Jason White, Head of Marketing & Communications, LiveWire Sport takes a look at OTT and asks… if we’re going OTT.
It was only 11 years ago when Blockbuster CEO Jim Keyes admitted "neither RedBox nor Netflix are even on the radar screen in terms of competition…It's more Wal-Mart and Apple."
Blockbuster was bankrupt less than two years later.
“Timing is critically important,” Keyes reflected last year. “I tend to get ahead of my headlights sometimes because I feel like I can see where the future is trending… and yet the consumer is not yet there.”
Sport is now heeding the warnings of the past by positioning “Over The Top” (OTT) well and truly in the full-beams, allowing disruptors to tear up the traditional broadcast model.
A new age of democratised content
11 years ago, Blockbuster’s circumstances may have been different - YouTube was a nascent channel, Facebook and Twitter didn’t incorporate video and Twitch was just a glint in the milkman’s eye – but there were warning signs that they chose to ignore.
Ranging from broadcasters such as DAZN and Eleven Sports, to global sports bodies such as football, swimming, hockey, surfing and netball, sports fans can now access straight-to-market content directly on their devices of choice.
Meanwhile, in the fast-paced world of online gaming, over 200m users are watching esports on YouTube every single day, with 50 billion hours viewed across the year.
“Esports owe credit for their recent growth to the ease with which OTT platforms let rights holders distribute their content,” explains Jon Tilbury, executive director of National Student Esports (NSE), the official UK body of university esports. “Despite being popular at a global level for decades, it was rare that an esports game would reach critical audience levels in any broadcast territory.
“With the launch of OTT platforms focused on gaming content, tournament organisers were able to take advantage of lower barriers to entry to self-broadcast their content online. The worldwide accessibility of these online channels united small regional audiences into a global force with the power to command the interest of non-endemic brands.”
Is all this OTT talk a little…OTT?
While new technologies offer rights holders new options to reach their audience, it risks leaving traditional broadcasters in limbo.
“If you don’t adapt in this current climate you don’t survive,” explains Ben Gallop, Head of Radio and Digital, BBC Sport.
In terms of linear viewing, sport is one of the few aspects of the television world that still has clout in the ‘by-appointment’ viewing debate. Take the recent ‘record-breaking’ Game of Thrones finale: if it were an NFL game, it would have ranked 71st in the most-viewed games in the US this season.
“The power of live sport to bring audiences in – including younger people – is still there,” continued Gallop. “Those really big events with cut-through will always retain their place on what we consider ‘traditional’ broadcast TV.”
“Technology is clearly driving an unbelievable amount of change,” explained Gallop. “Viewing habits of younger people are different to those of an older generation and that remains a big challenge for us.”
The stats agree, with Generation Z (those born after 1997) set for a significant say in the way sport is consumed in the future. By next year, 40% of consumers will comprise of this group with the majority already consuming over 3.5 hours of video a day, largely on mobile devices, with many prospects already explored in the world of gaming.
“The adjacency of online broadcasting and online gaming meant it was inevitable that esports would be the first niche entertainment category to leverage OTT platforms in this way, but the same opportunity exists for any minority sports with widely distributed audience,” added Tilbury.
World Surf League (WSL) is one such organisation, combining partnerships with the likes of FOX and Facebook to reach as many fans as possible across multiple territories, while giving viewers the opportunity to delve even deeper into the sport in a way that would have been impossible through linear options.
“We feel our OTT offering will be much more expansive than just portions of media rights,” revealed WSL CEO, Sophie Goldschmidt. “The lifestyle aspect of our sport opens many doors for content, engagement, and transaction beyond what you see from traditional leagues.
“Given the size of the surf market and the reach of ocean participation, there is no question that a balance [between traditional broadcast and OTT options] can be struck,” added Goldschmidt.
Gallop agreed. “There’s definitely room for both. We’re seeing that through the proliferation of new entrants to the market.
“For us, our business model is clear – we’re a free-to-air broadcaster funded by the universal license fee - so we have to reach as much of the population as we can. This means having linear and digital.
“There is a risk with OTT that everything becomes disaggregated and we lose that sense of communal viewing…[but] the idea of bringing the nation together is a key element of what we do. There’s still a place for that.”
Come gather ‘round people, wherever you roam
Communal viewing or not, the bottom line will be key on deciding the fate of content consumption in years to come, with viewing habits of a younger audiences increasingly becoming ‘on-demand’, while the introduction of 5G networks on the horizon could make immediacy of content an even more essential currency.
“OTT is going to be an important strategy for all sports companies,” Goldschmidt urged. “Finding partnerships that marry audience growth with revenue maximization is going to be essential over the next ten years.”
Whether the balance can be found or not, remember, it wasn’t that long ago that no one thought twice about standing in line at Blockbuster to rent a scratched up copy of Cool Runnings for a couple of days.
The times they are a-changin’.