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Monumental Sports Network gives glimpse into an OTT future

Monumental Sports Network is an OTT subscription service for DC fans. How soon will rights holders look to offer their own OTT broadcasts?

Ted Leonsis’ Monumental Sports & Entertainment owns the Capitals, Wizards , Mystics (WNBA), Valor (AFL), as well as multiple minor-league hockey teams.  Just last month, the company launched Monumental Sports Network, an OTT subscription-based service targeted at fans in the DC Area.  It will feature original programming, pre/post-game coverage, and live streaming of Mystics and Valor games.  However, the network will not be streaming Capitals and Wizards game, due to a unique, synergestic partnership between Monumental and CSN Mid-Atlantic.  Though this new OTT subscription services won’t be showing the “big-ticket” games, it does provide a glimpse into a future where rights holders eschew traditional broadcasting methods and provide OTT streaming of games directly to fans.

Image Credit: Monumental Sports Network

According to a recent study by The Center for the Digital Future at USC Annenberg, 63% of sports fans are willing to purchase sports-centric OTT subscription services.  This type of interest will only grow as streaming technology gets more reliable and the current “Millennial/GenZ” demographic (18-36) ages.  Now, this is not new information by any means.  Traditional broadcasters and rights holders have taken notice of this  trend and have done all they can to “digitize” their broadcasts.  And they’ve done a good job of it, as consumers are able watch games online quite easily – provided they have a cable subscription.  Therein lies the rub.  Despite the fact that traditional pay TV is the dominant broadcast model, it has begun to shrink.  According to a PwC report, cable subscriptions have fallen by 6% among viewers under 35 and more than 16% of participants surveyed had unsubscribed from cable within the past year.  While not currently the dominant model, digital streaming is the sports distribution model of the future.

Image Credit: FreeWheel Video Monetization Report

Steve Ballmer, owner of the Los Angeles Clippers, agrees.  Before recently signing a rights deal with Prime Ticket, it was rumored that the Clippers planned to broadcast games exclusively through an OTT model.  While that did not come to fruition, Ballmer remains adamant that digital distribution is the future of live sports.  Despite market trends and Ballmer’s passionate belief, there are quite a few obstacles for teams looking to broadcast directly to their fans.  First and foremost, the digital streaming market is not nearly mature enough for teams to eschew their long standing and lucrative partnerships with regional sports networks.  The recent NFL/Twitter ratings show that the market size just isn’t there for rights holders to go fully digital.  Additionally, the complicated web of media rights deals between teams, leagues, broadcast partners provides a significant barrier that teams must overcome to become the “first” digital provider.

As the Monumental Sports Network shows, rights holders are recognizing the power of digital streaming.  There is significant opportunity for growth in this space, and being a first mover can be quite profitable, just ask the MLB.  However, despite the “buzz” of digital streaming and its growth potential, this model just can’t compete with the size, comfort, and guaranteed revenue provided by the traditional pay TV model.  Don’t expect a  seismic change within the sports broadcasting ecosystem unless someone like Ballmer is willing to take a significant financial risk.

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