Streaming Gives Tennis and More A Sporting Chance to Generate More Revenue

Back in the early days of cable television, programming mimicked traditional television broadcasts, mainly because local stations wanted to expand their reach nationally via the use of the new technology. A combination of satellite uplinks/downlinks and community "head end" cable facilities was used to distribute regional powerhouse stations—like Atlanta’s WTBS ("The Super Station") or Chicago’s WGN—into communities across the country. The business model was simple: the stations, without changing their programming, could charge more for ads that would be seen nationally rather than ones seen locally.

Once cable television achieved significant market penetration, though, innovative entrepreneurs began packaging content into channels that serviced a specific niche. One of those niche channels, started in 1979, was originally conceived just to cover sporting events in the state of Connecticut. But when Bill Rasmussen, a television sports reporter from an NBC affiliate in the Northeast, wanted to purchase satellite transponder time, he was told that buying a continuous 24-hour satellite feed was less expensive than buying several hours each night. Based on the fact that the satellite would cover the entire country, he decided to do an experiment and test a 24-hour nationwide network dedicated to sports content.

Rasmussen’s network, ESPN, was one of the first to demonstrate that niche content channels could be successful in creating a demand for a particular technology, as ESPN’s programming drove consumer adoption of cable and exposed many consumers to sports that they may not otherwise watch. Along the way, ESPN has expanded to several networks, allowing live simultaneous coverage of several sporting events, and been involved with streaming content via the web and mobile devices. ESPN’s willingness to embrace new technologies shows just how great the appetite for sporting programming really is.

Streaming Mimics Cable
While it’s almost cliché to say that new mediums mimic old mediums, streaming of sports content is an area where this has been especially true. Most early streaming of sporting events were just repackaged TV or cable broadcasts—a way to test technologies and business models in an era where broadband penetration was limited. But streaming is at one of those tipping points where the technology’s been proven and now innovative programming models are beginning to reveal themselves.

A recent announcement illustrates this point. Major League Baseball (MLB.com) has used various partnerships through the last seven years to put games on the web, starting with audio streams and progressing to video streams, and eventually bringing most of these expertise and capabilities in house.