Sporting chances

Founded in 1979, the Entertainment and Sports Programming Network ESPN—is one of the biggest sports brands in the world. With six US cable television networks, the firm, which is majority owned by Disney, gets average viewer figures of up to 115 million each month. Outside of the US ESPN has 46 television networks internationally. Its international division, which includes those networks as well as a host of digital properties, has 350 million subscribers across 200 countries.

Tom Gleeson is the man in charge of driving strategy for the digital business for ESPN International—excluding the US—and that strategy is going to be heavily dependent on mobile technologies. In the US and beyond, ESPN’s mobile reach is already fairly well established. The firm estimates that it,“ attracted nearly 70 per cent of users seeking sports on the mobile web in 2010, averaging 11.5 million unique visitors,” which was an increase of 37 per cent on the previous year, while its mobile apps across all platforms average 4.5 million unique users per month.

Mobile alerts were up 250 per cent year on year, with 2.5 billion delivered to fans and sign-ups for alerts rose by 546 per cent. The firm aired 950 live events, including all 64 FIFA World Cup matches, on its mobile TV service during the year. And the firm is eyeing continued growth. As Gleeson says: “We think mobile is critical now and it’s more than critical in the coming years.”

And for those within the mobile industry, the thinking behind this observation is familiar. In many instances in emerging markets—and ultimately Gleeson’s growth will come from the same places as everyone else’s—the mobile may well be the only way to reach the consumer. Sports fandom is not dependent on wealth or location, after all. Millions of Africans are passionate followers of football, while cricket is almost a religion on the Indian subcontinent.

With this in mind, ESPN Digital is focussed on what the firm calls “the best available screen”. Says Gleeson: “The challenge for us is to deliver the best possible content to whatever screen that fan has available at a particular time. What we see going forward is that there are huge parts of the world where people are only ever likely to interact with our content, certainly on a digital level, on a mobile phone. And in markets like India, if we’re not providing a really good mobile offering then we aren’t going to be reaching a large part of the potential market.”

This doesn’t necessarily mean, however, that Gleeson’s team are focused on delivering ever richer content to mobile devices. “The content at a basic level is the same across all devices,” Gleeson says. “But on an iPad we can deliver a cricket score wrapped in stats and graphs and video, while to the consumer in the emerging market maybe we’ll just have a simple text that tells them the score.”

Gleeson argues that it is incumbent upon the content supplier, and not the network operator or the handset or platform providers, to ensure quality and consistency of content across different platforms. “Consumers don’t care about or understand our issues around rights, or anything else. They come to an ESPN branded app or site and expect, a good experience,” he says. “We can’t tell them that we can’t deliver that experience because of the handset supplier or the operator. The consumer is dealing with our brand.”

Of course there is a growing feeling among operators that, as the guardians of the successful delivery of all network traffic, there ought to be some level of compensation from the content providers that are filling the networks full of data and pocketing all the proceeds. So what does Gleeson think about that?

“I can certainly see where they’re coming from, and with the explosion in usage of things like the [BBC’s] iPlayer, there is a cost to bandwidth,” he says, following a conciliatory line. “We expect quite a lot of [mobile video] usage to be over wifi because, by and large, watching video over wifi is still a better experience than watching it over the cellular network.”

In any case, Gleeson says, the firm’s flagship mobile apps ought not to consume huge amounts of bandwidth, meaning that ESPN won’t be beholden to the operator community. In the UK the firm is shortly to launch an app that will deliver video of every goal scored in the top tier Premier League to the handset; for free. It’s a proposition that will doubtless see very high downloads for the app, although Gleeson doesn’t believe that it will act as a substitute for the subscription TV services, run by Sky and ESPN, that own the UK TV rights to Premiership football.

“The benefit with the goals app is that you get the video of the goal within a couple of minutes of it happening,” he says. “Usage on mobile devices is really targeted. It’s not about reading a three-thousand word analysis of a match, or sitting and watching a mobile device for three hours as you might a television.”

There is a middle ground, though, which is the increasingly popular tablet form factor. Realistically a tablet could be used to view longer video content without a huge compromise on the quality of the user’s experience. But in the content community, in ESPN’s experience at least, there are ongoing discussions about how tablets should be qualified in terms of digital rights. In the case of the new Goals app, Gleeson does not have the rights to offer the content for consumption on tablets.

“It’s an area where the rights landscape is going to evolve,” he says. “It’s not just the iPad that we’re talking about because you can stick a 3G dongle in your laptop and access data. But my iPad is only wifi. Should that be classed as a mobile device? Is the 3G iPad a mobile device? It can’t make phone calls, so maybe it’s not. The distinction between the PC and the mobile is blurring. This will become more complex as the rights continue to be broken into different packages like that,” he says.

Offering premium content to the end user for no charge is clearly only sustainable if it is supported by advertising and sponsorship. Gleeson says there is no element of the mobile play that is intended to work specifically as an up-selling hook. At the time of writing, MCI understands, ESPN has secured a sponsor for the new Goals app in the shape of Bet365.

“As much as tailoring content, we’re also trying to tailor advertising opportunities,” Gleeson says. “So if we’re talking to an advertiser and we’re reaching someone on an iPad we can offer an advertising solution that is far richer than we can offer on the phone. Advertisers want to provide users with the best creative, and the richest media they possibly can, and that’s very much in our thinking when we’re talking about what experience we’re providing to the end user.”

Some advertisers want to target only users of certain handsets, Gleeson explains, because they believe that those users will have more spending power. But ESPN’s appeal to advertisers is more about reach than it is about specifics,” he says. “We don’t have a lot of registration data, we’re not tracking that. We do a lot of research around who our fans are and how they’re accessing our content—and when an advertiser is trying to target men of a certain age, then we fit the bill. But I wouldn’t say that we have very detailed, in-depth individual data on our users.”

That at least is one area where the operator community will be able to outdo the content provider. But content like video remains a hugely appealing medium for advertisers. The headline sponsor on the new Goals app will be given three-second video slots ahead of the footage of the goals themselves. ESPN is confident that this is enough to appeal to the media buyers.

It wasn’t too long ago that a lot of operators could be heard to proclaim that “Content is King”; but that was when they thought they would be the gateway to that content. That model was a failure, though, and now operators have to play in a world where the King doesn’t necessarily value them that highly.

Gleeson doesn’t pull his punches when asked about the position of the operator in the value chain. “With our current business model we don’t have much interaction with the operator, they are just the pipe, really,” he says. The nature of the business means that ESPN works far more closely with handset manufacturers and the application store owners, he says. “That’s the distribution model now; it’s all about the application stores and it doesn’t really matter about the operator.”


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