UK football clubs could learn a great deal from European and US sports teams when it comes to monetising digital content, as Allan Swann reports.
Despite being eliminated by Chelsea in the semi-finals of this year’s UEFA Champions League competition, there remains one area where FC Barcelona (FCB) trumps not only the team from London’s King’s Road but all other competitors from the English Premier League, and that’s in using new media and mobile technologies to monetise its content.
Sport is inherently a business, one based around content distribution and marketing, and like almost every other business in the world right now, UK football clubs are having to confront issues surrounding Big Data, infrastructure and the cloud as they look to distribute their video content across new media, such as mobile and the web.
Kevin Usher, director applications specialist, EMEA at Avid, which provides the live editing software and hardware for FC Barcelona as well as a number of teams worldwide, believes that English football at all levels could do much better at utilising its content to connect with fans and open additional revenue streams.
Usher would like to see more UK sports teams utilising the Barcelona business model (which in turn is based on US models) by controlling and monetising their own content, effectively operating as their own virtual TV station and content distributor. This effectively ties into new technologies, such as mobile.
Barcelona already has a range of mobile apps built on its own program, FCB Apps. This allows other companies or individuals to develop their own ideas, and the club splits revenues with them (Avid partnered with the video distribution mechanisms).
This has seen the likes of FCB’s World Tap (a game of keeping the ball in the air as long as possible) exist alongside apps such as FCB Live for iPad. FCB Live displays stats in real time for all games involving Barcelona’s first and second teams, and also the brand’s basketball team Barca Regal.
FCB Watch operates like a social network, allowing Barcelona fans to find each other and also the nearest bar showing their team’s games live anywhere in the world.
FCB Mobile operates similar to most football teams’ apps, with player bios, news feeds and short clips. FCB Fantasy Manager allows players to test their skills as a potential manager of the club.
The potential to collate this form of Big Data is a key advantage in the modern mobile world, and gives clubs unparalleled access to their fans. Much of this remains tied to second-screen viewing of stats, news and social networks, but video will be the next big step. Big Data, in the form of the terabytes of video data being produced during each game, and how to monetise it, will become a key focus.
In the US, baseball teams such as the New York Yankees and Miami Heat are already sharing fixed and cloud storage for their vast digital video libraries to reduce costs. The entire Major League Baseball league utilises shared storage to the tune of US$600m a year, as does basketball’s equivalent the NBA.
Many of the US sports leagues have also collectively bargained their TV rights and incorporated archiving rules, so all footage is stored in the same manner and is easily available for journalists and documentary producers, while the public can view classic matches.
This also makes it available for new media and social media applications at the click of a mouse – and the ring of a cash register.
"Making this digital video content accessible is particularly important for mobile and tablet applications," says Usher. "Consumers may not want to watch whole matches on these small screens, but ‘goals of the day’ and highlights can be big revenue earners. A lot of this is currently lost to YouTube."
For example, David Beckham’s goal for England against Greece to qualify for the 2002 World Cup has some 6 million hits on YouTube, clipping at 30,000 per month. The Football Association has no interest in monetising content outside of its external broadcast rights, but if this video was exclusively hosted on the FA’s own website, allowing ads and sponsorship to be attached, it would pay for its own infrastructure costs.
The disparity between Premier League teams and other divisions mean that the quality of archiving differs widely. The vast majority of historical footage is trapped on analogue tape, buried in back rooms in mouldy clubrooms, especially for teams that have not seen action in the top league for decades.
However, for clubs struggling financially there is money to be made from the glory years among diehard fans, says Phil Ventre, Avid’s head of sports, EMEA.
"The technology available right now makes it easier than ever before. If clubs utilised shared cloud storage and shared physical digital infrastructure they could reduce the costs of these endeavours drastically. Unfortunately, a lot of the clubs still have a very protective, individualist mentality when it comes to sharing data," he says.
"Once you have the data organised, producing clip packages and pushing them to online video stores where it can be charged for is potentially huge."
