Sports Leagues Missing The Point About Fans Streaming Live Games Online

from the foul-ball dept

Tue, Dec 30th 2008 8:05am — Mike Masnick

Just a few weeks ago, we were talking about sports leagues freaking out over online streaming sites like Justin.tv destroying the value of their broadcast rights. However, in that discussion, we noted that these sports leagues seemed to be missing the point: the reason watching such streams online is popular is that the sports leagues have failed to adequately serve the needs of fans -- often falsely believing that online streams of games somehow take away from live attendance or TV viewing. Yet, now the NY Times is continuing this story, highlighting how various sports leagues are trying to crack down on such online streaming. About the only "good" thing in the story is that many of the leagues say they've learned from the RIAA not to sue people, but just to send cease and desist letters. That's a start, but it still misses the point -- which the NY Times contributes to by falsely claiming that anyone streaming a game live online is "stealing."

The only reason such streams are being placed online is because the leagues themselves have failed to adequately provide the video in a way that allows fans to conveniently watch the games. These unauthorized streams aren't "piracy" or "stealing." They're the market telling these leagues to shape up and improve their product. And, while the article incorrectly suggests that unauthorized streams have no ancillary product for people to buy (and thus are a true "loss"), that ignores pretty much all reality around sports fandom. If a sport or a team can build a strong fanbase, then there are tons of things that can be sold to that fan -- such as tickets to live events, uniforms, cards, memorabilia and much, much more. The real issue should be about trying to get and capture more fans -- because true fans will spend a ton on a sport or team that they love. It's disappointing that the various sports leagues mentioned in the article are too short-sighted to recognize this, but it's even more annoying that the NY Times reported their position as if it were factual, without any quotes from those who would point out how wrong the leagues are in their thinking.

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Filed Under: sports leagues, streaming, websites

30 Comments

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Twinrova, 30 Dec 2008 @ 9:11am

What did you expect...
... from a line of business that believes they can copyright facts of the sporting event?

The NFL definitely needs to get with the program. Instead of trying to invite new fans to the game, they take it upon themselves to take "great matchup" games and reschedule them on the network no one subscribes to.

At any rate, it's a shame fans are being shafted by the stupidity of those who aren't getting it.

Go, Bengals!

Oh, and this article from the NY Times makes me really question the source as something to rely on. It seems lately the NY Times is all about ranting, as opposed to delivering worthwhile news. Luckily I don't subscribe.
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Dan J., 30 Dec 2008 @ 9:16am

Confusing customers
I suspect that you're completely missing the real customers in this case. Your arguments are predicated upon a business market in which the league sells to the fans. While that's a side business, it isn't the real business that the NFL and other leagues are actually engaged in. The league's real customer is the television networks. The league sells eyeballs to the television network, which in turn resells those eyeballs to the advertisers. That's where the leagues bread and butter is, and it's where they make most of their money. Certainly, it might be possible to come up with other business models in which the league sells directly to the fans. That's already in place as a side revenue stream. But selling eyeballs to TV stations is their main business, and they're not going to give up those profits without a fight.
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RoadDoggFL, 30 Dec 2008 @ 9:25am

Swing and a miss, techdirt...
The NHL provides an online streaming service for the same price as the league pass package. There's interactive stats menus, chat with other fans, a lot of cool stuff. The problem? Atdhe.net broadcasts the stream for free.

Your argument doesn't hold up and the site is stealing a readily available product. I'm not saying it's lost revenue, just that you should reform your argument a bit.
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Peavey, 30 Dec 2008 @ 9:36am

ads
If they're streaming it online, aren't they most likely just simulcasting what is being played over the networks? If that's the case, all the ads are still intact, which is what drives the business anyway.

So what is the problem here exactly? Pissed because someone is taking your ads and replaying them for you?
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Hulser, 30 Dec 2008 @ 9:37am

Stealing? No. Piracy? Yes.
These unauthorized streams aren't "piracy" or "stealing." They're the market telling these leagues to shape up and improve their product.

