Archive for April, 2005

Parity in Sports

April 25, 2005

Saturday while flipping between the Mavs' playoff game and the NFL draft I started thinking about a common theory in today's sports world. People, now more than ever, seem to think there is a lot of parity in sports.

You often hear about how free agency in professional sports, especially football, has really leveled the playing field. Right as a team starts taking steps building a winning program their stud takes off after the big bucks.

In college sports, you hear about how scholarship limits have leveled the playing field and created more parity from top to bottom. Also, high school studs who want playing time from day one, so they can make that jump to the pros, may not prefer to go to a high profile school where they won't see the field or court until their junior or senior year.

I do believe there is some truth to this increase in parity. Upsets are more prevalent. In the NFL, it seems week to week almost anybody can beat anybody.

But while these factors (free agency, scholarship limits, etc) have increased the parity for most teams it has not at all affected the great teams- the championship teams. Once it is playoff time all this parity talk can be thrown to the wayside.

Take a look at the past few championship games

Major League Baseball
Red Sox vs Cardinals
Okay, so this is probably the worst of my examples but let me give it a shot. The Cardinals were the best team all year and finished with the best record in baseball. The Red Sox and Yankees were 2a and 2b with the edge going to the Yankees because they are the Yankees and the Red Sox were supposed to be cursed.

College Football
Oklahoma vs USC
These two teams were the best all year and their matchup in the BCS championship had been anticipated for over a year. All the scholarship limits and upsets had no affect on them.

NFL
Philadelphia vs New England
The Patriots were the defending champs and despite finishing the regular season one game worse than Pittsburgh you had to believe they were the team to beat. From the day last spring Terrel Owens weaseled his way into an Eagles uniform they were destined to finally make that jump to the Super Bowl.

College Basketball
Illinois vs North Carolina
Illinois played like the best team in the country all year. Despite Illinois' number 1 ranking, UNC received more publicity. UNC is the Premodanna School where Jordan and other greats played and legends coached. They entered the tournament as 1 and 2.

Championship teams and championship players don't let the parity affect them. These leagues implement these systems to intentionally create more successful underdogs because that is what Americans love to see. However, the championship teams were not made because of the petty help of systems. The New England Patriots are a small market team from Foxboro, Massachusetts and they have built a dynasty. They did not build this dynasty with the help of the system and they have not let things like free agency, poor draft position, and tough scheduling prevent them from winning.

These systems do not and can not create winners. Two players, Troy Aikman and Russell Maryland, have been drafted number 1 in the NFL draft in the past 20 years and led their team to the Super Bowl. Jamal Lewis is the only top 5 pick in the past decade to do it.

There will always be underdogs and as Americans we will always cheer for them. Creating systems that help them win cheapen their accomplishments. Underdogs are successful not because they benefit from a system, rather because of their determination and pride. Regardless of the attempts to bring down the greats and pump up the weak, the really great will always overcome.

"Champions know there are no shortcuts to the top"

hj

eBay and Free Stuff

April 20, 2005

In my previous blog I talked about how I was a big fan of the Google business model (i.e. provide a free service that creates a high traffic community and make your dollar off advertising fees collected from big companies). This model has been proven to work over time by Network Television and Radio. Beyond that not many businesses have exploited this theory until late. Now Google, Facebook, News Sites (CNN.com, ESPN.com, etc), Message Boards, AIM, and others have provided free services using the internet to exploit advertising.

I discovered a different model over Christmas Break while on eBay searching for Rose Bowl Champs memorabilia. In my search I came across an Austin American Statesman Newspaper with a full front page photo of Cedric Benson and Derrick Johnson on the field after the game with confetti falling from the sky. The bid for the paper was at $15 with a day or two remaining. I thought this was ingenious, taking something that you can get for free or that you normally would just throw away after using and sell it on eBay. It sounds simple because it is simple but it can prove to be very profitable.

After coming back to school, I started thinking about what kind of free things or things I would normally use and throw away that other people would potentially buy. About 70 universities across the country get Sports Illustrated On Campus, which is a small Sports Illustrated focusing primarily on college sports. The magazine comes free in the University student newspaper ever Thursday. My idea was to go to newspaper stands on Thursday nights and collect all the left over SIOCs and sell them on eBay. Since they are rare and only available to college students, many people such as alumni of a particular school that may be featured on the cover who have no way of getting the magazine will bid for them on eBay.

Over the past couple years I had bought a handful of things on eBay, mainly vintage Sports Illustrateds that featured University of Texas on the cover, but I really overestimated the difficulty in setting up an auction and selling. I started the bidding at $1.99 plus $2 shipping and handling and stole a lot of the formatting techniques from other magazine auctions. Now a $3 or $4 sale may sound petty but it took such little work and there was no expense for the magazines so it was 100% profit.

Fast forward a couple months. The bang hit the night of the UNC-Illinois National Championship. I was definitely cheering for the Illini because I have two family friends that are Illini alumni and I felt they proved they were the best team in the country throughout the regular season and Big Ten tournament. Fortunately, they lost and my little eBay business took off. Sometime in February the SIOC cover featured the Duke-UNC mascots on the cover proclaiming the rivalry the best in college basketball. Apparently that goofy billy goat in a Tar Heals Jersey on the cover of a SIOC is the hottest commodity in the state of North Carolina. Usually I post a bid every 3 days but with magazines selling for anywhere between $12-$20 a piece I started listing them so that one would end every day. In the 7 days after their national championship win I sold 9 magazines (a few were on second chance offers to losing bidders). Another magazine featuring Lebron on the cover also picked up steam during the tournament though not at the same rate as the UNC cover.

