‘It’s only live once!’: Football Broadcasting Pay-Walls and Changing Attention Habits

By Daniel Geey and Nii Anteson

Florentino Perez and countless other football administrators believe the game needs to change to cater for changing viewing habits and shortened attention spans. Many believe it’s more nuanced than that. Whilst we certainly have more distractions readily and constantly available to us, with endless social media streams, instant messages and email at our fingertips on mobile phones, tablets and other screens, young people are regularly spending hours on YouTube, Tiktok, Fortnite, Netflix, Roblox and plenty of other platforms.

It’s not that their attention spans are necessarily shortening; it’s that there are so many platforms competing for finite attention. There is much more digital competition for our attention than there ever used to be. That’s why the idea that football needs to protect its 3pm Saturday games by using the blackout period feels somewhat ‘1990s’ right now. Live football isn’t so unique that televised football content remains is its only competitor or substitute. Fans are multi-tasking and multi-screening. Fans can watch a game at a stadium whilst streaming YouTube, accessing TikTok or even watching another match. With mobile devices, it’s not an either/or approach anymore.

In one of his seminal articles, Matthew Ball explained that:

“Fortnite was Netflix’s most threatening competitor (which CEO Reed Hastings said in his investor letter a month later). This is most plainly understood as the idea that everyone is competing for finite attention and there are more applications for this attention than ever before. But the real challenge for Hollywood is that for decades, whenever “leisure” won over “work”, TV was the primary beneficiary. In recent years, the leisure decision has changed or “moved up” a level. It used to be “what to watch” and now it’s “whether to watch” – and the answer is increasingly “no, I’m going to play a game”.[1]”

Football and sport and every other content business is competing for attention and that competition is getting even stronger. Football is competing with Fortnite, not (just) other OTT platforms like Amazon Prime, Disney, Discovery etc. Many believe that football, the EPL, the WSL, the Champions Leagues and the EFL are competing in a significantly broader digital attention economy. It’s wider than football, sport, streaming and gaming. It means to many that restricting the televising of 3pm kick-offs in the UK feels rather antiquated.

There must be more innovative ways to engage fans than to block high quality access to the product. It feels like music’s equivalent to the Napster file sharing moment where people were illegally sharing and downloading music because there wasn’t a quality, accessible, affordable alternative, and then Apple music and Spotify et al showed up. For some time, decoder boxes showing foreign TV pictures of EPL games were endemic (especially in pubs); it’s now streaming’s turn. It appears relatively straightforward to find a streaming link to watch a 3pm game. The real jeopardy is being caught illegally streaming (because the rights holder is not receiving compensation), downloading a virus or the poor quality of the stream.

It leads to other more nuanced questions around whether the EFL or the WSL should be allowed to show games at 3pm rather than have to make do with the slots outside the EPL live weekend window (11:30 on a Saturday morning and 6:30 on a Sunday evening)? The UK is the outlier here. Only England, Scotland and Montenegro take advantage of UEFA’s blackout provisions.

Rights Rationale and PremFlix

The EPL collective deal is still alive and well with the rolled-over Sky, BT Sport (soon to be Discovery) and Amazon deal worth £4.8bn over three years. The EPL’s six-year US TV deal has been valued at more than £2bn. The Athletic recently explained:

“Even with no growth in the domestic market, the Premier League was able to increase the value of its international rights by 30 per cent for the 2022-25 cycle. That takes the league’s central income from £9.2billion to £10.5billion over three years, and it means the Premier League’s share of the global media market for domestic football leagues grew from 40 per cent to 44 per cent.[2]”

Sky historically bought EPL rights as the battering ram to launch and sustain their pay-tv offering. BT Sport bought EPL and UCL rights (in part) to reduce their broadband customers leaving to take up Sky’s broadband and pay-tv packaged deal. It’s been suggested that Amazon has bought EPL and recently UCL rights to acquire and retain Amazon Prime customers, who reportedly spend four times more with Amazon than non-Prime customers. The Pay-Tv landscape has evolved significantly. The subscription model has evolved although Sky, BT Sport and Amazon continue to cluster around EPL and UCL rights with a variety of different commercialisation models.

But how long:

·       will the EPL continue to sell and provide all of its games to broadcasters and

·       before the EPL decide to do some experimenting and go direct to customer?

The answer is that it appears to be in the offing.

Richard Masters in a recent interview explained:

“We have sold all of our international rights to third parties. In other words, we’ve licensed them as opposed to going direct to the consumer. However, we do have — and I can’t reveal where in the world — options to do various things. We’ve probably signed more long-term partnerships than usual – six-year agreements instead of three-year agreements – and there are options in some of those agreements to go direct to consumer in the name of the Premier League.”

The EPL isn’t going to kill the goose that lays the golden eggs but it may test the waters in particular lower risk jurisdictions working alongside production and distribution partners, potentially by-passing traditional broadcasters to connect directly with customers through a PremFlix style streaming platform. TalkSport and ex-Crystal Palace owner Simon Jordan was rather bullish on the value of any such deal but explained the core rationale here.

