A CYNOPSIS MESSAGE FROM BIG TEN NETWORK

Cynopsis Media presents: Streaming in the Sports Industry 2013
by Chris Pursell

Good Morning. It’s still Monday, January 28, 2013 and this is a special edition about streaming in the sports industry and how a breakout year in 2012 is driving business for the future.

As Streaming Grows, Sports Industry removes the Buffers

We knew it was coming, and 2012 was marked as the year that streaming finally hit maturity in the sports media world. Now, 2013 is poised to refine those content and engagement opportunities.

Case in point, last year NBC Sports Group fed fans the Holy Grail of sports events with both the Super Bowl and the Summer Olympics making history with live streams. The company’s digital coverage of the 2012 London Olympics featured 159.3 million streams, with 64.4 million live. The NBC Olympics Live Extra app saw viewers consuming 23.8 million live streams and 4.5 million live stream hours. The metrics were so successful that NBC Sports plans to stream more than 400 live events in 2013.

“We believed heading into these Games that if we could surround the consumer with as many touch points as possible — such as live streaming every athletic competition online, on mobile and on tablet — then we could increase consumption and engagement, not only on digital, but on television as well,” said Gary Zenkel, President, NBC Olympics over the summer. “The result has been record-setting viewership, traffic and engagement on all of our platforms. We could not be more satisfied and are looking forward to continuing to extend access to these incredible Games on multiple screens.”

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In February, NBCSports.com and NFL.com streamed Super Bowl XLVI, the first-ever for a Super Bowl, which drew 2,105,441 users, and made it the most-watched, single-game sports event ever online, according to data provided by Omniture and mDialog. Streaming the Super Bowl was such as success that the league is bringing it back for CBS’s coverage of the big game. Ad spots have been in high demand for next month’s game with buyers set to span a range from automotive to restaurants to beverage.

“Streaming is another platform for the sponsors to get exposure,” said Sean McManus, Chairman of CBS Sports. “It used to be that advertisers paid price for a series of 30 second commercials in the Super Bowl. That combined with some re-airing on some news programs and stories in print magazines about the ads were the primary way that they got exposure. Now with all the other platforms, whether it is online, or mobile or social media, it is just one more opportunity for an advertiser to get more value from a Super Bowl buy.”

As smartphones now past the 50% threshold in American homes, and tablets continuing to surge as costs come down, sports streams continue to thrive in a TV Everywhere world offering live events and interactive capabilities without pulling down overall TV ratings. Nielsen reports that nearly 60% of tablet and smartphone owners who access sports on their device check this content at least once a day.

“Live sports and live events are the stickiest connection with the fan, everything trends higher with a live event,” said Chris Wagner, EVP and co-founder of NeuLion. “You can see leagues and clubs creating live situations that they wrap around the live game, and it’s not just the press conferences. Fans can’t get enough of that stuff.”
 
One streaming service NeuLion is powering is NHL GameCenter as well as GameCenter Live, which offers out-of-market, live-game streaming. League officials state that the services have been instrumental in driving fans toward the sport.

“We saw triple digit growth on a product that is five-years old, which is pretty outstanding,” said Nili Doft, Senior Director Direct & Digital Marketing. “With all the devices, phones and tablets that we’ve developed for, we really saw a lot of adoption on those platforms last year. So as GameCenter Live subscribers get access on all those devices we really did see high adoption and authentication rates of the users watching the games on the additional devices they had access to.”

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Streaming was a central part of NBC’s new content alliance with Yahoo!, which features not only live streams of NBC events such Sunday Night Football and NHL Game of the Week, but also original online series featuring the likes of Bob Costas and Mike Florio.

“We know consumers are gravitating to video, they like to have the power to watch events and video when they want,” said Ken Fuchs, Vice President of Yahoo! Global Media and Head of Yahoo! Sports and Games. “Working with NBC Sports Group allows Yahoo! Sports to offer this power to our users. We also know users want experiences around video, and Yahoo! Sports is in the prime position to enhance the video experience with content and data from our teams – providing color around the events and relevant fantasy data, social media and more to keep users informed and engaged beyond just what’s happening on the field.”

Now, as habits continue to be formed by consumers, moves by companies that embraced streaming early in the game are already paying dividends. MLB.tv celebrated its tenth anniversary last August. When the online video arm of MLB Advanced Media first went public with a Yankees game, 30,000 people around the world tuned in. Today, the serviced now boasts 1.5 billion live video streams with a total of 3.7 million subscribers.

“Today’s fans have the luxury of getting a constant flow of information and multimedia about their favorite brands and athletes, thanks to team websites, mainstream media and dedicated blogs, social networks, apps, and more,” said Ken Zamkow, Director of Sales and Marketing at LiveU. “Organizations that tie those activities together the right way and know how to promote them effectively, can create ‘super-fans’ that will further promote the brand, constantly engage, will not miss a game whether at home or in the stadium, and are more likely to buy merchandise.”

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Metrics continue to show that ESPN leads the pack, having seen the value of digital rights early in the process. In fact, the company reports that 70% of sports content consumed on mobile devices comes from ESPN’s mobile apps. Carrying the bulk of the video load are the WatchESPN app which has been downloaded over 10 million times and ESPN3 which reaches 79 million households nationwide. Year-to-year, the average monthly minutes to ESPN3 and WatchESPN on computers are up 44%.

Two years in, BTN’s TV Everywhere platform BTN2Go saw growth of 326% in video views in its second year, with a rise of 393% in total hours streamed and a spike of 212% in app downloads year over year.  Network executives state that the importance of streaming goes beyond offering an addition service for viewers.

“It’s very important not just for advertising but for our distributor relationships as well,” said Michael Calderon, BTN Vice President, Digital and Interactive Media. “This is an era where TV Everywhere is championed as the service that will prevent people from cord-cutting. If you want to be able to watch new entertainment or live sports outside of your living room, you need to be able to access services like BTN2Go and some of the other TV Everywhere app that are out there. So it is very key for us in terms of distribution, and it’s key as it relates to delivering to our viewers.”

Of course, both challenges and opportunities await sports networks and leagues in the years ahead.

“Teams now need to create new workflows, allocate resources, obtain the right equipment, and hire the right people for creating appealing live programming online,” said Zamkow. “Some early-adopting teams and schools have already figured out how to create a return on this investment through sponsors, special events, increased visibility and fan loyalty, and increased ticket and merchandise sales. For the many other organizations this is the next challenge.”

With online distribution guaranteed to rise, casual and hardcore fans both tuning in and revenue continuing to grow via subscription, PPV and/or advertising, leagues are now looking beyond the borders to expand the brand.

“Streaming has changed the game when it comes to international branding for sports,” said Wagner. “You can very quickly distribute globally, handle a local currency and a local language and create a revenue stream that is based around a subscription product, a PPV product or an advertising product or any of those three combinations. So you no longer don’t have to go around the world and find individual operators and do individual deals with them. That opens a lot of doors.”

Later —
Chris Pursell for Cynopsis | Sports
01.28.13

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