Thursday, 22 August 2013

TV Rights

Live streaming over the internet: game changing. (from )

Over the summer I enjoyed some of my team's pre-season friendlies on a free, direct stream on the club's website. My Everton-supporting friend has to pay $3 a friendly, so I think I got a better deal than him. And now the season has started, I've been enjoying more free streaming thanks to BT Sports (I was lucky enough to already have BT internet, so now I can watch it and stuff on my computer). Binging on football has become easier than ever before.

Now, I should confess: before was really quite shady. I have no great respect for intellectual property laws. Nor am I sufficiently wealthy to have a Sky subscription. The natural, inevitable result of these two factors is that I have, in my time, tried to watch dodgy streams of live football online. Mostly in Arabic. Or Russian. Not once has the experience been satisfying. And the streams often, somewhat alarmingly, cut out while your watching them.

The clubs are lucky that what they sell – the rights to live games – are one-offs. Few people torrents football matches. But they aren't taking full advantage of this. Sure, they sell TV rights to companies around the world. But why have that middleman? Why don't clubs sell their matches online directly to fans worldwide?

Football is notoriously bad at business. Apparently in the seventies some of the sports companies managed to convince the clubs to not only pay for their strips, but to pay a premium for them. The clubs didn't realise that the advertising space on their shirts had value. The incompetence is staggering.

They're in a similar situation with broadcast rights at the moment though. The current situation is bad for the fans and it's bad for the clubs. For starters, streaming online would increase the revenues of those clubs – like, say, Swansea – who are not 'big' enough to have their matches shown on TV all the time, and it would allow all their fans to see all their games, even if they couldn't go to the stadium.1

It would also allow for a massive swelling of fanbase. This has already been a trend of football in the last twenty years, with clubs like Manchester United and Real Madrid becoming global brands. These clubs have millions of fans around the world who aren't capable of attending games. They would, and do, watch games though – and could surely be convinced to buy online 'season tickets' allowing them to view every match.

The reason Facebook is valued at more than $80 billion not because they have high revenues (roughly $1.2 billion a quarter, but increasing rapidly) but because they have a vast customer base. The theory is that it is easier to 'monetise' – rip off – customers you already have than to acquire new ones. Football clubs are in a similar position. They have large, loyal customer bases around the world. They need to get on it.

1Although it is true that fans in other countries perversely enjoy more Premier League matches on TV than British fans do – NBC bought the rights for every single Premier League game this season in America, for example. I suspect, though, that most foreign fans, with the exclusion of a limited number of expats, are fans of the top seven or so clubs in the league.

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