Take Me Out To The Webcast?
The first game of the 2004 Major League Baseball season on Mar. 30 will go down in history as "Opening Dawn," an early-morning broadcast of the New York Yankees and Tampa Bay Devil Rays in Tokyo. If fans couldn't drag themselves out of bed to watch, they had an option: Flick on their computers later to see an archived Webcast on MLB's Web site, MLB.com.
Watching your favorite baseball team go nine innings on your laptop may not be quite as satisfying as tuning in on a big-screen TV, but the MLB and media companies are betting that scads of fans will soon be logging on to the games. Just look at the spring MLB.com has been having. First, distribution deals worth a combined $49 million were announced in March with Internet service providers AOL (TWX ) and MSN (MSFT ) to stream live games and highlights over the Web. Then, on Apr. 1, the league was set to announce deals with three cable operators -- Comcast (CMCSK ), Charter Communications (CHTR ), and Cablevision (CVC ) -- to provide new high-speed data customers live Webcasts of more than 240 games a month. Fans can also access archived games for later replay.
The cable companies are initially offering the baseball package as a season freebie to entice fans to sign up for broadband. MLB.com will get an undisclosed fee for each new subscriber. For existing broadband subscribers, the baseball package will cost $80 for the season. Either way, that amounts to a lot of baseball. The only offer that comes close on TV is DirecTV Group Inc.'s (DTV ) MLB Extra Innings package -- also 240 games a month on satellite TV, for a steeper $149.
But will fans pay to watch less-than-crystal-clear images on their PCs when they can view higher-quality action on TV? Absolutely, say cable operators and Web-service providers. For one thing, a rising generation of tech-savvy sports fans prefers to watch a computer screen, multitasking on various windows, than be stuck to the tube.
Media execs also figure they'll snag plenty of viewers at the workplace. What's more, the long season makes baseball especially well suited for broadband, particularly among fans not living in the same cities as their favorite teams who can't see them on local TV, says MLB Advanced Media LP Chief Executive Robert A. Bowman. During the 2003 season, MLB.com's third year in business, the site attracted 500,000 subscribers. Those services contributed to MLB.com's $92 million in revenues last year, up 77% from 2002.
CHANGING WORLD. There's a big potential market. Broadband subscribers in the U.S. will grow from 27 million this year to 46 million in 2008, says Jupiter Research. And the ad muscle of Comcast and Microsoft Corp. (MSFT ) will no doubt help sell the offerings to a wide audience. Plus, the recent success of streamed college basketball games on AOL suggest that people might finally be ready to log on rather than tune in to sports.
That has TV execs worried. "This could set a dangerous precedent," says Barry Frank, a former CBS Sports president and top TV exec at sports-marketing firm IMG. For now at least, all local-game rights are protected: Anyone receiving MLB.com live video feeds won't be able to see their local teams. But those limits could erode if Webcasting proves hugely popular.
For Bowman, it's just a matter of time. "Broadband and live-action baseball are perfectly suited," he says. "They're like mustard and hot dogs." That may be a stretch. But hey, the world is changing. If the Yanks can play their season opener in Tokyo at five in the morning, why not watch it on a laptop instead of on TV?
By Tom Lowry in New York