As TV Viewing Habits Change, Local Broadcasters Turn to Live Streaming

A programming challenge and revenue opportunity

Audiences are increasingly preferring to view content and live sporting events on their smartphones and tablets. Tim Clayton/Corbis via Getty Images
Headshot of A.J. Katz

When the 2018 Major League Soccer season kicked off last month, Real Salt Lake fans didn’t have to fly down to Toyota Field in Frisco, Texas, to watch the Claret and Cobalt play its Western Conference rival FC Dallas. They didn’t have to turn on their televisions to watch the match either. Instead, RSL’s avid followers could download Salt Lake City NBC affiliate KSL-TV’s new app, RSL on KSL, and livestream the game on the digital device of their choice.

The KSL-Real Salt Lake deal marks the first time a professional American sports team has partnered with a local broadcast station on a local-only over-the-top deal. In February 2018, KSL-TV, owned by Bonneville International Corp., the Church of Jesus Christ of Latter-day Saints for-profit broadcasting arm, struck a three-year deal with Real Salt Lake. The agreement includes livestream coverage of RSL’s affiliated teams, such as the Utah Royals FC, part of the National Women’s Soccer League. The free, ad-supported app will carry more than 90 live games and video-on-demand content like pre-game shows on the station’s own OTT platform; it does not require a cable or satellite subscription. Current availability is in the following regions: Utah, Phoenix, Las Vegas, Reno, Nev., and Boise, Idaho.

The deal is a savvy nod to changing habits—as audiences are increasingly preferring to view content and live sporting events on their smartphones and tablets. It also provides a potential blueprint for local broadcasters looking to reach people who are abandoning traditional TV sofa viewing.

“Real Salt Lake originally approached us about a more traditional media partnership,” says Tanya Vea, vp and general manager of Bonneville Salt Lake City. “But I didn’t really have anything to offer them from a broadcast standpoint. We don’t have a secondary channel, but we had just launched the app.”

According to Vea, RSL immediately saw the potential in forging a nontraditional media partnership. Since its launch, the app has drawn roughly 30,000 to 50,000 OTT views for each two-hour game. By comparison, Real Salt Lake averages about 20,000 fans at its home games.

“Going over-the-top opens our content up to a much broader audience,” says Vea. “As a local broadcaster, that’s our goal.” At the same time, she notes, the station hit an over-the-air advertising ceiling and felt it could afford to experiment with new ways of earning ad revenue.

“From a growth standpoint, I don’t need this additional screen to bring in significant revenue right now because we have the infrastructure, as far as content goes,” she says. “We’re just using it in a different space, and we’re able to generate new revenue off of it.”

The ability to offer a secondary content distribution platform for locally produced content to capture audience, advertiser revenue and to extend their brands makes OTT an attractive proposition. “As affiliation agreements get more troublesome and expensive, says Brad Ward, CEO of TownNews.com, an Illinois-based digital media and online publishing company, “development of OTT channels give you an opportunity to build your local content and work on getting back to a 24/7 channel without network participation.” TownNews.com worked on KSL’s OTT app as well as those at a number of local stations across the country and Ward says, “This is just smart to be ready for what the future might hold, and these livestreams specifically, once fully developed, can be offered to the cable companies.”

Indeed, according to a recent report by the Video Advertising Bureau, national usage has tripled to nearly 15 million OTT-only households since 2013. Nielsen Media Research reports that 62.5 percent of U.S. TV households (74 million) now have at least one digital streaming service, an internet-enabled video game console or an internet-enabled smart TV. That’s up from 53 percent penetration in 2016. While streaming behavior varies by household type and market, last December, according to Nielsen, streaming usage increased on average by 30 percent over 2016.

In addition to the KSL-Salt Lake deal, YouTube TV recently brokered an exclusive English-language pact with the Los Angeles Football Club to stream 18 games, and another agreement to stream all Seattle Sounders FC matches, including exclusive streaming rights to the club’s 21 regionally televised contests on a dedicated Sounders FC YouTube TV channel. In addition, Chicago Fire signed a three-year deal with the new streaming service ESPN+, which launched April 12.

Beyond sports, a number of stations have started to supplement their broadcasts with a variety of digital partnerships and offerings. KGMB-TV in Honolulu now runs a digital-only “snackable” newscast. According to a recent report by the Knight Foundation, Atlanta’s WXIA-TV has published investigative, episodic video stories on its website, before airing them on TV. In Tyler, Texas, KLTV-TV livestreams its content all day, in tandem with its traditional broadcasts.

While some local broadcasters deliver their content over-the-top via their own OTT app, a number of ad-supported news aggregator services are cropping up, allowing users to access local news broadcasts and other content from TV stations across the country.

For instance, NewsON, a 3-year-old, multi-platform OTT service livestreams local newscasts from 167 stations in 112 markets. With NewsON, based in Atlanta, roughly 83 percent of the country can livestream at least one station in a designated media market via the free, ad-supported service. NewsON generates income from both consumer-facing advertising and also monthly fees from TV station affiliates.

Local stations have a lot of options on how they want to roll out their content. NewsON CEO Louis Gump says a number of local station groups are quite aggressive in how they roll out content on OTT, while others appear to have more of a wait-and-see attitude. But Gump feels it’s only a matter of time before all station groups have an OTT offering.

For media buyers with a background in ad tech, OTT looks to be a good bet.

Matt Bayer, svp of Advanced TV at Cadreon, the ad-tech unit of IPG Mediabrands, says audience-driven television is part of how he goes to market, but his approach on behalf of his clients is more “screen agnostic.” In other words, it makes more sense to gravitate toward whichever channel is more ideal to attract the audience the client is targeting. Whether it’s national or local, the channel could be linear, or it could be digital. That said, Bayer sees potential for value in OTT on the local level.

“We think the virtual MVPDs, like Sling TV and DirecTV Now, are ushering in an era of addressability that is unprecedented,” he says. “Now, will that translate to local television? Probably when local gets their subs up and then you can start building really big audiences on the local level.”

Raycom Media, the Montgomery, Ala.-based broadcasting company, which owns and/or operates 65 TV stations in 44 markets in 20 states, sees OTT as a tremendous opportunity. All 45 of the company’s news-producing stations have launched their own app.

“Most of our programming is news programming,” says Joe Fiveash, Raycom’s svp of digital media and strategy, “and we are building out more and more programming to put on OTT. The things that station in Utah is doing with soccer, for instance, is what everyone ought to be doing.”

Raycom stations air local news on weekdays and sports and lifestyle content on weekends, including The Southern Weekend, which is original Raycom lifestyle content for mobile, social, desktop and OTT that can also be re-edited and turned into a TV program. Raycom has been introducing native advertising to it.

"OTT is not going to be OTT as we presently know it five years from now. It’s just going to be television."
Joe Fiveash, svp of digital media and strategy, Raycom

This story first appeared in the April 16, 2018, issue of Adweek magazine. Click here to subscribe.

@ajkatztv aj.katz@adweek.com A.J. Katz is the senior editor of Adweek's TVNewser.
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