The Beautiful Game
By Carlo Longino, Mon Jan 22 00:00:00 GMT 2001
As the world's sports teams look to increase their fan bases and revenues, they are increasingly turning to mobile offerings. Leading the way are England's Manchester United, by virtue of their association with Vodafone.
Football: "the beautiful game," right? Unfortunately, things aren't so simple anymore. Far from being just a game, professional soccer is arguably the most popular spectator sport in the world. Its stars, regardless of their nationality, are known from Singapore to Stockholm, the French Rivera to the Rio ghettos. Many clubs are publicly held corporations, raking in billions from replica shirt sales sponsorship deals from the world's biggest companies.
So it's no surprise then that football clubs, like those in every other sport, are turning their eyes to wireless technology as another revenue-generating avenue. While it may be starting with SMS score reports or WAP sites with team news, several teams are aggressively developing advanced services to take advantage of increased mobile bandwidth. And it's not surprising that ground zero of football's mobile revolution is the game's home, England.
A Game Changed
"Some people believe football is a matter of life and death, I am very disappointed with that attitude. I can assure you it is much, much more important than that." Those famous words were uttered by Bill Shankly, the manager of Liverpool Football Club in the northwest of England during the team's heyday in the 60s and 70s. Although somewhat dramatic, they pretty accurately describe life in a part of the world where who you support can be more important than your race, religion, or family.
And clubs haven't been afraid to capitalize on that passion by selling replica jerseys, t-shirts, toilet paper, and anything else with room for a logo. These days, clubs can't afford not to with transfer fees and salaries for top players spiraling out of reach. It's a fairly vicious (and lucrative) circle -- after all, who wants to buy a t-shirt for a loser team?
But the English game really transformed in 1992 with an injection of television money from Rupert Murdoch's British Sky Broadcasting. Never before had live league games been regularly shown on domestic TV (still today the bizarre rights situation means there are more games shown outside the UK than in it), and never before had this kind of money been spun around the teams and players.
Sky's purchase of the Premier League rights was a huge success -- the company was able to build an entire satellite network merely because it showed live football -- and sparked a renewed interest in the game nationwide. But more importantly, it turned the clubs on to the fact that they were sitting on a very valuable resource -- their media rights.
"Our core asset is content," says Adam Rhodes, head of Liverpool Broadband, a new-media joint venture between Liverpool FC and Granada Media. "The reason people come is content. You lose sight of that at your peril."
A core asset, indeed. When Liverpool Broadband was formed, Granada put up all the cash (GBP20 million), and Liverpool's sole investment were their media rights.
A New British Empire
And one club, Manchester United, has built a commercial empire on those rights. Named the richest club in the world by Deloitte and Touche with a 1999 profit of GBP15 million on revenues of GBP110.7 million, United towers over other clubs financially, just as it does on the field. But the club finds itself in a unique situation, growth stifled by its success -- it has 100,000 members fighting for about 50,000 seats in its stadium each week, so ticket revenues are maxed out, and even the most die-hard fans will only buy so many rolls of club-branded toilet paper.
"Matchday income -- gate receipts -- is still the largest part of Premiership clubs' revenues," says Michael Hann, editor of football magazine FourFourTwo. "The [media] deals are likely to challenge this going forward."
So United has, with dot-com-like nimbleness, transformed itself into a powerful new media company. It launched its own digital TV channel, signed up a host of big-name technology partners (such as Sun, Lotus and Informix), and started an ISP service. But the real killer is the club's GBP30 million sponsorship deal with Vodafone. On the surface, it's just Vodafone paying to have their logo plastered on United's shirts so millions of viewers around the globe can see it every weekend. But in reality, it's a glimpse of the future of sports.
Along with sponsoring United's kit, Vodafone also gets the chance to develop co-branded mobile services with the club, the first of which, a WAP portal, launched in October. ManUmobile offers users (regardless of their carrier) WAP access to content similar to United's Web site, and Vodafone users can sign up to receive real-time scores and team news via SMS.
That's certainly nothing ground-breaking, but Vodafone and United are looking ahead with glee. The club's chief executive, Peter Kenyon, has already said it will broadcast games over the Internet beginning next season, when a new TV contract kicks in, part of which gives clubs the delayed rights to their games. And don't think they're not looking ahead to UMTS and thinking about the ultimate goal: live video of matches, straight to mobiles, anywhere in the world.
