BARCELONA: Qatar’s BeIN Media Group has rapidly expanded its Spanish subscriber base since winning the domestic broadcast rights for the country’s soccer league, but widespread illegal streaming blights the pay-TV sector and changing viewing habits are also eroding the business case for conventional sports coverage.
BeIN is the former sports division of Al-Jazeera. It broadcasts to 34 countries and is the lead soccer broadcaster in Spain, France, the Middle East and North Africa. Its rapid expansion has been unfettered by harsh austerity measures imposed on other Qatari state-run institutions that included massive job losses at Al-Jazeera following the energy price slump.
BeIN Sports launched in Spain in 2015, providing coverage of the Champions League and Europa League before partnering with Barcelona-based Mediapro to secure the principal domestic rights to La Liga — Europe’s strongest league — and the Spanish Cup for three seasons from 2016-17 onward, paying €1.9 billion.
The capture of La Liga rights was a blow to former telecoms monopoly and dominant broadband provider Movistar, which aimed to follow the model of Britain’s Sky in using sport to win both Internet and television subscribers.
“Even though the fees BeIN paid in Spain were quite considerable, generally the company has been cautious and does not go into a market and try to knock out every other bidder,” said Tim Westcott, senior principal analyst for TV programming at IHS Technology in London.
“They are almost certainly not profitable but I do not think they are paying ridiculous sums of money, at least on their TV operations. Their European business could be being bankrolled by the profitability of the core business in the Middle East.”
BeIN did not respond to questions from Arab News about the company and Mediapro declined to reveal their partnership’s commercial terms.
BeIN broadcasts eight of the 10 La Liga games each week, including at least one featuring Barcelona or Real Madrid, plus one Clasico game between this pair per season. That Real-Barcelona clause is crucial, with Spain’s Big Two dominating the league to an extent unseen elsewhere in Europe.
December’s Clasico attracted 2.2 million domestic viewers, nearly double the next most-watched game this season, according to Mediapro. In total, eight matches have drawn over 1 million viewers, all of which involved either Real or Barca. The highest-rated game not featuring this duo was October’s clash between Sevilla and Atletico Madrid, which attracted 0.77 million viewers.
Mediapro also provided audience data for two game weeks in mid-January. This showed the average audience for its 14 matches not including the Big Two was 0.3 million viewers. In a country of 49 million people, soccer accounts for 3 percent of Spain’s total TV audience, according to analysts Viewmetric, and a 5 percent decline in viewing figures in 2015-16 versus a season earlier mirrors trends elsewhere; the Premier League has suffered a 25 percent audience drop since 2010 despite the surging value of broadcast rights.
“Pay-TV companies do not necessarily measure their success in terms of viewers. The number of subscribers is what is important,” said Westcott.
“Inevitably matches involving the biggest two to three clubs get much bigger audiences, that is true in most leagues (but) I do not think they can ignore audiences because if people are not viewing the channels they are paying for they are less likely to continue with their subscriptions.”
BeIN says its Spanish channels have 4.5 million subscribers combined across all platforms, while Spain has about 15.3 million broadband subscribers.
The cost of BeIN packages varies and is usually sold as part of a broadband package, but the cheapest subscription is directly through the company at €9.99 per month. Prior to BeIN’s acquisition of La Liga rights, Spain was found to be the most expensive country in Europe to watch televised soccer because of the myriad pay-TV and pay-per-view subscriptions required to follow a team.
Such high costs in a country still recovering from the financial crisis may explain why illegal streaming in Spain is among the most widespread in Europe. A 2016 EU study showed 69 percent of Spanish 15- to 24-year-olds access digital content illegally, including sports.
“The effect of live streaming in sports broadcasting seems to be to reinforce the dominance of the first mover by weakening the scope for commercial challengers,” said Dr. Matthew David, a lecturer at England’s Durham University.
“There are many sports fans who cannot afford to see live matches, cannot afford TV subscriptions, do feel disaffected and will illegally stream in their millions but for those who can afford to pay it seems as though it is a badge of identity that they can be fans and be loyal to the commercial provider.”
Sky is also a broadband provider and has an extensive non-sports network of channels so is more immune to streaming, whereas pure-play sports broadcasters such as BeIN’s Spain operations are markedly more vulnerable.
“If you are not selling other products, only have the one product to sell and that product is freely available from someone else, then you are in a very vulnerable situation,” added David.
One-fifth of Spanish Internet users stream soccer illegally, La Liga told Arab News. In 2015, about 2 million homes illegally watched 141 million matches; the league estimates the value of these illicit transmissions at over 410 million euros.
“If there (is) audiovisual piracy, the market value could go down and damage revenue,” said a league spokesman.
It has developed tools to trace and analyze streaming websites and has launched a crackdown on hotels, restaurants and cafes showing such streams.
Broadcasters also face another challenge: The changing habits of viewers, especially younger audiences, who watch matches less intently and often use multiple screens simultaneously.
“There is no doubt people have shorter attention spans,” said Tim Crow, chief executive of Synergy, a London-based sports marketing agency.
“There is a lot of evidence younger fans would rather watch a highlights package or watch just a part of the game. Rights-holders and broadcasters are going to have to repackage the way they distribute and sell their content to adapt to those changing viewing behaviors and viewer demands.”
Younger adults seem less willing to pay hefty subscription fees for live sport and some broadcasters are beginning to question whether the huge sums TV rights command are justified, added IHS’s Westcott. “There is so much other content available online on services like Netflix that possibly people are saying sport is not the must-have content it used to be 10-15 years ago.”