Cosgrave gets in the end zone
BY any measure, €110m to stay in Lisbon for the next decade is a new level for the Web Summit. The massive deal was reached after some 20 European cities bid to host the conference, many with significant sweeteners or cash offers. A combination of a huge uptick in cash (Portugal’s original three-year deal with the Web Summit was worth €1.3m annually) and plans to expand the size of the Lisbon venue were enough to get Paddy Cosgrave to sign on for the next decade.
Reaction in Ireland to the deal has been a mixture of admiration and puzzlement. How has the Web Summit managed to pull this off ?
There are few precise parallels to Cosgrave’s business model in the Irish corporate world.
But there’s a fairly accurate one in the US. It’s the professional sports business.
In America, your beloved home team is less of a club and more of a franchise. And such organisations are willing to up sticks and move cities if a superior financial or infrastructural offer is on the table.
This happens fairly regularly across all professional US sports, but most often in American Football’s NFL.
Featuring the likes of the Dallas Cowboys, Chicago Bears and New England Patriots, it’s the most popular sport in America.
But its popularity makes it too valuable to abide by ordinary sporting principles.
As a kid who was introduced to the NFL in the multi-channel universe of the 1980s, I was gob-smacked when the Baltimore Colts suddenly moved to Indianapolis, a dreary mid-western US city in the middle of nowhere. What about their fans? The culture? The history?
Then the St Louis Cardinals moved to Phoenix. And the LA Raiders, having come from Oakland, moved back to the San Francisco Bay Area city in 1995. That same year, the LA Rams moved to St Louis, before moving back to LA in 2016.
Probably the most controversial move was when the Cleveland Browns upped and moved to Baltimore in 1996, an act that provoked fans into setting fire to the stadium. (They moved back a few years later.)
To Europeans, this sort of thing is unthinkable. Liverpool will never move to London or — God forbid — Manchester. Real Madrid can never be anything but a Madrid team.
But in the business world — and especially the professional conferencing world — it’s not as rare.
We now think of the giant Mobile World Congress telecoms conference, which is considerably commercially bigger than the Web Summit, as a staple of Barcelona. But up until 2006, its home was Cannes.
Other business conferences have a similar experience.
Arguably the biggest of all global tech shows, CES, was trialled in a number of US cities (including Chicago, Atlanta and Orlando) before finding a permanent winter home in Las Vegas.
And the Web Summit’s own North American conference, Collision, has wandered from city to city, recently relocating to Toronto from New Orleans.
Cosgrave arguably realised the value of relocation at an early stage.
When the Web Summit announced in 2015 that it was moving from Dublin to London, there was disbelief, followed by anger and resentment, in Ireland.
Surely it couldn’t work outside Ireland? Wasn’t the whole point of the Web Summit that it was based in Dublin, a plucky, charming, tech-friendly European capital? How could it survive in a country as seemingly off the radar as Portugal?
Yet it has. Not only that, it has thrived to an extent that wouldn’t have been possible in ‘tech friendly’ Dublin.
Having attended the event at the giant MEO Arena in Lisbon over the last two years, it has evolved into a high-end, smooth, professional conference, almost unrecognisable from the eccentric, hectic, spunky mishmash of its earlier incarnation at Dublin’s RDS.
It is finally becoming an annual event that can be mentioned in the same breath as the aforementioned Consumer Electronics Show in Las Vegas, the IFA electronics show in Berlin or Mobile World Congress in Barcelona (even if it is not as commercially big as any of these shows, whatever its marketing team says).
Even still, Cosgrave probably knows that there are always bigger, greater horizons.
One of the principles of US sports franchises is that they successfully calculate, project and leverage their economic value to a city. They then use this key data to push for improvements in infrastructure or facilities, most often represented in stadium repairs or upgrades.
This appears to have been a key tenet of the deal to keep the Web Summit in Lisbon, with a commitment to expand the venue, allowing the Web Summit to grow further.
Would the Web Summit have really left for Madrid, Berlin, London or one of the other European cities said to have been bidding for its relocation? Did it simply come down to the bidder with the biggest subsidy?
It’s not clear whether Lisbon was the highest bidder, but I’d be surprised if that was the dominant criteria for Cosgrave’s decision anyway.
If Albania offered two or three times as much per year to move it to Tirana, it’s highly unlikely that Cosgrave would move it there, despite a short-term cash windfall.
Like any ambitious conference, the Web Summit’s lifeblood is still based on whether people see value in it and are willing to return. It also depends on how easy it is for big sponsors and corporate partners to get there and do business there.
Lisbon, to be fair to it, does this very well. Its transportation links, accommodation capacity and host culture are more than acceptable.
So the Web Summit’s €110m deal looks like a landmark for an Irish company.
TECHNOLOGY