What's In A Name? Just Ask Paul Allen -- His New Firm Forged UW, Seafirst Deal
Seattle Times Staff Reporter
It began simply enough, at a lunch last fall between Barbara Hedges, University of Washington athletic director, and Bob Whitsitt, a top official in billionaire Paul Allen's broad empire.
But the result went further than either imagined: a new foray for the UW into the world of corporate sponsorship, and a new business for Allen, a co-founder of Microsoft who now owns the Seattle Seahawks and Portland Trail Blazers, among other businesses.
Last week, the UW said Seafirst Bank had won the naming rights to a remodeled Edmundson Pavilion. In exchange for a donation of $5.1 million, the basketball arena for the next 10 years would be referred to as "Seafirst Arena at Hec Edmundson Pavilion." Seafirst's total donation, of $9 million, will also buy signs for the company on a new Husky Stadium scoreboard and at other locations in campus athletic facilities.
Behind the announcement was a new company formed by Paul Allen's sports enterprises. Action Sports Media, which brokered the naming-rights deal, now expects to put together sponsorship arrangements for colleges and universities around the country. Those deals will equip football and basketball stadiums with state-of-the-art electronic scoreboards, advertising and financial sponsorships.
Whitsitt and Hedges were discussing the UW's $70 million campaign to remodel Hec Ed and build a new indoor practice facility and stadiums for baseball, soccer and softball.
Hedges told Whitsitt the UW was thinking of installing a new video scoreboard at Husky Stadium.
"Out of this innocent little lunch," said Harry Hutt, senior vice president of Action Sports Media, "came a giant project."
Whitsitt immediately called Hutt, who is also a Trail Blazer vice president.
The Portland basketball franchise had spun off a scoreboard business after installing a new video screen and other advertising in Portland's Rose Garden arena. Branching from that experience, the Allen subsidiary took up selling advertising in airports.
It has long-term contracts in Burbank, San Diego and Portland and is "bidding on the airport in a large, top-10 market even as we speak," Hutt said.
The company sells the advertising in an entire concourse and decorates according to a theme, such as the "beauty of the Oregon countryside" in Portland or movie studios in Burbank.
After talking to the UW, Allen's group decided to form Action Sports Media to market advertising and video technology at sports arenas.
By January, Allen's new company had signed an agreement with the UW to install a new video scoreboard at Husky Stadium and to find corporate partners for the other athletic venues.
Hutt said there also will be a video screen in the renovated basketball arena plus regular scoreboards for baseball, softball and soccer.
The UW is guaranteed at least $5 million from the arrangement. Above that, profits from advertising and other corporate sponsorships are to be split evenly between the university and Action Sports Media. Hutt estimates the total profit for both could be $20 million over the eight-year life of their contract.
Professional sports arenas increasingly are selling naming rights to corporations, but it is a relatively new ballgame for amateur athletics - though not unprecedented.
Corporate sponsorships have grown rapidly for about three years. There now are named arenas at private universities such as Syracuse and Brigham Young and public schools such as Texas Tech, San Diego State and Georgia Tech.
The new basketball arena at Ohio State is called Value City Arena - which has even proponents of naming rights shaking their heads.
The UW's Nordstrom tennis center is about 10 years old, though that name comes from a family donation rather than a corporate one.
So far, the Seafirst deal has provoked only a handful of calls to the Husky athletic department, according to Jim Daves, the department spokesman.
Even so, both parties to the deal say they will have to be somewhat careful about how quickly they embrace corporate marketing.
Hutt said colleges and his company can't completely emulate professional arenas and will have to refrain from "blatant selling" on scoreboards.
Gary Barta of the UW athletic department said naming rights had been discussed for a couple of years in the course of seeking money to renovate Hec Ed and build other facilities.
The university's ground rules were that a corporate sponsor needed to already have a long-term relationship with the UW and have a good local reputation.
At Hec Ed, Barta said, the UW was not willing to rename the entire building, wanting to hang on to tradition while financing a $38 million renovation. The long moniker "Seafirst Arena at Hec Edmundson Pavilion" was the compromise, he said.
The athletic department also decreed that rights to Husky Stadium were not for sale.
"Seafirst Arena at Hec Ed" isn't necessarily the end of things. Barta said the UW's arrangement with Action Sports Media could result in corporate sponsors and other donations to help finance new stadiums for baseball, softball and soccer.
And Allen's new enterprise is looking for business to spread well beyond Montlake Boulevard.
Hutt said Action Sports Media has received inquiries from about 10 other universities. The company wants to finish the UW deal - another six months or so - before taking on new business.
But after that, he said, "There is no doubt in my mind there is a business there."
That lunch between Hedges and Whitsitt just "stirred the juices," Hutt said. "We would have formed this company anyhow."
David Schaefer's phone message number is 206-464-3141. His e-mail address is: firstname.lastname@example.org
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