bigger than the rest of them, but there are half a dozen sports that matter on tv and have somezen that kind of critical mass of audience. , you will see something similar. -- will see -- overall touch call of duty will be the nfl. cory: but why?
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is it the time of the audience? pete: i think it is the variety of the interest in preferences of the audience. different people like different games. and at the scene around each game is a little different. some games are more urban, some are more sports driven and so people gravitate to the game their friends play or their friends watch or they feel attracted to, just like in sports. cory: quickly, you feel you have to get there first with call of duty before ea gets there with battlefront, which is a similar kind of game? pete: i wouldn't say we feel we have to get there first -- we feel we are getting there first, but that is because he sports has been part of the dna of the company of the company for 50 years, starcraft swept korea. we have a lot of experience, we have been through a lot of
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battles, and now we are trying to take things to the next level with the way we are structuring our city-based league. cory: the intersection of sports and new media is no more important than at twitter, the focus. >> we really focus with each partner differently. with the nfl, we expanded their partnership with us around a new show called nfl blitz. we have a show with them sunday through thursdays, breaking down what is happening around the fun thingsdoing some behind the scenes with players and such. we have a deal with the nba where we are broadcasting wnba games for the next three years. withso have a partnership stadium, where similar to our partnership with bloomberg, around a 20 47 news channel, we have a partnership with stadium and we just launched our 24/7
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news channel. it is important to understand what the content is that we can bring to our audience that is going to resonate the best, given why the fans are coming? to us? with the nba, we did research on our audience and it is most apprise fans come to twitter during nba games. the conversation around the game during gametime is electric. but we also found they are coming to twitter around the clock to find out what the latest and greatest with their teams is, their players, free agency was a crazy time on twitter. that is what led us to create the exclusive shows with them. other, therm-up, the starters, to really capitalize on the appetite that fans have for nba content. cory: away from the game itself, and even the season. laura: indeed. cory: you can hear more at, you can watch these interviews and even listen at
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