Spring Media’s OTT investment a sign of agency’s evolving business model
Spring Media, the Stockholm-based sports media and marketing agency, has purchased a majority shareholding in StayLive, a Swedish company that has developed and delivers live streaming services in the Nordic market.
The takeover of the OTT platform service company follows on from Spring Media’s acquisition in June of a majority stake in Sportacentrs, a Latvia-based sports media operation, as the agency seeks to lessen its dependency on media rights trading, given the heightened digital disruption.
Through this (and further) acquisitions, Spring Media is looking to build itself up as a full-service offering to small- and medium-sized federations, leagues and teams, chiefly in the OTT arena.
The founders of StayLive will stay on as minority shareholders and as part of the management team, as Spring Media “acquires its majority stake from passive owners and directed new issue of shares, providing capital for platform development and growth.”
Tobias Osmund, the agency’s chief executive, told Sportcal: “Spring Media comes from the sports rights business and for us that’s still the main part of our revenues. [But] we see our growth in the future coming from more business development-focused activities where we work with federations, leagues or teams to help them develop their businesses and increase the value of their properties.
“We’re seeing that with the disruption due to digital development, there are a lot of new opportunities for sports that previously didn’t really have a place in the media scene and had to fight to get picked up by broadcasters. Now we can help them take control of their own assets and connect with their fan bases.
“We’ve realised the need to have full control of the whole value chain, from advisory to helping clients with rights management, providing them with cost-efficient and modern production and having the OTT platforms to broadcast sports on.”
Following its formation in 2011 by former members of the media rights sales team at IEC in Sports, broadcast rights trading has formed the bulk of Spring Media’s business, including some properties previously distributed by the Lagardère-owned agency.
Early projects undertaken by Spring Media included the distribution of media rights to international soccer matches and club friendly matches (including the annual Copa del Sol exhibition tournament), World Taekwondo Federation events and the Swedish Speedway League, plus the creation of content around Spain’s preparations for Euro 2012.
The agency’s landmark media rights deal came just over five years ago when Dentsu, the Japan-based advertising giant heavily involved in sport, turned to Spring Media to lead negotiations in selling rights in Central Asia to the 2014 winter Olympics and the 2016 Olympics (it has since been retained for the 2018 and 2020 games).
Sports bodies in Sweden for which StayLive has developed an OTT platform include the national federations of bandy, floorball and powerlifting. Spring Media itself was recently appointed to exclusively represent the media rights of the Swedish Bandy Association.
Osmund said that Spring Media is looking to make more acquisitions, including a possible business-to-consumer OTT company, potentially outside of the Nordic territories. The agency already has regional offices in Hamburg, Astana and Mexico City.
He said: “We’re growing organically and we’re financing our acquisitions with our own capital. We’ve never taken any external financing or loans so it’s all [funded] by our own profits.”
Osmund highlighted the advantage of Scandinavian countries being “well developed digitally” and audiences “very accepting of watching sports on OTT platforms.”
He added: “We think we can use this experience from the Scandinavian region as other parts of Europe develop in the same direction.”
The purchase of Sportacentrs, a media house that encompasses PolarHD, an international sports TV production arm, as well as Sportacentrs.com, Latvia’s biggest sports news website, and free-to-air TV channel Sportacentrs, has established Spring Media in the Baltic region.
‘Fast-growing, profitable operation’ Commenting further on the reasons behind the StayLive acquisition, Osmund noted: “We’ve been working with a couple of third-party platform providers and even though that has worked quite well for us, we felt the need to be able to control the development of the platform that we work with.
“We were looking at either forming a strategic partnership with a platforms supplier to get closer to the development or the option - which we ended up taking - was acquiring a company that has the platform solution already.
“Given our international network we can help StayLive with sales outside of Sweden as they’ve been quite local and growth wise they’ve come pretty much as far as they can in this market.”
StayLive was also praised by its new owner for building a “fast-growing, profitable operation within sports streaming led by a young and highly competent management.”
Spring Media has previously worked with StayLive as an OTT partner for a couple of smaller projects in sport.
Pontus Karsbo, StayLive’s chief executive and co-founder, remarked: “We are pleased to welcome Spring Media as new majority owner of StayLive. The management that laid the foundations for the company over the years remains at the helm, which means that Spring Media acquires shares of people who have not been operationally active in the company. With a strengthened ownership structure we are now ready to create new value by gearing up a level in the current product development phase.”
As proof of concept behind the focus placed on the digital development of rights-holders’ assets, Osmund, who joined from the Associated Press news agency at the start of the year, underlined Spring Media’s work with the Damallsvenskan, the women’s top-tier soccer league in Sweden, to make it “one of the top three sports leagues in terms of exposure in the Swedish media.”
Spring Media began advising the EFD, the body that governs Swedish women’s soccer’s top two leagues, on its media rights strategy since 2014 and signed a deal in 2016 to launch a league OTT subscription platform.