Sports Stream

Leagues Score Big With Live Games to Mobile Fans

By R. Thomas Umstead -- Multichannel News, 8/23/2010 12:01:00 AM

For more than a decade, National Football League fans have been able to watch every bone-crushing tackle and game-winning touchdown through DirecTV’s popular NFL Sunday Ticket exclusive out-of-market package for live games.

This year, the crowd will grow bigger, encompassing even fans without DirecTV service. Instead of a hookup from their roof-based satellite dish to their 60-inch HDTV sets, fans will hook up a high-speed modem to their laptop computers.

The broadband NFL Sunday Ticket package is the latest attempt by the one of the big four pro sports leagues to play in the live-game streaming arena, as fans are finding more of their favorite sports events on the Web and on mobile devices. While the effort is not a major money-maker now, leagues fear they ignore viewer trends at their peril.

The all-star roster of pro sports properties offering content to portable devices includes nearly every slam dunk LeBron James makes as a Miami Heat star through the National Basketball Association’s NBA League Pass Broadband package and virtually every live game during Major League Baseball’s September pennant races.

With faster broadband speeds, more viewer-friendly mobile phones and portable devices like the iPad, league package distributors say streaming live sports content provides fans with a viable alternative to viewing contests beyond the TV.

“Being able to give direct access, a terrific experience and high streaming quality with the right applications inside the experience is critically important to reach a tremendous amount of displaced fans,” Perry Cooper, senior vice president of digital media for the National Hockey League, said.

The major professional leagues have made the majority of their games available to consumers through cable- and satellite-based pay per view and video on demand out-ofmarket packages for more than a decade. Only in the past few years have these games been made available to fans via the Web.

“With streaming [the leagues] are putting markers on various platforms with the assumption that they will grow,” Lee Berke, president of sports consultancy LHB Inc., said. “The bulk of viewers are still watching live sports games on traditional linear platforms like cable and broadcast television, but it’s growing and eventually it’s going to be a major percentage of how people watch sports, so you have to make your presence felt now.”

Indeed, the leagues’ migration of their live sports products to the Web follows an overall growth trend of sports fans accessing the Internet for sports information. A record 81 million people in the U.S., on average, visited sports websites each month in 2009, according to Nielsen Media Research.

DRAWING CROWDS
High-profile sports events have proven to attract huge online audiences in 2010. ESPN3.com’s month-long coverage of the World Cup soccer tournament this past June was viewed by 7.4 million unique viewers, with watchers generating 942 million minutes of viewing during the tournament — more than two hours per unique viewer, according to ESPN officials.

CBSSports.com’s “March Madness” NCAA men’s college basketball tournament coverage drew a record 8.3 million unique viewers who watched 11.7 million hours of live hoops games during the tournament’s three-week run, according to network officials.

NBCOlympics.com’s 17-day coverage of the 2010 Winter Olympics from Vancouver drew 46 million unique viewers and 710 million page views, more than double the total for the 2006 Winter Games, according to network officials.

“You’re looking at a scenario where people will continue to look to consume sports content wherever they are,” Berke said. “Everybody is anticipating the future that one or more of these platforms is going to take off in a big way, but in the interim there’s audience growth to be had.”

The NBA, MLB and NHL currently offer out-of-market game packages to satellite, cable and telco distributors. Th e NFL’s Sunday Ticket package is distributed exclusively through DirecTV through 2014.

In an effort to better serve its NFL Sunday Ticket subscribers, DirecTV in 2007 began streaming live NFL games as part of a premium, $99 upgrade for subscribers already purchasing its $300 linear Sunday Ticket package, according to Alex Kaplan, senior director of sports marketing at the top U.S. satellite TV provider.

The add-on “super fan” broadband service has since generated “fairly significant” growth in subscriber usage for the streaming package and has delivered incremental revenue for DirecTV and the league — although Kaplan would not reveal specific figures.

The satellite service will expand its offering this season to, for the first time, consumers who can’t receive DirecTV due to line-of-sight issues, including those who live in high-rise buildings. The broadband NFL Sunday Ticket package price for those subscribers is $350. It’s unclear exactly how many potential consumers this could add to the package’s subscriber base of approximately 2 million.

“We saw fairly small take rates last year [in a Sunday Ticket trial for Manhattan residents in New York City] and we don’t expect to see it being a major revenue driver — it’s just our desire to provide every consumer the opportunity to follow their favorite team,” Kaplan said. “But it’s a very small piece of the pie.”

NOT A TV SUBSTITUTE
Despite the broadband expansion, Kaplan still sees the broadband NFL Sunday Ticket package as a complement to its linear package and not a substitute for watching the package on television. To illustrate that point, DirecTV is giving away the broadband service to new customers who also buy the Sunday Ticket package and has lowered the broadband price for existing subscribers who buy the package to $50 from $99.

