Olympic record gold for NBC TV Everywhere in battle against Netflix
Editor | 06-08-2012
It may have shocked and disappointed sports fans across 50 states by failing to show the 100m Final live, but NBC is basking in an undisputed triumph for its TV Everywhere Olympics offering.
According to research released by the US National Inflation Association (NIA), in the four years between the Beijing and London Olympics, Netflix has been the clear leader in terms of Internet bandwidth consumption, accounting for just under a third (32%) of net resources. Yet after just a week of the Games NBC's Olympic 'TV Everywhere' coverage is in gold medal position, peaking at 34% of total bandwidth across major US networks nationwide, with Netflix slumping to 25%.
The performance is been seeing as adding to vindication of the broadcaster’s $1.3 billion expenditure on broadcasting the London Olympic Games. However there is some way to go in the monetisation stakes: NIA calculates that live sports programming currently accounts for a fifth of programming hours consumed in US households but the combined costs of national and regional sports networks now make up half of the cost of the average US cable bill.
Looking more broadly ta the sports rights industry, NIA cites ESPN as the most expensive channel for pay-TV companies to provide, with the average pay-TV company paying $4.69 per subscriber per month to be able to offer ESPN. It also notes the LA Lakers inking a $3 billion, 20-year deal with Time Warner Cable that averages out at $150 million per year.
Yet, says NIA, sport is the key for pay-TV firms in their battle against the ever advancing over the top (OTT) firms, most notably Netflix, who the analyst believes cannot effectively bid for sports rights with business models based around a customer charge of around $8 per month. And once with sports rights, pay-TV firms are looking to TV Everywhere to fend off OTT plays, the most successful of which to date is HBO GO.
As an indication of how successful the Olympics rights holder’s TV Everywhere offer has been, NIA observes that NBC has reported that over the first seven days of the Olympics, 6.2 million Americans have authenticated their pay-TV subscriptions to watch NBC's Olympic TV Everywhere streams, something claimed as a world record for a such an event. Furthermore NBC says that it has delivered 75 million streams in seven days with 34 million of them being live stream.