Sports franchises are at a pivotal crossroads in how they produce, package, and deliver content to their audiences. The ongoing shift to streaming is disrupting the traditional broadcast rights model and redefining how fans engage and interact with content. A recent Nielsen report (August 2021) found a significant upshot in the amount of streamed sports content compared with traditional routes. It reported 28% of sports viewing in the US came from streaming platforms, compared with 24% on broadcast and 38% on cable. In 2019, streaming’s share stood at around 14%.
The challenge now is to align their services with contemporary consumer spending habits while keeping their content highly engaging and interactive – easier said than done! At least with traditional approaches to service deployment. For that reason, 2022 will be defined by a continued embrace of cloud technology across the sports media value chain. By yielding the benefits of the public cloud, sports franchises will foster collaboration and drive innovation with technology vendors, enabling them to deliver better services faster. By doing so, they can deliver optimal monetizable value to the rightsholder while balancing short-term and long-term growth.
Use it or lose it
The most valuable asset sports broadcasters and operators have is sports rights – it defines their content offering for years to come and often sees investments made in the billions. In 2022, we will see broadcasters and operators go beyond the linear use of these rights to create complementary services and additional channels. This will be powered predominantly by the cloud’s capabilities, including incredibly fast time-to-market and new feature rollout. This can only bring a better return on investment (ROI) for sports rights while offering the freedom, scale, and flexibility to experiment with new user engagement tools, further growing ROI.
We’ll also see the leading broadcasters of sports content leverage the cloud to create data-driven, interactive content and dynamically deliver it to the end-user. Streaming aggregator services are acquiring an abundance of digital rights and shifting content away from traditional broadcast environments. This fosters an exciting environment of technology innovation within sports experiences that capitalizes on streaming technology. Expect to see features such as multiple camera feeds, overlayed live player stats, and real-time social media functions within these services. The cloud is the harbinger of this, allowing rights-holders to deliver highly personalized services by rapidly spinning-up new content or even linear channels and engaging a specific audience demographic.
Sweating the assets
Embracing the cloud and its functions will help drive revenue growth for sports broadcasters. The current approach is incredibly inefficient, especially when you consider a traditional broadcast production set-up often requires 10 or more cameras at the venue to create one broadcast feed, which only then translates into a two-hour linear broadcast. There is a huge discrepancy between the amount of content captured and what’s delivered to the end-user.
This year we will see all sports content captured at venues used and packaged into far more wide-reaching and interactive programming. This could include personalized highlight feeds and switching between multiple camera angles from a game and live player information. The cloud will enable broadcasters to take the same content but package it in numerous ways, targeted for different experiences and consumption means such as mobile, smart TV, and social media. The increase in revenue for broadcasters could be eight to ten-fold, when you consider the additional content available.
The importance of building community through real-time engagement
First and foremost, a streaming service from a sports league or federation is not about creating direct revenue streams, or necessarily replacing broadcast rights. It’s about creating a connection between the sport, it’s players and their fans. This connection allows a direct relationship to form, the sporting body to learn about their audience and finally grow all the indirect revenue streams that require a deep knowledge of the individual. Ticket sales, merchandising, sponsorship and even broadcasting rights themselves can be positively impacted when a club, team or league has an intimate understanding of their fan base.
Make it easy to access your content, make that content have the highest quality of experience THEN deepen those relationships by bring real-time engagement tools to drive interactivity, increase data gathering and prolong the audiences time directly connected to your content – this will be a key trend and an area of growth in 2022, deeper understanding gathered through rich-data driven transactions and interactivity. Once you know your audience you can create new revenue streams and build super-fans.
MediaKind’s 2021 Sports D2C Forecast found most rightsholders now consider it essential to have a direct relationship with their base, beyond an official website, even though it will be a decade or more before a D2C service becomes the primary means of distribution. This trend will continue to accelerate as content owners embrace streaming and digital technology to establish richer bonds with their fans. These new complementary services could include integrated sports betting, ticketing, merchandising, and chat functions within the same user interface. This will ultimately be enabled by developing and running distributed production chains in the cloud, from acquisition through to distribution.
We’ll also see greater experimentation within non-fungible tokens (NFTs) and other collectible digital assets as a means of giving sports fans fun memorabilia from games. The NBA and NFL have dipped their toes in the water here already at physical games and digitally, helping build brand loyalty beyond the court and stadium. New production technologies such as cloud-based clipping and editing will enable the creation of these assets. This approach to community development poses some challenges to short-term growth, such as needing to prioritize digital-driven experiments over new rights packages. So, there could be some difficult trade-off decisions to make to allow room to grow in the future.
A Virtual Reality future?
The Metaverse concept has dominated news headlines and marketing straplines recently, fueled by the likes of Microsoft, Disney, and Meta. It positions the cloud as the most progressive technology for connecting real and virtual content. Its exact impact on live sports remains up for discussion, but it could for example enable fans on one side of the world to virtually attend a game on the other through immersive VR technology. Imagine standing centimeters behind the goal netting as Lionel Messi delivers another wonder moment, or (attempting!) to run alongside Derrick Henry as he accelerates towards the end zone!
Although the certainty of the pandemic remains unclear, broadcasters and operators have an enormous opportunity to lead the development of cloud technology, delivering fantastic experiences while increasing revenue. They can scale their services better, harness flexibility, and champion innovation. With the Beijing Winter Olympics in full swing, and the FIFA World Cup in Qatar kicking off in November, another stellar year of live sports lies ahead. It’s up to the broadcasters, content owners, and operators to decide how they leverage their sports assets and utilize the tools and technologies available to deliver incredible sports experiences.