As with the US sports, Germany’s Bundesliga football league has a collective broadcasting agreement and has its entire video history digitised -already 5% of it is searchable in an online database. These rights are group-sold internationally and the revenues dispersed among the clubs.
The Bundesliga is also in the process of connecting all its stadiums by fibre. This makes real-time cloud-based production and editing a possibility, alongside potential streaming of matches between stadiums and Wi-Fi for in-stadium customers.
The US sports leagues run more like businesses – they are more efficient, produce higher-quality end content and are good money earners. Barcelona and a few other large European clubs are looking at these models further for inspiration.
Teams such as Liverpool, for instance, have been quite progressive and alongside its own TV channel it also offers an online e-season ticket that costs £49 per year. However, filling the schedule outside of games has proven costly and the quality is limited.
Interviews with players, training sessions and other PR exercises of value to hardcore fans do work, but would be much easier to manage in an on-demand web environment. Like most other forms of TV, viewers don’t want to be tied to a broadcast schedule any more.
By way of comparison, Major League Baseball spent $60m on its website MLB.com 10 years ago. Complete with subscriber video functionality, its instant popularity crashed the site on launch, proving the demand. It earns $600m per year in revenue using a combination of live games, highlight packages, exclusive interviews with players and coaches, and interacting with viewers directly through competitions, social networks and chat forums.
Yet the one key advantage the Premier League has is its global reach. Teams such as Manchester United and its international support base dwarfs anything Barcelona, Real Madrid or any other European giant can muster, especially in Asia.
This is a giant pool of customers, often with greater access to mobile or web-based technology than they do to a widescreen TV and a pay- TV sports package.
"In markets such as Malaysia piracy is a huge problem, but it’s also a huge opportunity for the clubs," says Ventre. "Research suggests that these consumers are not watching long-form video; they are watching clips. This is ideal for the mobile environment."
Premier League broadcast rights are due to come up for auction next year, the first ‘proper’ broadcast auction of the mobile web era. The last round was in 2010. "Remember last time round, iPads didn’t even exist. Think about how much the iPad has changed the computing and media landscape," says Usher.
The packages are expecting to include more robust online video-sharing deals, mobile web clauses and multiple tiers of broadcast channel ownership. New media outsiders are expected to be alongside the big TV bidders such as BSkyB, Setanta, ESPN and the BBC, and Usher predicts an online video firm, such as Netflix or Amazon’s LoveFilm, may also bid.
Ventre, meanwhile, expects Apple, which has $100bn in spare cash, to make a play, boosting its live sports media presence to lock more customers into its product ecosystem. Longstanding rumours concerning an AppleTV launching this year would fit into this plan nicely.
In terms of social media, US stadiums are already starting to incorporate tweets from the audience into their broadcasts. Athletes worldwide are engaging in social media, too, and are more accessible to fans than ever. The development of two-way interaction works not just as a marketing tool, but also develops a sense of community.
The aforementioned Barca apps can already provide live statistical updates for fans at games, but Ventre believes that social media will take off once stadiums start installing Wi-Fi, and potentially incorporate live Twitter feeds, video replays and half-time summaries instantly on iPhones.
Video messages filmed by fans on their phones could also be incorporated live on stadium screens, and indeed from around the world, while in the future, augmented reality apps, perhaps even augmented reality glasses, will be able to overlay statistics for attendees.
"Rather than focusing this content for external audiences, like say a subscriber’s access to video highlights on the web post-game, these kinds of new experiences will boost the in-stadium experience and create an even better atmosphere – boosting ticket sales," says Ventre.
By 2025, all matches will be shown live on every device, with multiple cameras allowing users to view the game from any angle, split images into picture-within-picture thumbnail style views, and even ‘tag’ individual players to follow on the pitch.
These kinds of real-time second-screen experiences will operate similar to a TiVo – users will be able to use touchscreen interfaces to rewind plays on the fly, turning every Tottenham Hotspur fan into a goal-line judge. Multiple games will also be viewable simultaneously using the same interface, effectively making a director of every viewer. Hopefully, by then England will have won a World Cup, so we can all appreciate such technological development.