Monday, June 4, 2018, 4:34 PM ET|Posted by Will Richmond
Discovery has signed a 12-year, $2 billion deal with the PGA Tour for global multi-platform live rights in 220 markets outside the U.S. for all PGA Tour properties. The deal provides access to 150 tournaments per year (2,000 live hours) including high-profile events such as The PLAYERS Championship, the FedExCup Playoffs and the Presidents Cup (though I believe it excludes other marquee events such as the U.S. Open, the Open Championship, the PGA Championship and the Ryder Cup which are outside the PGA Tour’s purview).
While Discovery will broadcast the tournaments on its various international cable and broadcast TV networks, the big potential upside in the deal is the new dedicated PGA Tour-branded OTT streaming service Discovery plans to build. The unnamed service, which will launch next year, will be another high-profile test of OTT’s ability to deliver direct-to-consumer benefits to super-fans as well as create incremental revenues.
Depending on pricing and features, it seems likely to be a winning bet by Discovery and the PGA Tour to further globalize the game and also drive higher interest, especially in Asia Pac where golf has long been popular. As a fan myself, the 2 big trends in golf are the rise of charismatic 20-something superstars and male Asia Pac winners and contenders (the U.S. women’s tour has long been dominated by Asians).
Just this past weekend, South Korea’s Byeong-Hun An finished second in a playoff at The Memorial Tournament. Earlier this season, Japan’s Satoshi Kodaira beat another South Korean, Si Woo Kim, in a playoff at the RBC Heritage. Kim was the youngest-ever winner of The PLAYERS Championship in 2017, considered the game’s “5th major.” Another Japanese player, Hideki Matsuyama, is a 5-time PGA Tour winner at age 26 and was last year’s U.S. Open runner-up. Meanwhile, Australian Jason Day and Adam Scott are major winners and Marc Leishman is a tour winner and frequent contender. These are the biggest Asia Pac names, but there are others as well.
No doubt there is a huge appetite for wall-to-wall coverage of these players in their home countries. The Discovery-PGA OTT service will provide the kind of flexibility for more intensive coverage of these and other stars. This could include dedicated cameras, feature/lifestyle stories and more. Unlike cable or broadcast, where there’s only 1 feed at a time, OTT allows multiple specialized feeds that let super-fans focus only on the players they love. Discovery has experience with this approach from its 2016 Olympics broadcast from PyeongChang.
OTT delivery also offers a compelling opportunity for sponsors. Elite professional golfers often have several marquee sponsor relationships which can include them being “brand ambassadors.” The OTT service will enable Discovery to approach players’ agents and sponsors with unique new opportunities to incorporate them into video streams, potentially with customized player segments. These could go far beyond the usual TV spots featuring the golfer/athlete saying just a few words (or sometimes nothing at all).
Targeting higher-income homes that are the base of golf fans will be enticing to a range of international luxury brands/sponsors. The PGA Tour is no doubt well aware of this, having recently opened offices in London, Tokyo and Beijing.
At a broader level, the Discovery-PGA Tour deal is yet another example of how OTT is enabling sports to become far more immersive, especially for mobile and connected TV users. $2 billion is a big bet by Discovery on international sports, but there’s a ton of potential to capitalize on major market trends.