Sunday, April 20, 2014

Sports and Second Screen - The Winning Combination

1.    Introduction: the winning combination!

Sports are big for TV. To be convinced of this, just look at the amount paid by BT to broadcast the football games of the European Champions league: £900m ($1.5bn/€1.1bn). As BT won the football rights, BSKYB the losing bidder saw its share price drop 11%[1] and £1.3bn ($2.1bn/€1.6bn) was wiped off its market capitalisation in one day. Clearly, the loss of football games rights was seen as a major risk to its future profitability[2]. According to the Telegraph, BSKYB even lobbied Champions League officials for three days to reopen the bid after it was excluded from the auctions.
Sports are big for TV because it can draw a huge number of fans who are ready to pay for content. Together with Hollywood blockbusters, sports form the basis of pay TV. Contrary to films, sports is also very big for 2nd screen.  Nielsen compiled the below statistics[3] that shows that sports is the main driver for tweets about TV shows. Forget about the “X-Factor”, and the US Presidential race--this is all about the Super Bowl; 50% of tweets about TV are about sports. Why do sports events drive so much social TV activity? This is due to the nature of fans and of sports events themselves. Sports fans are really engaged and very emotional about their teams and players. Sports events are broadcasted live and drive immediate reactions. 

Sports and 2nd screen are a winning combination because 2nd screen can give fans exactly what they want: an enhanced viewer’s experience:
·       Fans love statistics (how many aces? how fast was the last lap?),
·       Fans want additional content (the rear angle for this goal, Ferrari driver’s view for this lap),
·       Fans demand more information (when is the next race? how many sharp turns?)
·       Fans enjoy more games (test drive the latest F1, fantasy team)
·       Fans want more interactions with their teams, players (an app that can make you feel what a tackled rugby player feels).
All of the above could not fit on a TV screen and is dramatically improved when delivered within an app in parallel to TV viewing. For sports fans, second screen is a great addition to TV content. 
Also sports on the 2nd screen is a money-maker. The MLB (Major League Baseball) app “At Bat” has been the Apple App store’s top-grossing sports app every year from 2009 to 2013[4]. In 2013, it ranked as the overall 19th top-grossing app for the iPhone and 37Th for the iPad. We estimate the application generated $120m of revenues in 2013 (only on iOS). And the MLB is not the only example: the NHL and ESPN also have very successful paid-for apps that made it to the top-100 highest grossing apps in the Apple app store. Actually, most of the paid-for 2nd screen applications are sports apps (other notable paid-for apps include Formula1, English Premier League, etc.).
In this research document we will be looking at trends and developments in 2nd screen sports apps. We will base our analysis on publications, research, and interviews with key industry executives, conferences and industry knowledge. The report will cover an analysis of sports app functionalities and segmentation of sports app. We will also review providers of sports apps (sports leagues/federations, broadcasters, IT providers, etc.) and we will review the sports app business models. First though, we will clarify the concept of 2nd screen which a very often used word (but not so often defined).

2nd Screen Society members and research subscribers have access to this 30-page research report and all of our other research from our website, including our 30-page report on monetization, our 250-page report on the industry at large, and all of our quarterly updates and infographics for the past 2 years.  


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