Microsoft Corp. and the National Basketball Association Inc. unveiled a multiyear pact in which the league will adopt cloud computing and artificial intelligence services to personalize games and experiences for its legions of fans.
The deal, to build a consumer-focused digital platform, will begin with the 2020-2021 season, the NBA and Microsoft said Thursday in a statement. The software maker’s agreement extends to all NBA properties, including the Women’s National Basketball Association, as well as USA Basketball. Financial terms of the pact weren’t disclosed.
The selection of Microsoft, the world’s largest software maker, is a blow to rivals Amazon.com Inc. and Alphabet Inc.’s Google in the race for cloud-computing market share. Amazon Web Services leads the market for internet-based computing and storage, with Microsoft Azure placing No. 2. Microsoft also has a partnership with the National Football League -- best known for teams’ sideline use of the company’s Surface tablets.
Signing the NBA is a high-profile customer win because it comes amid the COVID-19 pandemic and a related economic downturn, when many organizations have decided to postpone major information technology projects. The NBA ground its current season to a halt last month after a player tested positive for the virus, but said delaying this deal, in the works for six months, wasn’t an option.
“We recognize that we have to take more control over our destiny,” Adam Silver, the NBA commissioner, said in an interview. “Increasingly, as we become more global, almost all of our fans will never actually step foot in an arena, and they will experience us through some form of media.”
Executives at both organizations describe this effort as akin to building a new media platform for NBA fans, letting the league personalize video content, make it easier to search its archives and integrate existing NBA products and services, including the e-commerce site. When the system detects a person’s interest in, say, Los Angeles Lakers star LeBron James, because they look at James’s highlights from a game, archives or buy his jersey, AI tailors content for them. That extends to personalized games on an app or website, during which the algorithm shows the fan more shots of James playing during a game, as well as his stats. A fan of James’s teammate, Anthony Davis, would see more of Davis on the court. Sports betters could see more data about the game, while followers of certain influencers could hear their commentary.
While Satya Nadella, Microsoft’s chief executive officer, said his favorite NBA team was “all of them,” he recognized the importance of having global basketball’s elite attraction as a client. “There are 1.8 billion followers of the NBA on social media, who already are consuming content around their favorite players, their games, their teams,” Nadella said in an interview. The company will use its tools for “video, tech, data, speech—all of these things together so that you can drive this next generation of fan experience.”
With the current season disrupted by the pandemic, Silver said he wished this partnership had been in place six months or a year earlier. The NBA chose Microsoft over others because of Nadella’s personal commitment, Silver said. Nadella’s predecessor, former Microsoft CEO Steve Ballmer, owns the L.A. Clippers NBA franchise.
Nadella said the deal demonstrates Microsoft’s focus on keeping productivity up and ensuring business continuity during the pandemic.
“We’ve had to raise our game and provision more capacity, whether it’s cloud, remote desktop, Teams, whose usage has grown by 60 times in this period,” Nadella said, citing the company’s chat and video application. “In the long run, we are dependent on overall economic activity and GDP growth. In the next couple of quarters we’ll know the full extent of what has happened in our economy, but we’re also confident that things will recover.”
Nadella and Silver spoke to President Donald Trump Wednesday during his marathon conversations with business leaders about how to restart the U.S. economy. Silver said his industry was looking for guidance from the federal government on how best to resume professional sports in the U.S. while keeping participants safe, which will likely mean forgoing fans in the arenas.
“In terms of the sports sub-group that I was a part of, there was discussion about how symbolic it is for the country to get sports back up and running considering it’s such an enormous form of entertainment in this country, as well as the psychic benefit people get from the competition and engagement,” Silver said.
Bloomberg News