Mike, it seems to me that this quote contradicts your previous statements on the topic. I've seen many people misread or twist what you've written, but I don't recall you ever actually writing that copyright infringement ("unauthorized streams" in this case) was not piracy

Unauthorized streams aren't "stealing" in the strict legal sense. (I myself have posted the you-must-be-new-here type of post where we point out the difference between theft and infringement.) And I agree that unauthorized streams are a signal from the market that demand is not properly being met. But, even given all of this, unauthorized streaming is still piracy. You can argue about who is legally culpable given safe harbor laws, the original poster of the content or the provider, but at some point in the chain an illegal act was commited that the majority of people would call "piracy".
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Sneeje (profile), 30 Dec 2008 @ 9:42am

Re: Confusing customers
I don't see that at all. However, I do believe you might be overlooking one of the key points. You are saying that these leagues have specifically decided that the fans are not their target customers. What Mike is saying is that these leagues do this at their peril.

This happens in business all the time--businesses must choose to serve the customers they believe will be most profitable to their business plan. What they cannot do, is try to eliminate or pretend that the markets they do not serve should not exist. Customer demand is valid whether or not you choose to serve it.

Mike's point is that very often, companies take the route of attempting to shut down these channels, without ever really determining how they affect their own markets. There is plenty of evidence that they help more than hurt, but the knee-jerk reaction is to assume they hurt.
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Iggy, 30 Dec 2008 @ 9:51am

Re: Confusing customers
Dan J, you make a good point about who the NFL views as the primary customer. In the current NFL model, the TV networks are the primary customers and the fans are mere end-users. It's kind of similar to the Google model in which digital media advertisers are Google customers and people are just end-users (the difference of course being that Google doesn't own their 'content').

Google lives or dies based on its ability to serve (annoying) ads alongside the functions it provides. Similarly, the NFL should stop worrying about who delivers their content to the end-user and focus on making sure that regardless of who delivers the stream, the ads are still carried and paid for. There are sooo many more opportunities to generate revenue from a multi-media stream delivered to interactive devices than from a broadcast signal piped to a dumb tv.
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Witty Nickname, 30 Dec 2008 @ 9:52am

Totally agree with #2. I suspect the reason many fans are watching online is because there are 10 games being played Sunday at 1:00 Eastern, and the one your LOCAL team is in is the one that is being played. I am a Dallas fan in Houston (luckily, America's Team usually plays a later game, but occasionally I am forced to watch the craptastic Texans.)

Anyway, the NFL's solution to this is to sell NFL All Access Pass to customers through Direct TV. Direct TV is available in every market, and I am sure Direct TV pays big bucks to the NFL to be the sole provider. A monopoly on All Access Pass would be much less valauble to DTV if the same product was available online.

I am sure the NFL has thought this through with studies, charts and numbers. I am also sure you just pulled this blog out of your hind end.
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Hulser, 30 Dec 2008 @ 10:03am

An ass out of umption
I am sure the NFL has thought this through with studies, charts and numbers. I am also sure you just pulled this blog out of your hind end.

On the assumption you're being serious...

First off, it's a rather large assumption that the NFL really does put much weight into "studies, charts, and numbers" in their business decision making process. Second, your statement assumes that you can't ever make an incorrect business decision if you use study results or statistics. If this were the case, then no one would ever make a bad business decision.
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Starting to hate the NFL as a company, 30 Dec 2008 @ 10:04am

Re:
DirectTV is not available in all markets (ok, maybe yes to all markets, but definitely not to all people). My condo association won't allow us to have Satellite, and has a deal with the cable company that we have no choice in(yes, it's more a problem with the association than the NFL, stick with me though) So there's absolutely NO other way I could watch many of these games, unless they were available online... Hey NFL, stream games on NFL.com and I'll be there all day for extra games as well as for fantasy, I can watch ads on the computer the same way I do on TV no problem....
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Sneeje, 30 Dec 2008 @ 10:05am

Re:
Huh? Why would you assume (implicitly) that studies, charts and numbers would result in the correct strategic approach to serving the market(s)? I can tell you that there are many cases studies showing that as businesses mature, they often view their external environments using the filters of their past successes.

