Agency Fifty-Three Six: Non-live content coming up on the rails
By Tariq Saleh
Highlights rights packages and short-form clips could develop into a premium product in the wake of the coronavirus pandemic, while the demand for content with ‘privileged access’ will increase, a leading digital sports marketing agency has told Sportcal.
Growth in the popularity of non-live content has been a notable trend in the sports industry recently, with multiple broadcasters and digital platforms looking to provide more bite-sized offerings to increase audiences.
It is now widely seen as an underexploited area of revenue having come to the fore during the Covid-enforced shutdown of live sport between March and July.
The greater focus on short-form content comes at a time when the value of live sport appears to be declining with games having to be played behind closed doors and viewing figures plummeting, according to Dublin-based agency Fifty-Three Six.
Marcus McDonnell, the agency's head of production, told Sportcal: "What we’re seeing now is the product has been diminished a little bit, the major broadcasters are acutely aware of that and have seen ratings dipping. So, we’re seeing a bit of an evolution in terms of the rights that they’re able to attain from rights owners and the ways in which they’re able to monetise them.
“There is a bit more leeway being provided by the rights owners to major broadcast partners because they’re allowing them to recoup their investment somewhat more and the [English] Premier League seems to be leading the charge on that.
“Beyond the live rights, there’s ‘ancillary content’ like highlights rights, as well as other original content opportunities which a rights holder could own and monetise. If the value of live rights is diminished, then do the highlights packages become more valuable?”
He continued: “Broadcasters like Sky are making the highlights packages free on YouTube at the moment and monetising them through ad share revenue, but it would seem that the purpose is really to keep fans engaged and pull them towards a paid subscription. However, if there is dwindling interest in watching the live games, and growing interest in shorter, highlights packages, do licensees put the highlights behind a paywall?
“There will be a myriad of different shifts in the media landscape with rights owners trying to create new value for broadcasters, while simultaneously adapting to fans behaviours as well.”
DAZN, the international over-the-top subscription broadcaster, is among the media companies to have increased its focus on non-live content as part of a recent shift in strategy.
James Rushton, DAZN’s acting chief executive, claimed that “one of the key learnings from the pandemic is the relationship between non-live content engagement and customer retention has never been stronger.”
'Access content' With more broadcasters seeking to expand their offering within the space, there could be new content revenue opportunities, with rights holders letting cameras into previously private areas to give viewers greater insight.
Tom Fox, Fifty-Three Six’s head of digital, explains: “Match highlights are becoming more ubiquitous, it feels like you can get short clips and content in so many different places now. The likeliest outcome, in my opinion, is the big companies will get scale and monetise it through ad share instead of packaging it as a premium product and I believe also the access content is more valuable in the long run and we’re seeing boundaries being knocked down there.
“Rights holders who we have worked with before would have said the dressing room is a private, privileged place and is sacred, what happens in those four walls doesn’t leave.
“But now, due to the loss in gate receipts, the commercial directors are saying, ‘we need revenue and that is a monetisable asset at our fingertips.’ So we’re seeing people do a complete 360, saying let’s roll out something that we can monetise because all of a sudden we don’t have the cushion of gate revenue and teams outside the Premier League don’t have big broadcast money coming in so they’re really under pressure to simply survive, not prosper.”
Fifty-Three Six specialises in ecommerce and performance marketing, digital strategy and video production and counts England's Football Association, the Irish Rugby Football Union, Racing TV, Pitch International, Munster Rugby, Joymo, RugbyPass and Relevent Sports Group among its clients.
McDonnell, who has significant experience in the rights space from previous roles at NBA and Pitch, believes there is a growing market for behind-the-scenes content and predicts more athletes will use their platforms to give fans greater and more intimate access.
He said: “The highlights package is one area of evolution, but we certainly believe there is massive opportunity in so-called ‘access content’ where fans are brought behind-the-scenes. This is often more ‘snackable’, short and sharp content, but can take the shape of long form programming too.
“There’s quite a big market developing around creating and curating content that’s specific to the athlete and that could be an emerging trend as well. But once commercial directors get a sniff of that incremental revenue, they may begin to recontract their players so that type of content is owned and distributed by the rights owner and they can monetise it in their own way.”
Direct access to teams and players is seen as a key element of fan engagement in this digital era and this type of content has opened up considerable commercial opportunities for rights holders, particularly while fans are not allowed in stadiums.
