May 12, 2015 | Authored by: Vindicia Team
Why sports and OTT content are a winning combo
When people want to watch the game on TV, they now have a number of options on their plate. First of all, viewers aren't limited to having to watch on their physical television. There are streaming video-on-demand services that are transmitted to all types of digital devices, whether that would be a laptop, personal computer, tablet or smartphone.
The various sports leagues have discovered the power of over-the-top content and distribution options to take advantage of their audiences throughout the world, while also targeting consumers who want to watch content on their own time and terms. In fact, one of the most popular sports leagues, the National Football League, as well as a leading wireless telecom provider Verizon are making strides to make the most of OTT content, building larger and more robust audiences.
NFL over the top
The more commonly referenced idea of going over the top in the NFL is a running back jumping over the defensive line in an effort to score. But the NFL is looking at OTT content with great anticipation and is actually building on past wins. For instance, a recent article for Yahoo Finance highlighted the fact that DirecTV paid a substantial sum for the contract for the "NFL Sunday Ticket." In fact, the media service provider reportedly shelled out $12 billion in the agreement with the league that will last eight years.
NFL Sunday Ticket is an OTT service that gives customers a variety of choices.
One of the reasons why this is gaining attention of other OTT content providers is the fact that the October 25 game between the Jacksonville Jaguars and the Buffalo Bills will be played in London. While that may seem like a great way to expose British fans to a sport whose name has a wholly different meaning in the U.K., there are certain logistical issues. Namely, the time that it will be broadcast - 9:30 a.m. EST and 6:30 a.m. PST - falls well out of the peak viewing hours of most NFL fans. There aren't too many people who will want to drink beer while eating nachos at those hours. In any case, the game is going to be broadcast through a digital service provider, which will have to make a bid for the right.
"It's a milestone event when one of the premier content providers in the country, if not the world, is willing to offer a game up on streaming only, especially following HBO's willingness to do an exclusive with Apple," explained Walt Piecyk, a media analyst at BTIG, an international research firm.
Paving the way for future innovation
Piecyk also expects there to be future negotiations with other OTT content providers - other than DirecTV - as the market matures, especially in understanding the necessary technological functionality. Already, DirecTV's NFL Sunday Ticket gives viewers the option of watching every game live on whatever platform they want. The most common and lucrative payment model for these media distributors are subscriptions that give users access to content on a recurring basis as long as they pay.
At the same time, the NFL indicated that it will do away with the rule the prevents local broadcasters from showing a game if it hasn't sold out within 72 hours of the start of the action, Yahoo reported. This may open up the market even further.
Verizon gets its head in the game
"The future of sports viewing will likely align closely with SVOD and OTT content adoption."
According to Multichannel News, Verizon is making a strong push to enter the SVOD field with recent agreements with numerous sports programming distributors. These include ACC Digital Network, Campus Insiders, ESPN, CBS Sports and several others, likely adding up to between 20 and 30 channels. The service is specifically targeted at mobile device users, a consumer segment typically aligned with the millennial demographic. It will also be first available to Verizon Wireless customers who already have data packages on their phones.
"Sports fans are some of the most passionate around, and they never want to miss a single play," said Terry Denson, vice president, content acquisition and strategy at Verizon.
Denson also indicated the mobile-first model is one that will likely pay off because the college football fans are largely made up of the Generation Y segment, who tend to use the smartphone or tablet as their go-to technology for most digital activities.
The future of sports viewing will likely align closely with SVOD and OTT content adoption. Considering the excitement fans have for each game and the very real option of being able to watch each of their favorite teams, streaming media will continue to gain significant traction. Furthermore, the growth in mobile and digital technology is making it easier for consumers to access content whenever and wherever they want. With this in mind, subscription-based payment models is the most conducive to capturing and retaining a larger market share.