As more sports offerings are added to streaming platforms, exec will have decisions to make about prices and whether they are sustainable. Dish Net/SlingTV Senior VP/Programming Andy LeCuyer said sports, broadcast networks and RSNs are a “big part of the reason for the costs,” and once platforms make the “decision to do all of those, it sort of defines what the product cost will look like going forward.” LeCuyer, speaking on a panel at the NeuLion Sports Media & Technology conference, said, “Maybe over time you’re willing to operate it at zero margin, or maybe you’re able to be successful enough in things like ad monetization. In terms of gross margin for the product, if you decide those, that defines where you’re going to go.” LeCuyer said Sling has “tried to go a different way” with its Sling Orange package, which has ESPN in it but does not have broadcast networks. LeCuyer: “That’s the way we’re able to maintain a $40 price point.” Hulu Senior VP and Head of Distribution & Partnerships Tim Connolly said, “Sports is indispensable programming. The RSN in that market, if it does a 3 share or a 4 share, that’s indispensable. ... Does it cost a lot? Yeah. But is it very valuable and indispensable programming that consumers want and happens to be the underpinning of the value proposition that we’re trying to deliver? Yeah.”
DATA ANALYSIS: Panelists discussed measuring ratings for MVPDs and strategies to keep viewers focused. Sony Interactive Entertainment VP & Head of PlayStation Vue Dwayne Benefield said his company not only measures households, but also “individuals within the household.” Benefield: “The data allows us to see things in real time, not only in the content offering, but in the experience.” He said PlayStation Vue’s viewers skew slightly male, and they are “heavy sports viewers.” In fact, Benefield said PlayStation Vue’s NFL viewing hours were up 150% over the same period last year. Connolly said 70% of Hulu’s viewing “comes on living room devices, 20% on mobile and 10% on viewers.” In terms of keeping viewers focused, AT&T Entertainment Group VP/Strategy & Business Development Tim Gibson said there is a need to “evolve the way we advertise and sell ads and deliver ads.” Gibson: “Eventually we’re all going to have to align on the right ad loads, the right ad formats that keep people watching this product.”
THE CHANGING INDUSTRY: Each panelist noted the stark difference in rights negotiations now compared to five or six years ago. Sling’s LeCuyer said negotiations on his service “took years.” LeCuyer: “For a while it was going and having discussions with our partners in the traditional world. The answer was, ‘Sure, you can have those OTT rights if you give us super distribution and pay premiums.’ Our answer was, ‘No we’re not going to do that.’ It took a while, but we used our existing deals to make partnerships that made sense for the product and consumer.” AT&T’s Gibson said the consumer in today’s world is “going to win in all this, whether we’re part of it or not.” Gibson noted TV everywhere is a “great example of our industry fumbling the ball on where customer expectations are going.” Customers “wanted the content they liked on these new devices they had, and it took us seven years too long to get to a point where we had ubiquitous, federated TV everywhere, for no good reason. If we don’t figure out how to act a little quicker in today’s day and age, some of the trends you see in legacy pay TV are going to continue to persist.”
