Media

Netflix can bet on Lilyhammer, but live sports are way more important to streaming video

Image Credit: Football image via Brocreative/Shutterstock

Lilyhammer, Game of Thrones, House of Cards, and Battleground are just a few of the strong programs that digital media companies are fielding in the competition to monetize online video. But ultimately, original series and other linear programming simply won’t be a match for the perennial most-viewed champion: sports.

The viewer appeal of sports programming is supported by stats: the Winter Olympics’ U.S. vs. Canada men’s ice hockey semifinals netted over 2.1 million unique live streaming viewers, likely the largest verified streaming audience in U.S. history. And worldwide, online or off, sporting and live events are the most popular programming in the history of television.

Sports content is the ultimate reality programming, and enjoys a distinct advantage over other TV fare. The combination of fan loyalty and live competition can’t be matched by even the best episode of Breaking Bad. Yet, sports broadcasters, universities and sports franchises aren’t resting on their laurels. Instead, they are developing offerings that attract new audiences, increase engagement with existing audiences, and create additional revenue streams.

Nowhere is this more evident than in college sports. When ESPN joined forces with the University of Texas to create the Longhorn Network, the first sports network devoted to a single university, less-influential colleges scrambled for TV money elsewhere. Colorado University and three others left the Big 12 conference and Colorado joined the Pacific 12, which created its own conference network.

But television football rights won’t increase forever, which is why online digital sports programming rights are so critical. That’s also why the Pac 12, Big 12, the ACC and others created digital networks to augment their audiences and revenues as have professional leagues and franchises worldwide.

Some franchises that have sold their program rights are capturing and streaming non-rights protected content, such as player interviews, training-diary footage and event highlight archives. Time Inc. recently partnered with the MLB and announced 120 sports, an online sports network that won’t offer live games, but will provide highlights and other feature content from a variety of leagues, 24/7.

Sports-centric online platforms like 120, Bleacher Report, Yahoo Sports, DeadSpin, Rant Sports and others are proliferating, and forward-looking franchises are using those outlets and non-rights protected content to attract more eyeballs, monetize video (often already produced and paid for), and learn more about their fan bases.

Data drives dollars

The Moneyball-like analytics available with online video are giving franchises rich audience data needed to fetch increased broadcast rights revenues as well as more sponsorships and ticket sales – dollars the linear world doesn’t see.

Franchises and broadcasters alike are upping the super-fan ante on Pac-12 and 120-like sports platforms with apps that let sports lovers customize their experience by choosing favorite teams, players and more. Providers are pushing out personalized content to viewers, including highlights, headlines and interview videos to increase engagement in a highly targeted manner. More targeted online engagement, of course, provides even more detailed demographic data.

Live content: The can’t-miss move

Live games have the potential to make more money than linear programming because they deter time-shifting, watching recorded programs that encourage viewers to skip through commercials. Pay-TV companies rely on high-value live content as one of the few exclusive assets they have to differentiate their offerings to viewers and advertisers. Sports fans will pay big bucks for live sports, and advertisers value them because they keep audiences engaged with a schedule.

The potential of mobile viewing gives live and non-rights protected sports video another leg up on linear programming. Tablets and other mobile devices are ideal for watching live games and highlights and playing fantasy football — anywhere. On-the-go devices are so popular among sports fans that statistics show mobile viewers watch three times more live sports video than video on demand, and tablet viewers watch live sports more than twice as much as viewers of all live video as a whole.

Winning strategy

The potential for sports programming to grow online viewership is undeniably strong based on its proven ability to capitalize on the loyal devotion of sports fans. Still, the continued growth and monetization of online sports programing will depend on the ability for media companies, teams and leagues to connect with more casual sports viewers beyond just rabid fan bases.

However, based on the aggressive game plans employed by sports broadcasters and franchises to grow revenue through focused engagement with sports viewers, they are a solid bet to beat linear video programmers in the race to make money via the web.

Belsasar Lepe, co-founder of OoyalaA co-founder of digital video company Ooyala, Belsasar Lepe now oversees the company’s Solutions Consulting group. Bel and his team manage large-scale deployments of the Ooyala platform around the world, helping customers to optimize their businesses across mobile devices, browsers and IPTV. Before founding Ooyala, Bel was a Google systems engineer.

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