It is no secret that the state of sports streaming is dismal in 2021. If numbers are anything to go by then the summer Olympics’ TV audience on NBC is down 45 percent from the 2016 games in Rio. Prime-time viewership has plummeted by 51 percent. The Tokyo Olympics are presently the least viewed Olympics in recent history in Europe and the United States, according to ratings statistics from the opening ceremony and the first few nights of activities. In Australia and Japan, however, television viewing is increasing.
Due to various reasons, such as different timezones and the ensuing pandemic, drawing comparisons with past events isn’t exactly fair. The OTT landscape delineates an era of transition where the initial dismal ratings for the Olympics may just be a blip on the radar. Based on insights from FX Digital and streaming media, let’s look at the key facets that will impact the success of sports streaming on OTT platforms.
Sports in a period of OTT transition
The suspension of animation last year brought to light structural problems that have long plagued the sports and sports broadcasting industries. Digital involvement, fuelled by live streaming, provides a way out, but at the expense of a seismic shift in economic structures. The situation is critical. NFL teams are expected to lose an estimated $5.5 billion in stadium revenue, according to Pete Giorgio, Deloitte’s U.S. sports practise leader. According to the company’s 2021 U.S. sports perspective, the NBA likely lost $500 million during the 2019–2020 regular season and playoffs due to a fanless bubble.
In the second half of 2021, it’ll be critical to discover new ways to entice fans back to arenas and generate new revenue streams. Deloitte’s prescription is straightforward: Sports leagues and individuals should go beyond traditional broadcasts and engage directly with their fans. Sports organisations must invest in the infrastructure necessary to support digital channels, streaming platforms, and augmented and virtual reality solutions.
Fans are still reeling from the after-effects of the suspension of live sports. However, the silver lining here, according to Ampere’s Q3 2020 research, is that 34 percent of sports fans in 22 areas are willing to pay to access at least one sport. This trend is more pronounced in the Europe and North America regions. So, how can sports organizations and stakeholders in sports broadcasting adapt to these changing consumer trends?
Sports changing the OTT landscape
Consumers are choosing more accessible and affordable ways to watch their favourite sports, paving the door for over-the-top (OTT) sports streaming. By 2024, revenues from sports media streaming rights are estimated to exceed $85 billion, indicating the sector’s potential future growth and an abundance of options for sports brands.
The global value of sports rights is currently around $48.6 billion, with forecasts anticipating a 75 percent increase in the next five years due to an increase in audiences moving to sports streaming services because of more accessible content. Sports businesses must recognise that streaming is the future of sports broadcasting by analysing the existing situation, with 59 percent of sports fans in the UK willing to watch sport exclusively via online streaming platforms. This feeds into the reality that more people are cutting the cord and looking for a one-stop-shop for sports streaming.
Fans also demand more interactive content when watching sports broadcasts, with 56 percent requesting more interactive content, highlighting the chances that sports businesses must seize with both hands in order to stay relevant. For sports streaming to truly take off, sports brands and organizations will have to emphasize on creating more interactive and engaging sports content. The opportunity to reach a much wider audience exists with streaming and stakeholders in sports broadcasting merely need to adapt.
Future outlook
Until the Olympics, a dearth of live sports events has impacted viewership. This is only indicative of a transition and enormous opportunity exists for sports organizations on online streaming platforms. The only thing left is to fine-tune the digital streaming model for better interactions and consequently improved viewership.
