OTT to Lead Gains in AsiaPac Sports Media Revenues

Sports media revenues across 11 AsiaPac markets will rise to $7.2 billion in 2024, a compound annual growth rate (CAGR) of 6.7 percent, driven by the OTT sector, according to new research from Media Partners Asia (MPA).

Per MPA, sports TV revenues will remain relatively flat at $4.3 billion by 2024, while OTT sports revenues will rise at a 22 percent CAGR to reach $2.9 billion. In the same period, sports rights costs will increase by a CAGR of 3.8 percent to reach $6.6 billion. Costs were up by 2.4 percent last year to reach $5.5 billion, while revenues rose by 7.8 percent to $5.2 billion.

The Asia Pacific Sports Media 2020 report found that OTT accounted for 21 percent of sports media revenues in AsiaPac last year and is set to make up 40 percent by 2024. Excluding China, OTT will account for 23 percent of sports media revenues, up from 12 percent last year. The report also cautions that this year’s key sporting events, including the Tokyo Olympics and UEFA EURO 2020, could be impacted by the global spread of the coronavirus.

Srivathsan A R, senior analyst at MPA, noted, “The market for premium sports remains relatively healthy in Asia Pacific, in spite of uneven structural dynamics and the corrosive impact of piracy. Sports rights investments in China, India, Australia and Japan are driven by a strong domestic sports ecosystem, supported by premium international rights for football, basketball and baseball. Rights costs in China are driven by a growing appetite for domestic and international football as well as basketball. Growth momentum, strong between 2016-19, will stabilize post-2021/22. Cricket continues to drive more 85 percent of India’s costs. Rationalizing of pay-TV spends on domestic rights in Australia will affect the overall market in the future while domestic baseball and football will drive growth in Japan’s sports rights market. Greater Southeast Asia, including Hong Kong, is dependent on growth in international football and basketball. Local football in markets such as Thailand, Indonesia and basketball in the Philippines will continue to deliver additional growth.”

Vivek Couto, MPA’s executive director, identified the types of operators that are finding investments in premium sports rights to be “scalable and sustainable.” These include “large scale internet players with pole position in a vast digital ecosystem, which helps subsidize investment in premium content,” such as China’s Tencent, and hybrid AVOD/SVOD operators delivering both entertainment and sports, such as India’s Hotstar and iQiyi in China. Sports investments are also lucrative for pay-TV operators that are growing their OTT businesses, such as Foxtel, Sky Network TV, Astro and PCCW’s Now TV. Sports rights investments are also fruitful for local and regional broadcasters “that have a combination of mass reach and premium segmentation with branded sports networks (i.e. Star and Sony in India; select free-TV players in Southeast Asia and regional pay network beIN Sports).”

Football (soccer) continues to drive the AsiaPac sports rights market, led by the Premier League. MPA says that the Premier League rights value is expected to moderate after 2022, particularly in China. Cricket continues to be lucrative in India, as well as Australia and New Zealand. Basketball is growing in demand regionally.