For Broadcast May 28, 2008

The odds of Llanelli and Tulsa, Oklahoma, having much in common seem extreme, but if Welsh producer Tinopolis buys US sports producer Winnercomm, a lot of cultural and business exchange will be on the cards.

The question is what Tinopolis hopes to gain by splashing out a reported £40m for it. Winnercom is the biggest independent sports producer in the US, with a deep relationship with top sports cable network ESPN. It also produces for 13 other national broadcasters and would help Tinopolis leapfrog into a leading position in the US market.

But the US market is very different from the UK. In the US, sports programming is mostly a "time buy", meaning sports producers buy time from networks to put on coverage that they then sell ads against.

But the problem of wringing more out of a deal with Winnercomm is twofold: the sports production business is a low-margin one - in sports producing a 6% margin is considered good. The other problem is whether the business model for how sports are produced and paid for in the US can be made to work for Tinopolis-owned Sunset + Vine outside the US.

But while these will not be easy to overcome, sports production experts note that advertiser-funded programming (AFP) and time-buyer models are becoming more prevalent in Europe.

Also, the scale argument of putting two businesses together may overcome some of the margin problems. It will be up to the numbers guys to figure out if that potential is worth £40m or not, but maybe Llanelli has a lot to learn from Tulsa after all.