The Business Of Sport

Sports Business: Days of regular programming over

Executive vice-president and managing director for Fox Sports Asia Italo Zanzi says the biggest change in consumer habits is fans having a much shorter attention span.
Executive vice-president and managing director for Fox Sports Asia Italo Zanzi says the biggest change in consumer habits is fans having a much shorter attention span. ST PHOTO: DESMOND WEE

Even rivals are partners as fans use new platforms but costs set to keep rising, says Fox exec Zanzi

It is a brave new world for traditional sports broadcasters.

Last week's announcement that Amazon had paid a reported US$50 million (S$70 million) to live stream a handful of games in the United States-based National Football League 2017-18 season was just the latest move by technology companies entering the arena of sports media rights.

Twitter, Google and Facebook have in the past acquired various broadcast rights and it was inevitable that the landscape would change, Fox Sports Asia's newly appointed executive vice-president and managing director Italo Zanzi told The Straits Times last week.

The 42-year-old American, who was formerly chief executive of Italian football club Roma, said: "We see these companies as much as partners as they are competitors. If the consumer adopts certain ways to ingest content, we want to partner those companies who do that."

Television may still be the primary medium for the average sports fan but that routine is altering.

In Britain, Sky Sports Super Sunday's TV viewership over the first 10 weeks of this season's English Premier League was down by almost a fifth from the previous campaign, and a whopping 39 per cent less than the peak of 1.68 million during the 2011-12 season.

  • INSTAGRAM MONTHLY ACTIVE USERS

    600m

    ESPN SUBSCRIBER BASE SINCE 2011

    -12m

    FOOTBALL MEDIA RIGHTS 2016 (US$16.7B)

    S$23b

A similar decline has occurred in America. According to report by Nielsen, ESPN has lost more than 12 million subscribers since 2011 and it noted that NBC drew 9 per cent fewer viewers for the 2016 Rio Olympics compared to London 2012.

No wonder that Netflix's chief executive Reed Hastings predicted in 2014 that "the age of broadcast TV will probably last until 2030".

Instagram, which now has about 600 million monthly active users, changed its video limitation from 15 seconds to one minute last year.

The National Basketball Association, whose 22 million Instagram followers make it the world's most popular sports league, has already capitalised by posting 60-second highlight packages of games.

Fox itself introduced its Fox+ video streaming app in the Philippines last month, ahead of its Asia-Pacific launch later this year.

There is a clear shift in media programming's rapid migration to digital platforms, said National University of Singapore Business School associate professor of marketing Leonard Lee.

"It also underscores the fact that today's consumers prefer media entertainment to be available on demand, and generally consumers' desire for control and convenience in today's digital age."

Sports media rights is big business and globally worth an estimated US$43 billion in 2016, up 18 per cent from the previous year, noted UK-based SportBusiness Group. Football alone contributed US$16.7 billion last year, a jump from US$13.5 billion in 2014.

One obvious result is that higher demand leads to higher price tags which are inevitably passed down the food chain; last year's football European Championship cost fans in Singapore a one-time fee of $88, more than the $69.55 it cost in 2012.

Such trends are unlikely to change, said Zanzi.

Despite football's undoubted popularity, there was room for new and less mainstream sports to flourish. Drone racing may be in its nascent stage but it has already secured multi-million dollar, multi-year sponsorship from several established companies.

It, and mixed martial arts - which Zanzi said has "tremendous potential in Asia and the marketing behind it has increased substantially" - make for short but intense viewing and are seen as perfectly suited for millennial audiences.

The habits of modern-day consumers are, after all, unlike those of the previous generations.

Zanzi said: "The biggest change is attention span. In the past we were more accustomed to watching one screen, one programme for a long period of time.

"Now most people, whether they are 20 or 80, have multiple screens going on and are demanding information, content from multiple sources fast and in diverse ways."

Aside from these behavioural changes, there has also been a movement towards a la carte services, which Zanzi reckoned was an "industry pushback against the bundle concept" which would package sports, news, entertainment, lifestyle content together.

A la carte offerings offer greater independence but taken to its extreme, said Zanzi, could have customers having to "subscribe to 10-12 services, pay 10-12 bills and have 10-12 passwords for all the various apps required" and it was unclear if that was "a functional way for people to digest content".

With more choices and content comes the potential for confusion and a cluttered marketplace.

Zanzi added: "It forces you to make your (branding) message more focused, more concrete."

Exclusivity is therefore key to Fox Sports Asia's approach. The network counts all four tennis Grand Slams, Formula One, Major League Baseball, golf's Masters and US Open, the Ultimate Fighting Championship and Germany's Bundesliga among its prized properties.

Live sports are the "most insulated on all assets", said Zanzi, adding that "if you're broadcasting that you are the exclusive home so by definition you're differentiated from others who cannot do that.

"Given our scale and resources on production and from the marketing and distribution side, we can and try to do things that are uniquely appealing to our consumers."


  • The Business of Sport is a monthly series that explores the current trends and talking points of the emerging sport industry.
A version of this article appeared in the print edition of The Straits Times on April 14, 2017, with the headline 'Days of regular programming over'. Print Edition | Subscribe