BIHUB PATH

November 17, 2021

Marketing, Communication and Management

Free or pay-per-view: the dilemma of European football and the new generations

By Martín Sacristán.

The revenue from broadcasting rights of European football clubs has continued to decline. And they continue to decline since millennials are now grown up fans. That generation and those that follow it no longer sit in front of the television. They demand content through their platforms and channels of choice and emphasise the relationship between players and influencers. Thus, we see the recent example of the Spanish twitcher Ibai Llanos, who visited Leo Messi, while the player refused to speak on traditional television sports programs.

How do broadcasting rights fit into this new behaviour? According to analysts, they will not lose economic importance as a source of income. They are replaced by the weight of sponsors, who will soon find it more effective to target communications directly to the fan base rather than showing commercials during broadcasts.

But that will only be possible if clubs and leagues create successful communication platforms with their fans. These platforms complement external ones such as Twitch or TikTok and allow users to actively participate in the meetings, be with their friends, interact with the sports commentator, etc. That is, to behave in sports as in everything else in their daily life.

The World Football Summit estimates that these platforms will be the first engine for club revenue growth in its latest report. They will increase their negotiating capacity with sponsors and sell their contracts more expensively because they will have the most valuable raw material today: their fan’s data.

And there is no alternative. Today 40% of young people between 15 and 24 years old are no longer interested in football. The rest do not want to see it in formats that do not go with their consumption mode. They refer to traditional television, radio, and press, as passive media poorly adapted to modern fans.

How is European football reacting? The most significant recent initiative has been the creation of a Super League. Their goal was to replace the Champion with the difference that only the most powerful clubs would participate. Those that generate the most audience and, therefore, the highest income from broadcasting rights. A financial solution based on the behaviour of classic fans. UEFA has also presented its renovation of the leading European championship, but although it admits more teams, it also does not get to the heart of the problem.

Once again, we must look at the United States, always one step ahead in managing the sports business. Buzzer is an exciting platform that emerged there, which seeks to monetise the trend of new fans to consume highlights. Summaries and best plays on a deferred basis, instead of the entire game and live. Half of NBA and MLB fans, the youngest, have already adopted this way of watching their favourite sports. Buzzer is trying to make a profit with a cheaper offer than a subscription to a sports channel. The user chooses their favourite team, preferred players and receives personalised notifications. If users want to view them, they can unlock them with a micropayment, starting from one dollar.

In the company’s opinion, its greatest potential is to attract new generations back to sports. And, to achieve in the medium term that the user ends up paying a monthly subscription service. This idea has convinced professional investors such as Michael Jordan or tennis player Naomi Osaka, who last June attended the company’s financing round for 20 million dollars. In May, they had also convinced the NBA, closing an agreement to distribute their content subject to copyright in the form of paid highlights.

The American Basketball League is also an example of the efforts made to hook new fans with content adapted to their language. CourtOptix highlights, add the artificial intelligence of Microsoft Cloud to the video images to provide the data analytics to the plays. In the beginning, this is something that may sound very technical and aimed at professionals. But this is something that new generations demand and identify with the rankings of video game avatars. Their daily routine, their language, that of eSports. Why not have it also in conventional sports?

There are apps in European football trying to transfer these initiatives to their model. But none have been endorsed by any national league or by UEFA, which would make a significant difference. Neither is the media interested in it, unlike the US where its networks have been quick to exploit the rights in the form of subscription highlights. Much remains to be done.

The big discussion in Europe is whether football must be a free or pay-per-view service. There is no such dilemma. Senior fans watched the most football on free conventional television channels. And where the new generations consume the most is in free online media. The former generated advertising revenue. The latter can generate that revenue by subscription, traffic monetisation, or exploitation through e-commerce. They all end up attracting fans to the stadium. And both models can work and generate income as long as football suits its fans and not the other way around.

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