PSINet clicks on $105M deal; Internet provider 'sponsors' stadium for 20 years to aid image; Fans: Name doesn't compute; Suites, radio/TV part of record NFL package


First, a word on the pronunciation. It isn't "sigh net" or "p-sigh net." It's "P-S-I Net."

Get used to it. It's a name you're going to be seeing and hearing a lot in coming years. Look for it plastered to the bricks of the Ravens' stadium, glued to the cup holders, beamed through cyberspace and repeated in pre-game shows and radio broadcasts.

Herndon, Va.-based PSINet Inc. will insist on such omnipresence, and has paid dearly for it.

The company, an Internet service provider, has agreed to pay $105.5 million over the next 20 years to become the Ravens' "presenting sponsor," according to a source familiar with the negotiations.

In exchange, PSINet will receive a jolt of publicity and name recognition to help it compete in the cutthroat business of computer services. That starts today with simultaneous news conferences in New York and Baltimore linked by satellite and broadcast live on the Internet (

The reaction from fans to the new name was not good, especially those raised at Memorial Stadium, an edifice dedicated to the nation's war dead.

"I hate it. It doesn't apply to anything," said Doris Gregor, a longtime Baltimore football fan. "It doesn't indicate football and it doesn't say anything about the team. I just don't like it."

Larry T. English, a Ravens season-ticket holder, said the commercialization of the name was overkill considering the taxpayer financing of the building and the "permanent seat licenses" charged ticket buyers.

"I think that between the city and state paying for the $220 million stadium and the fans paying the PSLs, it's a little ridiculous to have to sell the name," he said. "In my eyes, it will be Ravens stadium no matter what they call it."

The $105.5 million PSINet deal with the Ravens would be a record for a football stadium, shattering the previous mark set by the Tampa Bay Buccaneers at Raymond James Stadium.

The namesake financial services firm is paying the Bucs $3 million annually for 13 years. The PSINet sum would come close to the record $116 million that office equipment retailer Staples has paid to name Los Angeles' new arena.

PSINet rewards, too

But the Baltimore deal includes substantial elements unrelated to the name of the building -- such as ad time on radio broadcasts and the team-produced TV shows -- so its value as a benchmark is not clear.

One source said the radio component alone is worth about $500,000 a year at retail. That is revenue the team will not be able to attract from other advertisers, so it can't be considered a net gain for the team.

In exchange for its annual average payment of nearly $5.3 million, PSINet will get as close an association with an NFL team as any sponsor ever has. The arrangement stretches from sponsorship of the team's two television shows to access to the stadium's only double-decker skybox -- two suites stacked at the 50-yard line and connected by a spiral, cherry staircase.

To discourage fans from referring to the building as anything other than PSINet Stadium, the suffix "at Camden Yards" was purposely left off the official title.

Web page, kiosks, more

Sources say there will also be a substantial involvement between the team and company in cyberspace. Details are to be released today, but a new Web page for the team and Internet kiosks in the stadium are possible components, as well as some electronic razzle-dazzle to entertain fans on game day.

"If it's a good company and it's high-tech, it could move us into the next century in terms of what we do for the fans. But the name is a little hard to make ring," said Maryland Stadium Authority executive director Bruce Hoffman.

PSINet serves chiefly business customers, providing them with high-speed Internet access, e-mail service, Web site design and secure electronic commerce. PSINet is the nation's largest independent Internet service provider, with dedicated cables nearly ringing the globe and a special concentration running between Washington and New York.

Its competitors include such integrated and well-capitalized telecommunications behemoths as MCI Corp., AT&T; and Worldcom.

The stadium deal will catapult PSINet into the big leagues of name recognition, something that can spell the difference between survival or extinction in its fast-changing industry.

Stock rises after '98 fall

"This will surely give them the opportunity to raise their brand image to a national level. Anything they can do to establish a national brand would be good," said Charles "Chip" Morris, manager of T. Rowe Price's Science and Technology mutual fund, which owns PSINet stock.

PSINet lost $45.6 million last year on revenues of $121.9 million, but is growing rapidly and has drawn interest from investors hoping it establishes a strong beachhead and becomes profitable or is purchased by a larger firm. It was founded in 1989 as Performance Systems International Inc.

PSINet's shares rose 2 3/4 to 34 3/4 yesterday.

Fred Fried, who negotiates naming rights deals as executive vice president of Integrated Sports International of East Rutherford, N.J., predicts more high-technology companies will follow PSINet into the sports business.

"They are going to spike their name awareness exponentially. This is where you are going to see a lot of activity in naming rights," Fried said.

Qualcomm Inc. named the stadium in San Diego, Alltel Corp. bought the rights in Jacksonville, Fla., and Ericsson did so in Charlotte, N.C.

The impact on the price asked of future rights buyers will depend on the breakdown of the worth of the Ravens' package, Fried said. "It's a big number, but an awful lot of media inventory is packaged into the deal," he said.

Another 3Com turnoff?

The impact on the team and its fans is hard to measure. Fans were so repulsed by the 1995 renaming of San Francisco's venerable Candlestick Park as 3Com Park that many of them refused to acknowledge the new name. Some sportswriters and talk show hosts and virtually all the fans still use the old name, said David Binder, of David Binder Research.

His firm conducted a poll for the San Francisco Examiner shortly after the name was announced and found 57 percent opposed the change, even if the money raised would help bring a Super Bowl to the city. Candlestick Point was the name of the area that juts into San Francisco Bay where the stadium was built; 3Com is a computer services company based in Santa Clara, Calif.

"Candlestick was well loved by people, it was historic and it was quirky. The reaction to the change was extremely negative, there was a sense of 'How dare you sell something like that?' " Binder said.

The Ravens were careful to refer to their stadium in the generic during its first season, last year, to avoid a backlash against changing a preferred name. But San Franciscans also found the commercialization disturbing, something the Ravens are sure to confront, Binder said.

"If it [3Com] was a hip, cool name it might not have been so bad. But it was jarring," Binder said. "PSINet -- that's even worse."

Club is confident

Ravens spokesman Kevin Byrne predicts that people will warm to the Baltimore stadium's new name.

"I think the fans knew that we were going to have a name on the building that was related to a corporation. There's always going to be a group of people that would prefer it had another name," Byrne said.

The team paid the Maryland Stadium Authority $10 million for the right to sell the name of the stadium.

Baltimore-based sports marketing executive Robert Leffler, whose clients include the Ravens, said fans will appreciate the revenue the team is earning if it buys a better team.

"Fans have always had a hard time dealing with the economic realities of sports. But it's the team's job to maximize the revenues in the stadium," Leffler said. "They [fans] will get over it. If the team is successful, they will get over it even quicker."

Pub Date: 1/26/99

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