Sports and the Tech Majors A Competitive Partnership
The 20,000 Foot View: The big gap in streaming video’s content mix has historically been sports. This is now changing through a combination of disruptive challenger sports subscription video on demand (SVOD) services such as DAZN accelerating its rights and territory offerings alongside the increased interest being shown by the tech majors – notably Amazon and Facebook – in streaming premium sports offerings. Accelerating this process has been the market testing of ESPN+, the first significant sports SVOD service to be launched by a heavily invested traditional pay-TV stalwart, Disney. With the future sports fans overwhelmingly digital in their consumption, and with traditional pay-TV being squeezed financially by subscriber decline, sports viewing is being rebooted for a post-pay-TV world where the tech majors are optimally placed to succeed.
- Between XXX and XXX 2018 the weighted weekly average usage (WAU) of Facebook in core English-speaking markets declined by XXX Asia-Pacific accounts for XXX of Facebook’s daily active users (DAU), only XXX of advertising revenue comes from the region
- Facebook’s video engagement has failed to generate the uptake necessary to take consumer attention away from streaming heavyweights
- Amazon displays the key three assets to meet the needs of rightsholders: capital, tech and reach
- Amazon subscribers over index for sports consumption: XXX like watching live sports on TV and XXX have watched shows or movies about sports in the last three months
- With Netflix vehemently against entering the live sports rights market, Amazon is well placed to establish its video solution as the go-to sports XXX of 20–24 year olds watch games-related videos on a monthly basis
- Only XXX of 20–24 year olds watch traditional sports for free on streaming services
- The more e-sports become ‘sports’, the more that big tech companies can dilute the value of the traditional TV sports propositions.
- Amazon as the owner of Twitch is in the enviable position of potentially becoming the ESPN of next-generation sports coverage
- As the tech major with the biggest cash reserves (currently at XXX billion as of XXX 2018), Apple could purchase DAZN and arm it to win big in the rights frenzy of 2021
- The flatline of Disney’s media networks revenue growth reflects the secular decline of pay-TV subscriptions across the English-speaking markets
- Serving more use cases than the current global leading SVOD service will promote Disney+’s position as a true substitutive service
Companies and brands mentioned in this report: Amazon, Amazon Prime Video, Apple, Apple TV+, BeIN Sports, DAZN, Disney, Disney+, English Premier League (EPL), ESPN, ESPN+, Facebook, Fox Sports Asia, Hulu, Major League Baseball (MLB), National Basketball Association (NBA), NBA XXX Netflix, National Football League (NFL), National Hockey League (NHL), Take Two Interactive, Twitch