Once I started selling on eBay my mindset became very different. Now when I see free handouts at basketball and baseball games or in the newspaper or anytime I go to throw something away instead I have a different train of thought. Usually I would think I read this or used this and I no longer have a use for it so I will just trash it, but now the thinking is I may no longer want this but does somebody else. If somebody else wants it than it very well could potentially be profitable and therefore is worth picking up or keeping or whatever.

For those of you who go to schools who get SIOCs you're probably thinking why would someone reveal this idea when someone else could so easily repeat the same thing. And you'd be absolutely right; anyone could do this same thing and cut my bids in half. But I see two reasons why this wouldn't happen. First, that would be shady but hey who cares. Second, its not just good ideas that bring in the money. People have good ideas all the time but its the initiative to bring the ideas to reality that makes or breaks the project.

One a side note, Cuban had another very interesting blog about the approaching death of the PC era. Check it out blogmaverick.com

"The secret of getting ahead is getting started"

hj

GOOGLE is the shit

April 12, 2005

Over Christmas break I watched a special on Larry Page and Sergey Brin, the creators of Google, on I believe it was 60 minutes. For those of you who don't know Google began as a research project in the 90s when Page and Brin were Ph.D. candidates at Stanford. They both dropped out of school to start Google which is now worth $50 Billion in stock and Page and Brin are worth $7.2 Billion each. They clearly have a monopoly on search satisfying an estimated 80% of search requests everyday. Bill Gates and his Microsoft empire recently declared war on them after losing an attempt to buy them out and now has released his own version of MSN search.

The fact that two 31 year old guys, who look like they could still be in school, are knocking heads with the richest man in the history of the planet instantly brings them a certain factor of likeability. Their dedication to innovation is awesome and their business model is very 'consumer' friendly.

I say it is consumer friendly because all of their 'products' search, news, and email are free to use. They do not make their dough off the average Joe, rather they create incredibly useful tools that create tons of traffic. Where there is tons of traffic big dollar corporations will pay to be. So essentially, the people get state of the art technology for free and Google floats the bill to the Big Wig Corporations.

Since dominating search they have continued to grow with things like Google News (news.google.com) which keeps an up to the minute page of news sources around the web and automatically arranges them to present the most relevant news first in an objective neutral way. In a day when it seems all of our news is being spun to satisfy the bias of the broadcaster this becomes a very valuable resource.

They also have broken into email in a big way with Gmail. They give you over 2 gigabytes of storage which is the best among free email accounts to my knowledge.

They have promised a future in Text Messaging offering countless amounts of information anywhere your phone can travel. Soon you will be able to get up to the second Stock prices off the ticker by TMing 46645(GOOGL) with the ticker symbol.

But their coolest technology yet which they released last Monday is Google Maps (maps.google.com). Google bought Keyhole who owns the rights to Satellite photographs of EVERYWHERE in the United States. This thing is the coolest toy ever. I could spend an entire day thinking of places in the US to view. The default for everyone is your home address. After a quick search and a couple seconds of orienting yourself and zooming in you can find a birds eye view of your house from what seems like a few hundred feet. Baseball and Football stadiums look badass.

Google hopes to update the images so that all areas will have an image taken in the past 6 months. And its not only satellite maps, they also do directions and their search is much more advanced than any other.

Move over Mapquest, the Google boys are coming through.

hj

Great Minds Think Alike

April 6, 2005

I recently started reading Mark Cuban's blog at http://www.blogmaverick.com and it inspired me to start one of my own. For those of you who don't know, and shame on all of you, Mark Cuban is the owner of the Dallas Mavericks who made his billions creating broadcast.com which he later sold to yahoo. He is one of the most innovative and hard working business men around and he has a great sense of humor and keeps things fun. What makes him so cool is that he is not cool at all. He is a 12 year old kid who is a huge basketball fan. He is living a fans dream acting as owner of the Dallas Mavericks passing up the box suite for a Nowitski jersey and some seats behind the basket.

The first blog of his that caught my eye was titled The Sport of Business which, if you have aspirations to be successful in business, is Lombardi-esque. The next couple of blogs that I found interesting have ties to one of my previous rants concerning the music industry and the lack of innovation and hustle on the part of the RIAA and record labels.

His first assertion is that the music industry has missed the buck on the Internet explosion and digital file sharing. He brings to the forefront that in recent times DVDs, digital photography, video games, software, and ring tones, all 5 digital based products, have experienced huge increases in sales while the music industry has sat around with their thumbs up their asses busy filing a bunch of lawsuits. Sales have dropped nearly 15% from 1999 to 2004.

His second assertion is about the rapidly approaching extinction of CDs. In my opinion the industry's stubborn commitment to selling a single product that composes an album of music, whether that be a record, tape, or CD, is where they missed the point. Just now are internet music sales via iTunes and Connect Music Store moving into the main stream. When you walk across campus or go to the gym how often do you see people carrying around portable cd players? How long could you go doing these same things WITHOUT seeing someone with an iPod or some other mp3 player? Then why do music companies insist on selling CDs? In the very near future most music listening will be done on a computer, mp3 player, phone, PSP, PDA, whatever. Digital music players are rapidly making their way into our home and car stereos.

Cuban tells a story about being on a Mavs roadtrip and walking through a mall with his iPod and craving a song from the KillBill soundtrack and having absolutely no means of buying that song. He claims, and I very much agree, that the first label to come to grips with reality will see sales and profits go through the roof. The first to setup kiasks and digital music stores where people can come plug in their mp3 players and flash drives and instantly buy songs from a hard drive with a few terabytes of space containing every song ever created. Setting up laptops at concerts where people can plug in and buy an entire CD for $5.

"It's money in the bank"

hj