Company: Allstar Stats / Rotoworld.com / Sandbox.com (NBC Sports Fantasy Division)
Launch date: January 1, 1989 (Internet March 1995)
Became full-time operation: 1989
No. of employees: 10

This week we debut a new format for the business profiles, where one or more representatives of the company tell you about the operation via a Q&A format. This first edition draws together several businesses under the NBC Sports fantasy umbrella, with answers provided by Rick Wolf, director of business development for NBC Sports.

1) What was the impetus for the creation of Allstar Stats? What did it offer in its earliest stages?

Rich Pike and Mike Oliveto were high school friends and coworkers at Friendly’s restaurant in Thornwood, N.Y. In 1988, Oliveto worked as a developer at the Power Authority and Pike worked in marketing for online services CBS/IBM/Sears joint venture Prodigy. They played in a fantasy league and hated the reports. Oliveto took the data from the reports and generated better ones. The next year, they decided to run the business out of their parents’ house. Oliveto would do technology and Pike would focus on marketing. They bought a stats feed, bought ads in magazines and started running leagues.

The leagues came in very fast, so they bought hardware and worked long hours to make sure that their customers had the highest level of service and the best reports in the biz.

• In 1992, they added an IVR (interactive voice response) system so people could do transactions by phone.
• In 1995, they went on the Internet with an automated transaction system called the Evaluator.
• In 2002, they brought on Rick Wolf and his Full Moon Sports consulting company.
• In 2003, they hired Gregg Rosenthal as lead NFL writer.
• In 2004, they hired Rick Cordella, who wrote as a stringer to program Rotoworld.com. Cordella quickly became part of the management team and has carried the vision for Rotoworld.com from 2005 to today.

2) How did Rotoworld.com come about, and what has driven it to its current position in the industry?

Rotoworld.com was created as a news source for Allstar Stats leagues in 1998. Matthew Pouliot and Troy Beech approached the Allstar Stats owners with the idea of working for advertising money. Those four initially split all revenues for Rotoworld.com. In 2002, it became a destination site when Allstar spent money at a new design and Pike and Wolf developed our first online draft guides and Assistant GM products (now called Season Pass).

3) What kind of startup costs did each incur, and how did you come up with any necessary capital?

Pike and Oliveto started Allstar as a side job in 1989 and they quit their day jobs in 1990. They spent $10-15k on print ads the first year that they got back in signups in 1989.

4) Was there a big break, a specific occurrence, move or chain of actions that vaulted Rotoworld.com to its status as a leader in fantasy content?

Two moments: The first major moment is when Fox decides (in August 2003) to buy fantasy content instead of hiring writers. They pay us MUCH less than what they would pay a staff, but it allows us to invest EVERY dollar back into the site/personnel. It allows us to keep all our best people and extend technologically and content to achieve our leadership position, especially in content premiums.

The second major moment happens when Rotoworld.com takes a risk on an idea from Rick Cordella on how to maximize advertising on the site. In August 2004, Rotoworld.com begins to use ad networks to fill inventory that is not sold. An innovative method of using five to six ad networks at the same time results in triple the ad revenue for Rotoworld.com. Again, Pike and Oliveto are smart enough to pump it ALL back into Rotoworld.com and rebuild infrastructure of Sandbox/Allstar Stats, automating most of the two legacy sites.

5) How much of the revenue is connected to Rotoworld’s various deals to feed player updates? How many partners does the company have on that front?

Rotoworld.com has only a small number of clients (about a dozen). The content is also distributed to the 235 affiliates of NBC Sports.

6) How did the arrivals of Rick Wolf and Rick Cordella alter plans for or directions of the businesses?

Rick Wolf would never have played fantasy sports if it wasn’t for Rich Pike. In 1989, Pike, who played softball with Wolf, convince an owner in the Prodigy Rotisserie league to add Wolf as his partner since Wolf was on the development team for Baseball Manager, the first online fantasy baseball game. Wolf returned the favor in late 2001, by creating a set of suggestions for how to grow the Allstar Stats business, including private label games for media companies, Rotoworld.com as a destination site and content premiums. In January 2002, Wolf’s Full Moon company contracted with Allstar Stats in a heavily performance-based deal to raise top-line revenues.

Lost in the Allstar Stats success story is the impact of Rick Cordella. His advertising system innovation that tripled Rotoworld.com’s revenues starting in 2004 turns out to be the critical Allstar Stats/Rotoworld.com innovation since it drove high-margin revenue and set the stage for NBC’s involvement.

Most important is Cordella’s daily focus to quality, coupled with his ability to find, sign and most importantly retain great fantasy sports writers and understand what great sports content is. This is what makes Rotoworld.com continue to lead in fantasy news and premium content products.

7) How did the relationship with NBC generate?

NBC bought the rights for NFL football and wanted some contests and fantasy content for their soon-to-launch NBCSports.com. They called their old friend Brett Vandermark, who worked for the Arena Football League. Sandbox.com did the official Arena Football League games using an Allstar Stats engine and content from Rotoworld.com. VanderMark recommended Allstar Stats and Wolf, then acting chairman of Sandbox.com.

Allstar Stats execs worked with NBC Sports veteran Kevin Monaghan to create a partnership deal to produce games/content. At that time, NBC Universal became interested in owning it all to jumpstart its new NBCSports.com initiative. NBCU purchased Allstar Stats, Rotoworld.com and Sandbox.com on August 18, 2006.

8) What have been the biggest benefits of NBC’s acquisition of Allstar? If you could go back, is there anything you would do differently?

NBC brings a level of expertise, passion and economies of scale that taught us how to be better at what we do. They have shown a keen interest in the Rotoworld.com property as a breaking sports news property and continue to be very supportive of the premium content business. It really is a family.

