We’re experiencing an unprecedented summer of sports that is the culmination of a year-long backlog of major events. Kicking off with European football’s international showpiece EURO 2020, which boasts an expanded 24-team format and an increase in matches from 31 in 2016 to 51, it will be quickly followed by the XXXII Summer Games. Sports will dominate our TV schedules all across the summer months.
These events will generate more video content than ever before. But most of it won’t get airtime. This is especially the case with multi-disciplinary events where, despite huge overall viewing figures, audiences tend to be spread across a number of sports while many moments are not shown live at all. A valuable revenue opportunity is missed as a result - especially where advertising is concerned.
Cost no longer a barrier to niche channels
But the costs of running multiple niche channels up until now has simply been too high. However, the acceleration towards OTT and cloud-based services over the last year means that this is set to change. The cost of launching and running an OTT channel can be made low enough to allow regional web outlets or specialists in sporting disciplines to run their own 24/7 channels. So you could see, for example, a dedicated channel following Dutch athletes, or a loop of dedicated to rowing content.
Cord-cutting was not just an anomaly of a pandemic-hit 2020 by the way: it is continuing at an even faster rate now. According to data from The Trade Desk, 27% of all consumers (including 36% of 18-34 year olds) will drop cable in 2021. That’s nearly double the 15% of viewers who did the same last year. And when it comes to sports, almost 39% of viewers are now watching live sports events via connected TV (CTV).
The move to OTT brings a lot more flexibility and, importantly, reduces the cost of launching channels, which is great news for sports fans. This is due to a move from the CAPEX-based business model of “traditional TV,” which comes with a relatively large upfront investment, to OPEX, where you only pay for what you use. This difference means it’s much cheaper and easier to launch and run pop-up or niche channels for major sporting events.
Live streaming engages viewers for longer
OTT service providers also have an opportunity to turn live sports into 24/7 channels for the duration of a tournament or major event. A pop-up channel for a hockey match could be extended with highlights reels, for example, to keep hockey fans watching beyond the final whistle. This would create longer viewing sessions and more advertising opportunities that are currently being missed. Crucially, it could also help providers achieve higher CPMs as advertisers would be able to target niche audience segments - something that will become increasingly valuable as we enter a cookie-less world.
Recent YouGov data showed that viewers spend 4 hours more watching live TV per week compared to VOD or catch up. Turning VOD assets into live streams in this way could really help providers tap into this extra viewing time.
Dynamic streams are essential to success
Underlying so much of what I’ve discussed here is the treatment of the video file. As audiences move towards OTT and the extra viewing options it brings, so too must service providers ensure that their online video workflows are dynamic enough to match. To realise the opportunity of niche sports channels, video assets must be prepared in a way that makes them highly dynamic and meets industry standards. This latter point is important because in today’s streaming ecosystem, providers are likely to depend on multiple vendors. Often when there are issues in a stream it is the result of a bad connection between two technologies, so working to a common approach is essential.
Dynamic video assets must contain all the necessary event and advertising markers so that they can be stitched together later on in the most efficient way. If not, then encoding, storage and transfer costs of video files for the multiple use cases that OTT enables would quickly become too expensive to build a successful business model.
Once this is done then providers will find it much easier to work with other technologies such as dynamic ad insertion (DAI) or content management systems (CMS) further downstream without interruption. This will pave the way for much more flexibility in creating and managing new live streams and monetisation. And it will allow the rights holder to turn a niche sports match into a highly relevant, and valuable, 24/7 channel.
As we enjoy a fabulous summer of sports with more fans watching online than ever before, I think we will look back on 2021 as a pivot point for TV. As sports stadiums finally begin to open up, so too will the opportunities for fans to watch the sports they love on TV. Sports rights holders have a unique opportunity to tap into new audiences, engage viewers for longer, and drive new revenues. It’s a win-win and, as a Dutch national, I can’t wait for the Dutch channel!
This article was published on TVB Europe https://issuu.com/futurepublis...