A blog for students of Professor Kagan's Digital Marketing Strategy course to comment and highlight class topics. From the various channels for marketing on the internet, to SaaS and e-commerce business models, anything related to the class is fair game.
Wednesday, October 24, 2012
Digital Media & The Sports Experience
Live attendance at sporting events has been trending downward for the past 4 years, yet TV ratings for the same events have been trending upward. The catalyst for these revolutionary trends? Digital media. The two obvious technological advances driving this sea change are high-definition television (HDTV) and digital video recorders (DVRs), which provide fans views of the game action and unfettered access to replays, and do so in a manner that makes watching at home arguably superior to attending the game live (at least in terms of price and quality). Digital media has also changed sports consumption in other creative ways, as the tech blog Mashable points out in this article. For the most part, the digital media revolution has closed the distance between fans and the sports they follow, which may or may not be a good thing depending on which athlete's Twitter page you're reading at the moment. However, the digital media revolution has had a much bigger effect: it has played a significant part in the work stoppages of 3 of the 4 major North American sports leagues (NFL, NBA, NHL) within the past 3 years. League revenues have skyrocketed as digital media has made sports easier to distribute and market to global consumers. The collective bargaining agreements between players and owners in each sport stipulate some form of revenue sharing from team operations, but in each CBA the revenue source categories and associated player/owner split percentages are different. To make a long story short (and if you do want a longer story, grab some popcorn, get comfortable, and go here), digital media is radically shifting the size and the composition of the revenue pie for sports franchises - from gate receipts and concessions to digital media and advertising - and players and owners want to be compensated accordingly. The million-dollar problem that leads to contentious arguments and cancelled games? It's that the future of digital media, as with any techno-centric industry, is so unpredictable, and neither players or owners can agree on how lucrative the future will be and therefore what will be a fair split of that pie. Whatever happens, we'll be watching intently on our HDTVs to see what the future holds...
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