As more and more viewers expect a digital-first option when it comes to watching sport, platforms must be built for an ever wider range of experiences. For rights holders, broadcasters and promoters, being able to regulate and monetise access to online streams is just as crucial.
Pay-per-view (PPV) and subscription video on demand (SVOD) are familiar to pay-TV customers and to users of entertainment services such as Netflix and Amazon Video, but live sport presents its own challenges. Founded in 2011, Dutch-based Cleeng specialises in providing content owners with the support they need to deliver paid-for video securely and reliably to fans in the digital, direct-to-consumer age.
Gilles Domartini, the founder and chief executive of Cleeng, explains to SportsPro what the challenges and opportunities are in the emerging SVOD and PPV sectors.
SportsPro: What problem was Cleeng created to solve?
Gilles Domartini: In one simple sentence: if you are a sport federation, a famous club, or a sports broadcaster, how do you maximise your business by selling videos direct-to-consumer?
As a technology provider, we see that today's live broadcasters are facing a couple of major challenges on their journey to success: managing user accounts and identities across multiple devices, collecting funds and taxes across Europe and the world, offering state of the art viewer support, etc. These are very challenging activities and, put together, it leads to complexities with several vendor integrations, data analytics, long and expensive deployments, and catching up with new technologies and behavioral trends.
Cleeng solves this by delivering exceptional authentication, monetisation and security solutions quickly, deeply integrated into a unified experience for users, with a comprehensive business dashboard. We take care of everything, except the video streaming part that is handled by our leading partners at Brightcove, Livestream, IBM Cloud Video and Verizon Digital Media Services.
This means that our sport broadcasters are able to quickly conquer any market by launching an international service and serve the modern on-the-go millennial.
Where are you positioning yourselves in the market? What kind of rights holders and media companies are PPV and SVOD suited to?
We position ourselves as the smartest way to sell and protect premium videos, directly to consumers.
Regional federations like the WFTDA [Women's Flat Track Derby Association], NBL [National Basketball League], leading ventures like One Championship, and NHRA [National Hot-Rod Association], as well as tier-one sports broadcasters like Foxtel, Sky, or HBO Boxing chose Cleeng as their tech platform. These brands are using a variety of revenue models in order to sell directly.
Pay-per-view is a proven revenue model for one-off live events, especially within the combat sports niche. One of the biggest organisations in the boxing world, Golden Boy Promotions, came to us with a challenge: securely handle and market a US mega-fight via online PPV - in one week. Our team was proud to deliver, on time, a robust landing page capable of hosting 100,000 visitors with a redundant live streaming infrastructure as back-up and the advanced watermarking security to prevent piracy.
Foxtel, with their MainEvent online broadcast of the Mayweather v McGregor fight in Australia, and Sportsmax TV’s coverage of MayPac fight in the Caribbean are other good examples of successful PPV launches.
Subscriptions and passes work best for sports organisations that broadcast successive events like leagues and tournaments. But, we have noticed publishers are becoming more creative in designing flexible packages to attract and nurture loyal viewers. Key examples in this area is NHRA that offers both PPV and Season passes or Monster Energy Supercross season.
How do you approach relationships with new clients?
Every client is different, and we can offer quite some flexibility. The approach itself depends on the company’s experience with broadcasting online. We encourage sports organisations and broadcasters to go over-the-top with by empowering them with a market-ready solution. Adding up incremental revenues is the main goal for them, and we tend to assist them during their journey to success.
On the other hand, we are more than ready to jump in and help broadcasters that have clunky systems in place. While growing, the technology has to be able to handle large traffic and transaction volumes - we can handle 1.8 million transactions per hour - and sudden surges of user inquiries. Reliability and established processes are crucial here, and we proved we can do it.
What additional challenges arise from creating video platforms where you’re also handling transactions?
When you plan your video service and choose the preferred revenue model - pay-per-view, subscriptions, advertising - you think of great user experience and secure, reliable technology supporting it.