As for what I would do differently, I believe you should never go back. Look ahead and the future is bright!

David Bowie said: “Things that happened in the past only happened in your mind. Forget your mind and you’ll be free.”

9) What examples can you point to of NBC’s commitment to the fantasy platform?

We had 30-second spots on preseason games. We have had integrated information in all telecasts and in every Football Night in America. We have been promoted in every type of NBC Sports telecast.

Most importantly, they include fantasy in EVERY discussion. NBC Sports simply gets it on all levels.

10) What can we expect to see from you guys going forward?

We will continue to innovate whether in content premiums, fantasy content and/or content strategies. We will continue to dedicate ourselves to speed of delivery and depth of coverage. We will continue to expand fantasy sports news to be thought of as sports news.

The Fantasy Sports Writers Association is accepting nominations through the end of the year for its fifth annual writing awards.

The awards encompass football, baseball, basketball, hockey, auto racing, golf and now college sports. The FSWA selects a writer of the year in each of those sports and also presents several awards for top articles and running features in the premier fantasy fields of football and baseball.

This is the first year that the FSWA has included college sports in the list. According to FSWA president Mike Beacom, the recent growth of fantasy college sports helped to spur increased interest in the FSWA that was already evident last year at awards time.

“The 2007 FSWA Awards witnessed a record number of nominations and we are confident this year we will top that mark,” Beacom wrote in the association’s November newsletter, which announced the nomination period. “The FSWA welcomed close to 100 new members during the course of the past year.”

Writers must be enrolled in the FSWA to nominate candidates or win an award. Author names and affiliations are removed for the judging process, and winners are ultimately determined by independent college journalism professors, according to the FSWA. Those interesting in submitting nominations can use the online form any time before the end of the year. Anyone submitting for Magazine of the Year in baseball or football should mail three copies of the publication to the following address:

FSWA
c/o Mike Beacom
P,O, Box 296
Amherst, WI 54406

Awards will be presented at the 2009 Fantasy Sports Trade Association winter business conference in Florida on Jan. 27-28. Last year’s winners included Rotoworld’s Gregg Rosenthal for top football writer, Rotowire’s Jeff Erickson for top baseball writer, Rotowire’s Andre’ Snellings for basketball, Rotowire’s Janet Eagleson for hockey, ESPN’s Christopher Harris for auto racing and CBS Sports’ Ross Davenport for golf.

Fantasy sports are good for your league.

It doesn’t take an advanced degree or in-depth research to determine that. It’s common sense. Look around.

The NFL has exploded over the past five years or so, at the same time as fantasy participation has been growing by about 25 percent a year. Every outlet for football content has begun to cater its coverage to fantasy players. The NFL itself was the first of the major sports leagues to host fantasy leagues on its website.

Or check out baseball highlights on ESPNews. The “Fantasy Impact” box might not always present a stat that is actually relevant to fantasy owners, but the box is always there when they display the final score. Meanwhile, baseball continues to set attendance records and make a ton of money from broadcast rights.

The NBA and NHL now run fantasy games through their official websites, too. It’s just a good idea. It engages your fans, gives them an increased stake in the results of your events, and offers a potential entry point for new followers. Fantasy not only appeals to fans of a sport, but it can welcome in new consumers who might have no rooting interest in a particular team or might not have paid much attention to a particular league in the past.

I can’t help but wonder if that’s why the NCAA’s objections to fantasy haven’t made their way to the level of legal action.

Major League Baseball and now the NFL have taken fantasy providers to court over access to their athletes, and those two entities exist for the sole purpose of profiting from athletic contests. The NCAA, meanwhile, has stuck to writing op-ed newspaper pieces and sending letters to about how it doesn’t like the use of athletes’ names or the attachment of prizes to the college fantasy contests.

As we’ve pointed out here before, U-Sports has been running college fantasy games with player names included for more than 10 years. Obviously, CBS’ decision to name the players in its college football game this season put the issue on a much larger scale, but are we really expected to believe that no one in the NCAA was aware of U-Sports or any of a few other providers before? The governing body of college sports is simply too large an organization with too much concern for player eligibility to have not come across the games until this year. It seems far more likely that the CBS hoopla finally generated the kind of publicity that required an official response.

It does make some sense for the NCAA to come out against fantasy games publicly. As the official website states: “The National Collegiate Athletic Association (NCAA) is a voluntary organization through which the nation’s colleges and universities govern their athletics programs. It is comprised of institutions, conferences, organizations and individuals committed to the best interests, education and athletics participation of student-athletes.” From an academic standpoint, fantasy games offer no redeeming value to student athletes.

Of course, as stated here in the past, neither do a three-week championship basketball tournament, bowl games over winter break, Thursday night games on ESPN or baseball championships that stretch well past the end of classes in the spring.

That’s why it also makes sense for the NCAA to mount no formal challenge to fantasy sports. Fantasy offers free-of-charge marketing exposure and consumer engagement for college sports — the same sports that generate millions from broadcasting rights for the “voluntary” governing body and many member institutions.

Will the public push between the NCAA and fantasy providers take on a more official capacity at some point? Maybe. It would be hard to make much sense of such action, though.

A roundup of posts from the FSB news page.

– CBS Sports will host a 90-minute live gameday online show called “Fantasy Football Today,” starting this season.

– Fantasy veteran and Fanball co-founder Paul Charchian will do a fantasy football show for Open Sports Network as part of the just-announced lineup.

– The staff at Fantasy Baseball Dugout launched the beta version Tuesday of a new site targeted at college fantasy players, CollegeFantasyCoach.com.

– Dick Vermeil has signed on to be the promotional face of InjuryScout.com.