Blue sky thinking: Sony on ways the cloud is generating revenue and innovating in the sports industry  

By Norbert Paquet, Sony Professional Solutions Europe head of live production solutions.

For decades, sports teams had two clear main revenue generation opportunities: broadcast rights and in-stadium sales (tickets, concessions, merchandise). The lions’ share of revenue came from broadcast rights – strictly controlled by leagues – which left teams with little room for negotiation.

But the world has changed. While broadcast rights are still the golden goose of many sports leagues – the NFL’s annual media revenue of over $10bn exceeds the GDP of many countries – new revenue generation opportunities have emerged. In today’s hyper-connected reality, where fans have a seemingly insatiable appetite for content and data, even smaller sports organisations (as well as individual teams and players) can generate their own revenues.

The most valuable player driving this significant shift and enabling new revenue streams in today’s sports industry? Cloud technology, and here’s how.

#1: Giving niche sports a chance

For every major sports league that demands huge rights fees – the Premier League or the NFL – there are two or three which traditionally haven’t had the same demand. And they’re stuck in a vicious circle where they need to build an audience big enough for investment from a major broadcaster, who is the organisation which could help them build a bigger audience (if it wanted to).

This applies in almost any sport, whether it’s the global phenomenon that is football, or a niche sport like World Chase Tag.

By deploying their own cloud-based production workflows, those sports leagues can break the vicious circle once and for all. The cloud democratises teams’ ability to create content, since it runs on an OPEX model and therefore means they only need to pay for what they use. This means even lower league and niche sports can produce their own content with high quality workflows. With this, they can go direct to consumers via their own streaming platforms or can use public platforms like TikTok to build up their own audience.

#2: Going D2C

Creating your own streaming platform is something of a trend right now. All the big Hollywood and media studios are competing over eyeballs in the battle of the pluses: Disney+, Paramount+, AppleTV+ to name just a few. But increasingly, sports are no different. Cloud-based delivery systems are giving sports leagues more options to create their own dedicated digital and streaming strategies, bypassing the need to sell broadcast rights in multiple territories and instead going direct to consumer (D2C).

Take something like MLB for example. In the US, baseball is one of the big four sports with an audience of millions. In Europe, it doesn’t garner the same attention, so the league runs its MLB.TV service, so fans in other regions can stay on top of all the action.

Going D2C doesn’t just mean having to run your own streaming service. For major tournaments that don’t happen annually, D2C can mean adopting a digital extension strategy to give fans more insight into the tournament than they’d get on the broadcasts. Granting fans direct access to this additional information enriches their experience of the tournament in a way that wouldn’t have been possible through the broadcast alone.

#3: Creating more immersive experiences

Ultimately, this all comes down to enriching fan experiences. It’s not enough to just have fans watching their favourite sport on TV, which can often be passive engagement. Sports organisations want to create an emotional connection with fans, because this is where they can generate active engagement and start capitalising on new revenue opportunities.

As time goes on, cloud is only going to increase the accessibility of innovation, and sports leagues and teams will continue creating new, highly-tailored, interactive and immersive experiences for fans.

Take ESPN’s partnership with Pixar and the NFL from last year’s London Game. Beyond Sports – one of Sony’s sports businesses – worked on the project where a fully-animated live game, using positional tracking data from feeds to recreate the action in the Toy Story universe, was streamed on Disney+. Everything from the announcers, to the claw from Toy Story that dropped the ball on the line of scrimmage were designed ahead of time and animated live. Animated versions of the players were seen on the field and their actions played out as if they were toys in Andy’s room – all in real-time. The aim? To engage a new, younger audience who will ultimately form the ticket- and merchandise-buying fans of tomorrow.

#4: Speeding up solution-readiness

Not only do loud and software-based technologies enable new innovations, they also allow users to move fast when rolling them out. A good example of this – while not a revenue-generator – is some recent work that Hawk-Eye (the remaining Sony Sports business) has done with the National Hockey League (NHL) in the US.

A player-safety focused solution was rolled out by Hawk-Eye, which takes advantage of live feeds to review footage to check for player injuries, particularly concussions. This tool was designed to take advantage of the NHL’s existing cloud infrastructure, including media that already existed in the cloud, so roll out was simple. There’s not even the need for any additional footprint on site during games, from Hawk-Eye, or anyone else.

This roll out is a brilliant example of how cloud deployment can have a knock-on effect, making it faster and easier to get more out of existing workflows, and deliver more solutions that make it easier for sports fans to get even more in-depth access to their favourite sports.

#5: Creating full-service production studios  

What about the impact of taking entire workflows into the cloud? Esports have been around long enough that we can’t any longer refer to them as non-traditional sports, but there are elements of how esports tournaments run that show how innovative this relatively new industry is compared to many other broadcast-driven sports.

Esports’ home field is the internet, and that’s something that tournament organisers take advantage of on a regular basis. Games developer and esports organiser Riot Games partnered with Amazon Web Services to build cloud-first production studios all around the world for their different live esports events.

Located in Dublin, Sydney and Los Angeles, the studios give Riot Games the ability to cover all their leagues and events, remotely producing content 24 hours a day, sharing assets and stats instantly, regardless of the geography of any of the tournaments or its casters and pundits.

It’s clear that, for sports, so much more is possible thanks to the roll out of cloud technology.