Tycoons battle for online events as LeSports stumbles
LeSports, the HK-based sports streaming arm of cash-starved Internet company LeEco, is facing a funding crisis, but videostreaming service magnates are competing to take business away from the former “exclusive online broadcast rights empire.”
On July 24, Beijing-based video service iQIYI and the Association of Tennis Professionals (ATP) reached a strategic cooperation agreement to become exclusive new media partners for 2017-20 in the Chinese mainland, Beijing Business Today reported Monday.
After LeEco got into financial trouble, companies such as electronics retailer Suning Holdings Group, Tencent and iQIYI began looking into the core exclusive online broadcast rights resources.
Even though these companies are financially strong, it is still not easy to monetize sports events through exclusive online broadcast rights, according to media reports. Each company will need to re-position itself and find a way to unlock value from its copyright resources.
Suning has been testing the waters by redirecting the football events audience to its e-commerce platform.
The company expects to integrate sports events into other businesses to create new revenue streams. As a platform for events broadcasting, PPTV, the video streaming unit of electronics retailer Suning Holdings Group, will explore new business models such as pay-to-watch subscriptions, the report continued.
Tencent has gained years of operational experience with the National Basketball Association. But compared with basketball, the audience base for events such as tennis or the Tour de France could be tiny.
iQIYI is facing a similar challenge. For some sports events, the platform has not invested to promote its broadcasting. Users may need to go to some trouble to spot the program source. Payment for events broadcasting yet to be activated, the report said.
“It’s important to develop user stickiness. Based on that, video websites can be more innovative while creating more business models for added value,” He Wenyi, executive director of Peking University’s China Institute for Sports Value, told the Global Times on Sunday.
“Pay-to-watch subscription services don’t have to be the only choice. In the future, video platforms can diversify into third-party sponsorship deals and in return, audiences can follow the sports events they love for free,” He noted.