Introduction
All sports organizations must have effective media relations and consumer interactions. Sport-related media actions are carried out to reach the public and convey messages from the media or the sports organization. Transferring knowledge, skills, attitudes, and information all depend heavily on communication. Sports enthusiasts may now watch various sporting events or keep up with their favorite teams and athletes on various media channels. Moreover, the way people watch sports has significantly changed thanks to modern technology, which has even given rise to new platforms. As such, broadcast sports coverage has been transformed by improvements in communications technology, allowing billions of people all over the world to experience the grandeur and thrill of major athletic events, which is also achieved by subscription services. Both broadcast and subscription provide benefits to the consumer but, as argued in the paper, subscription services will continue to proliferate due to their profitability, which promises future growth to this model.
Broadcasting and Subscription Model Differences
In general, sports may be viewed on broadcasting channels that are available for free. Sports broadcasting is the practice of disseminating news and information about athletic events through the mass media, primarily television but also radio and the internet (Bergantiños and Moreno-Ternero, 2020). Broadcast networks use public airwaves to convey their encoding. Therefore, any home with a TV within a transmitter’s range can access these channels for free. Traditionally, public service broadcasting has been at the core of democratic regimes since it has been crucial in preserving a pluralist society and addressing its cultural and social requirements (Walsh, n.d.). Public broadcasting has the power to both enhance people’s personal lives and raise the standard of living in society thanks to its broad audience and sway.
The business model of broadcasts includes selling commercial spaces to sponsors to generate money. The interaction between sports, television and other media notably supports those connected to broadcasting companies. Moreover, television and media companies pay large sums of money for the exclusive right to broadcast major sporting events to live (Walsh, n.d.). As a result, the broadcasters can invest in the costly administrative and technological infrastructure necessary to broadcast sporting events to millions of fans worldwide via the royalties they receive from selling their exclusive material to other media sources.
However, in order to compete in the new technology-enabled broadcast environment, sports organizations’ networks had to modify their business strategies. Broadcast networks have lost significant amounts of advertising income as the value of television ads has decreased in line with the emergence of other sports-watching channels. Nowadays, the majority of football is now only accessible through a sports subscription provider (Walsh, n.d.). Businesses use a subscription-based business model and license their material to Netflix, Hulu, or other streaming services for a run of games, contests, or seasons (Walsh, n.d.). Recent content agreements between networks and companies like Netflix have increased the latter’s income and the former’s content quality. As the name suggests, cable TV is television that is delivered to homes through coaxial cables or, more recently, fiber-optic cables (Walsh, n.d.). Customers of cable channels must pay a subscription fee to access their programming. Advertisers still have plenty of possibilities to reach their high-value groups through commercial advertising, even though cable TV does not nearly have the reach of broadcast.
Growth of Subscription Services Popularity
Traditional pay-TV providers compete intensely for exclusive rights to high-profile sporting events. As fixed broadband markets mature, bundled offerings increase in popularity, and ultra-fast broadband networks are deployed, telecom operators are also considering these rights (Bergantiños and Moreno-Ternero, 2020). In order to increase the proportion of connected homes on newly constructed super-fast broadband networks, operators cannot overlook the growing importance of content in consumers’ decision-making for package purchases. Pay-TV providers have traditionally offered exclusive movie material and live sports transmission. The latter has been preyed upon by over-the-top media services more frequently because of Netflix (Lindholm, 2019). The three key factors contributing to over-the-top media services popularity are their wide selection which is always accessible, low prices, and straightforward user interfaces. As a result, there is pressure on pay-TV companies’ value offer for their filmed entertainment programming.
