Inception of the live sports streaming business model
Battle For Sport Cable TV -vs- Digital Streaming
Cable TV was the “original” live streaming service and it has come a long way in competing with the digital first streaming services such as Amazon, Netflix, Disney and Apple. One area where cable TV has maintained a competitive stronghold in, is with live sports events. Until recent years, when the digital streaming services started purchasing rights to sports streaming across the major sports leagues.
Notably, Amazon has bought rights to the soccer Premier League and the National Football League (NFL) and is actively purchasing more live sports rights for its streaming service. Apple is working on becoming a streaming aggregator in this space and has rights to Major League Baseball (MLB) and Major League Soccer (MLS) and is actively pursuing more live sports streaming rights. Netflix is doubling down on rights to live streaming sports in the area of wrestling. Disney offers a variety of live sports streaming options and recently announced a partnership with Warner Bros, Discovery and Fox to offer a joint live sports streaming app. This joint live sports streaming venture comes at a moment where more people are discontinuing cable TV subscriptions.
All of these moves are a natural pivot away from cable TV to the preferred streaming platforms which can be easily accessed through mobile phones, tablets and computers. One could see this transition from live sports on TV, to an app, as a linear and natural platform evolution in which live sports is viewed. However, there are others who are opting out of this evolution all together in favor of the revolution in live sports streaming — 3D immersive environments.
Inception in live sports streaming
Those who can see through the technological convergences and connect the dots before others are best positioned to reap the benefits before (and after) it becomes apparent to everyone else, what they have seen all along. There are some companies who are already building live sports’ inception inside the metaverse and the result will be a radically new way of experiencing live sports. A radically new way of fan community engagement with notably more avenues for monetization, advertising and content creation.
Improbable is one of the companies who is at the forefront of live sports’ upcoming inception moment that forever changes live sports (and I would argue live events and entertainment in general). Improbable is betting on the fully digital experience of the live event. While it could never compare to physically being in the stadium with all the embodied experiences that a live sports event entails (physicality, smells etc), a fully digital experience of the live event would be a strong (and more profitable) contender to current live sports streaming.
What does a fully digital live sports experience entail? You might ask.
A first glimpse into what that might look like at scale (see video) was the launch of this Major League Baseball virtual park. Not only is it an indicator of more to come in this new and emerging metaverse, 3D website live streaming of sports, but it demonstrates the existing technological capabilities to orchestrate and manage such an event. It unlocks countless new forms of fan engagement, live sports experiences and revenue streams.
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This new digital infrastructure of live sports is being built from the ground up today and it shows a lot of promise given the social and digital trends as well as the technological capabilities that are available today and coming online in the near future. The opportunity for multiple and profitable revenue streams outweighs both in person live events as well as ‘traditional’ live sports streaming (cable TV or streaming platforms). Here are some examples:
The above table focused on some main areas of revenue opportunity, however there are also operational cost differences worth mentioning. Fully digital live sports would have fewer operational costs compared to in person hosting of sports events and would have more monetization options than both in person and streaming bundles.
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Connecting the dots of socio-economic-technological convergence
Steve Jobs said that you can only connect the dots looking backwards. However, I believe that sometimes you can connect the dots moving forward. For those who think the above revenue examples for metaverse live sports experiences are outlandish and unrealistic, here are some dots worth connecting to demonstrate that these examples are indeed the natural trajectory of the next revolution in live sports viewership and engagement:
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· New generation new preferences: The next generation who is coming of age has socialized and played in gaming environments. These 3D website metaverse spaces are where they have built communities, played and created digital assets. Some even made money along the way.
· Rise of Digital Fashion: The digital fashion industry is growing each year with new and old brands entering the market, and more fashion options are being made available in gaming and metaverse platforms. The digital fashion industry is expected to reach $4.8 billion by 2031.
· Proliferation of sports data: From wearables that can track athletes’ bio data while competing, training and resting; and the rise of sports venue sensors coupled with machine learning and data analysis create a new form of data commentary and insight; which is now available in ways that were never available before. The proliferation of all kinds of sports data creates a new way to experience and interact with sports.
· Fan Engagement & Co-Creation: New technologies have created new opportunities for fans to engage with each other as well as to co-create with their favorite teams and players. Social media, NFTs, virtual reality, metaverse spaces and democratized image generation technologies are just some technologies that have driven more fan engagement.
· The rise of ‘Digital Twins’: Digital twins of stadiums serve as a new way to manage the physical infrastructure. Digital twins of an athletes (including but not limited to their sleep data, health data as well as sports data while they are performing) help anticipate readiness and the possibility of injury. In the example of the Improbable digital replica a baseball field, the digital twin was not created to manage the physical infrastructure but as a metaverse twin for virtual social interaction and live sports viewing. This type of digital twin has a lot of promise.
· Avatar familiarity: Those who engage with gaming worlds and the youngest generations whose social digital environments were metaverse spaces with avatars are very familiar with interacting with avatars and customizing their own avatar. While those who do not fall into these categories may not have experience digitally embodying an avatar, the Apple Vision Pro’s avatar feature is one indicator that this may become more mainstream. Speaking on this topic with the Executive Director of the GenLab Venture Studios Daniel Riedel he believes that Apple Vision Pro’s hyper realistic avatar feature is going to make interacting with digital avatars more familiar to the general public.
· Digital currencies & distributed ledger technology: While regulations are still in the making, the technological capabilities of digital currencies and distributed ledger technology are very much already available. Digital currencies create a more seamless way to transfer value inside digitally native ecosystems with digital assets such as metaverse spaces. This technology will create tremendous opportunity for digital economic growth. Once countries create, regulate, and enable their Central Bank Digital Currency (CBDC) the digital economy will expand further.
New Technologies, New Jobs, New Value Creation
Just like the rise of social media created new ways of advertising, socializing and entertainment — and a whole new industry of jobs. Digital twins of live events will do the same. There will be new jobs and companies that will be created to cater to the needs of digital twin live sporting events. Some include advertising in digital twin stadiums, managing brand activation during digital live sports, processing of all the data in these environments, digital twin sports event management, the list goes on.
While many would understandably prefer to travel to see their team play, there are millions more around the world who can’t (and there are many who can but would rather opt out of the physicality). Fully digital live sports creates a new way for fans around all corners of the world to engage with their beloved athletes, teams and fellow fans in ways that were never possible before. This creates a new way of re-imagining the live sports experience, its economic business model around, and countless new revenue streams.
This is inception of the live sports streaming business model.
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