A new study has found that increasing numbers of broadband users are watching sports coverage online and the budding industry is already worth more than $100 million.
Researchers at technology research firm,
Strategy Analytics examined hundreds of international sports sites and reported on the current availability of webcasts and their potential for the future.
At present, the internet accounts for less than 1% of sports industry revenues. However, the collapse of ITV Digital and Kirch has raised doubts over the value of broadcasting deals (see Insight Feature: Sport, Not The Draw It Used To Be?) and sports rights holders have started to tap other sources of revenue.
Industry overview Only a limited number of sites offer access to live sports webcasts, as rights are not available or are owned by television companies. Most of the content available is either video highlights or commentary and therefore has limited appeal to fans. The UK’s Football League, already reeling from the failure to recoup money owed by ITV Digital (see League Bosses Pay The Price For ITV Digital Defeat) has been forced to accept a new deal from NTL in which the 73 clubs share just £5 million for having their matches covered online.
However, this largely reflects the financial problems faced by UK cable firms and football clubs and there is every sign that internet revenues are set to climb. Fans unable to attend Premiership games will become increasingly dependent on the web and the NTL deal does at least give the lower league clubs an increased share of profits in future.
Strategy Analytics predicts that while the internet is unlikely to replace television as the favoured medium for watching sport, the spread of technology and an increase in demand could pave the way for live webcast packages to be sold separately.
“Broadband sports represent a significant new revenue opportunity for rights holders and operators alike,” said Nick Griffiths, Director of Broadband Entertainment Strategies at Strategy Analytics. “But they must nurture their relationship with great care, and must accept that the internet will play a supplementary role to television for many years to come.”
