The changing face of sports broadcasting
In recent years, FIFA has been looking for ways to innovate its showpiece World Cup tournament. Russia 2018 has been the first to use the Video Assistant Referee (VAR) system during matches in an attempt to eliminate controversial refereeing decisions during the tournament (Lampard vs Germany in 2010, anyone?). FIFA also recently announced that the 2026 World Cup (and perhaps the 2022 World Cup) will feature 46 teams, rather than the traditional 32.
As the way in which the sport is played continues to evolve, so too has the way we watch football. In particular, over-the-top (“OTT”) platforms, which distribute audiovisual content to viewers over the internet, have become increasingly popular since the advent of high-speed internet.
OTT platforms’ distribution of sports content can take multiple forms. The most common has been that of existing broadcasters creating their own OTT platform to supplement traditional broadcasting methods (e.g. cable or satellite). One example is SkyGo, which will allow Sky subscribers to continue watching Barclays Premier League matches on their devices under the latest rights deal, where Sky agreed to pay £3.58bn for a three-year deal from 2019/20.
However, in recent years we have also seen new entrants to the broadcasting market foraying into sports content, such as standalone OTT platforms. The most obvious examples are the social media giants, Facebook and Twitter. The former recently agreed a deal with the Premier League to broadcast matches in South East Asia for (reportedly) £200m, while the latter has aired Thursday night NFL matches in the past. Similarly, Amazon Prime won the rights to show ATP tennis matches and, significantly, twenty Premier League matches per season from 2019.
Thirdly, rightsholders have started to exploit their content via ‘in-house’ OTT platforms. One example is the National Basketball Association’s League Pass service, operated by Turner Broadcasting on their behalf, which offers live matches and highlights packages to its subscribers.
What does the trend towards OTT mean for sports broadcasting?
These initial forays into the market signal the intent of online giants, such as Amazon and Netflix, to become the biggest players in content distribution and media generally, using a strategy of sports rights acquisition to achieve this goal.
As the tech giants put their hands in their (very deep) pockets to bid for sports content, this is likely to inflate the amounts required to acquire such rights.
It is not yet clear whether the increasing involvement of OTT platforms in the market will lead to lower prices for consumers (as providers battle for market share), or whether the increased cost to broadcasters of acquiring the content (see above) will merely be passed on to subscribers. Recent history has shown that the cost for fans has increased steadily.
Some contractual implications
The trend towards OTT platforms when consuming sports content reinforces the importance of the new rules in relation to the portability of content. Under the Portability Regulation , which came into force on 1 April 2018, EU nationals who pay to watch their favourite sports online in their home member state can now access the same content whenever they (temporarily) go abroad in the EU.
Similarly, the licensing of content on a ‘per territory’ basis by rightsholders may be under threat. The global nature of the online players may force rightsholders to offer worldwide licences to broadcasters. For example, Amazon acquired the global rights to broadcast NFL’s ten-game Thursday Night Football package in April 2017. This is in contrast to the traditional per-jurisdiction model of content licensing; by way of example, FIFA tendered the right to show the World Cup to local broadcasters in each territory with, for example, the BBC and ITV sharing the UK rights, TF1 and beIN Sports sharing rights in France, etc.
While England’s fortunes in the World Cup seem to have dramatically changed this year, so too has the way in which we watch football. Stay tuned…