Will People Pay for Over-The-Top Sports Subscription Services?

OTT sports

Photo credit: www.lowyat.net

We’ve talked about the sports sector a lot recently – it is a hot topic after all. The growth in online sports viewership is astounding, to say the least, and we are expecting big things to happen this year and beyond. With these developments, come a host of questions, one of the big ones is: will people pay for Over-The-Top (OTT) sports subscription services?

Stats: OTT and sports may be a great match

Well, according to a study carried out by the Center for the Digital Future at USC Annenberg and Post Game, when someone creates an all sports Over-The-Top subscription service, 63% of all sports fans are keen to pay for one. For households with children, this number rises to 70% and to 78% for people who describe themselves as intense sports fans.

From these stats alone, it’s plain to see the potential in the partnership between sports and OTT technology. Sports has become a category of must see content and as such, many people subscribe to these kinds of services with a sense of urgency.

According to the survey on which the study is based, there is little doubt that there is a healthy market for sports and OTT subscriptions:

  • It has been discovered that 86% of Americans consider themselves sports fans (92% of men and 80 % of women) and 26% consider themselves intense sports nuts. Out of these 86%, a rather impressive 88% follow more than one sport.
  • In general, more than 90% of sports fans would be willing to pay something for sports programming. From these results, sports fans say they are ready to pay more for streaming than for similar channels via cable or satellite television and those in 25-34 age bracket say they will cough up the most for sports programming.

The ultimate sport that has been using direct-to-consumer models to distribute their video content is martial arts, especially boxing. Pay-per-view (PPV) as revenue model has proved that can generate great revenues for live broadcasters, by targeting their enthusiastic power fans that want their content live and available on every device. But lately, the prices over $50 (plus cable subscription fee) have an impact on the purchase decision for “non-power fans”.

That’s why, live broadcasters are considering the options to diversify their service portfolio with some variations of SVOD and TVOD models. This means allowing non-subscribers to stream PPV content for one flat fee and delayed broadcasts (on-demand video) for a less cheaper price.

It’s fair to say the market is strong; it’s safe to say that the market is healthy.

Viewers will pay for sport OTT/SVOD services if the quality of experience is therereporting digital experience issues

Of course, it’s great to see that people are so keen to take advantage of OTT subscriptions services, but certain standards must be met to earn their loyalty. Although more and more people are migrating to these kinds of services, it looks like there is a lack of focus concerning quality of user experience, especially when it comes to live stream.

Actual Experience recently released their Q1 report on the consumer perception of digital content experience. Their numbers show that only 22% of end-users reported very consistent and high quality experience and 78% of all organisations face some inconsistency with their digital experience quality.

That has  implications on the provider success numbers:

  • 56% customer churn;
  • 43% customer complaints;
  • 39% loss of revenue.

One organisation that works on standardizing quality of experience (QoE) in streaming video is Streaming Video Alliance (SVA). This month they officially released guidelines for streaming media delivery, including functional requirements for open caching and its first set of guidelines for QoE.

In order to compete and keep subscribers, streaming and buffering standards must be maintained to a solid standard. And providers are starting to wise up. 

Here’s what Allen Broome, VP, IP Video Engineering, Comcast, had to say about customer experience:

“In a lot of the testing we’re doing on UHD, until we get to screens over 85 in., the average consumer can’t tell the difference between HD and UHD. What we’re seeing from a quality perspective is high dynamic range [having a huge impact], and that’s what we’re pursuing. We’re going to have some HDR content out fairly soon.”

Recap: 

So, to answer our original question: yes, wide varieties of sports fans are willing to pay for OTT subscriptions services, and we’re expecting numbers to increase in the not so distant future.

Sporting events are amongst entertaining forms of visual entertainment on the planet, and as OTT and the world of online sports grows, more and more people will be queuing up to get their hands on a subscription or two.

Check out these great tips from fellow broadcasters for maximizing revenues from video streaming:

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