Dynamic giants: What the US and European sports video markets can learn from each other

By Rick Allen, CEO, ViewLift.

The sports video market is incredibly dynamic. The United States and European markets are two influential giants with similarities, but also some instructive differences and unique approaches, strengths and challenges.

TRENDS

USA’s Regional Sports Network Model and its challenges

The US sports market is characterised by its vast regional diversity, with some of its states boasting populations exceeding those of European nations. This demographic reality gave rise to the Regional Sports Network (RSN) model, which focuses on local coverage. However, this model now faces strain.

Bally Sports, for instance, has grappled with issues stemming from excessive rights fees, the impact of cord-cutting on its business model, and a delayed entry into the streaming arena. The issues facing Bally are having a massive impact on the US market, because for many sports teams, the RSN cheque is their second largest in any season. At ViewLift, we are working on providing different options for teams that fear the economic threat these RSN issues present for their own operations.

As an example, we recently announced that we are providing direct-to-consumer (DTC) streaming distribution for reigning Stanley Cup champions the Vegas Golden Knights, complementing the earlier deal between Scripps and this National Hockey League franchise for the broadcast carriage of games, following the closure of the previous incumbent AT&T-run RSN.

Europe’s dominance in soccer (football)

While the individual national sports markets in Europe may not rival the US’s sheer size, the continent’s greatest sports asset is the global popularity of its soccer leagues. Boasting many of the world’s most loved and watched teams, leagues and players, Europe enjoys an enviable position as the heart of the world’s largest sport.

European soccer offers valuable insights into building a global fanbase that transcends regional boundaries – a lesson the US can learn from, as it seeks to cultivate a broader international following for its sports leagues. And Messi’s electrifying move to the US suggests that support for and viewership of soccer will explode in the country if more of the world’s best players compete here.

LESSONS

Lessons for Europe

Cord-cutting preparedness: Europe must prepare for the possibility of cord-cutting escalating in the region, mirroring the trend already well underway in the US. The recent Disney-Charter carriage spat is a case in point.

Cable provider Charter Communications says that the rate it pays for TV networks, particularly sports, is so high that, combined with lower revenues due to cord-cutting, the company’s video margins are now razor thin. This makes it much easier for Charter to walk away from the video market and double down on its broadband and wireless businesses, which continue to enjoy much higher margins. In fact, in response to its carriage dispute with Disney, Charter implemented a simple consumer-friendly QR-code mechanism for its video customers to move to FuboTV and YouTube for lost Disney content.

By exploring innovative ways to deliver content and engaging with streaming services, European sports broadcasters can ensure they remain accessible and relevant to viewers. As long as sports leagues and broadcasters find models that work financially for both parties and also launch new services that ensure consumers can interact with sports when and how they choose, sports broadcasters can continue to enjoy success by combining linear TV with streaming.

Rights and sponsorship strategies: Europe should refine its approach to slicing and dicing broadcasting rights and sponsorship opportunities. By adopting a more granular approach to rights sales, sports organisations can optimise revenue streams and provide tailored experiences to their audiences.

And it’s not just Europe that can learn from the US’s sports rights approach. Indian Premier League (IPL) cricket garners the second most expensive rights per game after the NFL. It’s very likely that if the IPL followed the US granular rights approach, then IPL sports rights would be more expensive in the aggregate than even those of the NFL.

Embracing the RSN Model, without its missteps: Where they have regional scale and brands that transcend local loyalties, European sports entities can adapt a localised and multi-sport broadcasting model similar to RSNs. However, they should also heed the lessons from the US RSNs, such as not overpaying for rights – and being ready to handle changing consumer dynamics.

Lessons for the US

Global fanbase building: The US can take a page from European soccer clubs such as Barcelona, Liverpool and Manchester United in building fervent global fanbases. Spain’s LaLiga is actually playing catch-up to England’s Premier League in terms of global cachet and is now able to do so effectively, following the top-flight Spanish league’s move a number of years ago to sell its international rights collectively rather than on a club-by-club basis. This has made it much easier for LaLiga to build a global fanbase for Spanish soccer and its clubs, beyond Barcelona and Real Madrid – its most dominant, high-profile teams.

By investing in international marketing, outreach and digital engagement, American sports leagues can transcend borders and capture the passion of fans around the world. While leagues such as the National Basketball Association, National Football League and Major League Baseball are making strides in these areas, leveraging technologies such as social media and streaming can further grow nascent fanbases in international markets to build truly global momentum.

Adapting to changing viewing patterns: Understanding and catering to changing viewing patterns, particularly among GenZ audiences, is crucial – as is finding ways to engage these under-24 digital natives on their own terms. Key European engagement strategies, such as LaLiga’s partnership with esports and gaming giant Electronic Arts (EA), exemplify the power of embracing new platforms and formats that resonate with the next generation of sports enthusiasts. In this case, LaLiga gains exposure to 150 million hard-to-reach GenZ football fans, and EA gets access to Spanish football’s incredible IP.

Two-way play

As the US and Europe grapple with distinct challenges and opportunities, they will generate lessons that can reshape how sports are covered, consumed and enjoyed. Whether it’s Europe’s soccer dominance inspiring a global fanbase, or the US’s innovation solving for the changes in the RSN model, these lessons can spark innovation and new revenue-generating business models. Each market should look and learn from the other.