Interestingly, it was reported in The Athletic recently that the EPL in 2019 was pushing forward with a direct-to-consumer EPL streaming service in Singapore but did not get the required support amongst its club members.

As seen through the Project Big Picture (PBP) proposals, the EPL clubs were looking to experiment with direct to fan EPL offerings by carving-out particular fixtures from the collectively negotiated EPL deal to separately and in parallel monetise. So, for example, the EPL would continue to sell their defined packages of games to the broadcasters. However, additional games that fall outside of the package would be sold directly by the clubs such as Liverpool and Manchester United presumably via their OTT streaming platforms.

Attention x Rights Fees

There are currently no EPL and UCL live games available free to air in the UK (discounting the limited Prime EPL and soon to be UCL offering, to the extent that Prime can be considered free). There have been generations of young people growing up without easy access to live premium football content. In the UK, it’s been eight years since ITV broadcast the last free-to-air UCL live matches and it’s 30+ years since EPL matches were moved behind a paywall. Does that matter? To many, it does. As set out above, many believe the EPL and UEFA are not narrowly competing in a broadcasting market with other football leagues or sports for live rights. They are competing for attention with Fortnite, Facebook, League of Legends, FIFA and Dota as well as Disney+ and Netflix. If the content is difficult to access (because its live matches have been historically behind packaged paywalls) and video streaming and some gaming platforms are more easily accessible, sociable, innovative, addictive and attention retentive, many will see the greater engagement with the latter as consumers voting with their attention habits.

Both authors were (positively) sucked in in the 1980s and 1990s because content was easily accessible primarily on terrestrial tv. Whilst broadcasters will no doubt be aiming to monetise older, middle-aged generations, the question remains whether younger, premium sports subscribers are turning up at scale. Presumably this is one of the dilemma’s facing pay-tv operators as they appeal to younger generations with streamlined OTT offerings like Sky’s Now TV. The fundamental issue isn’t really with the broadcasters; it’s the strategy of rights holders to decide where to put their premium rights. Broadcasters will pay the high rights fees so long as the subscribers are drawn in and retained. If there isn’t the subscriber long-tail, then the market is signalling to the broadcasters that the premium content isn’t so premium.

This is perhaps why UEFA put the Women’s UCL onto DAZN’s YouTube channel to give it scope, breadth and relatively frictionless visibility. In the same way, at least a number of WSL games in the UK are shown free to air on the BBC. It was reported that 3.6 million viewers watched the most recent UCL final between Barcelona-Olympic Lyon and that the 61 matches in that year’s tournament brought 64m views. Some believe this blended approach needs to be given real consideration for premium men’s football.

With pay-walls dominating the premium men’s football landscape, some may argue that the generation of 35-45-year olds may be the last ones that remember live top flight English football on terrestrial tv. What if kids aren’t watching live matches but are gaming, YouTubing and accessing open platforms and free content? The football watching routine becomes less sticky, less ‘must watch’ and less of a ‘pay-tv battering ram’. Sky and others will only pay the rights fees if people are subscribing. The EPL may not wish to dilute their exclusive rights by putting some matches free to air but by not doing so, they potentially run the continued risk of not capturing current generational attention.

Conclusion

The easy narrative is that younger generations’ attention is more limited; we’re not so sure. People are spending plenty of concentrated hours on FIFA, Fortnite, Twitch or YouTube. It’s the ease by which their attention can be grabbed, harnessed and maintained.  

Whilst this may be medium/long term thinking, the overarching point is that as younger generations may be less attracted to live sport because they perhaps have not been drawn in at a younger age and have a broader set of consumption habits, future content platforms may not value such rights holder content as highly. If future live football is not as ‘must have’ as it was previously, then there will be a recalibration on the value of such rights. It may not be any time soon, but if subscribers reduce for whatever reasons, e.g., the cost-of-living crisis[3] or the content not being as attractive, pay-tv companies may not have the appetite and deep pockets to keep funding such huge rights rounds.

Which as explained above, leaves the next big question around different company’s models to monetisation. Traditional pay-tv was bundled with mobile, broadband and phoneline for quad-play offerings. Amazon Prime sees sports rights as a customer acquisition and retention tool for its Prime physical product delivery service. Who continues to pay sports rights holders mega money if subscribers aren’t there in the same numbers?

Part of the answer is already creeping into focus. Leagues will likely experiment with direct-to-consumer offerings in particular isolated territories to start (Premflix) and so will clubs (see the Project Big Picture structuring where 8 games per season were proposed to be individually sold outside of the EPL collective deal).

[1] https://www.matthewball.vc/all/7reasonsgaming

[2] https://theathletic.com/3470185/2022/08/03/richard-masters-premier-league/

[3] We say this at a time of massive energy bill and interest rate hikes (for when mortgage products expire) on the horizon in the UK. Disposable income will be at a premium. The chunky contracts when they expire will likely be the first to go. Netflix is the easy one to cancel but Sky, BT and Virgin will be ones that make a difference to the family bottom-line.