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Streams Vs Subscriptions: Sports Broadcasting’s Battle With Piracy

Tech companies are now working to harness demand for free streaming of sports

16May

For all the tech involved in sports, in the stadium and on the training field, some tech companies have been remarkably slow to innovate. Those creating wearables are booming, as are analytics and sports science firms. Broadcasting, though, could be doing more. Despite the unfathomable money paid out for TV rights, an incredible number of people still illegally stream live sports. Estimated to number in the millions, those who stream require only rudimentary IT skills and an aversion paying subscription fees to find quality streams on their laptop, with all the anonymity of the internet.

Without change, illegal sites will continue to outpace broadcasters. The argument from those facilitating streaming is that broadcasters are holding sports fans to ransom, with a handful of giants holding the keys to the world’s top sports; the lack of genuine competition has seen prices skyrocket out of many fans’ price-ranges. Just as one streaming site closes for fear of legal action, another pops up to fill its place - as long as the demand is there, this won’t change.

The UK is a particularly interest case. There is a blanket ban on the broadcasting of soccer matches during Saturday fixtures. Known as the ‘3pm blackout’, the initiative is intended to drive up matchday attendances, which many argue are under threat given the relative convenience of streaming at home or watching on TV. The effectiveness of the 3pm blackout is a debate for another day, but what it does mean for fans is that there is no legal alternative to attending the match and - if they’re lucky enough to get there - paying the extortionate ticket prices are demanded. The ritual of spending 20 minutes before every Saturday fixture finding an adequate stream will be a familiar one to most technologically proficient UK soccer fans, and change is clearly needed to harness this demand legally.

Illegal streaming is so normalized that it is surprising it has taken this long for broadcasters to innovate. Last month, though, it was revealed that BT Sport had signed an agreement with Youtube to live stream two of European soccer’s biggest matches for free. The Champions League and Europa League finals will be available to all with an internet connection, a move BT Consumer chief executive John Petter hopes will bring BT Sport to a younger generation of sports fans, who principally view their entertainment online. ‘We plan to make these finals the most social sports broadcast ever,’ he said, ‘with lots of exciting content in the build-up and on the night across YouTube, Snapchat, Facebook, Instagram, Twitter and Vine.’

Twitter, too, is finally muscling into live broadcasting. The social network is an incredibly popular companion to live sports, a second screen of discussion around an event and a place many will go to find highlights and other scores. Twitter announced last month that it would be streaming 10 NFL Thursday Night Football games live, for free, this fall. Amazon and Verizon were involved in the bidding process, and Twitter will hope that the effects of the victory can convince investors of the company’s growth prospects, despite its recent stall. Facebook was one of the other companies involved in the bidding for the Thursday Night Football, as Mark Zuckerberg and co. seek live streaming content to fit into their initiative of a video-first newsfeed.

The situation in China is quite different. The nation’s no-expense-spared campaign to make sport - soccer, in particular - part of the fabric of its economy has slowed down somewhat. The likes of Tencent, Alibaba, LeSports and Cina have shovelled huge amounts of cash into TV rights, but monetization in a country in which sport is generally consumed for free on state TV will not be easy. For example, Tencent parted with US$700 million in a five-year deal to secure the NBA rights in January 2015. After a grace season to get fans accustomed to watching on Tencent’s platforms, the company is now looking to monetize its considerable resource. ‘We’re a listed company ... we need to earn money, we need to find a way that we can earn [back] the licence fee we paid [to the NBA]. The main revenue [now] is from advertisement, we are trying new business models, trying to do subscription,’ said Echo Yang Lusha, business development and cooperation director at Tencent.

With or without the ubiquity of illegal live streaming, TV rights deals will continue to prove incredibly lucrative for both broadcasters and sporting bodies alike. Live streaming should be seen as an opportunity rather than a challenge, though, and the selective, free, easily accessible games have benefits for broadcasters that are robbed by fans turning to illegal streams. The world will watch the Champions League final one way or another, BT Sport should endeavour to ensure it is through their platforms, for free or otherwise. 

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