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Future Gazing: EuroLeague was Early on OTT, Sees VR as Next Big Opportunity 👀
The EuroLeague sees VR akin to OTT circa late '00s. While few are currently paying attention, there is an opportunity to get a head start on a potentially lucrative future revenue stream.
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The 2023 Turkish Airlines EuroLeague Final Four takes place this weekend, May 19-21, in Lithuania.
However, European basketball fans won't have to fly to Kaunas to get a courtside view of the action. The EuroLeague is once again livestreaming the games in virtual reality (VR).
The European club competition first offered a VR product to fans in 2021. Those who wanted to watch the Final Four as though they were on the sidelines in Cologne could purchase a 'virtual ticket' to do so.
The EuroLeague introduced the offering at a time when fan attendance was limited. But it has continued to lean into the technology, even with buildings having returned to capacity.
Earlier this year, EuroLeague expanded on its agreement with VR provider YBVR to include the broadcast of select regular season games.
“I always compare [VR] to OTT,” Alex Ferrer-Kristjansson (senior director, marketing and communication, EuroLeague) said. “In the early 2000s, nobody was doing OTT and nobody was paying attention. But [some of] those who got in early have built a very successful business around that.”
While many rightsholders now have their own OTT platforms (see: FIFA+, LIV Golf, NWSL), the EuroLeague has been in the business for more than 15 years. It first introduced EuroLeague TV back in 2007.
And the platform has become an important fan engagement tool and revenue source for the league having more than doubled its subscriber count and incoming revenues over the last three seasons.
As a result, the league has actively sought to protect its streaming rights in broadcast partnerships with few exceptions.
Ferrer-Kristjansson sees VR today in a place akin to OTT in the late '00s.
“We are doing this and nobody is paying too much attention," he said. "As the penetration and the acceptance of these [technologies] by consumers increases, and as the hardware gets better and lighter, [that will change].”
Widespread penetration may be closer than many sports industry insiders think, particularly if Apple's AR/VR headset, which is expected to debut later this year, touts 3D sport as its 'killer feature'. Remember, Apple acquired NextVR, a company specializing in delivering live and on-demand events in immersive virtual reality, back in 2020.
Combine those developments with Apple’s recent investments in live sports (see: MLB, MLS), and the fact that iOS 16.5 beta included a YouTube-style ‘multi-view’ experience enabling streamers to switch between different cameras angles during sporting events, and one can envision where the tech giant envisions broadcast going.
It should be noted that XTADIUM, the VR App developed by YBVR, gives fans similar capabilities. Viewers can also select from real-time statistical overlays and create private watch parties to enjoy games with friends.
It remains to be seen which, if any, of the features will drive adoption of VR technology.
But Chris Paget (partner in the sports group at Sheridan's) believes VR can end up becoming a meaningful monetization stream for rightsholders.
“Like other major tech companies, [Apple] has largely stayed out of expensive bidding wars. That could well change if those rights begin to move the needle on product sales and/or the product creates opportunities for new subsets of media rights," he said. "Such an approach could be seen as analogous to the broader business case of the telecoms companies who [have] historically been the major acquirers of sports media rights as the hook to cross-sell their primary offering.”
While Meta hasn't made as large of a splash as Apple in acquiring sports rights, it did announce a deal in April with Peacock that will make the streaming service –including live NFL and MLB games– available to customers in the U.S. via its Meta Quest 2 and Meta Quest Pro VR headsets.
The momentum behind the tech suggests those two leagues, and others that have bundled VR rights into broader agreements, may be missing out on a potentially lucrative opportunity sooner than later.
“It happened with radio, then with TV, with OTT and it will happen with VR,” Hector Prieto (CEO, YBVR) said. “It takes some time for technologies to reach their maturity state, but VR has now reached that turning point. We are seeing many big sport media players positioning themselves around the business potential of immersive live sports experience. Early adopters are those that will have a greater success.”
In addition to EuroLeague, the NBA, UFC, NASCAR and WNBA have all signed deals in recent months with companies looking to bring viewers closer to the game.
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