Commercial Collaboration: Today’s Powerful New Business Strategy

by Adam Hanft, Global Branding Expert, Strategic Advisor to Pixellot

Pixellot’s “Camera as a Service” model innovates the future, while surprisingly acknowledging the past

For decades, we’ve believed, and have been taught, that business is a simple – and fierce – competition.   I offer you a widget for $1 because it costs me 75 cents to make and because I need that much margin to operate.

You counter with 90 cents because if you pay me a dollar you can’t make any money.

I come back with 95 cents and will cut costs by serving crummier coffee to my employees.

Those are the adversarial kinetics we’re all used to.

CaaS Upends the Model

At Pixellot, we recently turned that zero-sum-game framework on its head with our CaaS, or Cameras-as-a-Service model.    In a bold move, we stopped selling camera, for the most part, and have entered into revenue-sharing opportunities with our customers.

That’s the essence of today’s commercial collaboration.

To back up a moment for those readers who are new to our blog, Pixellot is the global leader in delivering automated video solutions for the youth sports ecosystem, and beyond.    Cameras are the capture device, but that’s just the beginning as the video is then sent to the cloud, where it is edited, analyzed and streamed to athletes, parents, and fans at massive scale.

Massive scale is far from an overstatement; we deliver over 150,000 games a month to 80 countries.

But that’s not enough for us.  Because there are still millions of youth sports participants, putting their hearts and souls into the field, whose accomplishments are not being captured.   And are lost forever.

Shared Economics Ignites Opportunity

In order to expand our ability to capture more video, and to reduce the up-front costs for our partners –  be they distribution entities, schools or leagues – we install the camera at our cost.   And we enter into long-term revenue-sharing agreements with our

partners.  Last fall we announced an extension of our relationship with PlayOn based on this new approach, to better serve high school sports.

Doron Gerstel, our CEO, noted at the time that our technology “…driven by the engagement it creates and the personalization it makes possible, will unlock unprecedented revenue opportunities. We are making the pie bigger, so every share grows exponentially.”

That’s the fundamental re-imagining of our business that CaaS represents.  It takes the $1 or 90 cents negotiation off the table to create a new economic model for youth sports and sports in general.

But as transformative as it is our industry, there are precedents which give us confidence that the future for this grow-the-pie principle is a shining one.

Mutually-Assured Winning

You may have read recently about Nvidia’s plans to invest $100B in OpenAI; in turn, OpenAI will be deploying Nvidia’s chips for massive AI data centers.   Similarly, Anthropic will be using Broadcom technology for its compute expansion, and a combination of Apollo and Blackstone are financing it.

But these collaborative commercial frameworks aren’t just a recent development.  Many people don’t realize that in the 19^th century, railroads helped finance businesses along their routes.   The logic was undeniable.  Encouraging economic development meant more commerce and hence more freight.

Versions of this co-financed monetization are right under our noses, even if we don’t realize it.   The vending machine model works because the building owner supplies the space and the traffic.   The vending machine business supplies the unit, the inventory, and service.  The economics are shared.

Back in the day, the jukebox industry worked in the same way.   Similarly, when you get cash from the ATM that is sitting in front of your neighborhood deli, that’s commercial collaboration at work.

The relationship between retailers and property owners who host EV chargers operates the same way.    And in many cases, there are revenue-share structures between Las Vegas hotels and the makers of slot machines.  (What happens in Vegas is shared in Vegas.)

Each Partner Has Unique Assets to Monetize

In all of those cases, there is a symbiotic relationship between those who generate demand, and those who supply infrastructure to monetize it.  With CaaS, we supply the cameras, software, AI production and the operating system.   While our partners supply the games, the athletes, the families, and the demand.   Revenue emerges, exponentially and at scale, from streaming, subscriptions, highlights, sponsorship, recruiting, and media inventory.

This creates a shared, non-competitive commercial engine.   Our customers own the consumer, and we help them make the most of those relationships.

What’s more, the high-growth potential that commercial collaboration offers enables us to invest more in technology and innovation – because we know our partners are ready to distribute it.

To sum it up.  While the traditional sales model is based on “How much can I extract from this transaction” the collaborative model asks “How much value can we create together.”  With this re-framing, opportunity is amplified because all sides are in it together.

In sports, one team has to lose.  In the business of sports, commercial collaboration means everyone can win.