Carlo De Marchis, Chief Product and Marketing Officer of deltatre which was acquired last month by Bruin Sports Capital, reflects on the changing way the world watches the Games and the challenges facing broadcasters.
The acquisition of deltatre, the digital broadcast services and live streaming company, by Bruin Sports Capital last month not only marks the beginning of a new chapter in the history of the 30 year-old Turin-based company but creates a handy snapshot of where the sports media sector is today.
George Pyne, the sports sector heavyweight who founded Bruin after exiting his role as President of IMG in 2014, is busy building a diverse portfolio of innovative businesses and the acquisition should enable deltatre to build its brand and client base in the Unites States, adding to its established strengths elsewhere in the world.
That Bruin should be in the market for deltatre says much about the direction of travel of the sports media sector.
“Deltatre is on the cutting-edge of media, technology and sports globally – from live streaming to broadcast solutions to website and mobile application development and they are driving exceptional value for clients,” Payne said in the official announcement of the deal.
That the deal comes just ahead of the Olympic games in Rio is appropriate given that the Games, perhaps more than any other single sports property, have benefited from the creative implementation of digital technology to entirely transform the viewers experience and, with it, significantly hike the value of rights.
The most dramatic example came In May 2014 the International Olympic Committee announced that it had concluded a deal with broadcaster NBC for the rights to summer and Winter Games until to 2032 for $7.75 billion. The deal builds on its current $4.38 billion, four Games agreement , which runs up to Tokyo 2020, and led to US headlines that suggested Peacock Network negotiators were taking a bet on knowing exactly what the media landscape would look like in the latter years of the deal.
For IOC President Thomas Bach the deal represents good business. By tying –in a long-term partnership in the most lucrative Olympic market he has more or less guaranteed the organization’s financial good health for the foreseeable future as well as setting a benchmark for sales elsewhere in the world.
It is also an indication that Bach is happy to see things done a little differently on his watch. The NBC deal was followed, last year, by the news that Discovery Communications, the US media group which had previously acquired Eurosport, had paid $1.3 billion for the pan-European – excluding Russia – rights for the Games between 2018 and 2024.
Under a separate deal rights for 22 territories across Asia were sold to Japanese advertising giant Dentsu in a move which makes all sorts of sense given the size of the company’s own ad-spend on behalf of clients across the region. However the deal does not include key, highly lucrative markets such as China, South Korea or India.
The fact is that the business of selling Olympic TV rights has, inevitably changed to reflect the economic realities of the 21st century world and how they are being shaped by media technology which is impacting the way the world communicates, accesses information, conducts business and demands to be entertained.
In 1996 US broadcaster NBC broadcast 171 hours live from its ‘home’ Games in Atlanta. This year the broadcaster will make more than 7,000 hours of coverage available across its network and digital channels. Similarly, the UK’s BBC will show 500 hours or so across its TV channels and a further 2,500 hours on digital.
For Carlo De Marchis, Chief Product and Marketing Officer at deltatre the upcoming Olympics provides an opportunity to consider the digital opportunity.
“The way a broadcaster approaches the Olympics can be brand-defining,” he said.
“When you have an Olympic Games for 17 days with maybe 30 events simultaneously live for 12 hours each day the only way to cover it fully is through digital and to get maximum value from digital you have to design an experience which maximizes content discovery. That allows viewers and users to get to the content they really want to see when they want it and on the device they want it.
“That may be done on a sport-by-sport basis or flagging up stories as they develop during the course of an event. For example, that may mean flagging up the story when a national athlete progresses through an event because people may well want to watch them in the final of, say, the shop putt even if they wouldn’t otherwise be interested in that sport.”
According to De Marchis the key is ensuring that the service is a comprehensive and seamless as possible.
“The key thing is that live should go to video-on-demand immediately, not some time after an event. That means even while the 100metres is being run – because there will be someone out there who wants to see it at that moment.”
The fact is that the public wants sport when it is convenient to watch sport and they don’t simply want to see video but a raft of stats and other support information to give the action context and meaning.
De Marchis says that definitive changes in viewing habits have made all the difference.
“The days of people sitting down after dinner to watch the Olympics for an hour have gone.
“Obviously time zone has a major impact on the way a broadcaster designs their Olympic experience and even when broadcasters have existing digital platforms they need to design something new and different to cope with the complexity of the games.
“They may have a football platform because they do that all year round and it works for them. But the Olympic Games is different. It is a multi-vertical sports event and different viewers want different things. They may just want to watch the big stars, they may be interested in a particular sport, they may want to follow the flag – athletes from their own country – or they may just want to have fun.
“The challenge for the broadcaster is to show everything and make sure it is a real Olympic experience, not just a series of World championships.”
Social media will, De Marchis says, continue to play an important role in helping global audiences get the most from Olympic coverage by pointing in the direction of content and conversations and he believes that broadcasters are increasingly becoming aware of the need to work through social media to drive traffic to their own (first party) platforms.
“It is important to understand how a first party and third party platform such as social media relate to each other today,” he explained.
“The reality is that people won’t go to a first party platform to see news or a nice infographic when they can stay on Facebook or Twitter. Broadcasters need to concentrate on bringing the audience to their first party platforms to enjoy the full Olympic experience and that generally means watching events and special moments live.”
With digital usage in most markets at least commonplace and sometimes close to saturation, it is unlikely that the digital consumption numbers for Rio 2016 will show the same near vertical leaps as we have experienced at other major sports events over the last decade or more.
“The space is becoming more mature and ideas which were very new a few years ago are working their way through the system and being widely adopted,” explained De Marchis.
“The big challenge now is to enhance levels of personalization based on individual preferences. That’s something that you become used to from Netflix which studies your choices over a couple of years. The Olympics only lasts 17 days and we have to get the preferences in only three to make it work!”