Globally, Investors Express Significant Potential in Sports Technology Sector
In a recent survey by Altman Solon, the top technology investment opportunities in sports for the next 3-5 years have been identified. The report emphasizes digital and immersive technologies, content innovation, and streaming media agility as the leading investment areas shaping the sports technology landscape.
One of the key areas of focus is social media and short-form content, which are increasingly critical for engaging younger sports fans who prefer quick, accessible content formats. Virtual Reality (VR) and Augmented Reality (AR) are also driving new ways for fans to interact with sports, enhancing the viewing experience and creating fresh digital avenues for sport consumption.
Fan-focused technologies, such as Non-Fungible Tokens (NFTs) and virtual reality, are emerging as important tools to evolve sports viewing and build closer connections with fans. Streaming media and hybrid rights models are also gaining traction, with emerging sports leagues leveraging FAST platforms and hybrid rights strategies to compete effectively with established leagues.
The Middle East, in particular, shows growth fueled by younger fans’ interest and innovative sports investments, suggesting opportunities for technology that supports fan engagement and event infrastructure there.
The report found that 62% of the surveyed global sports executives see technology solution providers as the most attractive investment opportunity. This shift from a wholly B2B distribution strategy focusing on licensing raw content to hybrid distribution models that explore adjacent licensing verticals and O&O platforms is recommended.
Prime Video and Netflix are expanding their sports offerings to include exclusive live broadcasts of NFL games, while a growing cohort of non-traditional media buyers, including streaming services, technology groups, gaming companies, betting companies, and e-commerce marketplaces, are acquiring sports properties.
To boost returns, sports investors can build a spectrum of strategic assets and capabilities across their portfolios. The report also highlights the value of sports rights, finding that it offers recurring and predictable audience performances. European football clubs, for instance, have about 5 times multiples value, indicating growth potential, especially considering supply constraints.
Investments in technology could help sports rights holders broaden their audiences and attract younger viewers with new experiences. Executives must adapt their IP to meet the needs of a new crop of content buyers and an evolving, fractured global fan base.
Broadcasters are encouraged to offer new content use cases to expand audiences beyond monetizing live games with legacy broadcasters. Over 80% of sports industry executives think O&O channels (league social media accounts, league websites, and official fan communities) will be increasingly relevant for fan engagement. Diversifying into non-live content can offer new, untapped revenue opportunities for media rights holders.
Altman Solon partner David Dellea stated that premier sports franchises maintain their attractiveness, but investors are turning to technology providers. The full report on sports rights distribution strategies is available for those interested in delving deeper into these trends.
- In the identified areas of sports technology investment for the next 3-5 years, streaming media agility and content innovation are leading the way, shaping the sports technology landscape significantly.
- The report indicates that virtual reality and augmented reality are driving new fan interactions, enhancing and redefining the sports viewing experience.
- Fan-focused technologies, such as Non-Fungible Tokens (NFTs) and virtual reality, are crucial tools for evolving sports viewing and building stronger fan connections.
- The report found that technology solution providers are the most attractive investment opportunity for global sports executives, with a shift towards hybrid distribution models.
- Prime Video, Netflix, and other streaming services, as well as technology groups, gaming companies, betting companies, and e-commerce marketplaces, are acquiring sports properties to expand their offerings.
- To maximize returns, investments in technology can help sports rights holders broaden their audiences, attract younger viewers, and provide new experiences.
- The importance of adapting intellectual property (IP) to meet the needs of a new generation of content buyers and an evolving global fan base has been emphasized, with broadcasters encouraged to offer new content use cases for fan engagement.