Meaning once they get good at something they continue to try to do it better and better and then completely miss how their environment has changed (See AOL). As a result, their in-depth analysis often supports their flawed approach because their world-view cannot support other conclusions.
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Iggy, 30 Dec 2008 @ 10:06am

Simulcast of a public signal
Here's another thought - is there really anything wrong with a simulcast stream of a public broadcast?

If I lived in a rural area with weak over-the-air coverage and I decided to install a signal amplifier for the local community, would the NFL care? Would the TV station care?

So if I take a pubic signal and simulcast it over an Internet stream - intact and in real time - is this fundamentally different? Everybody should be happy because the product and ads are making it to more eyes for no extra cost. I think the issue is simply fear of the unknown. The TV stations probably don't know how to count all of the Internet eyes so they're worried about lost revenue. They should realize that they're methods for counting eyes for traditional broadcasts are all hocus-pocus anyway.

I could see the problem if pay-per-view streams were being bootlegged, but I don't think that's the case here.
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Loren M, 30 Dec 2008 @ 10:51am

I don't disagree that they should be able to stream content, but I don't agree with your logic as stated here:

"The only reason such streams are being placed online is because the leagues themselves have failed to adequately provide the video in a way that allows fans to conveniently watch the games."

If that were the case, then what's the difference between that and pirating an audio cd? "Oh I didn't buy your cd but chose to download it because you didn't make it easily available for my car's headunit."
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S. Kaas, 30 Dec 2008 @ 10:52am

Entitlement mentality
This is precisely the problem with people today: The *entitlement mentality*. Where do people get the idea that everything has to be "convenient and available" to them? Should I go steal a Lamborghini and then claim that it's their fault for not making it convenient for me to own one?

People, get real. If you don't like what the companies are selling to you, don't freaking buy it! Easy. It's not a *right* watch your favourite sports for free, it's not a right to own every piece of music, software out there.
Justifying theft, *and* bashing businesses because don't give you exactly what you want in the form and the price you want (ie. free), well, I don't know how one can be any more shameless.

(*) To add insult to injurty, these streams are of course available, at a modest price. How do you think they come about? They are copied from the mediacasts of the networks. They are not captured by the fans in the stands.
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Mike (profile), 30 Dec 2008 @ 10:52am

Re: Confusing customers
I suspect that you're completely missing the real customers in this case. Your arguments are predicated upon a business market in which the league sells to the fans. While that's a side business, it isn't the real business that the NFL and other leagues are actually engaged in. The league's real customer is the television networks. The league sells eyeballs to the television network, which in turn resells those eyeballs to the advertisers.

If that were the case, then my point still stands:

(1) Allowing open streaming INCREASES the number of eyeballs and thus INCREASES the value to the networks.

(2) Pissing off the fans would DECREASE the number of eyeballs and thus DECREASE the value to networks.
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Sneeje, 30 Dec 2008 @ 11:05am

Re: Entitlement mentality
"Entitlement mentality" is not the issue, unmet demand is. Wanting something you aren't willing to pay for does not mean you feel entitled, it simply means that you won't pay for it at the currently available price point.

But more importantly, you *would* be willing to pay for it at a lower price point, thus the unmet demand and the potential market.

Where there is a potential market, there will be a tendency for someone to move to fill it and that is what is being debated here. Mike is simply pointing out that there are other avenues to fill demand that don't involve selling people something, that will ultimately drive them to buy from you in other ways or make your pay streams more valuable.
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Jeff Rife, 30 Dec 2008 @ 11:15am

Re: Re: Confusing customers
Although I don't know about the NFL, I do know that MLB, the NHL, and the NBA all offer online streaming of their out-of-market games. If you don't understand why only out-of-market games are available, you'll have to ask your local television station about economics.

Other than that, there are no restrictions except having to pay the fee they charge for access.

So, I can see why these leagues would crack down on somebody streaming the same game for free. Although I'm a firm believer that free stuff can be advertising, the leagues are making money off the online streaming. Sure, we all would rather that everything was free, but that's just not realistic.

As for leagues that haven't moved into the 20th century, that's a different story. If they don't have a competing product, then although they have the right to shut down unauthorized streaming, the right solution is to provide it themselves.
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Jeff Rife, 30 Dec 2008 @ 11:23am

Re: Re:
My condo association won't allow us to have Satellite
Your condo association is violating federal law.

