Digital Media and Sport - Thematic Research

An analysis of the current state of play with digital media, and how sports has managed to successfully penetrate the industry.

The explosion of internet sites, social media platforms, and online media has changed the way fans consume sports content. Many now set up social media feeds to follow their favorite teams and view short highlights, as well as following leagues via streaming services.

The strategies that many major sports leagues and teams employ nowadays in the digital age are aimed at winning over new fans across the globe, broadening their appeal, and trying to increase the number of potential business opportunities, and with it, the amount of money that can be made.

There have been several successful examples of sports leagues forming strong links with foreign countries in an attempt to bolster interest in their games. The NBA’s business ties to China are one such example, while Formula One has seen an explosion in popularity in the US in recent years, in large part due to the massive success of their Netflix documentary series, ‘Formula 1: Drive to Survive’.

Streaming platforms are an excellent way to reach global markets due to their accessibility and popularity across the world. Several sports teams have already commissioned documentaries on their team in recent years, with many providing fascinating insight for sports enthusiasts to dig into. Netflix and Amazon Prime have led the way, successfully drawing in customers who might have been uninterested in the rest of their content offerings.

North American leagues such as the NBA and the NFL have seen massive success in launching their ‘League Pass’ services, which allows international fans to view all games in either shorter highlights packages or full replays for the cost of a monthly subscription service. Some of the world’s most popular leagues must start to consider if this is a way forward for increasing both their popularity and financial gain.

Key Highlights

• Digital media is officially defined as video, audio, software, or any other content that is created, edited, stored, or accessed in a digital form. This essentially includes any piece of content that is produced and published online and encompasses a wide variety of sectors and industries. Among the most popular digital media platforms are sharing websites such as YouTube and Spotify, social media platforms such as Twitter and Instagram, service-oriented websites such as Uber and Airbnb, and knowledge-sharing platforms such as Quora and StackOverflow. Many of these platforms began their development in the late 2000s, and many now rank among the most visited and used places on the Internet.
• Esports is another rapidly growing area that is looking to capitalize on the shifting landscape. Some 32% of internet users aged between 16 and 24 and 30% aged between 25 and 34 are esports viewers, according to a 2019 survey conducted by GlobalWebIndex. This demonstrates that ‘generation hashtag’ (which includes anyone born between 1991 and 2005) are the prime consumers of esports. This growth is consistent with the rise in popularity of digital media platforms, with key ecospheres on popular sites such as YouTube and Twitch entirely dedicated to esports.
• For years, sporting events were exclusively tied to cable subscriptions, and OTT platforms were not even part of the conversation. However, the popularity of the latter has soared in recent years, with an estimated 1.2 million people in the US dropping their traditional TV services in Q2 2020 alone. A survey conducted by PwC found that 82% of people kept their traditional subscriptions purely to watch live sporting events, and they would have canceled had these not been available. A turning point in the shift towards OTT platforms was the $130 million deal for Amazon to stream 11 regular-season NFL games. Amazon was also early in securing rights to Premier League games, paying the league £90 million for a three-year deal for twenty games a season in 2019. Amazon was the first tech giant to have invested in sports streaming, with Netflix having ruled itself out of live sports, Google’s focus on YouTube Premium, and Facebook not having an OTT platform at that time.
• Digital media revenues are predicted to eclipse $415 billion by 2025, at a CAGR of 11% between 2021-2025. Digital media revenue growth is expected to be strong over the next few years, as social media becomes more popular, and streaming platforms become even more of a fixture in the lives of everyday people. The emergence of new platforms has led to them becoming more restrictive in licensing their own content. For example, Disney+ exclusively owns the rights to the Marvel Cinematic Universe, while Netflix has several TV series that it has produced that are unavailable on other platforms. The market essentially forces consumers to hold multiple subscriptions to have access to a diverse range of content, which will naturally increase the number of subscriptions, and therefore, the amount of revenue.
• Growth in OTT has been driven by audience demands. In the US, 2019 was the first year that more viewers were subscribed to streaming services than were paying for cable. Research from eMarketer has also shown that by 2024, 46.6 million households will have abandoned cable entirely in favor of streaming platforms. Pre-pandemic, many sports fans still preferred watching sports games at bars/pubs. These venues have slowly begun shifting towards paying for OTT services instead, which has allowed them to save money and retain more control over the content they show, including the option for ad-free broadcasting.

Scope

• This report provides an overview of digital media, and how the industry has grown so massive in the last decade, to a point where people can make a full-time living using these platforms.
• The current trends dominating digital media, as well as the trendsetters leading the industry, and what sports leagues have capitalised the most during the boom of digital media.
• The report provides a detailed analysis of the potential future development of the digital media landscape, and what challenges it faces it in its immediate future.
• An in-depth look at the value chain for digital media, and what generates revenue for the biggest platforms in the sector.

Reasons to Buy

• For those wanting an in-depth analysis the current landscape of digital media, and how the sports world has begun to utilise digital media to maximise their own business.
• For those wanting a sense of the current performance of many of the dominant digital media platforms, and the difficulties and controversies they are currently facing to stay dominant in an extremely competitive and diluted market.
• The publisher’s thematic research ecosystem is a single, integrated global research platform that provides an easy-to-use framework for tracking all themes across all companies in all sectors. It has a proven track record of identifying the important themes early, enabling companies to make the right investments ahead of the competition, and secure that all-important competitive advantage.