Media Rights Giving Sports Business a Boost

PwC sees fees rising 7.2% to $20.6B by 2019
Author:
Publish date:
RS339018_20150329_AK1_1115.JPG

Media rights to live sports in the U.S., the most dependable programming on TV, are expected to increase 7.2% per year through 2019, according to a new report from PwC.

Pegged at $14.6 billion in 2014, PwC projects that media rights to sports will climb to $16.4 billion in 2015 and tackle the $20.6 billion yard line by 2019.

The growth in media rights will power the sports industry. PwC sees the entire U.S. sports industry growing at a 4% annual rate, from $60.5 billion in 2014 to $73.5 billion in 2019.

The PwC report says a lot of the growth in sports media rights will come as teams in Major League Baseball, the NBA and the NHL see their current local deals expire. It estimates that 35% of those deals will expire over the next five years. While those local deals are smaller than the national deals they will represent the bulk of growth because most national rights are in the middle of longer term agreements.

“Segment fundamentals and base rights fees should remain strong given the popularity of sports programming with consumers and advertisers. However, as consumers and advertisers continue to migrate towards Internet-connected devices and ‘second-screen’ activity, it’s more likely the traditional pay-TV model will have been by the next major sports deal cycle PwC sees media rights eclipsing gate revenue as the biggest money maker for sports by 2018," PwC says.

Gate revenue will rise 2.6% from $17.7 billion in 2014 to $18.3 billion in 2015 and $20.1 billion in 2019.

Sponsorship revenue is rising 4.5% annually from $14.7 billion in 2014 to $15.3 billion in 2015 and 18.3 billion in 2019.

Merchandise revenue is expected to go up 1.4% from $13.5 billion to $13.7 billion in 2015 and $14.5 billion in 2019.

Related