As FIFA World Cup neared last year in December, the rush to download the JioCinema or JioTV application was palpable with sports lovers showing hardly any hesitation in downloading the apps. Being a sports-loving country, it was not unusual behaviour as no one really wanted to miss watching Messi and Ronaldo in their full glory.
OTT channels making a foray into sports has generated a lot of interest among media companies. Not just FIFA, even the IPL men’s and women’s leagues are spurring OTT and media players to invest huge sums of money for bagging media rights of these big-ticket live sporting events.
While Viacom18 Sports, backed by Reliance, acquired the FIFA World Cup 2022 rights for a reported sum of Rs 450 crore after defeating Sony, Star and other such big players, the latest battle for the IPL women’s tournament rights was also won by Viacom for Rs 951 crore for 5 years. Disney Star India last year won the TV rights for men’s IPL tournament (2021-27 cycle) for Rs 23,575 crore. Even tournaments like India vs New Zealand in 2022 were streamed by Amazon Prime. Sony Pictures India is set to broadcast Australia Open.
With stakes getting bigger for these sporting galas and major media players jumping into the fray, we asked industry experts if the arena is set to get bigger or if there is a sense of caution.
Sports rights – A valuable asset
Viren Razdan, Managing Director, Brand-nomics, said delivering sports content is a good business for OTT channels. “Sports and sporting events have been great drivers of viewership and conventionally TV has been the dominant channel of consumption. With the huge surge in audience segments, not only has sports given OTT channels a valuable asset to draw attention but broaden their bouquet of offering to a new consumer segment.
TV channels have extended their franchise onto OTT and juiced the deals well to broaden their advertiser and consumer base. OTT’s pushing their weight together is definitely good for business as the demand rises and new advertisers’ opportunity come into the fold.”
Speaking in terms of MAUs and subscriber growth, Karan Taurani, Senior VP of Elara Capital explains how sports content investment is a better benefit than investing in web series or movies. “Sports as a content strategy is becoming very much important. I know that the content costs are high. But it definitely gives you that success in terms of getting a larger user base or probably getting higher MAU number. If you look at other content, including web series and movies, it’s just about them doing well or them kind of gaining success. If they’re not becoming successful through word of mouth and through public acceptance, then, there is no proper benefit or there is no addition to the subscriber base despite the heavy investment to this content.
So, I think sports that way, relatively, gives you that assurance in terms of customer growth, and it is definitely a hefty content cost, but the customer growth is good enough because you can use that customer base to cross-sell your other content.”
As for Jolene Fernandes Solanki, COO, Madison Media Ultra, sport on OTT helps in expanding the customer base. “Sports as a genre always gets in incremental reach across platforms. With the change in consumer behaviour during the pandemic, we saw a huge spike in online viewing on OTT and an increase in connected TV. Largely the impact comes at the back of two key pillars: New User Base and Viewing Experience.
By having sports as an impact on OTT, the expectation is incremental revenue for OTT players, which comes at the back of the new user base. Once the user is bought in, they mostly tend to experience the app and also stick on even after the event has culminated. This was clearly visible on JioCinema in the case of FIFA – the userbase increased during the tournament and 1/3 of its users stayed back on the app post the end of the tournament.”
On the existing competition between OTT players, Solanki said, “The current OTT space in India is extremely competitive with large players fighting for a share of the user’s attention. In a market where people are spoiled with choices, there has to be an impact medium to drive differentiation. Sports as a property helps connect with a larger audience and builds mass reach on the platform in a very short time. These active users can be further nurtured with platform content. Monetarily it is a good approach as the future is data-driven. Having extensive access to users will allow companies to monetize seamlessly.”
On how OTT players can keep viewers engaged in this busy market, Solanki said: “Setting the right expectation of estimated reach/viewership is important. Viewership primarily depends on 4 key elements: type of tournament (hence the right audience on the platform), the existing clutter of the sport, the share of the attention of the current users in the time period and buzz around the talent participating.”
Karan Taurani explains how OTT players can retain customers after a tournament ends. “It depends in terms of what strategy you want to adopt, and what kind of scale the platform wants to operate in. This gives you a good opportunity to showcase your other content offerings to the customers for a very long time. And in case, things fall in place for you, the customer sticks on the platform, rather than getting the customer separately. So, this is a better strategy if you have the deep pockets to basically tap that large customer base and also the potential to pay such a hefty money in terms of the rights.”
Sharing insights on the connection between players and the audience, Razdan said. “OTT channels have to explore the events and not just be passive telecasters as the medium opens up interactive opportunities. What would be the differentiator is not just the touch-point to view but the connection to make this interaction more meaningful. As the emerging cord-cutters tribe grows we need to learn how we make the next move to keep them in the game.”