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Netflix "Cheer!" is what "Clash of the Corps" Should Have Been


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Varsity "buys" The Cadets?  Curious to see how a for-profit entity could "buy" a non-profit one?  Laws are pretty clear about the ways you can dismantle a NPO and typically all you can do is donate the asssets or proceeds from the sale of the assets to another NPO.  No for profit entity can financially benefit from assets that were obtained by a NPO.

https://s3.amazonaws.com/mentoring.redesign/s3fs-public/Closing or Transferring a Nonprofit Business.pdf

 

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13 hours ago, TwoValves said:

Varsity "buys" The Cadets?  Curious to see how a for-profit entity could "buy" a non-profit one?  Laws are pretty clear about the ways you can dismantle a NPO and typically all you can do is donate the asssets or proceeds from the sale of the assets to another NPO.  No for profit entity can financially benefit from assets that were obtained by a NPO.

https://s3.amazonaws.com/mentoring.redesign/s3fs-public/Closing or Transferring a Nonprofit Business.pdf

 

Sorry - I was unclear.  I have heard (rumored, I must admit) that Varsity would be interested in bidding YEA if the Cadets separate from it, so they could assume control of USBands.  Not the drum corps.

Mike

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4 minutes ago, MikeN said:

Sorry - I was unclear.  I have heard (rumored, I must admit) that Varsity would be interested in bidding YEA if the Cadets separate from it, so they could assume control of USBands.  Not the drum corps.

Mike

yeah i think there'd be a split

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1 hour ago, MikeN said:

Sorry - I was unclear.  I have heard (rumored, I must admit) that Varsity would be interested in bidding YEA if the Cadets separate from it, so they could assume control of USBands.  Not the drum corps.  

 If there's something going on here, maybe they should have taken Boston's offer.

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On 1/14/2020 at 4:58 PM, MikeN said:

"Cheer" ties back into Drum Corps and band.  I get a newsletter called "BIG," by Matt Stoller, about the economics and politics of monopolies.  Today's newsletter was about Varsity Brands, the monopoly behind cheerleading competitions.  (They're also owned by Bain Capital, BTW.)  In one of the episodes of the show, "cheerleaders complain that they can't watch cheerleading on TV anymore, because Varsity streams its competitions over its for-pay app Varsity TV, moving ESPN out of the picture."

Have seen ...twice?... written online (I think once here and once on Reddit) that Varsity would bid if the Cadets decide to sell YEA, to start expanding into the band world.  That would be a very bad thing, for many, many reasons.  Varsity has regulated out rival apparel companies, directly owns gyms where cheerleaders practice, and lobbies against regulating the activity as a sport, because it would then impose limits on competitions and practice time.  Example - in another quote from the newsletter, their CEO "admitted that in at least one contest, cheerleaders got more points if they used more Varsity equipment as props."  

BTW, cheerleading "causes more than half of the catastrophic injuries for female athletes in America."

Mike (instant expert, 'cause I read one article.  Granted, it was about 30 minutes before I saw this thread for the first time, so... timely!)

I (personally) would expect "Varsity" to end up with the drum corps video biz / licenses within five years

As others have mentioned I know they are interested in USB (and/or BOA) to get a foot in the door

Which one sells to them first is anyone's guess - but Varsity is a BILLION dollar annual biz... yes, with a B

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1 hour ago, Jeff Ream said:

yeah i think there'd be a split

correct - they would peel off Cadets and just sell them the circuit to make this work practically/legally 

I have zero idea (or knowledge) of whether this would happen or not, but it makes sense from a portfolio expansion perspective. Cheer groups are HUGE - but so are marching/music ensembles with, what, 25K high schools in the USA and 10K or so with competitive marching/music ensembles. Some with several per school

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2 hours ago, George Dixon said:

I (personally) would expect "Varsity" to end up with the drum corps video biz / licenses within five years

As others have mentioned I know they are interested in USB (and/or BOA) to get a foot in the door

Which one sells to them first is anyone's guess - but Varsity is a BILLION dollar annual biz... yes, with a B

I could see this.   Flo was trying to bust into the Major League Soccer streaming business with DC United and Cincinnati while making overtures to other teams and the league itself.  