As long as you place the satellite dish in an area that you control completely, no law can prevent you from having up to a 1-meter dish. For more information, see the FDA fact sheet.
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IT Dude, 30 Dec 2008 @ 11:30am

Really?
Maybe if the players didn't makes millions of dollars each the damn leagues would have more money. I'd rather sports ONLY be broadcast online or special "sports only" channels so it doesn't interfere with good TV shows that us sports-hating-nerds like.
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Overcast, 30 Dec 2008 @ 11:31am

This is precisely the problem with people today: The *entitlement mentality*. Where do people get the idea that everything has to be "convenient and available" to them? Should I go steal a Lamborghini and then claim that it's their fault for not making it convenient for me to own one?

That's comparing apples to oranges, however.

Because the technology exists to easily provide people with an alternate way of watching a Game. You are not taking the content from the Network or the NFL at all. The Technology exists, the demand exists - just not the will to change the same old business model.

Yet, like the horse and buggy - it's days are numbered. Despite any amount of push, any amount of whining, any amount of legalities - the horse and buggy's days were numbered the day the first 'affordable' Ford rolled off of Henry Ford's production line.

Now, like then times have changed - the days of linear one-way broadcast are at an end. Why? Because two-way dynamic broadcast is available. Like the Model T - the internet and computing devices are 'affordable' to anyone with a desire to use them. And why not use them? They are more efficient, more flexible, offer more choices, and faster.

The Networks, The NFL, whoever; can keep up with trying to perpetuate their own version of the Horse and Buggy, but it makes no sense for anyone else (other than those who provide the old technology) to not move forward into the 21st Century.

Now... if the technology existed to make a duplicate copy of a Lamborghini without taking a car from anyone else - just purely making a copy out of 'thin air' (like a replicator on Star Trek or something) - would it still be stealing?

Stealing really means, in the strict and literal sense to TAKE something that does not belong to you.

"1: to take the property of another wrongfully and especially as a habitual or regular practice"

Perhaps 'Unauthorized Duplication' might be what's happening, but not stealing. I guess - back in the early 20th century, we should all be glad there weren't "intellectual rights" on the concept of transportation, indeed.

So again, if you make a copy of a Lamborghini yourself, by whatever means, exact in every detail - you still haven't stolen a thing.

I guess you could say, "All the king's horses, and all the king's men; couldn't put the old business model back into viability again."
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Dan J., 30 Dec 2008 @ 12:00pm

Re: Re: Confusing customers
(1) assumes that all eyeballs are equal. They aren't. Television stations sell ads based on the number of viewers they can proved to those ads. Viewers are counted based on estimates of the number of TVs tuned to that station. It may very well be that people who view the stream on the 'Net watch the same commercials. But if those viewers aren't counted in the official stats, they don't help the television station sell advertising. It may very well be argued that this is a systemic problem and the entire system needs to be rethought. Perhaps so, but it's not the NFL's responsibility nor is it within their capability to change the television advertising business. The NFL sells the right to air their games to the networks. Online streams takes eyeballs away from the official networks numbers, reducing their ability to sell advertising and making the right to transmit the games less valuable.

As for (2), I'm a huge fan of professional football games in general and of one team in particular. At the same time, I absolutely DETEST the National Football League as an organization. I hate the fact that they're holding Thursday night games on a channel that they're demanding money for the cable systems to carry. They're using fan loyalty in an attempt to essentially extort money from the various cable companies. I hate the fact that they fine players for removing their helmet, for any tiny deviation in the appearance of their uniform, for celebratory actions following a touchdown, and in general that they seem to try to do everything they can to take all of the fun out of the game. I watch the games in spite of the NFL as a business organization, not because of them. They regularly and consistently piss me off. But I still watch the games. The NFL knows this. Their actions don't threaten to drop desire for their game at all. More's the pity, actually. If it did, they might actually change a few things for the better.
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Giorgio, 30 Dec 2008 @ 12:14pm

I agree
I agree with the main point of this article.

