How The $2.3 Billion Sphere In Las Vegas Plans To Become A Global Brand
Huddle Up is a 3x weekly newsletter that breaks down the business and money behind sports. If you are not already a subscriber, sign up and join 100,000+ others who receive it directly in their inbox each week. Today At A Glance:The MSG Sphere in Las Vegas is going viral for its out-of-this-world display on the Las Vegas Strip. But what really is this giant Sphere for? Why was it built? How does it work? And what does the business behind it actually look like? This newsletter will cover everything you need to know about the new Las Vegas MSG Sphere. This newsletter is also available via podcast on Apple or Spotify. Enjoy! This Newsletter is Sponsored By ButcherBox!
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You’ve all seen the MSG Sphere in Las Vegas by now. The 366-foot tall x 516-foot wide structure is located next to The Venetian Resort and has taken the internet by storm. The project broke ground in September 2018 and was expected to cost about $1.2 billion. But construction costs ballooned as the COVID-19 pandemic impacted labor and material costs, and MSG revised its projection four times — from $1.2 billion in 2018 to $1.66 billion in 2020 to $1.87 billion in 2021 to $2.3 billion in 2023. MSG Sphere Construction Cost Projections
Still, the project is now complete, and the $2.3 billion in construction costs might end up looking like a bargain. That’s because there is nothing else like the MSG Sphere. The venue could potentially host MMA or boxing matches. But it was specifically designed for music and art. The inside of the MSG Sphere has a 250-foot high screen with 360° views all the way around. There are 168,000 speakers, promising to deliver the same pristine sound to every seat, whether someone is in the top row or down on the floor. And the outside of the Sphere has 1.2 million LED lights (the size of hockey pucks) spaced eight inches apart that each contain 48 diodes (aka semiconductors) and can display 256 million different colors. MSG also opened a 68,000-square-foot studio in Burbank, California. This is where all the in-house creative, production, tech, software, and engineering teams will implement content on the Sphere’s exterior. And the building even has a 28,000-square-foot, 100-foot-high custom geodesic dome that was intentionally designed as a smaller version of the Las Vegas Sphere for creative and testing purposes. “Most music venues are sports venues,” U2’s Bono said in an interview with Apple Music. “They’re built for sports – they’re not built for music. They’re not built for art. This building was built for immersive experiences in cinema and performance … you can’t come here and see an ice hockey game.” Furthermore, the Sphere was designed by the architecture firm Populous, which also designed Tottenham Hotspur Stadium, State Farm Stadium (Cardinals), Hard Rock Stadium (Dolphins), Lusail Stadium (Qatar World Cup), 12 Olympic Games venues, and thousands of sports arenas and other projects. And the venue will officially open to the public on September 29 when U2 starts their 25-show residency. MSG Sphere Specifications & Details
MSG Sphere Upcoming Experiences
Outside of concerts and shows, the Sphere should make millions on advertising, too. MSG has already struck a deal with the NBA to display NBA Summer League content on its exterior every day during the 11-day competition. And the Sphere’s unique canvas and social media virality makes it a prime target for forward-thinking brands. So don’t be surprised if the Sphere instantly starts earning 8-figures-plus in annual advertising revenue. Why? Just look at One Times Square, for example. The famous Times Square building went fully digital in the mid-1990s and now generates upward of $23 million per year in advertising revenue. And it’s not like MSG is going to stop at just one building; London, England, is next.
James Dolan spun off the live entertainment parts of his business earlier this year, rebranding the Sphere in Las Vegas and MSG Networks part of his portfolio as “Sphere Entertainment Co.” This business trades on the New York Stock Exchange (NYSE) under the ticker “SPHR,” and the equity value has increased by 25% since the Sphere went live. So don’t be surprised to see more sphere-like venues pop up. MSG executives have already purchased land in the Stratford area of London for their next project. And with investors reacting positively to the new entertainment venue, it’s clear that James Dolan and his partners believe it has the potential to become a global brand. If you enjoyed this breakdown, please consider sharing it with your friends! I hope everyone has a great day. We’ll talk on Friday. Listen to the Joe Pomp Show on Apple or Spotify. Interested in advertising with Huddle Up? Email me. Your feedback helps me improve Huddle Up. How did you like today’s post? Loved | Great | Good | Meh | Bad Huddle Up is a 3x weekly newsletter that breaks down the business and money behind sports. If you are not already a subscriber, sign up and join 100,000+ others who receive it directly in their inbox each week.
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