OK, I say “sports,” but I’m going to stick to the area I know best which is football (or “soccer,” if you swing that way). I think the issues are pretty much the same for all sports, mind.
In some ways, I think there are easier issues to deal with here than music or film. Sporting events have the greatest audiences on the day the events are taking place – either live or highlights; only important matches or ones with extraordinary outcomes tend to make much impact in, say, DVD sales. Clubs can monetise the audience over the longer term through season tickets, merchandise and the like, whilst broadcasters tend to rely on subscription fees and the odd one-off payment for special events. And in this episode, I reckon there’s an answer to that whole interweb “problem.”
Now then. 20 years ago I was one of the first people I knew with a Sky box. For about £18 a month I could get The Simpsons, the footy (in every division and country in the world just about), “movies” (or “films,” as they used to be known) piped right into the house.
And it was ace. I found friends that would magically appear on a Sunday for the treble bill of football, The Bill omnibus and The Simpsons – popularity guaranteed for under 20 spons a month. Not bad.
Flip forward 20 years and surely things have got even better, right? I mean, that’s what progress does, doesn’t it, make things better? Nope. As a consumer, things are rubbish. Let’s say I want to be able to watch all the games for my chosen team – I only care about club football these days and I don’t have time to watch everything. First, I search for things like “Club X TV fixtures” or “When are Club X on TV?” and a number of related searches. The results are perplexing – smart keyword buyers have managed to associate everything from blogs to football kits and boots to website forums and comment pieces. Finding a list of fixtures and what channel they are on is not something natural search does well. So, we go to the club website and trawl through their own TV channel listings and other sundry items before finally finding a list of matches and TV channels. But wait – something’s missing:
That’s right – listings only go up to a couple of months in advance – TV channels don’t want to have to bet in advance on which teams will be doing well / playing attractive football “for the neutral” so far upfront, so the televised games are selected later in the season.* This is fundamentally troubling – after all, there is a choice between ESPN & Sky for coverage. Maybe I can only afford one – what offers best value for money? Well, I choose my subscription by the year, not month, so I could choose Sky now only to find that ESPN have all the good games later. So, I have the functionality available to bet on a match in January 2012 (which is always highlighted by the fixture), but I can’t tell what channel it’s going to be on? This situation suits the broadcasters, but not the fan. Moreover, I follow my club for the whole season, not just some of the games. I don’t like going to pubs and being forced to endure the commentary by fellow “fans” who parrot what they heard on phone-ins that morning as “opinion.” I want it in my house. And that’s going to cost.
In fact, when it comes to package selection, there is just too much choice, it’s way over-complex, and the price is unbelievable. OK, so the latter might just be me being a miserable old git, pining for the days when I could have all the channels and still have enough change from a £20 note for fish and chips and a can of Coke, but it seems like there is very little change from £100 a month.
Bear in mind this is 2011 and we have HD tellies so who wants non-HD? (I’d throw 3D into the mix but – ha- that viewing experience is just rubbish for football, so I’ll leave it out for now), but even with a deal on installation etc as a new customer, Sky plus ESPN plus a basic channel package in HD plus the ability to watch it in more than one room (honestly, the chutzpah!) comes in at around £80 per month. The club I support has season tickets which cost around £725 a year for an adult and £300 for a child (cheap for a Premier League club). A year’s worth of telly – which is never going to be the same as going to the game – comes in at around the same price. Telly was always regarded as what you did because you couldn’t afford to go to the game – now it is priced on a par with the real thing. And that seems wrong. Sure, I get a whole load of crappy channels thrown in and that has some value, but it’s not what I want. I am a consumer – I have demands and they are not being met. My money stays in my pocket.
And so we turn to where my demands are being met. For about the last five years, I have been able – pretty much wherever I am – to switch on my PC and watch my club. At this point, someone screams “piracy!” whilst the crowd look horrified, policemen prime their truncheons and delicate ladies faint in swoons of shock. Aren’t I taking something for free? Aren’t I stealing? I wouldn’t download a car, would I?
It is a measure of the sheer genius and efficacy of entertainment lawyers, PR peoples and lobbyists that this mindset has come to pass. Sadly, it has nothing to do with reality. Firstly, “free” is not free. Secondly, stealing a car deprives someone of that object – nothing I do deprives anyone of anything physical – I don’t stop the same thing being sold to anyone else. Thirdly, I am sat here with a sum of money that would be spent on football with whichever provider decided to comply with the laws of supply & demand. I have written more about the myths surrounding “piracy” here.
Firstly, then, watching without paying is not mere “freeloading.” Setting aside the nominal licence fee (a tenner or so a month) I have Freeview. All of those 70+ channels are not merely sharing my tenner are they? Mostly it goes on the BBC and, frankly, when compared to the price of satellite / cable, I see the licence fee as a bargain for news, documentaries, Match of The Day and various radio stations alone. But those other “free” channels are surviving somehow, right? Yes. It’s called “a-d-v-e-r-t-i-s-i-n-g.” You may have heard of it. You may also be aware that different channels charge different rates for their advertising – the more viewers they have, the more the ads cost. Amazing! So when I watch, say, a Champions League match on ITV (a free channel) am I thieving my footy? I am not.