I'm Italian and 2 years ago I moved to UK. I'm a football fan (..i mean soccer of course) and wanted to watch italian fotball: you know what, in UK is impossible!!

Sky does not of offer Italian football in UK, neither does Setanta. I got italian sky with online streaming access but I cannot view anithing because I'm in UK and my IP is not italian..same problem with my italian broadband provider which, in Italy, provide very cheap football matches on streaming.

This is why I watch matches on 'particular'streaming websites..what else should I do?? Offer me a proper service and I will be happy to pay for it! This is not an issue of money..I'd pay 5 euro rather than watch, as I'm used, bad quality streams...
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Baylink, 30 Dec 2008 @ 2:32pm

Actually
Slithering Jeezus...

Could we all get this straight, now?

"Stealing" is very precisely defined in criminal law: it means taking a thing of value away from its owner, so that they don't have it anymore.

The thing we used to call "copyright infringement" and then started calling "criminal copyright infringement" and are now trying to rebrand as "stealing" is the deprivation of the right to commercially exploit the distribution of copies of a (usually) artistic work... and *most* of what they're really trying to do is to force you to pay again for the same material when you buy a new device.

I see no reason why I should be unable to rip music off CDs I buy commercially so I can play them using my N800 when I'm not at home... but record labels sure see one.

So, really, it's enabling record labels and movie studios to *steal from us*, in a way technology never permitted them to enfoce before.

Oops. :-)
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David AkA pats4lyfe, 31 Dec 2008 @ 1:45am

Re: What did you expect...
cmon now the needs to learn..Im tired of wakin up on sunday to see the eagles vs the redskins i wanna see my pats move in for the kill on the colts or steelers why should i have to suffer threw a eagles thats why i go online to jtv so i can see the game btw im a huge fan of Kyle Korver a player for the utah jazz has any ever seen one of there games on tv i havent so untill then jtv LIVE LONG and LIVE STRONG
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S. Kaas, 1 Jan 2009 @ 10:36am

Re: Re: Entitlement mentality
If it were "unmet demand", it would be about establishing a legitimate business, buying the content from rightful owners, selling it for less than the competitors.

Stealing is *not* the way of free market. "Unmet demand" is another shameless euphemism.
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S. Kaas, 1 Jan 2009 @ 10:40am

Re:
"Because the technology exists to easily provide people with an alternate way of watching a Game. You are not taking the content from the Network or the NFL at all."

Nonsense. You *are* taking away income from the networks. That is stealing. Whether you cause the damage indirectly, by removing physical products or more directly, by removing income steam, is immaterial.
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Anonymous Coward, 1 Jan 2009 @ 10:48am

Re: Actually
"I see no reason why I should be unable to rip music off CDs I buy commercially so I can play them using my N800 when I'm not at home... but record labels sure see one."

Depends. Does the licence grant you the right to rip the music? If it does, yes, there's no reason you cannot do that.

But if it does not, and you still purchase that CD, thus agree to the license, *then* turn around and unilaterally decide to violate the contract you made, of course not. Is that how you do all your business? By violating agreements whenever you feel like it?

In other words, you are not entitled to more than you agreed. *If* you don't like the terms, you simply don't buy the product. That's how free market works. Consumers speak with their money. If people don't like the licensing terms, and don't buy the product, the vendors will take note. But when you break an agreement, you are on the wrong, period.

Bottomline: Nobody forces you to agree to their licensing terms. It's their product, it's your decision to purchase or not. But if you agree, you are bound by the terms, and cannot violate them without coming off as a brazen criminal.
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av8tor, 6 Jan 2009 @ 4:00pm

stealing? I dont care
I dont care how or why, as long as I can watch my team play, that is all I care about.
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tokyogirl, 13 Jan 2009 @ 3:03pm

Sports is to watch and enjoy the game. If we can't watch it, its popularity goes down. In Japan tennis is almost extinct because no TV stations broadcast anymore. Streaming is a vital tool to vitalize sports such as tennis.

If technology is available, games should be available to stream with cost or without cost. A new exciting era for sports is coming and we should not kill this golden opportunity. We can always work out.
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