It’s clear, however, that this hasn’t been all smooth sailing.
Sports rights holders are rubbing their hands in anticipation, because the value of sports rights is rising sharply. After the huge price hikes of the previous decade, there had been somewhat of a stagnation in recent years. The French Ligue 1 even saw the value of its new multi-year deal drop. But now, a new group of deep-pocketed interested parties has emerged: the streamers are about to make major investments in sports. Specialized sports streamers like DAZN have been active for several years. Market leader Netflix, after broadcasting the Paul/Tyson match, has also discovered the power of live sports. YouTube (more on that in my next column) invested in American football earlier. According to figures from Ampère Analysis, streamers will spend over 12 billion dollars on sports rights this year.
The investments that British-Ukrainian entrepreneur Sir Lech Blavatnik has been making for years are starting to bear some fruit. His company DAZN is growing rapidly and attracting one investor after another. The company is running at a significant loss and has a massive need for financing. This month, according to insiders, the Saudi Arabian Public Investment Fund paid a billion dollars for less than 10% of the company. With the promise that he’s building the Netflix of sports, Blavatnik has managed to convince investors. As a result, the company has become a tough competitor to pay-TV channels like Sky and is squeezing many public and commercial TV broadcasters even further.
Entertainment streamers, meanwhile, also see the value of sports—and not just for attracting new subscribers. Keeping churn (the cancellation of subscriptions) under control is at least as important from a strategic standpoint. Therefore, Netflix is going to invest in American football. Less dominant players like Peacock and Paramount+ are also heading in that direction—a development that has the National Football League (NFL) rubbing its hands in anticipation. We also know that trends in the U.S. sooner or later make their way to Europe, which will undoubtedly mean that here, too, the value of sports rights will shoot through the roof.
It’s clear, however, that this hasn’t been all smooth sailing. DAZN incurred the wrath of German consumer organizations by hiking its prices for the Bundesliga and the Champions League a little too enthusiastically. Technical problems in Italy plagued the sports streamer, and even Netflix underestimated the impact of a mega-event like the Paul/Tyson match. Those are temporary problems, though—ones that will disappear as streaming technology advances and industry expertise continues to evolve.
Private equity firms see these developments as well and are becoming more and more interested in sports organizations. And here again, the NFL is at the center of attention. After an extensive study, the league concluded that private equity firms (at least to a limited extent, for now) can invest in NFL clubs. Sports are increasingly being valued for what they’re truly worth, because there’s still so much potential in them—due in no small part to streamers taking an interest in the rights. In other words: sports are streaming ahead!
The Battle for the Eyeballs (2016-2017)
Fast forward to 2016, we entered a new battle of attention; the Creator Economy. Suddenly, it wasn't just YouTube, but also Instagram, Snapchat, and a newcomer called Musical.ly (later TikTok) marked the start of platform cannibalization. TikTok and Instagram weren't just eating into the remaining linear TV time; they were fighting YouTube for every second of the youth's attention. YouTube’s monopoly on digital video was over, while older audiences were finally discovering YouTube, the kids were moving toward hyper-short-form.
This was the moment 'traditional' YouTube videos (the 10-to-20-minute formats) were suddenly seen as 'Long-form.' The definition of patience was definitely changing. And not just among the younger demographic.
Convergence
Today, we see a fascinating (and perhaps slightly alarming) trend: Platform Convergence. Every platform is starting to look exactly like its competitor. YouTube has Shorts, Instagram has Reels, TikTok is pushing into longform, Netflix is experimenting with short clips and Spotify is actively pushing video content. Everyone is fighting for the same 'scroll.'
Simultaneously, the high-end VOD market, with Netflix, HBO, Disney+, Prime Video and Apple TV exploded, alongside the renaissance of audio through podcasts and audiobooks. We are consuming more content than ever before in human history, but it is more fragmented than we could ever imagine just one decade ago.
This leads us to a question we frequently discuss at 3Rivers: (How) can traditional media companies keep up with this velocity?
If broadcasters and production houses are still struggling with a 'Streaming First' mindset, how will they survive this “attention Economy” reality? Take the BBC, for example. Just recently, they announced a landmark partnership with YouTube to produce bespoke, original programming specifically for the platform. Not just clips, but full shows designed for a YouTube-native audience.
When the world's leading public broadcaster admits they can no longer reach the next generation through their own front door, you know the gatekeeper era is officially over. They aren't just 'posting' on YouTube anymore; they are building for it. And it’s not just about content; it’s about infrastructure...
In the US, YouTube is effectively becoming the new 'Cable Company.' Through YouTube TV, they are bundling over 100 linear channels, and by poaching the NFL Sunday Ticket from traditional satellite TV, they’ve secured the ultimate 'must-have' content. They aren't just competing with broadcasters anymore; they are replacing the entire distribution chain.
And we haven't even seen the full storm yet. We are looking at:
These are not just experiments. The micro-drama industry alone is projected to reach $26 billion in annual revenue by 2030. We are seeing startups in this space valued at hundreds of millions of dollars before they even have a full library.
