Live from Sportel: Digital rights, revenues up for debate

Digital revenues and the roles rights holders, federations, and third-parties like YouTube are playing in the content distribution and monetization business were at the centre of a lively panel discussion at Sportel on 7 October

Frank Leenders, FIBA, director general, began the discussion laying out just how much things have changed between the 2010 and 2014 FIBA Championships.

“There have been a few trends over the last four years and I think you can say that the Website and portal is still important but that the growth in mobilised services with apps has allowed for a 50% growth in traffic over 2010,” he explained. “And consumers are using mobile much more than desktops and there is also an enormous increase in social media-related activities with Facebook and Twitter. “

One aspect of social media behavior, said Leenders, is that users tend to stick with one channel.

“Twitter users don’t easily switch between Twitter and Instagram or Facebook,” he said. “So they are all important to us. And YouTube is very big for us in terms of engagement and promotion.”

John Gleasure, Perform Group, chief commercial officer, said that digital subscriptions are a core business and with more than 80,000 live events every year, plus the acquisition of Opta, the company has seen digital user growth top 250 million.

“There are a whole plethora of ways to drive value to partners with their own portals and direct channels,” he said.

Tomos Grace, You Tube/Google, senior partner manager, proved just why YouTube is an important partner as it now has a billion unique users every month, nearly half of all global Internet users.

“And they watch six billion hours of content and we see that growing very quickly and for sports the growth is even faster,” he said. “Sports is a very dynamic space and it’s not just a question of scale today but growth tomorrow.”

Some YouTube partners, added Grace, are making advertising revenues that hit seven figures. In addition, YouTube drives users off of the free service and on to the paid services of partners or to areas where they can buy tickets or merchandise. For example Adidas used YouTube to drive users to Adidas.com where they could buy a ball.

“The tools are getting better and better to drive users to external partner sites,” he added.

When the discussion came to the posting of user-generated content that included game footage on YouTube things heated up.

“Fans engagement content is fantastic and often better than the content rights holders can produce and we can place an ad in front of and ID the content and monetize it,” said Grace.

Simon Greenberg, News Corp., global head of rights, said that in those instances YouTube was making money off of pirated content. Grace countered that YouTube is hard at work looking to ensure that doesn’t happen.

“We’ve invested millions of dollars and thousands of engineering hours to ID content as the objective is to identify user-uploaded videos of a film, music, or TV that are owned by rights holders,” he explained. “When users upload a video that matches a referenced file uploaded by the rights holder we can apply the policy of the rights holder to track it, block it, and help them monetize it.”

The question facing everyone is how to handle rights. Are digital rights included with broadcast rights? Is it worth holding them back until a proper business model arrives? Or is it better to move ahead, even if it costs revenue, in the interest of growing a brand or driving the value of broadcast rights?

The consensus was that fears of digital viewership negatively impacting broadcast viewership have been laid to rest. And broadcasters, increasingly, want to have the digital rights so they can distribute content via their own online and mobile channels while federations look to use the platforms to build up their community.

“Different channels and social media can build an audience,” added Gleasure.

Leenders said that next-generation services could include things like multi-angle event coverage.

“Conceptually it is simple: work together with partners to bring basketball fans together and offer the best product throughout the year with one destination that helps the fan find what they want,” he said.

Gleasure concurred that fan engagement is something everyone wants.

“But is it driving revenue for the rights holders and adding value?,” he asked. “From a marketing or commercial perspective that is the biggest challenge for this.”