Part 2: The essentials of building a sports streaming business at scale

What does it take to build the sports streaming business at scale? Broadcasting live sports events is a complex process unlike streaming regular entertaining fare. It is important for streaming services to ensure a seamless live sports experience without latency/ video quality issues. Experts say that building and ensuring a better streaming experience for the fans is very important, though whether fans care about the latency of their live streams continues to be an industry debate.

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Part 1: Is sports streaming the big growth driver for streaming platforms now?

Greg Armshaw, Senior Director Strategy, Brightcove, believes that live experiences have a time sensitivity that increases the pressure on the production teams who need technology solutions that work at scale. “Otherwise,” he adds, “revenue and reputation can be lost in a few minutes of your favourite sports championship final. There is no second chance with live sports.”

“Streaming has become an essential part of the fan experience, and sports leaders continue to prioritise OTT streaming to boost fan engagement, resulting in business growth. Providing an enhanced digital media fan experience and creating and monetising digital assets are the top two opportunities to convert audience reach into revenue. Unique elements such as a customised video player showing more content than just a simple leaderboard, adding player scorecards, highlights, live polling and live trivia; developing exclusive stories about players both on the field and off, can strengthen and amplify their connection with the team and the players. Capitalising on data they gain from video usage and using these insights to refine and target content enables businesses to connect with fans in powerful ways,” says Armshaw.

He claims that Brightcove’s video platform technologies have a significant role to play in the success of sports streaming businesses.

“The Brightcove Video Cloud solution is an all-in-one video hosting and publishing platform that makes it easy to upload, manage and publish videos. It enables live and on-demand video across multiple screens while providing an exceptional viewer experience. Brightcove, on a weekly basis, streams high-scale internationally renowned sporting events and leagues. This year, we are very proud to have worked with media companies and leagues streaming the most famous sports events in the world. The kind of event that only occurs every four years, and thus there is no question about the ability to support security, monetisation, and broadcast-grade streaming quality in must-work circumstances,” he says.

Actual streaming aside, he adds, Brightcove offers a variety of options to build the app user experience across a vast range of devices, from mobile phones to Smart TVs and connectible devices like Fire TV. The turnkey app solution is Brightcove Beacon, inbuilt with interactive features which help grow and retain global audiences with flexible layouts, monetisation options, and unmatched reliability.

“Running a successful streaming business, much like any other, comes down to creating value for the customer,” says Amagi Co-founder-CEO Baskar Subramanian. According to him, sports content has always been in demand; success or failure in setting up a sports streaming business comes down to creating superior experiences for the fans. He maintains that cloud-based live streaming solutions are a great way for sports streaming. Sports broadcasters typically broadcast sporting events on multiple platforms such as traditional pay TV channels, streaming, D2C apps, etc., he adds.

“While this enables viewers to seamlessly navigate between devices based on where they are consuming the content, for viewers who prefer streaming over other distribution models, personalisation, interactivity, and value-added sports commerce like merchandise shopping, sports betting, fantasy leagues could be enticing. Technology investments is another key differentiating factor. Broadcasting live events is complex and has many moving parts. To make sure that the live telecast goes off without any glitches, broadcasters need a strong technology infrastructure. Cloud-based live streaming solutions are a great way to ensure that streaming of sports content goes uninterrupted,” says Subramanian.

According to him, the key requirements for a glitch-free live telecast are low latency rates, impeccable video quality, robust disaster recovery solution, monetizing the live stream with an effective ad strategy, live stream recording to improve the shelf-life of your content so that you can make the most of it even after the event gets over, among others.

“Cloud-based live orchestration solutions offer all of this and much more. The level of automation that cloud solutions offer help operators to manage multiple live streams from any remote location effortlessly while offering fans a rich and up-to-the-minute live streaming experience,” Subramanian explains.

Sports are different, the scale of live streaming is different than the scale of VOD, says Manik Bambha, Co-Founder & President, ViewLift. “People come in a burst within 10 minutes of the event's start time, and they are gone within two minutes of the event being over. Clouds, CDN, and tech stack are built differently for sports.”

The world loves sports, and sports organisations of all types and sizes are leveraging streaming video to tap into that demand, states Greg Armshaw.

“Advances in streaming technology, such as the tighter integration of video and statistical data, are creating new opportunities to deliver compelling, monetisable viewing experiences. Low-latency video, which ensures near real-time streaming, enhances viewer experience and also enables supplementary activities such as fantasy gaming and second-screen applications. Additionally, the emergence of co-watching capabilities is delivering fans the joys of a shared sports experience, generating more demand for sports streaming,” he adds.

Greg quotes Brightcove’s Q2 2022 Video Index Report, which shows that sports videos recorded the highest growth compared to any media vertical from October 2021 to March 2022.