Amazon, the online retail giant, has had success in this space due to its ‘All or Nothing’ docu-series which has featured several soccer teams such as England’s Manchester City and Tottenham Hotspur and the Brazilian national side, New Zealand rugby's All Blacks and several franchises in American football's NFL.
Fox, who has previously held digital roles with Ireland-based pay-television operator Setanta Sports and Twitter, believes Amazon will continue to be among the companies best placed to disrupt the sports rights space and the influence of the traditional broadcasters.
He said: “It opens the door to other players like Amazon as we’ve seen them enter the market. I’m not sure if the end result is good for fans because the way they can consume games will be more fragmented.
“With the Premier League, [pay-TV's] Sky and BT Sport have dominated the rights for years [in the UK], but their model has been hurt now for different reasons like ad revenue and the value of the rights themselves. When you think of the buying power of Amazon and those within that space, you would have to foresee them mopping up more rights over time and more of the content moving to an online streaming system as opposed to classic linear broadcasts.”
Amazon has displayed its buying power recently, snapping up a package of rights in Germany to European soccer’s Uefa Champions League and is reported to have acquired a package in Italy.
It has also made its first foray into rugby and cricket in recent months, acquiring UK rights to the Autumn Nations Cup, the eight-team rugby union competition, and rights in India to the New Zealand cricket’s team’s international matches.
This adds to its strongly assembled portfolio headlined by American football’s NFL worldwide and the Premier League in the UK only.
Direct-to-consumer As well as engaging with emerging players in the rights market, sports properties are increasingly exploring ways to bypass existing media platforms by distributing content to fans through direct-to-consumer models.
The OTT route continues to be attractive in the sports industry with Greek Super League club PAOK are among those to have fully embraced this model and moved away from traditional rights deals with linear broadcasters.
For others, particularly clubs in the top European soccer leagues, revenue from broadcasters continues to account for the majority of their income and therefore difficult to abandon.
However, some sports organisations are seeking opportunities outside of live content to explore the direct-to-consumer route.
Fox said: “Working with rights holders, what we’re seeing is they’re trying to pivot slightly as a lot of them have been very reliant on gate receipts and ticketing revenue.
“Now, there’s such a big gaping hole financially in their revenue and we’re seeing more rights holders looking to recoup lost revenue through more direct-to-consumer models.
"We’re working with a bunch of people in that space who are looking to maybe shift their focus slightly and monetise some of their digital assets and content by looking at supporters’ clubs and direct-to-consumer models. They are looking to build new revenue streams using the great assets they have at their disposal.
“For a lot of them, this would have been on the roadmap but it has all been accelerated in the current climate. There has generally been an overall shift and acceleration in digital activity for sure.”
Covid-19 has brought digital to the fore, and there is consensus within the industry that sports without robust strategies in this area will be at a disadvantage in terms of reaching audiences globally and attracting new fans.
With their experience in this space, the Fifty-Three Six executives foresee digital continuing to disrupt the rights market and open up untapped commercial opportunities for rights holders, with the help of evolving technology.
McDonnell said: “There is technology available to rights-owners now at a relatively cheap level to enable them to monetise their rights direct-to-consumer. Whereas previously they would have preferred to have gone to a broadcaster for some sort of minimum guarantee, whether it was through a digital outlet or linear broadcaster, I think there has been a bit of a willingness from rights owners in particular to see if they can go direct-to-consumer and they now have the technology to do so.
“Whether it’s going through the major platforms like YouTube or Facebook, you can, with relative ease, broadcast your own rights... there isn’t a massive barrier to entry. But with all the will in the world, you can put live content out there, but it doesn’t mean you’re going to get an audience or generate revenue.
“We’re encouraging our clients to be brave when considering going direct-to-consumer. We’ve got the knowhow in terms of monetising fans and it’s just a matter of having a bit of savvy and understanding and investing in media, marketing and the right people.”
Fox added: “I think we’re at the tip of the iceberg. We’re obviously in the video space and from the outside, we’ve been focused on producing video with the purpose of driving measurable results, that was a bit of a gap in the industry as we saw it.
“I was a little bit surprised at the level of sophistication within big sports businesses of how to monetise and how to run campaigns that drive results and that’s what we’ve hung our hat on and have seen lots of success with. But really, with the direction the digital landscape is going, that really feels like the beginning of the journey and not the end.
“It feels like with the advancements of technology and how rapidly that’s moving, some of the possibilities are endless over the next 10 to 15 years.”
A feature on the growing demand for non-live content will appear in the next issue of the Sportcal Insight magazine, out in December.