The China sports TV market has been a hot bed of activity in recent years as a combination of a booming economy and the ability to deliver live streaming content to mobile devices and PCs have opened up new growth opportunities. So the question for many in the sports industry is what's next? That subject was part of a panel discussion at Sportel Asia, held in Singapore this week.(l-to-r) Beatrice Lee, Hang Yu, Jim Small, Sam Li, and Richard Welbirg discussed the state of the China sports TV and media market at Sportel.
The subject of the future growth of the sports industry in China was first up topic wise, with Beatrice Lee, MP & Silva, managing director for Asia Pacific saying that the sports market has grown for the past 20 years and that the mandate of the Chinese government to grow sports participation via a massive infusion of government funding will help the market continue to grow in the future. The government's goal is to take the sports industry from its current level of only 0.6% of gross domestic product to 1% by 2025, a move that would see the industry become worth more than $800 billion U.S. dollars. Lee added that even with the recent dip in the Chinese economy the amount of money that the government has huge compared to any country in the region.
As an agency we need to be more creative and have more strategic partnerships, she explained. And when it comes to future business models Lee is betting on the pay model.
Consumers realize they are not just paying for content but for quality, more control, and the choice and freedom to watch what they want when they want to watch it, she explained. And how we can profit on this trend ultimately depends on what rights we have in the market and being more brave than everyone else.
For example, the agency last year inked a deal with Le Sports to deliver more than 1,800 hours of live football coverage per season over digital outlets. The content lineup includes top-tier Italian football division Serie A; top-tier French Ligue 1; Belgium's Pro League; plus English football's FA Cup, Football League Championship, and Capital One Cup. The deal also included the Scottish Premier League, Brazil national team global tour matches, and England national team matches.
CCTV had the Serie A rights for more than 20 years but the digital rights give us the reach to give advertisers a more targeted audience compared to traditional media, said Lee. And Le Sports is a good partner to work with without losing CCTV as a traditional partner.
Sam Li, Sina Sports, head of content acquisition, agreed that CCTV is not a competitor for digital properties as Sina Sports was able to have more than a million fans interacting on its platform about a football match that was broadcast on CCTV.
It worked pretty well as we can provide a lot of different components [to complement the CCTV broadcast], said Li.
Sina's core business of digital distribution has been in a boom and that there is also a big enough industry to allow for different business models to exist.
We have 20 million visitors on a daily basis and we listen to what they want and that is interesting content, whether it is live or non-live, he explained. And what they are telling us is that what we have is very sticky and they will visit our site on a daily basis whether or not we have a live event that day. And that is because of our editorial team, reporters, and the great news we offer as well as up-to-date news.
Sina Sports has also added Manchester United's club channel to its product offering, a partnership that Li sees as valuable. It also goes to Lee's point that the new nature of rights deals in China mean more than just video content.
It's not just a channel with 24/7 programming but a partnership that will include off-line events, marketing, merchandise, and whole series of other elements, says Li.
Talkin' Baseball
Hang Yu, Le Sports, VP of Strategy, has overseen some notable rights deals, including a three-year deal with Major League Baseball signed in January that gives the company exclusive media rights to broadcast 125 MLB games per season through the company's Web site, mobile apps, and OTT devices. The deal includes four HD games per week plus 20 HD post-season games, the All-Star game and Home Run Derby, and the World Series. The deal also includes VOD rights for re-broadcasts.
During the past 14 months I have seen the biggest revolution in rights acquisition market, bigger than in the previous 15 years, he said. It's unbelievable how much of an increase there has been in licensing fees for all kinds of properties.
Jim Small, MLB, President of Asia/Pacific, provided the rights owner perspective for the session, explaining that the deal with Le Sports is about more than just the games and is the result of years of investment by MLB into the Chinese market. Those efforts began with putting bats and balls into the hands of Chinese athletes and youth across the country via a road show that has helped more than 600,000 children play baseball. Dipping a toe in the water allowed the league to understand the Chinese market and the opportunities.
It's about the ability for fans to come in and buy products for a team on the Le Sports store or chat rooms where people can talk about the games with like-minded people, he said. And we are extending it to the University arena where there are 80 Universities playing baseball in China, with more baseball teams than basketball teams in the Beijing area. There is a rounded aspect to our relationship with Le Sports and we are in it for the long haul as our next step is to make China a baseball-playing nation.
Le Sports also acquired the rights for Chinese Super League football for the next five seasons for $414 million. The first two seasons call for the games to be
