DELIVERING PREMIUM SPORTS IN EUROPE:

ARE REWARDS WORTH THE RISKS?

05/14/2020

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AGENDA

Distribution reach and financials

Typology of actors : Pay-TV, telcos,

OTTs, Tech giants

Market structure and competition

Our focus today: Premium sports

distribution

PREMIUM SPORTS

DISTRIBUTION

STRATEGIES IN EUROPE

SPORTS RIGHTS HAVE EXPERIENCED A MASSIVE GROWTH

Source: Dataxis

SOCCER LEAGUES’ DOMESTIC RIGHTS VALUE PER SEASONEUR

Millio

ns

2013 2016 2019

2016 2019 2022

1300

610

829

630

412

2070

726

9631008

628

1890

1153

973

1140 1170

0

500

1000

1500

2000

2500

2012 2016 2020

2016 2020 2024

2012 2015 2018

2015 2018 2021

2015 2016 2019

2016 2019 2022

2009 2013 2017

2013 2017 2021

KEY PLAYERS IN PREMIUM SPORTS DISTRIBUTION IN WESTERN EUROPE

Source: Dataxis

TRADITIONAL PAY-TV UNDER PRESSURE FROM SVOD

PAY-TV & SVOD PENETRATIONWestern Europe – 2015-2019

Number of subscriptions, % of total households

Millio

ns

PAY-TV & SVOD REVENUESWestern Europe – 2015-2019

EUR

Billio

ns

Source: Dataxis Source: Dataxis

0%

10%

20%

30%

40%

50%

60%

0

20

40

60

80

100

2015 2016 2017 2018 2019

SVOD subscribptions Pay-TV subscribers

Pay-TV penetration SVOD penetration

0

5

10

15

20

25

30

2015 2016 2017 2018 2019

SVOD revenues Pay-TV revenues

TRADITIONAL PAY-TV THREATENED BY RIGHTS HOLDERS

RIGHTS HOLDERS OPERATORSAGENCIES

CONSUMERS

TRADITIONAL

DISTRIBUTION

D2C

OFFERS

Source: Dataxis

SPORTS OFFERS

RIGHTS REPRESENT A HUGE INVESTMENT FOR OPERATORS

FOOTBALL RIGHTS VALUE VS PAY-TV REVENUESSpain – 2017-2022

EUR

0

300

600

900

1200

1500

1800

2100

2400

2700

2017 2018 2019 2020 2021 2022

UEFA Champions League rights value LaLiga rights value Pay-TV revenues

Millio

ns

Source: Dataxis

SPORTS: A MARKETING TOOL FOR TELCOS

PAY-TV REVENUES BY TYPE OF ACTORWestern Europe, 2019

% of total Pay-TV revenues

PAY-TV REVENUES GROWTH BY TYPE OF ACTORWestern Europe, 2019 vs 2018

Source: Dataxis

Source: Dataxis

3-play TV only

-6%

-4%

-2%

0%

2%

4%

3-play TV only Total

TELCOS USE DIFFERENT STRATEGIES TOWARDS SPORTS

AVAILABILITY OF SPORTS IN OPERATORS’ OFFERSSelected examples

SPORTS PENETRATIONBelgium, 2019

% of total Telenet TV subscribers

13%

87%

Play Sports subscribers Other TV subscribers

9%

91%

Play sports revenues Other TV revenues

TV REVENUESBelgium, 2019

Million EUR

PAY-TV AND

BROADBAND

OFFERS

SPORTS OFFERED FOR FREE

TO BROADBAND AND/OR

TV SUBSCRIBERS

Source: Dataxis

ORIGINAL

CONTENT

SPORT

SPORT IS PART OF A WIDER CONTENT STRATEGY

MAXIMIZE SERVICES

VALUE

DIFFERENTIATION

THROUGH PREMIUM

CONTENT

OWNERSHIPS

HIGH VALUE

CUSTOMERS (88,4€

convergent ARPU

2019)

GROWTH IN

CONVERGENT

CUSTOMERS (93% of

TV base in 2019)

Source: Dataxis

NEW OTT PLAYERS: DISTRIBUTION IS KEY

DISTRIBUTION AGREEMENTS WITH LOCAL MAIN

PAY-TV OPERATORSSelected examples

Distribution income

OTT subscriptions

Advertising

Other revenue

ELEVEN SPORTS – REVENUE ALLOCATIONGlobal – Year ended 30 June 2018

% of total revenues

Source: Dataxis

TECH GIANTS: A GROWING INTEREST IN SPORTS DISTRIBUTION

GROUP STRATEGY

Premium live

US & Western

Europe

Build a global

ecosystem

High, direct

competitor

GEOGRAPHICAL

FOCUS

TYPE OF CONTENT

THREAT TO

BROADCASTERS ?

Agregator (YouTube

TV) in the US

Non-Premium live,

mainly highlights

US & Global

Attract advertisers

Low, more a partner

Premium live in

some markets,

but mainly

highlights, non-

exclusive live

US, LATAM and Asia

Growth in rising

markets and mobile

Low, more a partner

Mainly highlights,

non-exclusive live

US & Global

Invest in content to

boost audience & ad

Low, more a partner

Source: Dataxis

TRADITIONAL SPORTS PAY-TV ACTORS AS AGGREGATORS ?

PARTNERSHIPS BETWEEN OPERATORS AND SVOD PLATFORMSSelected examples, 2019-2020

2019 2020

PARTNERSHIPS BETWEEN OPERATORS AND NETFLIXSelected examples, 2017-2020

2017 2018 2019 2020

Source: Dataxis

GOING OTT D2C, A MUST HAVE FOR PAY-TV BROADCASTERS?

A D2C OTT OFFER CAN BECOME CRUCIAL TO

COPE WITH MARKET CHANGES

BUT IT TURNS TO BE LESS RELEVANT FOR

TELECOM OPERATORS

PAY-TV BROADCASTERS HAVE OTHER WAYS

TO COMPETE WITH OTTs

FLEXIBILITYPERSONALIZED

CONTENT

USER

EXPERIENCE

Source: Dataxis

CONCLUSIONS AND OUTLOOK

▪ OTT supremacy?

▪ Impact of COVID-19?

▪ Piracy?

▪ Market consolidation?

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