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29 November 2018

Sports bars can turn OTT threat into opportunity

The sight of Amazon and Facebook leading the big tech charge into premium sports rights has been received as a threat on two counts by venues such as sports bars whose livelihoods depend on communal viewing of live matches.

On the one hand it exposes them to the challenge of streaming quality which is far more critical for them than a consumer accessing the same event on smaller screens at home. More critically these big players are peddling a disruptive model by encouraging viewing at home with the social element coming through online communication and chat rather than face to face over drinks in a bar or other public place.

The services have not been designed for consumption “en masse” on large screens, instead promoting personal interaction for access to alternative camera angles or background information for example. This brings the fear that as more and more premium sports content migrates from legacy pay TV operators to one of the big tech players, especially Facebook with its social media agenda, sports bar audiences will be whittled away.

Yet a closer look reveals that these fears are overblown, and that OTT offers opportunities for sports bars even to gain custom by improving the overall experience. The situation can be likened to digital cinema threatened by the advance of first video tapes, then DVDs, followed by pay TV and finally SVoD into its territory, with the response including measures such as more luxurious seating complete with refreshments to entice customers out of their living rooms. This coupled with surround sound and enhanced picture quality has helped maintain audiences in some regions at least. In the case of sports bars the march towards OTT comes in hand with advent of Ultra HD so that too brings opportunities for them to provide superior sound and picture quality on large screens compared to the typical home experience.

Ability of sports bars to capitalize on OTT depends on at least maintaining their audience share as the transition inevitably gathers force. This means firstly making sure they address those technical issues within their grasp, ensuing they have the best broadband connection possible or that they can afford, although inevitable some rural venues will be at a disadvantage. This will minimize the risk of buffering or artefacts which are even less acceptable on large public screens.

Then there is latency, which was a problem during the 2018 FIFA World Cup, but is being addressed through various measures including multicast ABR. This is obviously a concern for public venues since it was quite common during the World Cup for somebody to see a goal scored on their smartphone and celebrate, spoiling the experience for others in the vicinity. That said, the challenge is in hand and recently AWS Elemental’s Director of Product Management for Video Delivery Solutions Lionel Bringuier argued that it was now possible for OTT providers to keep end to end delays within 6 seconds. It was not quite clear whether this was the absolute total for if so that would be better than satellite.

If venues do succeed in retaining audiences that could be self-fulfilling as it is then in the interest of OTT service providers to cater for them with features and even targeting. UK commercial broadcaster ITV has discussed the possibility of offering ads that address groups of venues of even specific bars, catering for the captive audiences they have. Big screens offer scope for inset ads that would not work well on say a smart phone and this could be addressed via server-side ad insertion.

OTT also brings opportunity for venues to diversify and especially if they are in populous areas and gather audiences for more niche second line sports, that play particularly well on a big screen. This includes some up and coming activities such as drone racing as well as a growing host of eSports.

There is also the big elephant in the room – price. Venues around the world have been stung by high subscription costs for premium packages and that dynamic is unlikely to change with OTT because the determining factor is inflation in price of rights packages. It is not clear at this stage how or even whether OTT holders of premium rights packages will accommodate public venues, so that is still an open question. But again if audiences hold up, the service providers will be compelled to play ball.

The one point in favor of venues is that many people enjoy watching events at bars and social media does not change that. There is also scope for integrating the viewing with other aspects of the venue’s service, such as food ordering via table top displays as some restaurants are now trying.