Pay TV Sports rights strategies in Europe 22nd November 2018
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Agenda Inflation of sport broadcasting rights Analysis of sport TV content distribution Analysis of sport rights distribution Case studies Concluding remarks
Rights spendings in billion euros INFLATION OF FOOTBALL BROADCASTING RIGHTS Domestic TV rights spent for top European football leagues for the three next seasons Strongest growth for the Bundesliga, LaLiga and the Ligue 1 6,00 +30% +3% 5,00 +40% 4,00 +40% -13% 3,00 2,00 1,00 0,00 Sky Germany (2018/2021) Sky Italy and Dazn (2018/2021) Mediapro and Telefonica (2019/2022) Mediapro (2020/2024) BT and Sky UK (2019/2022) Pay TV broadcasters
SCOPE OF THE RESEARCH: Western Europe 11 countries in Western Europe Mature Pay TV markets Pay TV subscriber base CAGR at 3,2% in 2018/2023 Arpu range from 17 to 32 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% 35 30 25 20 15 10 5 0 Pay TV penetration Blended TV ARPU Higher ARPUs are found in countries with large FTA markets, where Pay TV subscribers are those who are willing to pay high prices for premium content on TV.
SPORT CONTENT MARKET VALUE 6.1 bn Value of the west European Pay TV market for Q2 2018 Sport content contribution to Pay-TV market revenues 2.1 bn Subscription revenue generated by sport TV packages 1.9 bn Subscription revenue generated by premium sport TV packages Premium sport TV packages: Sky, Dazn, Teleclub, MySports, BT, RMC Sport, BeIN, Canal+, Proximus 11, Voo Sport, Play Sport, Ziggo Sport, Fox Sports, SportTV, BTV, Movistar, Mediaset, Serie A Pass, Eleven Networks Basic paid sport TV packages: Eurosport, Telekom Sport, Premier Sport, Eir, Gaago TV, Opensport.
CONTRIBUTION OF SPORT CONTENT TO PAY TV REVENUES Highest share of Pay TV revenues in: Spain - 41% Main actors: Movistar (Telefonica), BeIn UK 40% Main actors: BT, Sky Telcos creating inflation on sport markets to drive subscribers to their fixed broadband network Lowest share of Pay TV revenues in: Belgium, Netherlands Only 10%-15% of Pay TV subscribers are willing to pay for premium TV content
MOST POPULAR PREMIUM SPORT PACKAGES Penetration on domestic TV households Top players by country Growth drivers BT Sport Fox Sports Eredivisie Sky Sports Ireland Movistar Fútbol Canal+ Sport Sport TV Teleclub Sport Sky Calcio Italy Play Sport Sky Sports Germany Sky Sports Austria 0% 5% 10% 15% 20% Detention of key sports rights European football competitions and/or Top national football leagues and/or Top competitions from other sports Redistribution strategies Direct redistribution partnership Indirect redistribution Even between premium broadcasters themselves: cf broadcasting deals between Sky and BT in the UK, Canal+ and SFR in France, etc.
SPORT OTTS STILL IN THEIR INFANCY OTT is still playing a minor role in the distribution of sport content 5% OTT market share of total Sport package subscribers TV market share of total Sport package subscribers Major OTT players Bein Connect, Now TV/Sky Supersport, Dazn League OTTs Gaago TV, Serie A Pass, NBA League Pass France 7% 95% Spain 4% Pay TV broadcaster challengers OpenSport, Premier Sport, Eurosport Player Potential new entrants Amazon, Facebook 93% 96% Operators Pay TV Everywhere apps going D2C BT, Play Sports Go
REDISTRIBUTION OF MAJOR FOOTBALL LEAGUES Major football leagues penetration of the regional Pay TV market (11 countries) English Premier League Bundesliga LaLiga Ligue 1 Serie A Champions League DFB Pokal EFL Cup Europa League English Football League FA Cup Jupiler Pro League Nations League Eredivisie 0% 5% 10% 15% 20% 25%
REDISTRIBUTION OF FOOTBALL VS OTHER SPORTS Major sport competitions penetration of the regional Pay TV market (11 countries) English Premier League Bundesliga LaLiga National Basketball Association PGA Tour Formula 1 Rydercup 2018 The Rugby Championship World Rugby Seven Series Ultimate Fighting Championships (UFC) National Hockey League 0% 5% 10% 15% 20% 25%
CASE STUDY: VODAFONE SPAIN June 2018: Telefonica buys back Mediapro s rights for the UEFA Champions League and Europa League (2018/2021) for 1.1 billion euros July 2018: Telefonica launches a channel dedicated to its UEFA rights July 2018: Vodafone will stop distributing Telefonica s football channels September 2018: Vodafone loses 70K TV subscribers in Q3 12% 10% 8% 6% 4% 2% 0% -2% -4% Subscriber base QoQ growth Q22017 Q32017 Q42017 Q12018 Q22018 Q32018 Telefonica Espana Vodafone Spain Orange Spain Sport TV packages penetration of the Spanish market Movistar Fútbol BeIN Sports Spain Movistar Motor Package Movistar Deportes Package Opensport 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% Penetration over Pay TV market Penetration over TV Households
Million subscribers CASE STUDY: RMC SPORT FRANCE Mai 2017: Altice acquires UEFA Champions League and Europa League exclusive broadcasting rights for August 2018: Altice launches RMC Sport Redistribution via Canal+ and on OTT November 2018: Altice claims «more than 1 million customers won back in France» in Q3. 200K new subscribers would be attributed to the sport offer. Fixed B2C additions: +166K subscribers 70% of which coming from the sport OTT. Only 50K new fixed broadband subscribers 12 11 10 9 8 7 6 5 4 3 Fixed broadband subscribers and QoQ growth +0.6% -0.2% +0.9% +2.0% Q22018 Q32018 Free Bouygues Orange SFR
A BROADER LOOK AT SPORT ON TV IN EUROPE Diversity of Pay TV ARPUs in Europe From less than 5 to more than 25 <5 <10 <25 >25 Nordic countries Situation similar to Western Europe High ARPUs, premium sport TV packages Central and Eastern Europe Average ARPU below 10 No market for premium sport TV packages Lower cost of broadcasting rights for top european and national leagues
Q&A
For more information on this webinar and the Dataxis new sport module: juliette.boulay@dataxis.com For more information on the NexTVSeries COO & DACH conference in Berlin, Nov 29th 30th: priscilla.tirvengadum@dataxis.com
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