The whole thing was done on promises that they'd be doing specialized content, features, match day things pre and post game, etc.  The day of the first game came for Flo to cover and the entire first half was missing because...we never did learn why.  It was almost like it was halftime and someone at Flo remembered, "oh yeah, some soccer thing" and hit a switch somewhere.  

They offered refunds and the like and subsequent games were streamed fairly well.  But the additional content and such never materialized.  Then completely out of the blue, DC United announced they were ending the contract with one game left on Flo's schedule.  DC streamed it for free on their website.  No word on any lawsuits regarding 'breach of contract' from either way about that. 

Flo also had Big Ten network's "BTN Plus" content streaming at one point, now that's back over on its own app an BTN's regular channel is streamed through the Fox Sports Go app.  

Both of these seem to indicate Flo tried to expand into all sorts of areas and markets of streaming without actually laying out the infrastructure, staffing, and such to make good on their promises (something DCI could have probably told them...) and it's starting to collapse as the 'big streaming players' are leaving those hasty deals.  That would prime some company who is ready to do it to hop in there and start sniping particular contracts.  Varsity getting in there would make sense.  I do wonder if they'd go for WGI before trying to take on DCI and BOA though given that the logistics of streaming from a gym are probably easier than a football field.

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7 hours ago, George Dixon said:

correct - they would peel off Cadets and just sell them the circuit to make this work practically/legally 

I have zero idea (or knowledge) of whether this would happen or not, but it makes sense from a portfolio expansion perspective. Cheer groups are HUGE - but so are marching/music ensembles with, what, 25K high schools in the USA and 10K or so with competitive marching/music ensembles. Some with several per school

what i see of some of their rules and how sponsors get favored in judging, i smell a huge issue

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Literally moments ago got the next newsletter, still talking about Varsity Brands.  Two possibly relevant-to-drum-corps points:

 

Quote

*I missed out on two anti-competitive practices in the industry. The first is called “Stay to Play.” For many cheerleading competitions, though not all, out-of-town contestants are required to stay at a specific area hotel or set of hotels, or they cannot enter the contest. This is yet another way to raise prices on cheerleaders, and parents hate it. The second is that Varsity tends to be very aggressive about takedown notices for cheer contest video. If you film your kid at an event and put it up on Facebook or YouTube, Varsity is likely to ask you to take it down because it’s competitive with their VarsityTV streaming app. As one parent told me, it’s basically Varsity preventing you from sharing your memories publicly with your family or friends.

* Cheerleading is more dangerous to monopolize because it involves children. There’s a whole tangled legal fight between the NCAA, the Department of Education Office of Civil Rights, and Varsity over the definition of sport. This is one area where policymakers at the Education Department, and not just at the antitrust agencies, have some authority. The bottom line is children are doing dangerous gymnastics and tumbling on surfaces like grass and rubber tracks that have not been proven safe, and one result is more catastrophic injuries than might otherwise happen. (I also heard rumblings about other safety concerns that go beyond physical injuries endured during contests.)

Mike

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It is interesting how people can interpret things differently.  I know nothing about the situation, but I do happen to be an antitrust expert.  So, let me offer a couple uninformed opinions just for fun:

First, Varsity may be trying to offer a benefit to the participants by arranging availability at hotels, perhaps even at a reduced rate.  In return, the hotels may be asking Varsity for some effort to direct participants to them, perhaps in exchange for that reduced rate.  If so, that could be a win for all the parties involved, especially if the alternative is limited hotel availability at higher rack rates.  

The Cheerleading as a sport thing is very interesting and complicated.  Some do not want it to be classified as a sport because they are worried schools would use it as a title 9 offset to football and then reduce investment in other sports for women and girls.  Others want it to be classified as a sport so that it is covered by insurance schools take out on their sports programs.  So this is a very complicated issue, as least as I understand it.

Best.

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