Martin Ross: As Sportel hits 30, what next for a media sector in flux?

As gnarled veterans of the rights trade join fresh-faced digital start-ups in the Principality next week, a cautious media-rights industry continues to question just what the future looks like.

Martin Ross

The 30th edition of Sportel, Monaco’s sports media trade fair, might be the most important iteration yet. The most lucrative for delegates? Very unlikely (unless you work in anti-piracy protection), but key in helping to shape the rights sales model going forwards.

A scroll through the list of Sportel 2019 attendees offers a clue as to the pertinent issues in the sector. You’ll find nine executives from the streaming services arm of a major agency (Endeavor Streaming) and no fewer than five from a football league’s anti-piracy company (the Bundesliga’s Athletia Sports).

Bytedance, the Chinese technology company behind the TikTok app, makes its debut in a nod to the ever-increasing demand for short-form video, perhaps at the expense of the live rights product if the attention span evidence is to be believed. The main players in the betting and data rights sector (IMG Arena, Genius Sports, Sportradar and Stats Perform) are also out in force.

Last year’s gathering was one of introspection, with a shop floor shorn of MP & Silva and no Lagardère Sports stand given its dwindling media rights involvement. Margins had become increasingly squeezed in minimum guarantee rights deals. There was a certain buzz missing, even if that was, in part, due to a downswing in the largely cyclical nature of premium sport rights sales.

Agencies and rights-holders have reassessed their business models and arrive at Sportel 2019 better-equipped to take properties direct to consumer with over-the-top solutions but knowing that monetising that approach effectively is tough. Look no further than IMG’s decision to pull its Strive OTT platform in Sweden in favour of a rights agreement.

Following years of steady rights fee increases, the Bundesliga has readied its own OTT platform as a bargaining chip during international rights talks to be held in Monaco. France’s LFP is doing the same and LaLiga is already well down that road. The Premier League might not be too far behind them after considering the option in Singapore.

The Bundesliga’s recent six-season US deal with ESPN showed rights-holders are ready to fully embrace OTT (just four games per season will be shown on linear TV with the remainder on ESPN+) and that sizeable fees can be generated by doing so. But there remains a feeling of caution about where the whole industry is going during this interregnum between the linear and digital eras. Endeavor’s pulled IPO and Wanda’s flop on the Nasdaq stock exchange will do little to shift any gloomy clouds above the Grimaldi Forum.

The highlights of Yousef Al-Obaidly’s recent ‘state of the industry’ speech are also sure to be discussed over canapés and cocktails. The sports rights market will disintegrate beyond recognition? Rights-holders are sleepwalking toward a financial cliff? There was an element of exaggeration for effect but the sound bites from the beIN Media Group chief have resonated.

A once dominant international market player now insisting on non-exclusive rights deals is not good news for anybody. And to that effect, the beoutQ piracy affair is not a ‘Mena-only’ issue. Especially when their set-top boxes are appearing internationally.

Any suggestion that the exclusive rights sales model is dead would be way off the mark, however. Just ask executives from DDMC Fortis and Team Marketing (as and when they emerge from the private meeting rooms downstairs). Exclusivity will be the watchword for their impending AFC and European club competition rights sales respectively, even if getting close to the value of some existing deals will be a huge challenge. Future headlines about certain Champions League rights fee drops are to be expected. That’s just where the market is.

When Sportel 30 draws to a close and the taxis (and helicopters) head for Nice airport, the hurdles that face the market will still be there. The self-questioning will continue. But the industry should be in a better place to answer the questions and plot its commercial path forwards.

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