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Eurosport’s mega-deal for Olympic rights across Europe has the potential to change the sports media sports media landscape for ever. The man making it all happen for owners Discovery Communications is industry veteran Peter Hutton who talks about strategies for the reinvigoration of a broadcast brand which was too often more admired than watched.
Sometimes you just don’t see them coming.
On June 29th the International Olympic Committee announced that Discovery Communications, the US-based owner of 51 per cent of Eurosport, was to pay $1.45 billion for all platform rights to the Olympic Games across Europe from 2018 – 24.
As well as signing the massive cheque, Eurosport will take care of delivering the IOC’s new Olympic Channel and the deal with give the broadcaster access to the IOC’s massive archive.
It is a game changing deal for all parties. IOC President Thomas Bach and his team have cash in the bank and their own TV channel sorted while Eurosport has the rights to content which historically heads the ratings
the ratings in every European country. It goes further than that. Being an Olympic broadcaster seems to confer a gravity and status which, it is arguable, Eurosport has struggled to acquire over the last three decades.
But the writing was on the wall for Eurosport and, it now appears, the European sports media status quo, the moment that Discovery took the reins in January last year. As the Olympic deal clearly demonstrates, Discovery’s big ambitions for the channel have been backed up by a willingness to invest in fresh rights across the board and to put in place the personnel with the experience to realise the potential of the brand.
Key to the operation was the appointment Peter Hutton as CEO. There’s not much in sports media that Hutton hasn’t done. He’s commentated, presented, bought and sold rights, run agencies , launched channels worldwide…..the list goes on.
Now he has what is beginning to look like a dream job as Eurosport shifts into top gear, shredding old perceptions and opening up a world of fresh opportunity to capitalise on the brand, expertise and
infrastructure which have developed since its launch in 1989.
In many ways Eurosport has been something of an enigma to the many observers. Everybody knows it but, in many markets, that wasn’t backed up by commensurate audience share. Yet despite that its online operation is one of the most visited and successful in world sports.
For years it remained a puzzle. As its footprint crept across Europe and then Asia and Australasia its brand appeared to grow faster than audiences. Typically it would screen sports events that others didn’t want or would be a secondary rights holders for events in some markets.
Eurosport specialised in giving airtime to sports which were part of the Olympic programme but which few other broadcasters considered valuable beyond the gilded showcase of the Games themselves. In short it was a sports broadcaster which appeared to have a different set of goals and to play by different rules to the hyper aggressive pay channels which have stamped their mark over the world of sport and the bank accounts of its superstars. But while others may have seen Eurosport as a niche channel with a massive footprint, Hutton viewed it very differently.
“Growing up I remember how exciting it was when we started getting these additional channels available. The take on sport at the time was just so small and I thought that Eurosport, because of its content and the fact that it was international, was glamorous and exciting”, he said.
“Since I came here we have done a lot of research which shows that people think of Eurosport as a trusted brand which is part of their lives. There is a great emotional pull and I think that now gives us a great platform to build on”, he said.
The ultimate objective, he explains, is to create an offering which will‘ be the driver
be the driver of the Discovery bouquet in every territory’ and given that Discovery’s international operations now account for the lions’ share of its revenues, it’s critical that the strategy succeeds if it is to continue to grow.
“Discovery are willing and able to invest in Eurosport and to take it to a completely different level”, explained Hutton.
In practical terms that means taking a trusted but slightly underused brand down off the shelf, dusting it down and making it more relevant in more markets.
Sport may claim to have a universal language but just because the pictures translate worldwide doesn’t mean that a one-size-fits all approach will deliver an audience or a healthy balance sheet and the strategy which Hutton is implementing is testament to that simple truth.
The switch of emphasis inevitably means change and managing change is an issue for all new CEOs.
“With a business which is 30 years old it is important to spend time identifying what works and what doesn’t. In the past Eurosport has suffered from a lack of long-term investment but Discovery want to create a long-term, strong brand and are investing to achieve that.
Taking Eurosport forward is like getting a vehicle which has been driven for a long time at a certain speed. If you suddenly put your foot down (on the accelerator) you want to be sure that bits don’t drop off”, he said.
Hutton knows all about the aftermath of mergers and acquisitions in media. He lived through Sky’s take-over of British Sky Broadcasting back in the day and was in Asia when Fox and ESPN united and, as a result, knows that things can be difficult for individuals concerned about their career paths.
But the business imperative is the one which matters most and Hutton is determined that Eurosport should be a ‘product people can be proud of’ and one which ‘helps when it comes to affiliate negotiations.’
In short, Eurosport needs to step up to the mark to become a must have channel in more markets and that, he says, involves a long hard look at both the content mix and production.
