The latest auction for the right to show Premier League football on television looks like a great deal for the top flight of English football. For fans, less so. Taking to Twitter, they blame Amazon.
The e-commerce giant’s first move into live football streaming in the UK, buying the rights to show 20 Premier League matches from 2019 for three years, certainly helped the Premier League out of a pickle. Two of its rights packages had gone unsold, until Amazon swooped in and bought it for a highly discounted (but so far undisclosed) price.
BT picked up the other one for £90 million to round off its football portfolio, bringing its total number of games to 52 per season; Sky Sports will broadcast a further 128. The moves mean it's the first time a full round of matches will be shown live in the UK - but football fans aren't too happy.
For Dan Macpherson, a Sunderland fan from South Shields who tweets as @SAFCL1, the impact on fans is obvious: “I'll be pissed off my amazon prime subscription fee goes up now because of them getting 20 premier league matches.”
Further south, some 160 miles down the M1, Dan in Chesterfield – or @OptaDan_TSC to his Twitter followers - resorted to expletives: “So Amazon are now on the scene for showing premier league games, which of course means the public have to stump up more cash. Will Sky and BT be reducing their packages as a result? It’s rhetorical. Of course they fucking won’t. Con artists.”
Still, the fan of Manchester United and Heart of Midlothian also sees an upside. “It shakes things up – hopefully anyway.” He’s already subscribed to Sky Sports and BT Sports, and is now getting ready to sign up for Amazon Prime. Dan hopes that Amazon will “make a big enough splash” to create a “more competitive market, which hopefully makes it cheaper for people like me”.
The losers will be pubs, traditionally the place for English football fans to congregate and celebrate or mourn the performance of their teams. Jo Cliffe, who worked in pubs for many years and also took to Twitter to vent about the deal, says that most have poor internet connectivity, especially in the countryside. Fans won’t be pleased when the live-streaming of a tackle near the penalty area will suddenly be replaced by a scrolling circle as the feed buffers to a halt. “Unless fans are willing and able to pay for high bandwidth, streaming will be unavailable to them,” says Cliffe.
Fans like Cliffe have a point, says Paolo Pescatore, an analyst at CCS Insight. Most of the UK still has low fibre broadband penetration, so for Amazon delivering even ten games at the same time will be tricky. “Given the needs for faster speeds, customers might be forced to upgrade their fixed line broadband connection.” But while it might be bad news for fans in the short-term, Amazon’s entry into the UK’s Premier League broadcasting duopoly could have positive long-term effects.
But what’s in it for Amazon, given that its rights package covers just two days of the football year?
For starters, it’s a great publicity stunt. All the media coverage helps the brand to establish itself on par with its bigger rivals (bigger in terms of sports coverage, that is). There are still people who are not Amazon customers, and they might be intrigued by, say, a free Amazon Prime trial to watch the games, says Julian Aquilina of Enders Analysis. Once the matches are over, some of these new Prime customers are likely to stay, boosting Amazon’s opportunity to gain marketshare.
Amazon is probably also playing the long game, waiting for the next auction of Premier League rights, scheduled for three years from now. During that time, Amazon will have plenty of time to experiment and find the best way to monetise sports rights, says Ed Barton, an analyst at Ovum. Data capture from digital audiences to target advertising in live sports streaming is one area Amazon is likely to experiment with, he adds - something that the traditional TV industry hasn’t quite developed yet. While Amazon does target advertising very efficiently across many of its platforms, right now this exists neither on Amazon Prime Video nor on its main rival, Netflix.
Sport live streaming on Prime could transform the industry’s current oligopoly of rights holders. It helps that sports rarely get time-shifted. People want to watch it live, says Barton. “Big brands love it when huge audiences watch their ads all at the same time. So in acquiring sports rights, you are acquiring a type of media where your audience is much more likely to watch the ads live at the same time and not over the next few days,” he adds.
The rights bought by Amazon may seem to be heavy on rather dull fixtures – the industry calls them “two-tier rights” – but the internet behemoth is unlikely to leave it at that, says Barton. They will keep getting “more and more tempting rights, relevant to new, bigger and bigger audiences they didn’t have access to before.”
So new footie fans will sign up to Prime - and from that perhaps go shopping on the Amazon e-commerce site, as well as use the Amazon Twitter service to watch some game streaming. They might even buy Amazon home speakers or one of the streaming Fire TV Sticks. “These are all touch points that let Amazon gather data on how audiences behave over a vast range of digital activities. And adding the live sports on top of that – that’s another piece of the puzzle,” says Barton. “They are moving towards the Everything store.”
Not at the moment, says Pescatore. Amazon’s move actually puts BT in a rather advantageous position, he adds, as from next year it will be able to offer the Premier League from all rights holders - through BT Sports, on TV through their relationship with Sky, and now online with Amazon as well.
But if Amazon makes the deal a success with just 20 games, at the next auction it may buy many more - and “in that case, BT and Sky really need to sharpen their pencils,” says Barton.
While most football fans may still watch matches in front of a large screen in their living room, younger people tend to use connected devices - away from the main TV screen. They are increasingly impatient with limitations to what they can watch, says independent analyst Claudio Aspesi, an expert in European media sector. They also care much less for the media bundles beloved by Sky and others, which combine sport with content that they may not want or care for. “This is what makes the Amazon model so powerful: if Amazon is happy to sell its [sports] content at a low price point as a promotional tool for Prime, or even for free in exchange for selling consumers a lot of goods and services, everyone else will struggle to compete.”
It’s not the first time Amazon is buying the rights to stream sports; it already owns the rights to show the US Open tennis tournament in the UK, along with the men’s ATP World Tour and N.F.L.’s Thursday Night Games. But Premier League is a totally different animal. “We are talking about a six-digit numbers in terms of cost to broadcast and produce a game,” says Pescatore. It’s much more expensive than tennis rights for example, where Amazon simply takes the feed of professionally produced content and streams it on their platform, for a total of about £10m a year, he adds. “Compare that to what Sky and BT are paying - under the new deal, Sky will pay around £9.3m per game, and BT around £6.25m. It’s a huge investment.”
Right now, it’s much more cost effective to broadcast live matches via satellite or terrestrial TV than streaming it via the internet, says Aquilina. The rights to stream Amazon’s other content – like movies and TV series – are usually also cheaper than football rights, so Amazon is likely to focus on those for a while. “It will be a long time before companies like Amazon will turn their attention to live sports as whole market,” says Aquilina.
Amazon’s entry into the market is likely to trigger further innovation in streaming technology. BT Sport brought 4K or ultra-high definition TV, Dolby Atmos, and 360 degree videos to sports broadcasting, and plenty of innovative features in its mobile app, says Pescatore. “This has forced Sky Sports to up its game. It’s not solely about technology, but production and good editorial content,” he adds. The launch of 5G mobile networks during the next few years could be a game changer as well - with content providers like Sky and Amazon soon likely to serve linear streams over mobile phones to audiences that may rival broadcast viewers, says Barton.
It may take more (or rather less, in terms of cost) to placate football fans, says Cliffe: “So many people are already priced out of actually going to matches and it feels as though being able to watch it on TV is going the same way.”
This article was originally published by WIRED UK