And don’t forget sponsorship. The exact amounts involved are hard to discern, but three top sponsors pay in the region of £135m for a 3 year deal. It’s worth that much because of the numbers that will be watching the games, of course. Those numbers are partially on subscription channels, partly from pubs and, yes, partly from “free” viewers. It is the total number that is important and it is made up of significant chunks of each – no one audience is sufficient by itself. That huge audience is, then, rather valuable – which is why so many broadcasters want it.
ITV, then, who paid c. £160m for three years’ worth of rights, clearly believe they will make that money back because of the value of ad sales. A cheeky enquiry to a colleague in a media-buying agency (the people who buy ad space on behalf of their clients) tells us that the cost of a 30 second slot for a regular Champions League game is c. £45,000 for ITV as opposed to c.£15,000 for Sky. For the final it’s more like £40,000 on Sky and £105,000 on ITV. Do you see that? The audience for “free” viewing is bigger and thus the ads cost more. Oh, and let’s not forget all the ads on players’ shirts and advertising hoardings around the ground. Someone paid money for those in the hope someone is watching. And they’re happy if more people are watching, too.
In other words, when I watch something for free on a channel that sells advertising, I am not a freeloader – I am a crucial part of the channels’ & sponsors’ business plans.
So, why do people host pirated football? Because – guess what? – there are people that will pay them money for hosting adverts whilst they show unlicensed sports. But surely this will be ads for dodgy porn, malware-infested fakes and all manner of under-the-table tomfoolery?
Well here’s the fun part: UK companies are already using these illegal channels for advertising. And not small outfits, either. Big ones. The biggest. Vodafone, Disney, big pharma, the lot. It’s not a few odd cases, it’s everywhere and it’s everyone.
This weekend, I saw UK adverts for washing powders, coffee and mobile phones. And let’s be clear: these weren’t European or Chinese versions of the ads that have somehow found their way onto my machine.
These were the same ads I see on TV, with .co.uk URLs and British accents. And these were not just video trails (which tend to be served whilst streams load) but banner and other display ads, including interactive ones. In other words, the same advertising you would see on official channels. I’ll give them the benefit of the doubt and say that most media buyers probably don’t realise that this is going on as this would be wrapped up in the lower end of the inventory they purchase – probably listed as “miscellaneous websites: reaches 100,000 people, costs £X” – and is a very minor amount in comparison to the total, so it isn’t likely to be something that gets much attention. But for their clients, unless anyone flags it, why complain? You want to advertise to a certain audience, you go where they are – and if they’re watching pirated football, who cares? They’re still consumers.
Next, I feel obliged to point out that downloading something for free is not the same as stealing something physically. ITV & Sky can continue to sell their services to other people, I am not stopping them. It is a complete fallacy to equate downloading something from one source as somehow depriving them of a sale. They simply don’t have what I want in a format I want a price I can afford, so they are “losing” precisely nothing. I was not going to spend that money with them, so how can they have “lost” it? Perhaps, instead of wringing hands about “lost sales,” the better answer would be to examine the pricing, format and availability of the product? Because, in fact, the rights-holders (clubs, leagues, official bodies) – as well as broadcasters – are all losing out on potential revenue by not servicing demand adequately.
Which brings us neatly to the third point – that supply and demand (aka everyone’s first lesson in economics) tells broadcasters exactly what they should be doing. At the moment, my personal demand is supplied by crappy streams. Why?
- I can see whatever match I want
- It is a reasonable stream
- I can choose which broadcaster I want to view it with (including which commentary)
- I can follow just my team, I don’t need a package of things I don’t want in order to do so
- The price is right
- I have to search around a bit which is a bit annoying (although I usually find it quicker to track down a stream than, say, track down figures for what sponsors paid for Champions League rights)
- The quality is occasionally poor
- I may have to switch streams mid-match
- I probably miss, on average, 10-15 minutes of the match through any / all of the above.
Various broadcasting friends wanted me to add that I also risk malware, viruses, penury and lupus too, but I like to think that my level of tech expertise avoids this. However, for many people this will be true enough. If you download the necessary software for viewing from official sites, no problem; but many streaming sites have links to software that is filled with malware, frankly. That’s because they are in control of how they get money from you; it’s not regulated or licensed so they do whatever makes cash and adding spyware means someone somewhere is paying them to do so.
Even so, ultimately, when faced with a choice of all the above, it’s streams every time. Had I the simple choice of being able to follow all my team’s matches for, say, £20 a month, nothing else included with them, I’d pay it. And so would hundreds of thousands / millions of other people.
But that requires something we are not used to in commercial models: non-exclusivity. If UK broadcasters pay £400m for TV rights, it’s because they know they become the only show in town. Once other people can show those games, their rights are worth less. If Tommy Streamer can show the game on his blog page then why is anyone going to watch ITV or Sky? Exclusivity guarantees the broadcaster they will have a monopoly on showing a game; that means they are guaranteed a certain minimum audience to watch the game and that means a minimum amount of income.
