Streaming technology company Deltatre today released a 25-page report on the shifting economic trends developing across the sports streaming landscape. The company compiled research through analysis of U.S. and U.K. sports fans, interviews with top industry executives, and gathered data from over 1.2 billion minutes of streaming video from sports OTT services it supports.
According to the report, sports content distributors worldwide are currently spending 15 percent of total budgets on streaming, and U.S. operators will invest more than $6.8 billion on OTT technology by 2021. Deltatre also found a 53 percent year-on-year increase in the number of minutes spent streaming sports content in 2018 compared to 2017. As far as pricing is concerned, the report says two-thirds of consumers are willing to spend a maximum of $39 total per month on sports streaming packages—with the remaining third prepared to pay more.
“Netflix has seen huge success because its pricing is widely affordable. But what the sports industry has seen is that a premium price product creates a barrier to entry—and also to fandom,” according to an unnamed senior-level executive from a major American sports league quoted in the report. “Putting out highlights and original content as freemium is a great way to bring people into the product with something that can be enjoyed year-round, 24/7.”
While the number of paying subscribers for sports streaming services has increased 24 percent year-on-year, 20 percent of fans still pay nothing for sports content in any given month. According to Deltatre, that is indicative of significant account sharing. The report indicates that an average of 8.6 devices are linked to each individual account subscribed to sports streaming service powered by the company. Television (64 percent) is still the leading device used to consumer sports content, followed by mobile (49), tablets (41.5), and smart TVs (38.2).
Six out of every 10 users surveyed expressed a desire for real-time information about the live sports content they watch through in-player statistics and social media integrations, while one-third of consumers asserted that virtual reality will be commonplace and integral to the sports viewing experience by 2025. Additionally, one-third of the fans surveyed believe 5G internet connection will have the greatest impact on how they consume sports content by then.
“The main difference [in 2025] will be the platforms. Younger generations will start to be in charge and so TV screens won’t be relevant anymore,” according to an unnamed senior industry executive quoted in the report. “Everything will be centered around the smartphone with more possibilities to buy short content PPV—like ‘last quarter’ or ‘last innings’”. The NBA has been at the forefront of that type of micro-viewing trend in sports, already allowing fans to purchase 10 minutes of NBA League Pass access for just 99 cents.
SportTechie Takeaway
Deltatre, a Bruins Sports Capital portfolio company, provides its streaming technology infrastructure to organizations such as FIFA, the EPL, the NFL, the IOC, UEFA, BT Sport, and Discovery. Its report outlines the increased investments sports media companies are making toward building their own OTT streaming platforms, potentially creating direct competition for platforms owned by tech companies such as Amazon or Facebook.