
"Streaming services like Netflix, Disney+, Apple+ etc that benefited from live sports being dark have the most risk to their U.S. reported sub adds during the second half," Laura Martin writes.
The return of live sports to U.S. TV screens will set "record" ratings in the second half of 2020 and attract new pay TV subscribers, including so-called "cord-nevers," or, mostly younger, people who have never before subscribed to pay TV services, instead relying on video streaming products, according to a Monday report from Needham & Co. analyst Laura Martin.
"We believe that the return of seven pro sports in July and August plus the NFL in September suggests higher linear TV sub adds in the second half, including by cord-nevers, and higher subscriber churn for streaming services," Martin wrote. "Disney, Fox and ViacomCBS are the companies in our coverage universe that have the most upside from the return of live sports."
The analyst also highlighted: "A majority of sports fans we surveyed don't consider films or television series as substitutes to pro sports competitions, so sports programming is the cornerstone of the $150 billion revenue per year traditional
U.S. pay TV bundle. Emotionally, sports represents a large shared-interest community with the authenticity and unpredictability of live events, enhanced by a clear winner and loser at the end of play."
Overall, live sports will be "the first major content genre to return to TV owing to clearly aligned economic interests between players and team owners plus the easily identifiable billions of dollars at stake if a season (or games) are not played," Martin explained. "In contrast, new TV and film content production is heavily unionized and requires the collaborative cooperation of over a dozen guilds (eg, directors, actors, producers, editors, makeup, costumes, teamsters, etc) to re-start production at the large public content companies."
Why will live sports TV ratings hit record levels? The analyst pointed to data from a Morning Consult survey in June that
found that 27 percent of respondents self-identified as sports fans plus 38 percent as casual sports fans, implying that 65 percent of the 330 million U.S. population, or 215 million potential viewers, self-identify as sports fans. "In an environment where only news or library content (ie, reruns) have been viewable for months during lock-downs, we expect game-day TV ratings to surprise to the upside," she added.
"Supporting this conclusion, the Sunday, May 24th PGA 'match' averaged an astronomical 5.8 million viewers across the entire three- to four- hour event, and raised $20 million for COVID-19 research, doubling the goal of $10 million," the analyst mentioned. "PGA golf is not normally one of the top viewed U.S. sports, so TV ratings upside should be higher for fan favorites."
Martin on Monday also mentioned the backlog of completed films, but signaled a bigger hurdle for them as they are "awaiting the intersection of cinemas reopening and consumers willing to sit for two to three hours in an enclosed space with dozens of other people."
Who in the industry wins big from the return of live TV sports? "Assuming the current pro sports schedules remain intact, the resumption of live sports games benefits ESPN (Disney) most, followed by Fox, followed by ViacomCBS," Martin said. "Streaming services like Netflix, Disney+, Apple+ etc that benefited from live sports being dark have the most risk to their U.S. reported sub adds during the second half, because viewing time will move to sports, which may lower their perceived price/value ratio to consumers." Netflix last week forecast weaker subscriber trends in the current third quarter.
Disney, whose theme parks and film segments have also been hit by the pandemic, has the highest media rights payments for live sports content at $5.8 billion paid out in 2019, followed by Fox's $3.3 billion and ViacomCBS' $1.7 billion.
"It is most important for TV ratings and revenue that the NFL returns, followed by the NBA, owing to their large media rights fees and implied ad revenue streams," Martin concluded. "Both MLB and the NHL generate the bulk of their revenue from local sources, such as ticket sales, concessions and/or the regional sports networks. The NFL generated $16 billion of revenue in 2019, 45 percent higher than second-place MLB, 50 percent of which was from media rights fees, so the NFL returning to play is most important for Disney, Fox, ViacomCBS and the U.S. traditional TV ecosystem."
"TV" - Google News
July 20, 2020 at 08:53PM
https://ift.tt/32P5q9l
Return of Live Sports Will Set "Record" TV Ratings, Attract Pay TV Subscribers: Analyst - Hollywood Reporter
"TV" - Google News
https://ift.tt/2T73uUP
Bagikan Berita Ini
0 Response to "Return of Live Sports Will Set "Record" TV Ratings, Attract Pay TV Subscribers: Analyst - Hollywood Reporter"
Post a Comment