So If YouTube is the new cable company, Netflix is not slowing down, TikTok stars are the new Hollywood studios and drama is shortened to 1 minute vertical content... then where does that leave the traditional industry? That’s the question I’ll be tackling this year for us and our clients. A fascinating puzzle, and I’m enjoying every piece of it.
In December, the international creative community gathers in London to take the temperature of the industry: debating trends, forging partnerships, and hunting for the next big format. In recent years, a new fixture has joined the global circuit of media markets: Content London. C21, once primarily a publisher, now increasingly a heavyweight conference organizer, is steadily tightening its grip on streamers, producers, and broadcasters.
The British creative sector, meanwhile, has reason to celebrate. In 2003, a landmark change in legislation granted producers ownership of the IP they create. It transformed the industry. Since then, the UK’s creative economy has expanded at remarkable speed. This year alone, more than two billion £ worth of formats, finished program sales (these days more often counted as library sales), and consumer products will leave the country. For the UK, the United States has long been a natural export market (the absence of a language barrier helps) and nearly half of all international sales continue to flow across the Atlantic.
This success is anything but accidental. Investors are lining up to back creative talent, the government actively supports the production ecosystem, and the talent pool seems endlessly replenished. More than forty new production companies launch each year, even as the domestic market stagnates. The UK advertising market may be under pressure, but the country’s robust export pipeline more than compensates. I’ve worked in this sector for around fifteen years, and its consistent level of creative excellence never ceases to impress.
The framework may have been shaped by government policy, but it is creative entrepreneurs who continue to push the industry forward. Take Richard McKerrow, founder of Love Productions and the mind behind The Great British Bake Off. Or Stephen Lambert, creator of Gogglebox and Undercover Boss and founder of Studio Lambert. Lambert has built a powerhouse team capable of elevating even externally conceived IP, The Traitors being the most striking example, to extraordinary global success. Each year brings a new wave of talent with ideas that spark fresh energy across the industry.
Driving it all is the British audience itself: curious, loyal, and accustomed to high-quality homegrown programming. Every genre thrives; from soaps (yes, Coronation Street is still going strong) to prestige drama, from factual to entertainment. Anyone wanting to understand what true creative entrepreneurship looks like need only spend some time in the capital of the audiovisual world.
Skeptics might point to turbulence: the challenges at the BBC and Channel 4, Sky’s bid for ITV, or the looming saturation of the streaming market. The rules of the audiovisual landscape are indeed being rewritten. But the British creative engine shows little sign of slowing. It continues to do what it has always done best: turn ideas into global successes.
Do you remember that video from 2006 featuring YouTube founders Chad Hurley and Steve Chen? The two young men addressed the 'YouTube Community' with promises of continued innovation and product development. But after just two and a half minutes, they could no longer keep a straight face. They had just sold their barely 18-month-old, loss-making company to Google for a staggering 1.65 billion dollars.
At the time, many thought Google had lost its mind for paying such an astronomical amount for a fledgling startup. But it quickly became clear that the tech giant had placed a calculated bet. The modest YouTube maintained its position as the market leader in online video, while Google's own platform never gained traction. The team at Google had already recognized that video would become the next killer application on the Internet. Instead of competing, they acquired the persistent rival that was standing in their way, regardless of the cost. The rest is history. According to social media expert Jonatan de Boer, YouTube now generates over 36 billion dollars in annual revenue.
Today, YouTube is unquestionably the largest video platform in the world. Monthly views are measured in the trillions, and the number of active channels approaches 5 million. What stands out is that, according to a recent report by Evan Shapiro, nearly 95 percent of all views come from just the top 10 channels. What began as a platform for short-form, user-generated content is now evolving into a wide-reaching video ecosystem. And increasingly, major media companies are embracing it.
Just a decade ago, traditional broadcasters were extremely hesitant to publish content on YouTube. The Dutch public broadcaster NPO offers a striking example. Acting under the leadership of then-chairman Henk Hagoort, the organization tightly controlled content distribution and explicitly forbade its affiliated broadcasters from using YouTube.
The situation today could not be more different. YouTube is now seen as an ideal platform to promote television programs. An additional reason has emerged as well. YouTube attracts a predominantly younger audience, which gives media companies a valuable opportunity to connect with a harder-to-reach demographic.
Channel 4 in the United Kingdom was among the first broadcasters to recognize the platform’s potential. After a test phase, they decided last year to start publishing long-form content on YouTube. They were also allowed to manage advertising on their Channel 4 YouTube page themselves, with a share of the revenue naturally going to Google.
This created a win-win situation. The broadcaster gained additional reach. YouTube gained more compelling content for its viewers. And both parties benefited from the resulting revenue. YouTube is now often watched on television screens, competes directly with Netflix, and even commands more viewing time in the United States, with 12 percent compared to Netflix’s 7.5 percent. ITV has already followed with a similar deal, and it seems inevitable that others will join. All of this continues to strengthen YouTube's already dominant position: in just 20 years, the once awkward underdog has grown into a mighty media giant.