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Report: Sports rights holders view D2C as ‘essential part’ of future distribution strategy

MediaKind's new report includes analysis from the likes of the ATP Tour, ECB, Formula One, Manchester United, the four major US sports leagues (MLB, NBA, NFL and NHL) and UEFA.

MediaKind has published a new report that aims to define the future of direct-to-consumer services in the global sports rights market.

The company says the MediaKind 2021 Sports D2C Forecast is the most significant analysis ever undertaken of the D2C OTT platforms owned and operated directly by sports rights-holders.

It covers sports leagues, confederations, national associations, leagues and clubs and includes analysis from the likes of the ATP Tour, ECB, Formula One, Manchester United, the four major US sports leagues (MLB, NBA, NFL and NHL) and UEFA.

The report states that while most of the 40 rights-holders analysed still define their D2C platform as complementary to broadcast coverage, most now see it as an essential part of their future distribution strategy for live sport and building direct touchpoints with fans.

Half of the rights holders said they use their D2C service purely as a supplementary content hub, focusing on delivering high-quality video. The other half concentrate on making full use of OTT’s interactive possibilities, embedding fan engagement features into their services.

In terms of distribution, 58 per cent of the leagues etc analysed by the report have a standalone D2C web domain, with the remaining 42 per cent providing D2C services via a sub-domain of their main website. Just over a third of the total rights-holders offer their D2C service through a standalone mobile app.

Other key conclusions from the MediaKind 2021 Global Sports Forecast include:

  • Subscription models dominate: The majority of rights-holders who operate a D2C OTT service make it available as a subscription service. The subscription model is likely to be the dominant long-term business model.
  • The UX bar is rising from entertainment to engagement: There is an even split between rights-holders who use their D2C platform as a content hub only and those who are exploring a whole range of fan engagement tools to exploit OTT’s full capabilities.
  • Focus is on maximising recurring revenues: The rights-holders analysed provide six different types of entry points for fans. The reports states there is a clear need to generate guaranteed revenues in a subscription culture where immediate cancellation is made easy – for example, heavily discounted annual passes to tie fans to the service long-term.
  • Opportunity for secondary monetisation is mostly untapped: However, rights-holders must resolve the dilemma of whether to integrate secondary monetisation verticals – such as betting, ticketing, and merchandising – on their D2C service to reach engaged fans behind a paywall or to put these features on their main website to reach wider audiences, said the report.

Raul Aldrey, chief product officer, MediaKind, said: “Streaming is a major part of sports media, with internet-based delivery now very much the present, as well as the future of media content distribution. The growing ubiquity of D2C platforms means they now form an essential part of any strategy for live sport – regardless of whether they are a complementary service to broadcast coverage or the primary means of distribution. While current D2C services are largely representative of an emerging market, this sector is ripe for experimentation, exploration, trial and error, innovation, creativity, and risk-taking – with big rewards for those that get it right.”