World Cup to Kick U.S. Device Use Into High Gear

The beta-test phase for big television streaming events is officially over.

Viewers — and advertisers — now have baseline expectations that live TV programming also will be available on multiple devices, in beautiful HD quality, with a rich set of second-screen features.

The 2014 FIFA World Cup epitomizes the shift in the biz. For ESPN and Univision Communications, the two U.S. nets carrying the global football fiesta, the event will serve as more proof that live video distribution on Web and mobile is an inextricable part of the TV business model.

“This is an opportunity for us to, as our business cards say, serve sports fans anywhere in the world, on any device,” said Ryan Spoon, ESPN’s senior VP of digital product management. “It ties into our core TV offering.”

ESPN and Univision are storming the digital field for the World Cup in Brazil, which begins June 12. Both will live-stream all 64 matches of the tourney, including the July 13 championship, available to most U.S. pay-TV subscribers on the Web and via apps. ESPN will provide alternate camera angles to digital viewers, and the cabler will cater to fans worldwide with the redesigned ESPN FC website and newly launched app, loaded with real-time news, scores and highlights.

This year, World Cup digital viewing will easily top 2010’s event, when ESPN3.com delivered 15.7 million viewing hours,and Univision pumped 10 million hours of live video via UnivisionFutbol.com.

But the 2014 World Cup is not likely to break records for Internet video domestically. Mainly, that’s because the sport isn’t that popular in the U.S. Only 7% of Americans say they plan to follow the 2014 soccer tourney closely, and two-thirds don’t expect to tune in at all, according to a Reuters/Ipsos survey this spring. Plus, the biggest-screen-available rule will apply: Only 10% of soccer fanatics in the States said they’ll watch the World Cup exclusively on digital devices, according to a survey by TV app developer Peel.

So if most people will catch the games on HDTVs anyway, then why bother with digital streams?

ESPN, ABC and Univision can’t afford to lose any incremental audience, particularly as most of the Cup matches will occur during the workday (most people can’t access TVs at the office). Moreover, ESPN/ABC paid $100 million for the English-language rights for FIFA events from 2007 to 2014, and Univision paid $325 million for Spanish-language rights. Both deals took into account the coin the networks would generate from streaming.

And U.S. rights for the next two Cups are even pricier: Fox will pay a reported $425 million for the 2018 and 2022 tournaments in English, while NBCU’s Telemundo is ponying up $600 million for Copa Mundial in Spanish.

“People expect streaming video,” Frost & Sullivan principal analyst Dan Rayburn said. “The broadcasters have to do it.”

The business case is straightforward: Live-streaming the entire World Cup to an average of 1 million users per match would cost $3.2 million in delivery fees, according to Rayburn’s calculations.

When accounting for the tens of millions of dollars ESPN and Univision stand to rake in from cross-platform ad sales, it’s a no-brainer. All the major 2014 World Cup sponsors, which include Anheuser-Busch, Coca-Cola and McDonald’s, have multi-screen buys, said Vilma Vale-Brennan, managing partner at GroupM’s MEC Bravo multicultural ad agency.

Under the networks’ TV Everywhere imperative, it’s also important to reach younger auds, who overindex on online and mobile video consumption. The World Cup delivers a passionate, highly engaged fanbase unrivaled by any other sporting event: “You need to engage early enough with consumers in the digital space, as adoption of online viewing continues to grow,” Vale-Brennan said.

For Univision, mobile is crucial: 72% of Hispanics own smartphones, 10 points higher than for the average U.S. consumer, per Nielsen. “Digital is on a growth trajectory, and it’s very, very much part of our business,” said Scott Levine, Univision’s senior VP of product and technology.

If all goes as planned, programmers will deliver a World Cup experience that lets mobile and Internet fans tap into the action as easily as they flip on the TV, and can instantly share clips on social media.

True, some recent TV events — such as ABC’s first live-stream of the Academy Awards in March — have crashed spectacularly online. But industry execs say the issue is about adequately provisioning capacity, not the technology itself: NBCU’s 2014 Winter Olympics delivered 24.6 million digital viewers, with a total of 2.1 million unique users watching the U.S. vs. Canada men’s ice-hockey semifinal on Feb. 21.

Turner Sports also saw a surge in video-streaming usage for the NCAA basketball tourney this year, delivering 69.7 million live video streams across all platforms (up 42% from 2013) for a total of 15 million hours consumed.

“We’re past a place where people sit and wait to see breathlessly whether streaming media is going to work,” said Jaime Spencer, VP of media-consulting firm Frank N. Magid Associates.

Akamai Technologies, the industry’s biggest content-delivery network provider, began prepping for the World Cup with broadcast partners more than a year ago, said media division senior VP and g.m. Bill Wheaton. For the 2010 World Cup, TV networks were concerned about whether the Internet could handle the load. But since then, Wheaton said, “We’ve honed our skills … and we’re ready.”

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