COVID-19 and the Vulnerability of Pure Play Sports Streaming Services

The 20,000 Foot View:  The postponement of annual competitions and  major quadrennial events has highlighted just how heavily pay-TV and sport-centric streaming services’  value propositions rely on live sports. Filling schedules with re-runs, docuseries, interviews and archived footage are stopgaps unlikely to increase engagement. Justifying a sports video streaming subscription is now tougher for consumers than ever. In the saturated attention economy, sports streaming services now face increased competition for audience attention and the coronavirus global pandemic leaves them particularly susceptible to subscriber churn. Streaming insurgents that overextended in securing now-dormant rights will have an even harder time recouping these investments in the face of an impending economic downturn.

Key Insights

           of consumers across the US, UK, Canada and Australia watch live sports 
• Watching sports            has            more penetration than the            sports consumption activity (attending events            watching sports highlights)
• Rights holders            broadcasters need more content on            platforms to extend reach;            of            watch sports highlights on social            four points lower than on           
• Sports is            to drive Amazon’s user acquisition;            English Premier League (EPL) coverage            UK WAU penetration to            in            up from            from            2018
• Pure play            streaming apps are niche: in            in the US, WAU for            DAZN and Flosports was                       and           
• Sports appeal            niche, with an average of            sports monthly –  more than            below  film and comedy
• Sports under-indexes            streaming users: sports is the            consumed genre among SVOD subscribers;            for all consumers
• NBCUniversal’s big            bet is off; Peacock deferred            in advertising inventory for its            US coverage of the postponed            Tokyo Olympic games 
• Kayo sports            the leading sport-centric streaming service            Australia for weekly engagement, yet            a subscription penetration            smaller than           
• Canadian consumers            the second-lowest penetration for holding            or more digital subscriptions at            only Australia at            in            2019
           of consumers would reduce spend on a pay-TV subscription via cutting movies or sports packages from their subscription during an economic downturn

Companies and brands mentioned in this report: 2020 Tokyo Olympics, Amazon, Amazon Prime Video, Apple, Bundesliga, Comcast, COVID, Crave TV, DAZN, Discovery, Disney, Disney+, Ditto TV, Eleven Sports, EPL, ESPN, ESPN+, Eurosport Player, Facebook, FIFA, FloSports, Foxtel, GolfTV, illico.TV, Intsagram, iRacing, Kayo Sports, La Liga, Madden, MediaPro, MLB, MLS, MLS, MOTD, Nascar, NBA, NBCUniversal, Netflix, NHL, Peacock, Serie A, Six Nations, UEFA Euro 2020, UFC, US Masters, WWE