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In February 2004, Sport and Technology hosted a series of roundtable discussion groups that addressed the issue of monetising digital sports content. An esteemed panel of rights holders, distributors, broadcasters and executives involved in digital sports content production and delivery took part in the debates that covered rights issues, production concerns and killer content suggestions, as well as focusing on the main revenue streams that rights owners can create online. The easiest way for sports to make money online is through e-commerce according to Paul Wright of digital sports specialist Aura Sports. Leo Mindel, director of sports website specialist SOTIC, agreed: "Clubs are starting to get back control of their merchandising through online services. The ones that are smart carry links to their merchandising and ticketing around their audio content and that's how they make money." For an investment into an e-commerce platform in the region of £10,000, ($18,333) some of Mindel's rugby club clients are making back £250,000 ($458,000) a year, he stated. Phil O'Brien, chief executive of sports photo agency Empics, disagreed that there is a particular opportunity in online merchandising and sees it as small fry compared with offline/high street opportunities. "But it is the best mechanism for a club to promote its merchandising that's available today," countered Osborne Clarke's head of technology, Simon Rendell in defence of e-commerce solutions.
The consensus was that subscription services will only work online if the content is unique - such as behind the scenes with David Beckham on the Realmadrid.com website - or can't be accessed elsewhere such as on television. Subscription services will also appeal to geographically displaced fans.
The participants believe that the days of a federation being advised to align itself with a bookmaker to make money online are over. Online gambling carries little margins apart from the big brands because many gamblers have multiple accounts and will shop around online for the best prices said Wright from Aura Sports. Jean-Paul de la Fuente, director of consultancy Deureka, however highlighted opportunities in quasi-gambling that federations and sites might be able to harness.
Addleshaw Goddard's sport and media consultant Tony Singh flagged up the growth in peer-to-peer online betting exchanges and sees that as an opportunity for large federations to make money by setting up exchanges themselves. "But that would probably only apply to three of four federations in Europe."
Gideon Lloyd, founder of virtual broadcasting company DatAcq, mentioned feedback that he regularly receives from the gambling industry. "If dots can be put onto mobile phones that simulate the horses or greyhounds in races, that would be killer content from them. They don't want pictures, they just want the dots because that's all people need in order to place a bet."
Gaming/game-playing is also an element that can add to enjoyment of a sport and add revenues according to the participants, who touched upon the success of fantasy gaming in the US. The ability to play games online and compete at the same time as an actual sports event or athlete also has huge potential.  Targeting
A major theme that emerged from the discussion groups was the ability for digital offerings to build excellent databases and to target fans more closely. "The ability to persuade consumers to opt-in within sport is unparalleled," said Singh. "Federations are using new media to understand their customers better." "Sports should certainly be investing in their own future as far as developing their databases goes, whether through partnering with a Betfair or Vodafone or BT or the like," agreed Terry Blake from consultancy Blakesports, and formerly the commercial director of the England and Wales Cricket Board.
The internet gives smaller or less high profile federations the power to show a sponsor exactly who its fanbase is and to tie in campaigns across all platforms. "This is more valuable to me at this stage than a large rights deal," said Andrew Thomas, commercial manager of the Lawn Tennis Association.
Some participants however said they refuse to register on official websites and prefer to access content via the unofficial ones or on sites where registration is not required.
The online sponsorship model is changing according to Aura Sports' Wright. Sponsors of a property used to think they also received online branding as part of the deal. Whereas sponsors now see greater potential online and are willing to "place extra money on the site." Wright believes more sports will aggregate together and sell their online advertising and sponsorship collectively in one package or work together on collective database management.
Advertising and sponsorship online will become less intrusive according to the participants, with exposure to branding becoming more subtle. However, some participants believe that 30 second messages before or after an online experience will grow in popularity. "Generally if the advertising is relative to the format, then people are okay with it," explained Wright.  Production issues
"The real problem is around creating the content. For example, 99% of content is not suitable for mobile consumption," said Dan Herlihy from British Telecom. When costs drop at the production end of the chain, then the critical mass needed to generate revenue will be smaller too. In that instance, Herlihy sees niche and grassroots services doing well as long as they can get data and video to consumers quickly.
De la Fuente takes the view that broadcasters shouldn't feel threatened by new media at the level of quality is it now: "Content should be available on television as well as other platforms because people consume things at different times on different devices. It comes down to personal choice."
"Separate delivery will be one of the key things," agreed Herlihy, where content will be streamed to the device of choice of the consumer, depending on where they are or what device they happen to have in their living room.
According to the participants, content producers are getting more savvy at filming in two formats/shots in one recording session so that content can go out on traditional broadcast channels and then on mobile for example as well. "It's a very practical point and saves money," said de la Fuente. "Although that's not so practical at live events," added Paul Mason from BBC Resources, where different television formats come into play.
But who is going to pay for the editing costs involved in producing different formats for different platforms? DatAcq's Lloyd added that there are some amazing technologies out there that are 'nice to haves' for rights holders rather than 'must haves'. However, if the technology company says it has found a sponsor to cover the costs and the distributor/broadcaster can have the technology therefore for nothing, then it suddenly becomes an attractive proposition, he added. If you have any suggestions for future roundtable discussion groups and/or would like to be involved as a speaker, delegate or sponsor, please contact info@arksports.com
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