Article

Leap Of Faith

New Details Emerge in ASP Takeover Deal

| posted on October 09, 2012

The 2014 ASP World Tour event at Snapper will be the first contest where the new deal takes hold. Photo: Joli

A source close to the ASP has opened up to SURFER with details surrounding ZoSea media’s purchase and subsequent privatization of the ASP. Last week, the ASP sent out a very general and vague press release touting the deal with ZoSea media, leaving much to speculation as to what effect this buyout would have on the future of professional competitive surfing. But according to our source, ZoSea’s takeover of the ASP is “the biggest thing to happen to professional surfing since the ASP’s inception.”

The facts behind the takeover paint a picture of a deal built not on a concrete business plan, but rather on a promise of what ZoSea could accomplish, most notably absorbing the exorbitant financial costs of running a World Tour event. “This was very much of a leap of faith on the part of the ASP board,” says our source. “It was by no means a unanimous decision by the board with more than a few voting members questioning whether or not this acquisition was best for professional surfing. That being said, at the end of the day, given the current economic climate facing many of the top brands, this is what had to happen to move professional surfing forward.”

The acquisition, which was signed as a term-sheet deal, will be formally finalized after a series of meetings between ZoSea and the current ASP Board that will take place between now and December 17. SURFER can confirm that the following changes will be made once ZoSea takes control over the ASP in 2014.

When the Deal is Finalized, ZoSea will Effectively Take Control of the World Tour Events

Currently, a number of brands own the licenses to the 10 active World Tour events. When the deal is formally signed, ZoSea will take over sole ownership of the licenses to every World Tour event in 2014.  The brands that currently own the event licenses will have a right of first refusal to purchase primary sponsorship details. As an example, come 2014, Quiksilver will be given the opportunity before any other brand to sponsor the event at Snapper. The cost to purchase a primary sponsorship will be structured as follows: in 2014, it will cost $250,000 to sponsor a World Tour event; in 2015 it will cost $500,000; in 2016 the cost will settle in at $1 million. Although it differs per event, it’s currently estimated to cost an average of $3 million to run a World Tour event. Additionally, ZoSea will sell commercial spots during the webcast to both endemic and non-endemic companies.

ZoSea Will Take Over the Majority Interest of the ASP Board

The current ASP board is composed of an equal representation of World Tour surfers and board members. Under the new plan, ZoSea representatives will hold the majority of interest but will retain some surfer representatives for council. “Some of the boardmembers were wary that a board not made up of the brands and surfers could take surfing down the wrong path,” said our source. “But according to ZoSea, although they will take ownership over the ASP, they’re still keen to hear from the surfers. They won’t necessarily be asking the surfer representatives what to do, but rather how to do it.”

The Term Sheet Deal Was Agreed Upon without a Concrete Business Plan

“There was a five-year generalized plan of intent that ZoSea presented to the ASP, but there was no solidified business plan,” says our source. “For a lot of the people in that meeting, this was a little worrisome. But given the alternatives of continuing to run the event themselves, the brands decided to move forward. It was very much a ‘trust us, we know what we’re doing’ deal.” By December 17, when the deal is set to be officially signed, our source expects ZoSea to have a more concrete plan in order.

ZoSea Will Create A Single Production Team for the World Tour Events

Beginning in 2014, a single production team and announcers will be put into place. It’s not currently known who will make up that team.

Two Other Organizations Were Also in the Bidding

According to our source, two other outside agencies were also eyeing to take control of the ASP. Because of a non-disclosure agreement, those two agencies could not be named. Some ASP board members openly questioned whether it was best to sign with ZoSea, or go back and vet the other outside agencies again for a chance at a better deal.

By 2014, A Commissioner of the ASP Position Will Be Created

The position is expected to mimic that of the NFL and will most likely be filled by an ex-professional surfer in good standing with both the surfers and the industry. It is not currently known who that person will be.

Pension Plan for Male and Female World Tour Surfers

The current ASP board is composed of two surfers rep. As a means to help gain their vote, ZoSea will offer a million-dollar pension plan for World Tour surfers. “The details on the pension plan are very hazy at the moment. But I can confirm that a million-dollar plan has been put forth. How it’s going to work is still up in the air, but I can assume that there will be a lot of meetings between the surfers’ rep and ZoSea moving forward to fill in the details.”