The other emerging trend in the sports industry concerns the customers’ benefits related to subscription services. As mentioned earlier, the providers of subscriptions continue to multiply due to the higher revenue promised by this model. As discussed in Butler and Massey’s (2019) study, the monopoly in subscription channels might result in more games but a lower average viewership and advertising income per game than the competitive free-to-air broadcast equilibrium price. Hence, if there were a monopoly firm, it would try to increase revenue through fees from new subscribers and income from advertising from audiences who would not otherwise be watching subscription channels (Butler and Massey, 2019). Therefore, competitiveness in the subscription channel industry should benefit customers. Fortunately, the market for sports subscriptions providing is competitive. Thus, the increasing amount of pay-TV with sports subscription might be more popular due to the advantages it gives to consumers.
Moreover, a significant shift in recent years has been technological advancement that enables large-scale video streaming via the internet. This includes, in particular, infrastructure development to give high-speed internet access to a broader segment of the world’s population, which is enabled through a subscription model (Lindholm, 2019). The online streaming explosion has had a swift and dramatic influence on how people consume sports. For a long time, television networks have leveraged exclusive live sports broadcasting to compete for viewers’ attention and membership costs. However, more recently, these channels have used such broadcasts to keep their viewers’ attention while trying to compete with online actors such as Netflix (Lindholm, 2019). They took advantage of the fact that live broadcasts of sporting events are not entirely translatable in the eyes of consumers for other types of video entertainment.
The described developments raised the prospect of a subscription model in sports broadcasting by transferring the traditional model. Moreover, the trend of subscription-based systems aids in the resolution of some of the legal difficulties that have arisen as a result of technological advancement. For example, the same technological advancement that allows television rights holders to easily live stream athletic events also allows for unlawful pirate streaming. However, subscription-based music streaming services, such as Spotify, have helped to minimize online music piracy (Lindholm, 2019). Therefore, subscription-based sports subscription services may have a similar impact.
Sports streaming services provide a lot of advantageous features, making them significantly superior to television networks for live sporting events streaming. Streaming services provide a variety of eye-catching incentives to their members. Sports streaming expands the scope of sports. A sport that previously had a smaller audience immediately becomes accessible to worldwide audiences without boundaries. Anyone, using any appropriate device, may watch a sport in its live streaming format from anywhere. Another significant advantage of sports streaming is the real-time involvement of fans who share similar ideals and feelings. It adds to the expansion of a sport, the players and teams engaged, and the sport continues to obtain new grounds that were not previously known to exist. Moreover, sponsorship and paid commercials are used to make live-streaming content feasible. A sponsor may earn greater exposure by targeting the appropriate customers at the right moment. Finally, subscribers may watch their favorite sports from any location. They may select from a variety of options to enhance their sports viewing experience. They can terminate their membership at any moment and, if necessary, renew it later.
The future of sports media, as a result, is moving toward the increasing popularity of subscription services. The shift away from free-to-air sports coverage could be impossible to reverse. One-time pay-per-view sporting events and sports channel subscription packages are two of the most lucrative income sources currently available in sports broadcasting. As a result, pay-TV providers are moving their purchasing power toward premium sports, making it more challenging for Free-to-Air broadcasters to hold onto such live sports rights. The television business, particularly the sports broadcasting section, has had to adjust to the reality that the public is increasingly obtaining video entertainment online rather than through television stations.
Conclusion
To conclude, sports media are gradually growing to include more subscription services. The rise of their popularity could be explained by the higher revenue of the providers and better customer benefits resulting from the competition between the marketers in the industry. In the future, sports broadcasting will most likely be replaced by subscription-based online streaming services due to the technological advances, customer satisfaction, and legal protection they provide.
References
Bergantiños, G. & Moreno-Ternero, J. D. (2020). Allocating extra revenues from broadcasting sports leagues. Journal of Mathematical Economics, 90, 65-73.
Butler, R., & Massey, P. (2019). Has competition in the market for subscription sports broadcasting benefited consumers? The case of the English premier league. Journal of Sports Economics, 20(4), 603-624.
Lindholm, J. (2019). The Netflix-ication of sports broadcasting. The International Sports Law Journal, 18, 99-101.
Walsh, B. (n.d.). Broadcast vs. Cable – What’s the Difference and Why It Matters.