Documentary Business

Peter Hamilton Consultants, Inc

Sports viewers are leaving the channels. Why? What it means for the Documentary Economy

Sports ratings in the U.S. are in sharp decline.

  • Why?
  • What does it mean for the Documentary/Unscripted sector?

Graphic retrieved from Sports Media Watch

What’s driving Sports viewing?

Some industry analysts blame Covid:

  • Empty stands take away the noise, the fan reaction shots and fan storylines that both energize games and deepen the viewer’s emotional engagement.
  • Many fan-free top-flight games in US and UK have the appeal of a Croquet championship.
  • Adding weight to this theory by contrast was the recent success of the Aussie Football League (AFL) Grand Final in Covid-free Brisbane. Cheering, unmasked fans packed the stands, creating a viewing experience vastly different from any EPL or NFL game. (Watch game highlights here)

Others point the finger at politically involved athletes:

  • They say that heavy Sports viewers are turning off because they reject anthem-kneeling and similar displays of engagement.
  • However, National Hockey League athletes are the least likely to make political statements, and the Stanley Cup finals suffered the greatest viewing decline reported by SportsMediaWatch

Some blame Apps:

  • Prior to the rise of apps, heavy Sports viewers like me would use our remote to flick from channel to channel, and game to game.
  • Shifting between an app like Netflix and the channels is a ‘multi-click’ affair.
  • Once viewers have settled on an app, they are less likely to graze the channels, looking for a game that suits them.

Graphic retrieved from Social Bakers

A 4th theory points to social media:

  • There’s no doubt that social media is changing the way fans engage with Sports.
  • Viewers of live Sports are increasingly using multiple devices, either to make deeper connections between the game and its players, or to pursue their social lives outside the game that they are watching.
  • Fans are shifting their allegiances from teams to players. Lebron James enjoys nearly 50 million Twitter followers, versus 9 million for the LA Lakers.
  • And the world-at-your-fingertip experience of the mobile device is undermining many fans’ patience with televised games that last as long as 3-hours for baseball and NFL.

The unified theory:

  • Covid is accelerating a dramatic shift in the ways viewers’ consume video primarily from channels to an evolving mix of channels, video apps and social media.
  • The decline in Sports viewing in 2020 both anticipates and drives shifts in viewing across other genres, including the Unscripted / Documentary category.

The Old Model

  • Sports, Movies, Kids, News and Entertainment were the programming legs on which the 500-channel broadcast / cable model grew into a billion-dollar industry.
  • The Documentary / Unscripted category is a niche strand within the TV Entertainment leg.
  • Advertising and affiliate fee revenues created fortunes across the multi-channel value chain, including for factual networks, distributors and producers.

Recent Erosion

  • Kids dumped Nickelodeon for YouTube years ago, and now TikTok is their hot option.
  • TV News headed online a decade ago, though Fox News thrives with older viewers.
  • The Hollywood studios are caught in a pandemic trap:
    • Will they wait to release their hit-bound mega-movies in cinemas after Covid?
    • Or will they premiere them on their new streaming platforms, like Disney+?
  • While the studios dither, Netflix is releasing a stream of big budget movies that only studios could afford until recently.
  • And now, Sports has joined these genres with a unique set of issues that is eroding its audience and in turn, the multi-channel model which has enabled a decades-long boom in the Unscripted niche.

Graphic retrieved from Lightshed Partners

Cord-cutting Accelerates

  • Analysts are predicting around 50 million US subscribers by the mid-2020’s.
  • That’s down from 100+ million a decade ago.
  • The channels’ subscriber and advertiser revstreams are in sharp decline.
  • And hence so are the networks’ programming budgets.

Streamers Ramp Up

  • Streamers led by Netflix are expanding their pipelines of originals, including documentaries.
  • However, the streamers’ volume of commissions is less than the channels because they are not tied to an hourly live schedule.
  • Nevertheless, in aggregate the channels still spend several billions each year on new Unscripted / Documentary programs.
  • Read my guides NETFLIX 2021: What You Need To Know Now! and 32 U.S. Networks: Budget Sweet Spots to learn what they are buying for 2021, and who are the key buyers.

More to read…