The World Tour will Retain the Same Basic Competitive Structure as Before but Will Possibly Include Specialty Events

ZoSea will only be taking control over the men’s and women’s World Tour events, the ’QS and the PRIME events will continue to be handled by the ASP. “The WQS will still be the feeder system to the World Tour. That system seems to be working and ZoSea isn’t interested in changing it.”

There’s A Proposed Broadcast Deal with a Major Television Network

Although there is not yet a confirmed television broadcast deal in place, our source has said that ZoSea is in the works of attempting to finalize a deal that will potentially see World Tour surfing broadcast on network TV.

There Will Be An Increase In Prize Money for Both the Men and Women’s World Tour

The current prize purses for both men’s and women’s World Tour events stand at $425,000 and $110,000 respectively. Under ZoSea’s plan, the prize purse for the men’s event will increase to $500,000 and the women’s to $250,000.

  • http://eneyege.wordpress.com Mark A.

    It will only be good for people who will make a living off of it. It will pollute the rest of the ocean. Just like everything else, it’ll suck.

  • Dom T.

    The day professional surfing events are shown on major broadcasting channels is the day I stop watching them. Surfing is not the kind of sport that needs a big media agency to manage the events, it’s fine as it is. What a sorry state of affairs.

  • http://nathanpetty.com Nathan

    Definitely going to be interesting to see how this all plays out. Better for surfers and viewers? Have at it.

  • Jo

    So much money. So much structure. It gets repulsive at some point. There is nothing like surfing, nothing matches it. I enjoy the events although there is a balance to reach. It is not fu*ing basketball, football or whatever else. Let the personalities and their experiences in the best (and average) waves around the world entertain us.

  • Lane

    As long as we don’t have to pay for webcasts in the future

  • Jeff

    I’m pretty stoked to see that the gals are getting a pay increase and that they’re

    trying to implement some sort of pension. Other than that, who do you think will

    get the commissioner job??? Like, a former a-list surfer or some savvy b-grade

    or lower dude? Slater for Commissioner 2014!! nahh, he’d get bored as hell

  • westie

    commissioner= K. Perrow

  • craig w

    I believe that 1 organization needs to take control of the events so that the webcasts can be consistent. One organization can develop the best technology for delivering this to the masses instead of what it is now.
    However, this also puts the ASP at risk just like the AVP volleyball tour. They have gone bankrupt and can’t afford to pay the players any money.

  • Graham

    Seems like a great plan to pump money into the sport. Hopefully other industries like snowboarding will learn how to run a world tour w/ similar structure.

  • Bobo

    “ZoSea representatives will hold the majority of interest”. We all know what path is determined by corporate greed.

  • jan key

    yeah lets take this more mainstream then it is now….. stoke whole new generations into the sport [?]… i mean there are so many surf spots… couple more million grommets should be no problem….. probably have to take a ticket for a surf…..” number 337…. you may have the next wave…… unless of course a pro wants it…”…..
    pension plan?? give me a break………
    ” i have given up my life for surfing…. i have traveled the world surfing great waves… i have ridden your best breaks with only one or two others out…..
    [ something you will never do ] but now i am tired and just cant keep up with the young kids….. i want to retire and i want somebody to pay for me to continue with my lifestyle”
    bullshit!! get a job!!

  • Elizabeth

    Kc: Did you know surfing has taken the place of golf?

  • against the new plans

    Anyone rooting for the industry is a pathetic loser who never made it in life.

  • asp fan

    this is what pro surfing really needs. with the way the economy is going, soon there will be half or no CT events at all, as most of the endemic surf industry brands are taking it hard. and believe me, these brands will gladly drop a multi million dollar investment in a contest with no “real” traceable return on that investment before they will cut marketing budgets for their retailers that actually generate their income.

    this is a step in the right direction… but the two things that really bother me are – NO BUSINESS PLAN??? what kind of entity enters into a multi million dollar term sheet with no business plan to reference. that is a Business 101 fail.

    and 2) WHO and WHAT THE HELL IS ZoSeas?? how’s about a company profile to ease some nerves here? While i am all for an endemic brand being the one who could ultimately shoulder an umbrella sponsorship.. i am also aware that with the financial state of these brands.. it simply is not possible.