“We certainly don’t think our mobile and online versions are going to take the place of [the TV] experience,” Kaplan said. “We see it as a great supplement and enhancement to the existing product.”

Other pro sports leagues, like the NHL, see broadband packages more as revenue generators. Along with the live feeds, the online packages often provide more features than the traditional television packages. Th e NHL’s $169 GameCenter Live online game package, for example, provides fans with multiple camera angles for one game a night; allows viewers to watch up to four games simultaneously; and offers access to league-wide video highlights as well as repeats of all games throughout the season, Cooper said.

The league has experienced a 25% increase in subscription sales for the 2009-10 package compared to last season, according to Cooper. “We’ve had terrific season-over-season growth and we’re at the beginning of the product life cycle, so we think there’s a lot of upside from a cross-channel perspective for our out-of-market package,” he said.

The NBA has also garnered “significant” sales for its inaugural 2009-10 NBA League Pass Broadband package, according to Bryan Perez, senior vice president and general manager for NBA Digital, although he would not reveal specific figures. The $149 package — which is free to purchasers of the $189 NBA League Pass television package — allows viewers to watch three games simultaneously as well as repeats of any game throughout the regular season.

“The most requested feature of those customers who subscribe to the television version is the ability to watch when they travel, and that’s what League Pass Broadband serves,” Perez said.

Major League Baseball has been among the most successful thus far in pitching its online out-of-market package to consumers. MLB Advance Services’ MLB.TV premium service, which launched in 2002, generated more than 500,000 subscribers during the 2009 season, according to MLB officials. That number is expected to grow as the league has expanded the distribution of the package to Sony’s Playstation 3 gaming console and Roku Internet-connected set-tops.

The $119 MLB.TV package allows subscribers to access every out-of-market regular-season game as well as the ability to watch three games at a time and jump to any half inning of a live or on-demand game, according to the league.

Executives said that as broadband penetration continues to expand — currently more than 42% of all households have a broadband connection, according to the NCTA — more sports fans will flock to the Web to view live pro sports telecasts.

Some cable operators have expressed concern about losing subscribers to their linear out-of-market sports packages. Still, Mark Boccardi, vice president, programming and product development for In Demand, said the NHL, NBA and MLB out-of-market packages continue to be “consistently strong performers” for cable operators despite competition from broadband and mobile sports packages.

“Not only do I think there’s strong opportunity for growth, I think the TV experience continues to remain the best way to watch these out-of-market sports packages,” Boccardi said.

The NBA’s Perez is also bullish on the revenue potential of streaming live content to mobile phones and other portable devices such as Apple’s iPad. With mobile phones employing new and enhanced 4G technology, Perez said, the potential audience for the league’s $39.99 stand-alone NBA League Pass Mobile product, launched last year, is huge. The mobile package mirrors the same features as the NBA broadband offering.

APPS? ABSOLUTELY.
To that end, DirecTV will also offer a wireless phone and iPad app for its NFL Sunday Ticket package this fall that will allow package subscribers to watch NFL action on portable devices. “I think the tablet market will be particularly viable for this type of content distribution just because the viewing experience is so good,” Kaplan said.

MLB’s iPad app has already been a major hit with consumers. The $14.99 At Bat app, which allows MLB.TV viewers to watch live games as well as breaking news, schedules, interactive rosters and player stats for every team, has already been downloaded 100,000 times since the iPad launched this past April, according to league officials.

“We know that there is a lot of runway for growth when it comes from fan activation across all channels — television included — because our penetrations are nowhere near what we think market demand is,” the NHL’s Cooper said. “Everyone should feel good about upside related to channel A,B or C — we think there is a lot of upside when you look at how many avid and displaced fans there are in the U.S.”

What pro sports leagues are offering online:

Major League Baseball: MLB.TV, $119 annually; for cell phones, mobile devices such as the iPad, Sony’s Playstation 3 game console and Roku’s Internet-connected set-top box.
National Football League: NFL Sunday Ticket To-Go (in conjunction with DirecTV), $350 annually; available to consumers unable to access DirecTV. Additionally, NBC will stream its NFL Sunday Night Football telecast on NBCsports.com and NFL.com.
National Basketball Association: NBA League Pass Broadband, $149 annually; NBA League Pass Mobile, $39 annually.
National Hockey League: NHL GameCenter Live, $169 annually; provides multiple camera angles for one game nightly; viewers can watch up to four games simultaneously.

Sports fans have flocked to online events in 2010:

ESPN3.com’s June World Cup soccer tournament coverage generated 7.4 million unique viewers.
CBSSports.com drew 8.3 million unique viewers to its NCAA Men’s College Basketball Tournament coverage in March and early April.
NBCOlympics.com’s 17-day coverage of the 2010 Winter Olympics from Vancouver drew 46 million unique viewers.

SOURCE: The networks