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Nick Meacham | What is the ‘Spotify solution’ for solving piracy?

SportsPro managing director Nick Meacham offers his thoughts on how to fix the sports industry's perennial problem of piracy.

22 April 2021 Nick Meacham

One question I hear a lot across the sports broadcast and over-the-top (OTT) landscape is 'how do we solve the problem of piracy?’

It's growing out of control. And we've seen it now reach the point where major broadcasters like BeIN Sports warn they no longer consider rights to be truly exclusive.

In short, you cannot stop piracy. You can slow it down, and there are some incredible tech companies and tools that help with this. Companies like Synamedia, Nagra, Verimatix, Irdeto and loads more have an array of technologies and strategies to combat the scourge of piracy. But the fight will never be won unless sport has its 'Spotify moment’.

What Spotify did for music was democratise access to music, remove fragmentation and enhance convenience. People are willing to pay for this.

Sport, by contrast, is moving in the wrong direction. Why? Because it's now living in a rights model of splicing and dicing and fragmentation. The model most major rights owners are following is simple: the more you cut up your rights, the more reach and revenue you'll create. That is generally true. However, the move towards fragmentation has led to one major flaw: fans are finding it harder than ever to know where to go to watch their favourite sport and sports content.

Who are the organisations that do consolidation the best? The pirates. You can literally subscribe to pirated platforms as a subscriber where everything is nicely consolidated. In some instances the user experience is better than some legitimate direct-to-consumer (DTC) platforms.

So yes, rights holders are generating more revenue than ever by carving up their rights, but they are also creating even more opportunity for the pirates to be more valuable to the fan experience.

Is the solution in sight? What or who can be the Spotify to sport’s problem?

The complexity of the current media rights framework make this near-on impossible in sport unless someone can create a destination that houses all available DTC offerings, providing an integrated experience and a single destination for finding whatever it is you're after.

The closest example I've seen for this type of one-stop-shop service is an aggregator tool dubbed Chrome Kaleidoscope, a Google platform leaked in August 2020. But I'm not sure this is the solution. Kaleidoscope approaches consolidation at a platform level, not at a rights holder level, leaving similar challenges around fragmentation even if access to video streaming services has been improved marginally.

We have also started seeing a few more exclusive deals lately which spur hope, with the most interesting being the move by WWE to sell its US rights exclusively to Peacock for US$1 billion over five years. WWE’s owned and operated streaming service was seen as the benchmark for DTC OTT platforms, even winning Platform of the Year at last year’s SportsPro OTT Awards, so its decision to sell the audience it has spent years curating, and with it the ongoing first-party data being captured, is a huge move. But a deal where all content is in one place will be of huge value to its fanbase, raising the prospect of increased watch times and engagement.

Consumers will pay a premium for convenience, and they will move away from piracy once the solution is there. But it looks like we're not close to that solution – yet.

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