The payment system is key for monetising live videos, but you will realise that you need to think about all aspects of the business. We love to point to our video platform ‘iceberg’ graphic [below], where payment is only the top of it.
Identity management, reporting, security, coupon schemes, multi-device and multi-language support are all features that end up as a necessity if you want to build a successful service in the new context.
I have to stress video security here, since it’s always closely connected with payment handling. This is super important for broadcasters since they must prevent any piracy in order to stand by their paying viewers.
How can video services be plugged into the rest of a rights holder or media company’s broadcast operation?
The beauty of OTT is that you, as a sports broadcaster or rights holder, can launch a video service without disrupting your core broadcasting systems. These services complement the traditional systems in place, show immense flexibility, and can be adapted to the viewer's behaviour. We’ve seen multiple broadcasters managing these projects as separate business units, where they have full control over costs and ROI.
This is particularly visible in the sports industry, where companies that acquire rights in specific regions want to launch fast and ‘milk’ the opportunities that the rights exclusivity provides.
At Cleeng, we partner with the biggest B2B video platforms to be able to help clients go on the market as quickly as possible and add new revenue streams.
With our video watermaking solution, called Tattoo, we can easily deploy advanced technology that tackles user piracy, and provides instant benefit to the sports broadcaster. The more people buy, and those who do so appreciate the fact they benefit from a quality experience and fair model.
How does building a platform for a one-off PPV event differ from creating one for a SVOD service?
These two types of services differ a lot, indeed.
The live PPV segment usually runs one-off streaming events, with contract constraints and implementation cycles of three to six weeks. That means that the platform should be ready to deploy, look great instantly, and be capable of handling high traffic volumes with sudden peaks and piracy attacks.
Cleeng’s platform is built for volume and scalability. It takes care of the full customer journey and makes authentication, payment, and customer support processes run smoothly, at volume. The support of multiple language, currencies and the ability for geo-restriction allows live broadcasters to go to market fast - eg Foxtel, Final Fantasy, Golden Boy Promotions.
Features such as scalability and support for multiple currencies and markets allows rights holders to go live with international broadcasts of sporting and video game events quickly
With sports, it is pretty common for organisations to manage their own online TV channels where they can sell live and replay video directly to consumers. Cleeng Portal is a product developed exactly for that purpose. Monster Energy Supercross have launched a full site in a a few weeks’ span, capable of handling hundreds of events in the next season.
As the business proves healthy, we noted that sports broadcasters move towards subscription services. They often migrate their traditional TV subscribers to their new OTT environment and provide high-end video content supported on many different devices.
Broadcasters that run their services on our Cleeng SVOD platform really love the features like subscriber management and churn prediction to grow their subscriber base and their revenues - eg Tennis Channel, NHRA and France Televisions.
Cleeng helped the organisers of the Monster Energy Supercross series create a paid-for video portal within a matter of weeks
How do you see the SVOD and PPV markets developing? Where is their potential greatest?
That’s a billion-dollar question. It’s pretty clear that PPV is still a viable model for a lot of sports organisations, if it is properly executed. It is a massive revenue opportunity, as the outcome of recent ‘Money Fight’ meant ten million PPV buys globally.
However, in the pursuit of business sustainability and growth, we expect broadcasters to move more towards subscription-like models and build stronger relationships with their viewers. Happy fans and minimal churn translate to recurring revenues and strong market position. Easier said than done…
What is the future for Cleeng?
We think we have a unique opportunity. E-commerce is not in the DNA of the industry, neither a main strength for broadcasters or sports federations. While it looks easy on paper, it is very challenging if you want to be truly successful and compete with the likes of Apple, Amazon, or Netflix.
The latest PwC survey showed that sports broadcasting will become the fastest expanding business segment within the next three to five years, with a projected eight per cent growth. It gives us a strong signal that we are on the right spot.
Live PPV can generate more than US$3 billion per year, according to our estimates. We see that SVOD adoption is crushing the forecasts lately, too. By offering the best solution of the market, and empowering clients with rich data analysis and insights, Cleeng can become a massive business.