MLB.com is gearing up for next seasonNovember 14, 2011: 3:34 PM ET
CEO Bob Bowman, the man behind baseball's digital properties, made bold bets that have paid off big time. Now, the challenge is to keep growing without alienating fans.
By Daniel Roberts, reporter
FORTUNE -- Here's a surprise: Major League Baseball provides back-end streaming services for conservative talker Glenn Beck. In addition to his web channel, GBTV, it also powers almost all of ESPN3's online video. And the Webby Awards. And March Madness On Demand.
Headquartered in New York City's Chelsea Market, MLB.com has established a reputation as a technology powerhouse. Its successful stable of websites, apps and streaming video products is arguably the most advanced of any major league sport. And much like Amazon's (AMZN) Web Services division, which quietly provides cloud computing to other businesses, MLB.com has turned its powerful consumer brand into a healthy technology business.
How did that happen? In part, MLB.com has used new products to make the most of the collision of sports and social media. This year's World Series resulted in an average of 352,000 social media comments per game, according to social analytics startup Bluefin Labs. That includes public tweets, Facebook posts and blog comments. For Game 6 alone, there were 901,000 such comments -- crushing the NHL Finals and approaching the Academy Awards, which yielded 965,000 comments. (MLB.com does not disclose its financial performance; its ownership is shared equally among the league's 30 teams.)
A mega-popular app hasn't hurt either. The "At Bat" app was the highest-grossing last year in Apple's (AAPL) iTunes store. Across the iOS, Android and BlackBerry platforms it was downloaded 1.6 million times. The idea behind the app, says MLB.com CEO Bob Bowman, has been to provide everything a fan could possibly want relating to the game. And it does, or certainly gets close. Users can read editorial content from MLB.com sportswriters, listen to radio play-by-play or watch an instant replay within a few seconds.
Multimedia senior vice president Joe Inzerillo says the league is also seeing increased adoption of MLB.tv's "season pass," which allows people to watch entire games online and costs $120 per year. MLB.com's website, meanwhile, is being accessed more from mobile devices, such as phones and tablets, than from desktop PCs and laptops. (This chart shows traffic to MLB.com -- notice the spike in wireless access.) "The way it's looking for four years from now," posits Inzerillo, "is you have one connected device, just one thing, in your living room, and that's how you watch all of your online video content. Then you also still have a PC in the corner that you blow the dust off of when you want to write a letter."
MLB.com has been adding features to the At Bat app at a breakneck clip. One example: users can now "check into" a game, once they're physically near the stadium, and receive offers that might range from a seat upgrade to a 10% discount at the shop. They can also see aggregated tweets from others that are at the game. At three ballparks, the app even lets users order food and skip the line when they go to pick it up.
The question now is, how can MLB.com build on its success without making its products bloated or confusing? Communications vice president Matthew Gould says, "We push this technology to fans and let them use it as they wish, or not. We think it will enhance the experience, but we don't make it an intrusive thing."
Still, the company has to decide how to market and merchandise new features. "The question is always what will we do with the app marketing-wise," Bowman says. Right now, at $14.99, it's what he calls a "one-size-fits-all" package. He wants to add some premium options to the app, but seems to be at a loss, wondering, "How do you build on a soft good? Honestly, who do you even look for to tell you how to do that?" Answering those questions will be crucial to continued growth. The standard practice would be to create a handful of new features and offer them at an extra fee on top of the basic app, but Bowman is hesitant to do that.
One change that Bowman says is likely to come soon: a monthly subscription. "We probably won't charge in the off-season at all," he says, because "we don't want to annoy our customers." Currently, the app price goes down to 99 cents in the off-season, and returns to the full-season price when spring training starts. With a monthly subscription system, fans would have to re-up each month, but would have the luxury of skipping it for a while if their team is already out of the running, for example.
Ultimately, it is that steady stream of new ideas and new features that has most helped distinguish MLB.com. Whichever changes the company decides to make, it will be tinkering with a winning formula. Then again, any misstep might mean having that much more to lose.