    in the end, i would be more comfortable seeing NIKE, ESPN, or even TARGET listed as the potential suitor for a long term deal, instead of some unknown entity that may very well up and leave if a return is not seen immediately or their unknown (and most likely not as deep) pockets run dry.

    this seems like a desperation move on the ASP’s part. but if none of the above brands could come through.. i’d rather take my chances with these guys than have WCT events disappear like how skating did in the early 90′s.

    and as far as all you commenting about how you will STOP watching ASP events if it becomes “mainstream” and sold out… it’s too late for that. gaining mainstream media has been the goal of the ASP and it’s event sponsors since INCEPTION. if you dont like PROFESSIONAL sporting events – as WCT CONTESTS (note freesurfs are), then stop being a fricken hypocrite and turn your webcasts off. good luck ASP!

  • David

    My understanding and history of private companies taking over of sport events means the webcasts at some point will turn into pay per view events. If that doesnt happen its all good.

  • dk

    no way this ever makes a dime

  • BEE

    Probably end up with free low quality webcast and they will charge for “enhanced” high quality webcast.

  • http://www.j-bay.com Garth Robinson

    How can a company like Billabong ever have gained control of our best surf break of Supertubes for a waiting period that pretty much covers the best of our winter surf season? Now we can look forward to that peak time being ‘owned’ by ZoSea, who have no link whatsover with J-Bay. Thus South Africa’s best surf spot’s best surfing period is now owned by some unknown company because of the stupid ASP and surf industry wankers taking the money and the easy way out. It would be better for us all is we banned all contests and instead travelling and local regular surfers could enjoy J-Bay best wave like it used to be back in the day. Joburg could do with a wavepool and they have enough potential crowds, so Kelly take your ZoSea/ASP and shove it up there where the sun don’t shine.

  • E

    Surfing is indeed becoming like tennis. Sad sad sad.

  • Kenny M.

    “These are the best of times, these are the worst of times”. I enjoy watching the contests on the web, especially with the heats on demand feature and virtually no commercials. Don’t fix it if it isn’t broken.

  • nathan

    you know what happened to skateboarding in the 90′s? THEY REALIZED THEY CAN MARKET THEMSELVES and make plenty of money…most of them just said “screw contests and this corporate crap.” sound familiar? you guys should interview rasta or dane and see what they have to say.

  • jan key

    all these sponsors that are having a bad economic time at the moment….. for the most part have nothing to do with the surf industry…. oh they do make wetsuits and boardbags and other little bits and pieces… but face it they have sold out surfing to gain a hold in the world ‘rag trade’….. big money selling an image… and Moscow and Beijing really need ‘surf wear’
    i have always supported the surf industry…. to me that means when in an area, i buy boards from the local surfshop…. using the local shaper …. i have gotten some awesome boards over the years.[and a couple of dogs] any wax… leashes and other little shit i try to procure there also… the big names come to mind when i need a good winter wetsuit…. then and only then is there a bit of research put into their product….. i love watching the likes of KS surf but i dont owe him a living….. pro surfing has gotten too big for its britches as far as i am concerned… the guys involved in the corporate side are in their twilight years and couldnt give a stuff that by promoting a sport and increasing the water population tenfold , to a point that its unsafe and really not that fun in the good spots…. shit they dont care , they had their day. and with the big bucks they can spend months on end at the few remaining quiet spots on the planet….. and in comfort , as their other good buddies have put up surf camps and made no-go zones for their surfing pleasure….. places where just a few years back guys with the balls to get there did just that and scored…. and shared.
    so what do you think…. taking the next step… is it going to benefit anyone but the miniscule few making the bucks?

  • Jason S

    A commissioner? Now it’s looking more like the corrupt and total joke NBA instead of tennis. Surfing has officially gone down the shit hole. What’s next? Boards made in China for $800 US! YAY!

  • http://surfer.com Kelly

    Who and what the hell is Zosea????
    Been surfing for 30 years……and NEVER even heard of Zosea!! And someone thinks that an unknown company like this is going to hold-up over a year or two? Sorry aint going to happen. THIS IS THE BEGINNING OF THE END.

  • Daniel

    Leave things the way they are now. I hope they don’t close this deal with ZoSea or whatever sort of company might be on the way. The events have been really good over these past years. Just honing the webcast would be enough.

  • kai

    This is great! Surfers suck as does surfing. This is a match made in heaven