But the market supports multiple types of demand. At the prices they are charging, broadcasters only service a certain percentage of the potential audience – the rest of us would be happy with less quality for less money, either as paid-for or ad-supported streams. But the only people smart enough to tap this market are the “pirates” and the advertisers who serve ads on their networks. If I was a broadcaster I would offer those networks a license to show streams at a maximum quality of, say, 50% of the HD streams I can offer and take a percentage of the advertising revenue.
I wrote about this yonks ago when I worked for a company that became EMC (and whose blogs have been similarly assimilated) as an idea for content distribution, the principle being that nobody should care who shows the content as long as they take the ads? Reward people for doing it too – even if it’s a small share of the proceeds it incentivises them for finding an audience and your revenue goes up with the growth in total audience size. I called this “microdistribution.” It has a lot in common with the Long Tail in that it recognises that a myriad of tiny niches may add up to something huge, a la Google Adwords etc.
And there’s another reason why this might improve the delivery of football. At the moment, I am stuck watching, say, Match of The Day on the Beeb or Sky’s full match programmes. MOTD is the last resort of the desperate fan – matches reduced to highlights which are ridiculously short to squeeze in every game. Here’s the build-up play, here’s the shot, here’s the goal. The replay is rarely anything more than the final ball and shot. But what makes a goal amazing is often the quality of the build-up, the passing, the bypassing of the defence through tactical executions. All of this is lost – and the result is the barf-inducing banality of football phone-ins which consist of people making comments about matches based on the few minutes they saw on MOTD and the commentary they heard. In other words, you are listening to opinions about opinions. As a result this promotes a shallowness in the way many people engage with the game. Tactics are reduced to quick soundbites – talk about a pressing game, playing two up front or one in the hole behind the striker – but tactics go much deeper than that.
In the 1990s, before we all agreed he was a bit of a twat, Andy Gray used to do a tactics session in the hour or two before a big game – full on tiddlywink counters and pushing them around, examining why certain managers chose different formations and so forth. It was a big part of my deeper understanding of the game; what had been based solely on a love of playing, mixed with the tribalism of being a fan, developed into something more. The various tactics sections on football shows of all sorts are now lamentable. A favourite piece of utter crap was Andy Townsend’s Tactics Truck on ITV - like so many ex-footballers, a nice chap just repeats the obvious, draws some circles around defenders who have lost their man and that’s it.
But this is because TV is broadcast to such a big audience – it’s not possible to cater to all the different tastes fans might have. I know not everyone’s a tactics nerd, but I’d liketo watch a real tactics nerd doing their thing. Allowing the little guy to broadcast would allow the niche interests to blossom – tactics, Alan Hansen-a-likes who only see the defensive errors, students of the cultured pass, the different chants, partisan commentaries which barely mention a single opposition player’s name except to berate them (which, in fairness, is what it’s like watching any footy on a club’s own channel). All these would be possible.
This creates a “long tail” of football consumption. And in the long run, it’s better for the game because everything is catered for. Again, it’s fair to say that specialist broadcasters do make an effort to vary the programming – there’s the Saturday morning “variety show,” or the highlights reels or the fan-led shenanigans. But consumers are way more varied in type than a broadcaster alone can deal with at times. Niche interests are often what keep subjects interesting to a wider audience; I can’t see anyone likely to broadcast, say, a programme just for referees or coaches. But I bet there’d be some people who’d like it. Search the net for football blogs and you’ll find women tacticians as well as “I love Thierry Henry’s thighs”; Villa fans who only want to discuss the 1970s, others who only ever discuss one player at their club. The “tail” may be lengthening but it’s just not long enough.
Broadcaster and event owners aren’t going to give in easily – the one thing about selling exclusivity is that you get a big lump of cash if you’re the event owner and the chance to earn a big lump of cash if you’re the broadcaster – it’s a high stakes game with big rewards (unless you’re Setanta and screw up the maths / sales).
And that’s why chasing pirates seems like a better bet – who’s going to say “Yes, this year we shall forgo our £100m income for £25m with the potential to earn an extra £150m”? You’d take the lump sum every time. I get it, but it’s clearly short-sighted.
Free market exponents will consistently tell you that free market means more choice for the consumer. And yet, here we are, us disenfranchised punters, we buy our replica kits, matchday tickets, programmes, consume advertising on hoardings round the pitch, idents and ad-breaks, we’re happy to consume and maybe even pay you some money… but all we are is “thieves.”
Meantime, I’ll just leave this here…
*EDIT : I showed this piece to a number of friends who work in sports broadcasting – amongst the points they wanted to add were that “…the TV fixtures situation is not the great TV carve-up as many people would believe. There are great number of factors why [they] can’t set the fixtures for the entire season in advance: clubs, local authorities, transport providers, and the police influence dates/kick-off times. There is the performance of the clubs in the cup competitions to consider and the sheer logistical weight of organising the fixture list. Hence it is split into 3-4 phases. [Sports broadcasters] attempt to even out each club’s number of appearances on [TV] throughout the season.” Only fair to include that. It can’t all be hyperbole and invective.