The value of the North American sports sector is forecast to rise by an average of 4.8% over the next five years according to a new report by Sport for Business member PwC.
This is almost 60% ahead of the growth it has shown between 2008 and 2012 and is a healthy indicator that will filter through to global sport and to the sector in Ireland. In real terms the value in North America is predicted to climb from $53.6 Billion to $67.7 Billion.
The main driver is in the area of broadcast rights with a forecast growth rate of 7.7% each year through to 2017. Gate revenue will still be the biggest single element worth $19.1 Billion though the growth here is likely to be 3.9% and boosted by a more peaceful labour market among players in the major leagues who have forced short seasons in NHL and NBA in recent years.
Merchandising is a challenging area with forecast growth of only 1.6% per annum though that may be higher in Ireland with the boost in 2013 alone of new sponsors and kits for Dublin and Cork GAA teams, as well as Munster Rugby, and the pending announcement of a new kit deal for the IRFU.
The media growth rate is very high against a background of falling advertising and spending across almost all other sectors but there are clear reasons why it is valid.
Firstly sport and big entertainment shows are fighting back against time shifted viewing that was killing the reach of advertising.
Viewers want to experience events in real time, driven by a desire to be part of second screen conversations around twitter and other social media. This means they will watch live, as an extended community and advertising around the big sports events is increasingly geared towards engaging with the social audience that is locked in to the programme.
Another trend highlighted in the report as adding value is the increase in location based technology services to increase spend and reduce cost at stadia. The production of interactive downloadable programmes is already here while game day apps around data and sharing experience will be standard sooner than many might expect.
Secondary ticketing services where sports rights holders can capture some value and security on resale of debenture and corporate tickets is another area that is already established and growing.
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