• 5 Reasons Why CBS’s Live Streaming of Super Bowl 50 is a Big Deal

    Continuing the trend of making live sports available to viewers across a wide range of devices, CBS will stream live coverage of this Sunday’s Super Bowl 50 broadcast to viewers both online and through an expanded network of over-the-top connected TV devices, including Xbox One, Apple TV, Roku and Microsoft 10. This decision by CBS and the NFL to allow, and even encourage, the consumption of the premier sports event of the year through connected TV devices is significant for 5 reasons:

    1. Moving live streaming to the TV and living room – Since 2012, the TV network broadcasting the Super Bowl has made a live stream of the game available through web browsers on desktops/laptops and to mobile devices (through the NFL’s partnership with Verizon). Not surprisingly, because online viewing could not take place on televisions, total online viewership, as reported by these broadcast partners, was relatively small, averaging 800K for Super Bowl XLIV (we’re going to miss the Roman numerals!) in 2015 and approximately 538K in 2014. 

    Now, by allowing viewers to stream the game through connected TV apps on larger TV screens, the NFL and CBS are moving consumption from a more solitary experience not suitable for shared group viewing (and partying) to the comforts of a living room or den, where gaming consoles and other connected TV devices are typically located. OTT entertainment video services have seen dramatic increases in viewing when consumption shifts to the living room through connected TV apps; for example, Hulu estimates that nearly 60% of viewing through its service is now taking place on TVs.

    By putting the Super Bowl live on connected TVs, it is on a level playing field with the network feed via pay-TV, so the online audience is virtually guaranteed to grow. Hopefully CBS will share a breakdown of browser vs. app viewing, both in terms of unique viewers and time spent.

    2. No pay-TV authentication – In an attempt to reach the widest possible audience, and to appeal to “cord-cutters” and “cord-nevers”, viewers will not be required to authenticate that they are a pay-TV subscriber in order to access the live Super Bowl stream. While this policy remains the same as with past Super Bowls, it deviates from the NFL’s other broadcast partners’ (NBC, Fox, CBS and ESPN) streaming approach of requiring pay-TV authentication for most of their live streams (such as regular season NFL games viewed through the WatchESPN, Fox Sports Go and NBC Sports Live Extra apps). Instead of “cord-cutters” and “cord-nevers” being stiff-armed by TV Everywhere’s authenticated model, CBS and the NFL are welcoming them with OTT’s open arms.

    To put the decision not to authenticate into further perspective, CBS has been arguably the most vocal proponent of the value of broadcast TV networks as part of the traditional pay-TV ecosystem, pointing to the value of live sports programming as a “must have” component of the pay-TV bundle. These arguments have led to lucrative retransmission fees from pay-TV operators to CBS and other broadcasters. By not requiring authentication for the most popular television event of the year, CBS is both weakening its retrans argument and essentially limiting itself to just one revenue stream. This decision was likely made through the rights negotiations with the NFL, which pushes to achieve the widest possible reach for its signature game, and it highlights the conflicting goals and realities faced by players in the ecosystem.

    3. Showcasing content in connected TV apps – For many years broadcast and cable TV networks have used sports, and football in particular, to promote other content available on their networks and web platforms. With the Super Bowl delivered into viewers’ living rooms through the CBS Sports connected TV app, CBS can introduce OTT sports viewing to a new universe of users and showcase the depth and breadth of other on-demand and archival content available in their apps. Importantly, CBS can also use the Super Bowl to introduce its “CBS All Access” SVOD service to OTT-leaning viewers. CBS understands the promotional potential as it has already announced it will premiere the first episode of the new “Star Trek” series in 2017 on its network, in order to promote CBS All Access, where all subsequent episodes will be exclusively available.

    4. Big test of OTT’s potential right in time for a game-changing Thursday night football OTT rights deal – The NFL has experimented with OTT distribution of its games, including the Bills-Jaguars online-only stream with Yahoo! in October 2015, along with online simulcast regular season and playoff games through its broadcast partners’ digital properties. As the technology to enable these kinds of large-scale streaming offerings matures and as younger audiences continue to choose OTT services over traditional pay TV subscriptions, the NFL (and its network partners) are no doubt looking to learn as much as they can about the attractiveness of OTT as a distribution model. And, to the extent that viewership (both in terms of raw numbers of viewers and length of viewing) through connected TV apps is significantly higher than in past years, this may accelerate the NFL’s embrace of OTT delivery of its games and content through its own and its media partners’ apps.

    By announcing it will split the OTT distribution of its Thursday night football package into a separate deal, likely with an online-only partner such as Amazon, Apple, Google or Facebook, the NFL is staking its claim that there is tremendous value in online distribution and taking steps to reach the broadest possible audience, including those outside the pay-TV audience. The stronger the Super Bowl’s OTT performance, the better the negotiating story the NFL will have with prospective OTT bidders. Gotta love the timing!

    5. OTT and TV ads will be the same for viewers and advertisers – CBS has announced that it will deliver all of the same national ads to its connected TV app viewers as it will in the TV feed. This differs from past live streams, where a sizeable portion of the ads were online-only and sold separately. By delivering the same ads in the connected TV apps as it does through the TV feed, CBS ensures all viewers get to share in the experience of viewing the popular Super Bowl ads, while providing advertisers (who are being charged by CBS $5 million per 30 second spot) with the largest possible audience. (note that locally-sold and broadcast ads, which sell for much less, will not be shown in the streaming version).

    This move by CBS has the potential to alter the structure of how ads in online streams are sold, as CBS is requiring advertisers to run their ads in both the TV and OTT feeds and to pay for the OTT audience at the same rate as the TV audience. By combining the audience for measurement purposes and equalizing the value for online and TV audience, specifically for a unique and premier event like the Super Bowl, CBS is making a bold statement that it sees OTT as an appealing medium for advertisers and viewers. However, to fulfill on this bold vision, much work remains to be done on measuring these audiences effectively, quantitatively and qualitatively (especially for less prominent events than the Super Bowl), ensuring quality of video delivery, and easing measurement and management for advertisers and their agency partners.

    In many ways, the Super Bowl is a unique media event, both in terms of the social nature of viewing (expanded, even for football) and mass appeal that the game has, bringing together casual fans with the rabid fans that are the lifeblood of the NFL. This year’s approach shows how important it is for the league and its media partners to cultivate streaming audiences and develop viable monetization approaches for OTT services.

    By bringing OTT live streaming of the year’s most popular sports event, completely free and without requiring pay-TV authentication or any other type of consumer payment, to an expanded range of connected TV app partners, the NFL and CBS are “flooding the zone” to ensure the game is accessible to virtually all viewers. Every year the Super Bowl is the “Big Game” but this year, it’s a “Big Deal” as well.