“Video views in the sports segment in India saw a 57% robust increase in growth. The video-viewing behaviours that fans cultivated in the last two years are now an integral and expected part of the digital sports experience bringing more opportunities and demand for streaming platforms,” he adds.

According to Manik Bambha, linear is 95% of sports revenue for Tier 1 sports. Until the revenue shift, both will go in parallel. The trend is linear to digital, but that may take 5-10 years.

Growth driver

Going forward, sports will be the next big growth driver for streaming platforms, especially for the major players. 

India has always been passionate about sports, particularly cricket, as was evident from the battle for IPL digital streaming rights, says Baskar Subramanian. The opening of the 2020 season of IPL on Hotstar is believed to have been watched by 8.1 million people.

“SonyLIV has similarly witnessed tremendous growth in viewership by offering consumers premium content such as India’s cricket tours to South Africa, and Australia. And now we see other big OTT players entering the fray including Prime Video and JioTV. It remains to be seen how the competition among these OTT providers will shape the sports streaming landscape in India. What is certain is that sports will be a key growth parameter for viewership on streaming and will have a huge impact on the platforms’ success or failure,” he adds.

The great shift

Experts feel that we will see the gradual shifting of sports content, especially the live streaming of sports, from linear TV to streaming platforms.

The gradual shift to streaming platforms is already here, says Greg Armshaw. He points out the fact that a growing number of consumers are adapting to OTT video platforms for their flexible viewing experience and convenience. According to him, the proliferation of internet penetration, compatible devices, declining data charges, personalisation of content, and pricing are some of the significant factors driving this growth in India, and this holds true for sports too, being one of the most undisputed industries where fans will pay for what they love.

“As per Brightcove’s Q2 2022 Video Index Report, in mature markets, Connected TV (CTV)  saw the most significant increase among all devices in views and time watched, while smartphones were the most preferred device in developing markets like India. This is a testimony to the transition from TV to digital, making this a golden era for content creators and broadcasters,” says Armshaw.

Armshaw points out that streaming live sports, especially cricket, has become the critical differentiator in India’s OTT space. The growth of e-sports, he adds, is further influencing the development of sports streaming platforms and their high popularity, indicating to revolutionise India’s fast-growing OTT market.

Concurring with Greg Armshaw’s views, Baskar Subramanian says that the shift is well underway as demonstrated by IPL. “India has always been a digitally savvy country, particularly in the urban areas. Rural India is not too far behind. Smartphone penetration is making inroads into tier 2 and 3 cities and the heartlands, and so is the adoption of 4G and 5G networks. With mobile as a platform becoming mainstream, digital consumption is going to become the norm,” he adds.

The business model for sports programming is evolving fast. Will we see gaming revenues dwarf most forms of video content going forward?

Sports programming was tailored to traditional linear TV consumption, but is now pivoting to streaming, says Baskar Subramanian. According to him, the economics of cloud solutions and OTT distribution is very attractive compared to traditional broadcasting. The cost model, he adds, encourages the telecast of league and local games across sports disciplines as the cost of production and distribution is less prohibitive.

“The overall business continues to be heavily ad-supported, on top of the subscription fees that viewers pay towards cable or streaming services. Once Free Ad-supported Streaming (FAST) TV makes inroads, and premium sports content becomes available on FAST platforms, we can expect it to be driven purely by ad revenues. It will then give rise to innovative ad models, brand insertions and personalisation,” he says.

“While streaming is attracting audiences of different age groups, the landscape is still being defined in India. OTT providers are experimenting with different types of content to understand the various market segments and what works best for them. Mainstream gaming is still in its infancy in the country. Cricket is the mainstream sport that people follow in India, and currently there is a gaming experience that is piggybacking on cricket broadcasts. It is possible that this could be the starting point for other forms of gaming-related entertainment. We’ll have to wait and see,” concludes Baskar Subramanian.

Greg Armshaw dwells on the monetisation opportunities. According to Armshaw, with the increasing transition to live streaming and on-demand videos, businesses in the OTT space are eyeing four winning approaches to monetise their sports content:

• The ad-supported approach generates revenue by running ads before, during, or after the live or on-demand video. Streaming sports services typically command higher rates from advertisers because they deliver a very appealing and engaged audience.
• The sponsorship model is another way to monetise sports content. Presenting unique video programming opportunities— like a virtual event or original series—can significantly boost the bottom line while providing broad exposure for marquee brands.
• Subscription-based models offer a direct-to-consumer streaming product with different subscription plans. Subscriptions typically include exclusive materials like game replays, player interviews, and expert analysis.
• In a transaction-based model, businesses can collect a one-time payment to access a specific sporting event. Some organisations are experimenting with microtransactions, allowing fans to purchase part of an event, with prices declining as the game progresses.

“Speaking of gaming, it is already a hugely popular pastime, and its popularity is only growing in India. With the advent of new technologies like virtual reality, it’s likely that even more people will be drawn to gaming in the future,” he concludes.