£900 million, £1 billion or possibly £2 billion? It remains to be seen how much BT, Sky and others will be willing to bid this year in the battle for the rights to show Champions League football. We don’t have to wait long, however. In just over a month’s time parties must submit their first round bids to European football’s governing body, UEFA. This comes at a time when people are asking if there is a move away from watching televised sport to watching short form content published on social media platforms and viewed on mobile devices. Sky Sports, for instance, has reportedly faced a drop in TV viewers for live Premier League games this year.
Many sports properties have yet to recognise the advantage of short form content (e.g. clips). Short form content attracts fans, sponsors and advertisers alike.
We look at some of the legal and commercial strategies sports properties could employ to monetise short form content.
Battle for Control: Carving out Rights
The way in which football rights are sold has changed over the past ten years. Along with the live television packages, the English Premier League (EPL), offers ‘near live’ packages for all matches not shown live; a clips package for all matches, including in-match clips; and a highlights package for exploitation on free-to-air television. Live packages are offered on a ‘technologically neutral’ basis (i.e. on TV, mobile and IPTV (internet protocol TV) platforms).
With such a range of packages and a change in how consumers wish to view and interact with content; sports properties need to assess the value of these packages at all levels and decide whether to exploit such rights themselves or license to third parties. The EPL, for example, has successfully carved out its mobile and digital clip rights from its primary broadcast package with Sky Sports and News UK for three seasons from 2016/17.
Sports properties also need to consider whether there is value in creating their own digital content. Last year, Manchester City created their own CityVR app; and Chelsea TV offers viewers exclusive behind the scenes footage. Exclusive digital content can help to drive engagement and gives clubs the opportunity to create effective marketing strategies. There is also brand value in certain rights. For example, the Football Association (FA) decided a few years ago to unbundle the national women’s football matches for both the broadcasting and sponsorship rights from the men’s football matches. This has led to significant new investment in women’s football.
Unlocking the Potential of Social Media: Engagement Data and Advertising Revenue
The popularity of social media cannot be understated: social media offers sports properties a new way of engaging with its fans, valuable data and a new stream of advertising revenue. Sports properties need to work on commercialising the potential of these platforms. Last year, Real Madrid generated more than 110 million views on social media after pushing content from its club TV channel to Facebook Live. This content included behind the scenes footage, news and shoulder programming. What does this mean? This shows that fans still want professionally produced content.
Can we learn more from this data?
The Power of AI
Exploiting new technology such as Artificial Intelligence (AI) could help sports properties to better understand fans’ patterns of behaviour in real-time and which pieces of content are most compelling to them. AI can monitor, analyse and deduce user behaviour and sentiment across social media platforms. The key will be in reading such data and establishing what figures show content is being engaged with. For example, would you rather offer a sponsor a clip with 5m views which is 5 seconds long with 75% audience attention rate or a longer clip with the same number of views but with an audience attention rate of 90%? Notwithstanding the immense benefits AI can offer, sports properties will have to bear in mind how it uses such data; especially in light of the General Data Protection Regulation (GDPR) coming into force in May 2018. Non-compliance could result in fines of €20m or up to 4% of global revenues.
Advertising Revenue: Using Twitter Amplify
Sports properties may also want to consider teaming with social media platforms to publish in-Tweet video clips with advertising embedded in real time. UEFA uses Twitter’s Twitter Amplify service to share ad revenue between parties: Twitter gains premium content to keep users on its platform and UEFA (and its sponsors) gain enormous reach and great exposure.
Piracy: Collaborate or Take Down?
Sports properties are changing the way in which they deal with unofficial and infringing content. Rather than request that such content is taken down, sports properties are working with over-the-top (OTT) platforms (e.g. YouTube) to monetise such content. YouTube offers sorts properties an official channel for their content, a share in ad revenue and access to a tool, Content ID, which identifies infringing content and gives sports properties the option of removing it or a share in in the ad revenue being generated from it.
Alternatively, to protect the interests of rightsholders, sports properties could take further steps to prevent fans from using their mobile devices to film and upload clips from inside stadia. While it is not a direct breach of anyone’s copyright in the UK to transmit footage of a sports event, this sort of activity is often prohibited under ticketing terms and conditions. In 2014 Manchester United imposed a ban on the use of iPads and other tablet devices at home matches. It remains to be seen if other clubs will follow suit in light of the popularity of streaming apps such as Periscope and Meerkat. The National Hockey League, which governs ice hockey in the US, specifically bans the use of Meerkat and Periscope including any live streaming up to 30 minutes before the start of a game.
As Stephen Nuttall, a former commercial director at Sky commented: “There is no going back to a world of restricted choice.” The way in which consumers watch and engage with content has changed significantly over the past few years. Sports properties must consider the way in which they monetise short form content in order to adapt to this new sports media landscape.