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SPORTS piracy is costing rights-holders and streaming providers $28.3 billion (€23.7 billion) every year, according to a new report by video solutions company Synamedia and market research firm Ampere Analysis.
The study, titled Pricing Piracy: the value of action, claims OTT sports streaming services would stand to gain $5.4 billion or 19 percent of the overall total, if they eliminated piracy, with the remainder of the savings available to pay-television broadcasters.
The authors of the report calculated the figure by identifying the demographics and characteristics of those illegal users most likely to convert to legal services, including their reaction when illegal viewing is disrupted.
By understanding the triggers that would convert illegal users into legal consumers, the report claims rights owners can turn piracy into a revenue opportunity rather than a cost centre.
A study of 6 000 sports fans in ten markets by Ampere Analysis found 74 percent would be willing to switch from a pirate stream if a legitimate feed was made available and the pirate feed became unreliable.
The report labelled this demographic the ‘converter cohort’ and claims this group of fans tends to be younger, or part of a family with young children.
Such fans could watch as many as 10 or more different sports using connected devices. Forty percent of this group said they would subscribe to OTT streaming sports services, including single-sport services run by rights owners, with the balance opting for traditional pay-television services, particularly those that offer exclusive sports rights. In fact, 57 percent of the converter cohort already pay for legitimate services and 52 percent pay for pirate services.
The report claims that converting pirate customers to legitimate ones would require service providers to eliminate the triggers that encourage fans to pirate sports content in the first place. These include a flexible access without complex installations or long contracts, ease of use, and availability on every device in any location, coupled with a price point that is often much lower than a traditional pay-television service with premium sports tiers included.
Yael Fainaro, senior vice president of security at Synamedia said: “After years of growth, a recent downturn in rights fees has been exacerbated by the pandemic, hitting sports rights hard. But just as the value of rights is being eroded, there is now the prospect of creating new revenues by converting illegal viewers into paid subscribers.
“While previous attempts to value the revenue leakage from sports streaming piracy took a crude approach, we now have the detail to develop targeted approaches and the tools to deliver quantifiable results, ensuring every investment hits the jackpot.”
In a previous report, Synamedia claimed the biggest deterrents for viewers of pirated streams were the fear of disruption and the risk of legal and social consequences, including being arrested or fined. Some 84 percent of fans who watch illegal streams cite both of these as reasons to reduce or stop viewing illegal streams. — Sport Business
Online Reporter