Vodafone sees a day within four years when users can subscribe to the matches, much like pay-per-view television, on their mobile devices, and while watching them view statistics and player bios, and of course, order merchandise. And did we mention they'll be watching this all on a Manchester United-branded Vodafone device?
"This ground-breaking agreement goes beyond a pure shirt sponsorship and will bring a new range of mobile information services to a loyal massive audience," says Vodafone UK chief executive Peter Bamford. "There is additional business potential in the bringing together of the world's largest telecommunications company and the world's best known football club."
Beam It To Me
There are already some forays into match broadcasting over mobile devices. British company Worldzap and Finnish telecom Sonera are testing a service to beam football highlights to PDAs using high-speed circuit-switched data (HSCSD) phones, and have already successfully transmitted the first video highlight over the system, a goal by Borussia Dortmund striker Joerg Heinrich from a game in October.
With the system, users receive SMS alerts of key moments during the game, such as "GOAL" or "PENALTY." Video highlights are then processed in Worldzap's production center in Switzerland and uploaded to a Sonera server in Helsinki, where it can immediately be seen by users. The current delay time is only two minutes.
Worldzap is testing other content such as post-match interviews, games, and advertising. The company has a definite advantage in its relationship with German media giant KirchGruppe (Worldzap is a joint venture of a Kirch-owned VC firm), which has secured the media rights to the 2002 and 2006 World Cups.
"This is a great first step towards our ultimate goal, which is allowing passionate sports fans to keep in touch with all the action, whenever they want, wherever they are," says Worldzap CEO Brad Kwong. "Our future is allowing users to specify each week which events they want to follow, and delivering to them the key moments as they happen."
For The Better...
And gambling certainly cannot be ignored. Conventional wisdom says that two things have the power to drive any new consumer technology: pornography and gambling. They certainly helped satellite and cable television and the VCR, and Web betting and porn sites are about the only dot-coms not laying people off these days. The wireless world may not be too different.
In addition to several currently available WAP betting sites, Punters in Hong Kong can place bets on horses using an SMS-based system. In only 5 months, the Hong Kong Jockey Club has signed up 22,000 users -- a number it took 8 years to reach with their previous remote-betting device attempts.
Mobility will certainly engender an increase in "personalized" gambling -- the type of services offered by Flutter.com or Eurobet's Match service -- where bettors gamble against each other, rather than the house. Match even allows people to raise the stakes during an event -- a perfect application for when you're at a match or watching it in the pub and can't get to the betting shop.
"Betting will become part of the matchday experience," Rhodes says. Imagine betting a friend 20 pounds that your team will beat his at the weekend. You're at the match, and your team goes up 3-nil, playing fantastically. You SMS your friend and log on to the service to raise the stakes, wanting to put 50 down after seeing the way your team is playing in the first half. Your friend accepts, and boom, you've got the chance to win (or lose, of course) even more.
What do the clubs stand to gain from this? A cut, of course. Manchester United already has a relationship with Eurobet, and betting shops are easily found in and around most every football stadium. So the clubs are keen to get fans both inside the ground and out using branded mobile devices where they can simply hit a "bet" button and place a wager with the club's partner, the team getting a payout all along the way.
So What Next?
Football, nor England, is alone in wireless initiatives in sports. America's National Football League launched a wireless site this season that provides fans with scores and team news, with a view to selling them subscription-based streaming video or highlight services in the future. The NHL's Carolina Hurricanes have taken advantage of their location in North Carolina's "plugged-in" Research Triangle Park by placing ads with ticket discounts on mobile Internet services that when clicked transfer the user directly to a phone rep (for mobile phone users) or m-commerce site (for PDA users).
Time will tell how much of an impact mobility will have on any of these sports, or football. Chances are it will still be "a game of two halves," as former England great Kevin Keegan put it. But the clubs are hoping those two halves will be coming from a much bigger financial pie.
Carlo Longino is TheFeature's resident business guru and over-opinionated American. His previous experience includes work for The Wall Street Journal, Dow Jones Newswires and Hoover's Online.
And he swears it's a glass of mineral water.