A small but prestigious group of leaders in sports broadcasting recently gathered at the Paley Center for Media in New York City to discuss what lies ahead for the industry in a session called Sports Television: Winning the Game of Disruption.
Moderated by Sports Illustrated Senior Editor, Richard Deitsch, the discussion panel featured Mark Lazarus, Chairman NBC Sports Group; Sean McManus, Chairman, CBS Sports; Eric Shanks, President, COO & Executive Producer, FOX Sports; and John Skipper, President, ESPN, Inc, Co-Chairman, Disney Media Networks.
The New Digital Era
One thing these leaders could agree on: it’s critical to embrace all of the new ways people are viewing content beyond the traditional television set, including on mobile, tablets, and OTT.
For the sports arena, embracing these changes is especially critical. Live sports ad view growth has more than doubled since last year and sports alone accounted for 25% of premium digital video ad views in Q1 2015.
We refer to this evolution in digital video consumption as the “new living room.” Today, audiences of varying demographics are experiencing premium video content across a multitude of screens and locations; we are no longer tethered to the family couch to access our favorite programs.
When it comes to sports viewing, OTT is emerging as a channel of choice for consumers. In Q1, OTT devices accounted for nearly 40% of live sport streaming.
When asked about the rising popularity of watching sports on OTT devices, Mark Lazarus responded, “We have to innovate and be available on all these platforms. We have recently launched NBC Sports Live Extra on AppleTV and Roku and we will continue to innovate and build for the new platforms that come along. We have to.” He went on to say, “It’s about being where the fans are watching.”
In response to the same question, John Skipper shared, “Every single technological innovation in delivery of content advances sports. Sports over-indexes on any of these platforms. This is all good news for us.”
Similarly, when Eric Shanks was asked about any concerns he has for challenges that may accompany OTT programming, he replied, “I’m not concerned at all. I’m actually encouraged and excited about over the top and what it will mean to our business in the long run. It means more competition for our content and more ways to reach consumers.”
Clearly as consumers make their preferences clear about how and where they want to access their favorite programing, publishers will follow their lead. Viewing on over-the-top (OTT) streaming devices and smartphones grew 380% and 105%, respectively, year-over-year.
Fivefold: the amount authenticated viewing of sports content has grown in the past year. That’s 499%, to be exact– and even more remarkable when compared to entertainment growth (still explosive at 212%) and news (165%). Sports also accounted for 50% of authenticated ad views.
Authenticated content is key in reaching millennials who, according to John Skipper, less than a ⅓ of their time watching video on traditional televisions. “This is why it has to be about mobile, other kinds of devices and authenticated television.”
While programmers have historically struggled to entice viewers into providing authentication credentials to access premium video content, not-to-miss live sports events, including March Madness and the Super Bowl, “have brought viewers over the authentication wall,” according to Brian Dutt, FreeWheel’s Director, Advisory Services
FreeWheel regards live sports as the “gateway drug” for viewers as live sports events are drawing increasing numbers of viewers to ultra-premium high-CPM ad inventory. With every simulcast, viewers’ cravings for immediate access to all genres of content grows.
The Big Picture
John Skipper summed it up nicely when he outlined the two issues the industry faces:
- How to navigate and adapt to the changing landscape in how consumers want to view premium video, the amount of video available and the different platforms that are available
- In response to the migration of advertising from traditional to digital, the importance of adopting new measurement systems, new ad serving systems and how to make sure to continue capturing their rightful share of the digital ad revenue
At FreeWheel, we serve as a partner to the largest players in the industry to resolve for both of these obstacles. Our platform for video ad management and monetization helps the TV industry generate revenue from their ad-supported content on desktop, mobile, OTT and traditional set-top box devices.
See what else the panel had to say about how social, email, periscope and other pertinent issues are impacting the sports industry in the full video recording of the Paley event Sports Television: Winning the Game of Disruption.
For a broader look at the state of video monetization, download our Q1 report. The FreeWheel Video Monetization Report is released quarterly and highlights the changing dynamics of how enterprise-class content owners and distributors are monetizing premium digital video content.