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SABC Sports Broadcasting: Driving the Cost of Rights

This presentation discusses the increasing cost of sports broadcasting rights and its impact on the SABC. It also explores the SABC's role in boxing and its investment in the sport.

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SABC Sports Broadcasting: Driving the Cost of Rights

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  1. SPORT BROADCASTING ON SABC PLATFORMS PRESENTATION TO THE PORTFOLIO COMMITTEE ON SPORT PRESENTED BY MR. R. NICHOLSON22/02/11

  2. VISION A world class, sport based content and production broadcaster

  3. MISSION • To be at the forefront of innovative, quality, viewer-centric, efficient, nation building sport content broadcasting.

  4. WHAT IS DRIVING THE COST OF RIGHTS

  5. SKY: Sport, News and Movies The Global trend Fox : Sport, News and Movies Multichoice: Movies, Sport and News Globo: Movies, Sport, News HBO: Sport, Sport News and Movies

  6. How has the playing field changed . (calculations based on a sample of countries and not total TV universe)

  7. The Global trend • The number of new broadcasters worldwide, has increased competition for “good sport content”, whilst the amount of “good sport content” available to buy has remained same. • This has created a serious scarcity, driving the price of sport content up at the rapid rate we are currently seeing. • In South Africa alone the introduction of Supersport and Etv created a major paradigm shift. • The SABC found itself no longer in the driving seat for sports rights, the addition of TopTV has potential to worsen the situation. • Federations were now able to pit broadcasters up against each other to solicit the highest price • The price of rights is well above its market value.

  8. THE SABC’s influencing factors The Regulations detail out a criteria in Clause 4(1) for identifying National Sporting Events of Public Interest as follows: 2.1 (a) A confederation sporting event involving a national team or an individual; (b) A semi-final and final of a national knockout competition; Or (c) An opening game, semi-final and final of a confederation sporting event. 2.2 The Regulations also lists National Sporting Events using the above criteria.

  9. SOME OF THE LISTED EVENTS

  10. SABC’s other influencing factors • Availability of the broadcast rights required, be it for radio or television. • Audiences and public opinion. • Commercial viability of the sporting activity/property. • Availability of platform space to broadcast • Suitability to the SABC’s overall strategy and that of the Channel in question. • Long term investment and strategic relevance (incubation)

  11. SABC’s spend to date on sport

  12. SO what does this tell us? • So what we can deduce is that rights fees are set to continue their increase over the next 60 months. • The rate of increase may slow down, but will still out strip the rate of growth on sponsorship and advertising revenues. • This will result in Free to Air broadcasters being squeezed further and further, as they do not have a funding model that can sustain the cost growth on sports rights. • The saving grace for Pay broadcasters is the fact that they can increase subscriptions to accommodate the rapid increase in the cost of sports rights

  13. SO what does this tell us? Cont. • TopTV has the potential to make this trend worse • Advertisers are spending less and less on sport sponsorship • In developing countries such as South Africa, Brazil and India, the man on the street, who cannot afford pay TV, will find access to sporting content increasingly difficult. • In South Africa, access to rugby content on a regular basis, requires that you pay a minimum of R200 per month, which is a tall order on a net salary of R1300 per month.

  14. LOOKING AT BOXING AND THE SABC’s ROLE 14

  15. OBJECTIVES Entertain and inform audiences Deliver world class live and magazine boxing To be sustainable Invest in the development and promotion of both amateur and professional Boxing Partner BSA and other boxing stakeholders to create a vibrant industry LOOKING AT BOXING AND THE SABC’s ROLE 15

  16. The SABC Sport BoxingKEY GUIDELINES • Promoter neutral, no preference for one over the other • Female boxers and promoters to be incubated and developed • Dates allocated annually through a tender process • Dates allocated to the best available potential fights and fighters • SABC does not get involved in the promoters staging of the fight • SABC accesses the promoter based on his staging of the fight against the deliverables he was given. • International fights are viewed separately and assessed based on individual merit. 16

  17. The SABC Sport Boxing KEY GUIDELINES cont. • The SABC funds a total 26 National and Regional live fights a year • All the funded fights are broadcast live and or delayed. • These live dates are supported by a magazine program on boxing Blow by Blow (32 broadcasts a year) • Fights are allocated annually to promoters by open proposals/Pitch process • All promoters complaint with BSA regulations can apply for a date. • The panel of assessors is made up of individuals from the SABC and from BSA, (no promoters are included for the fear of them being conflicted) 17

  18. SABC’s INVESTMENT IN BOXING TO DATE 18

  19. KEY CHALLENGES WITH BOXING • The calibre of fights to date has not been to a standard that assists the SABC drive audiences • Boxing viewership figures have steadily declined in a constant time slot over 3 years • The quality of promoting and match making is often not to the standard expected • SABC entered into a 50/50 joint venture agreement with Vodacom to support boxing and Vodacom pulled out of the agreement after 3 years • The Sponsorship industry generally see’s boxing as a bad investment and as a “blood sport” which does not suit their brands. • The SABC has single handily carried boxing since Vodacoms pull out

  20. KEY CHALLENGES WITH BOXING • SABC has developed numerous fighters through its investment, only to lose them to Golden Gloves and Supersport once they become World Title fighters and audience drivers • To actively compete and see some audience performance and returns from boxing the SABC would have to focus on top end boxers and that would defeat the developmental role. • Female fighters are not as readily promoted as male fighters • The two Female Promoters that were being incubated by SABC have both quit or put their careers as promoters on hold. • There is not enough platform space to cover more boxing

  21. What is the way forward on boxing? • Reduce our overall quantity of fight dates put to tender per year • Focus on top quality fights, with better fight staging • Investigate options of retaining the Hot Talent Boxers. • Increase the number of undercard fights per live broadcast. • Expand the Baby Champs program to cater for development boxers • Partner with the likes of Wits Business School, Gibbs, UJ to develop promoters and their promoting skills. Promoters who attend the development program to be given preference. • Increase the joint effort to seek sponsors in with BSA • Solicit S.R.S.A’s assistance with funding boxing as a National Interest Sport.

  22. Developmental sport and rural penetration .

  23. Developmental sport and rural penetration . Developmental Sport and Rural Area penetration has been and continues to be a challenge for the SABC and the key challenges are follows • Platform space particularly on TV, to show the adequate amount of developmental sport. • Subsequent to bullet 1, is the development of sporting content that speaks specifically to Rural areas. • The cost of increasing delivery • The commercialization of developmental sport. • The development of some of the federations that manage developmental sport

  24. What we are doing and intend to do • One of the key catalysts to better developmental sports coverage, will be the introduction of a sports channel in the new DVBT2 environment. • We currently cover a large quantity of sport on radio, which has the desired penetration and in all 11 official languages. • We currently cover the National Indigenous Games, we will be looking to our relationship with S.R.S.A to assist in affording these games greater coverage and perhaps live coverage on certain radio stations. • We are looking to increase the duration of Siyadlala, to ensure that it offers developmental sport a greater voice • Better scripting in our current programs to ensure inclusion of developmental communities

  25. What we are doing and intend to do • We need the Committee’s assistance with the defining of events of national interest to ensure that SABC can provide access to all sport, particularly on sports such as Rugby which currently does not have a free to air allocation. • We also need the Committee to assist with the “must carry, must pay clause” which will assist in funding sport within the SABC • We are also looking to the Committee to assist with managing the rights cost of rights from Federations in particular amongst the big 5, as high costs reduce the funds available for development sport.

  26. Questions? 26

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