“Clearly we want to become more relevant to individual local markets but that is not only a matter of determining what sort of content to invest in but about the technical infrastructure needed to deliver it. That requires investment.
Even simple things like making sure programmes are in the right language can be an issue. We broadcast in 21 different languages and produce promos in eight but when I got here we found that our Spanish language channel was broadcasting with commentary in English”, he said.
What is clear is that the policy of thinking local and acting global is applicable to Eurosport like never before but that doesn’t necessarily mean making the biggest and ballsiest bids for the most popular sports events in local markets.
Holland provides an example of Hutton’s thinking.
“We bought rights to Italy’s Serie A for the Dutch market because of the number of Dutch players with clubs in that league”, Hutton said.
“Elsewhere we have acquired Motor GP rights for four or five markets where it is particularly popular and the key is to slot these into schedules alongside the jewels of pan European broadcasting.”
One of those jewels is the French Open Tennis Championship from Roland Garros which is about as close to a home fixture as any broadcaster enjoys.
“Our studio there was like a bus station as presenters from different markets came in and out creating stories around local heroes. That allowed us to achieve economies of scale while delivering a far better and more relevant product in different markets”, Hutton said.
In June the channel announced a slew of new deals including the Europa League in Scandinavia and Singapore, the PGA Tour in Norway, Rugby World Cup in Germany, Wimbledon tennis in Belgium and football including France’s Ligue 1.
The deal for UEFA’s Europa league in Scandinavia is indicative of the new Eurosport approach. Competition for the rights is not thought to have been fierce yet the Europa League performs well in the region because more local teams compete than in the senior, and far more expensive, Champions League competition.
And, says Hutton, there’s more to come.
“Right now it’s about getting great deals done and shooting bad deals in the head”, said Hutton who understands only too well that
the market knows of Eurosport’s rights hunger and may look for unrealistic prices.
“It is important to have the instinct to say no sometimes”, he said.
Eurosport’s specialist events division, which acts as a manager, promoter and producer of properties including the FIA’s World Touring Car Championship and European Rally Championship as well as equestrian events including the Gucci Masters and Longines Global Champions Tour.
In all, Eurosport Events produced 57 events last year, delivering 1,500 hours of programming which was taken by 148 channels in 188 countries.
“It is a good, solid and profitable business and, as Discovery want to invest in IP, that is a good match”.
Eurosport’s online operation is also considered a significant asset for the broadcaster.
“The number were a surprise to me. It is the number one sports website in Europe and delivers independent sports news. It really has journalistic integrity”, Hutton said.
“The other big surprise was the success of Eurosport player which has something like 200,000 subscription, people watching online. I understand how big the growth potential for the service is. After all, I used to watch people watching video on their devices on the Hong Kong metro.
One of the big sins in sports broadcasting is to buy rights and not to show them. With Player we have the means to ensure we don’t do that. That means, for example that player viewers in the Netherlands will be able to watch any of the Serie A games which are being played, not only the one selected to be shown on the Eurosport channel itself”.
“Digital enables us to meet the desire for more immersion around major sports events and deliver more complimentary programming. Take second screen for example. We are on a fast moving journey there and that makes it difficult for the industry.
Overall the challenges are not simply to keep people’s attention but to attract new viewers. It’s about getting people to taste new things by creating the right headline and the right hook.
We are ideally positioned to be able to help federations to broaden their reach. After all, if you are, for example the USPGA, you don’t only want to be on specialist golf channels, you need to be able to grow the audience”.
More or less everything that Hutton and his colleagues are doing right now is challenging the image of Eurosport built-up over many years.
“We are moving in a different direction”, he said.
“We are becoming more mainstream in prime time and we don’t want to let-down the fans we have attracted. We also want to be seen as the home for certain sports – like cycling – and that means being able to deliver for the super fans”.
In some respects the new Olympic deal is in keeping with what Eurosport has always been about. Sports which feature in the Games but struggled to find a broadcaster for their other major championships were often featured and the station took pride in its relationship with the Olympic world. In that respect at least, one can argue that the Olympics is coming home.
What is critical is the way that Discovery decides to use their newly acquired prize. How will they comply with ‘listed event’ legislation in certain territories and what approach will be taken to sub-licensing beyond the need to fulfil statutory requirements?
All will become clear but for the time being Peter Hutton has a lot of other things on his plate and he is pleased with the progress which has been made to date.
“In those markets where we have localised content and invested in talent there has been an immediate upturn in ratings,” he said, pointing to a 24 per cent increase in audience in the UK and 18 per cent in Germany.
We are getting there but it is important to focus on creating a real emotional connection with the audience as well as simply driving ratings – no matter how important they are overall”.