In 2021, we saw the continued response to a global pandemic, which included restrictions around and cancellations of major sports and entertainment events. Each year, ICR’s sector-focused teams draw on their deep industry knowledge to share their views on the year ahead and identify key issues that will dominate the minds of investors and the media in the coming year. Below, we explore the trends we expect to see in the global media, sports, and entertainment industries. 
 

  • Everything is going meta, with digital entertainment leading the charge, especially as it relates to fan engagement and celebrity-athlete brand monetization. Companies like Sorare are offering fans ways to buy and trade branded NFTs. Video games are increasingly launching NFT-based strategies and anticipate play-to-earn games to be the next wave of digital content. Both DraftKings and PLBY Group launched high profile NFT strategies, which are contributing to the top and bottom line. 

strategy will unlock keys to the “meta-mansion,” setting up a recurring revenue stream based on membership.
 

  • Does 2022 mark the full return of live events, further bolstering the experience economy? In its Q3 2021 financial update, Live Nation announced that fan demand had led to double-digit growth in pricing and on-site spending in the quarter and that “Q3 marked return to live at scale.” And recording artists all over the world are gearing up for a very crowded 2022 as tours are rebooked from 2020.

The emergence of the omicron variant is cause for some concern for the industry; however, it will not likely have near the impact that the pandemic had on 2020 and 2021. This is due to existing COVID-19 protocols including testing, vaccination mandates, and masking and social distancing policies at most live events.
 

  • Esports has become a means to connect with the next generation of sports fans, and 2022 could be the industry’s break-out year. The esports industry saw significant investment from sports teams and institutional investor interest from 2015 to 2017. And now, it is estimated that in 2022, the esports industry could top $2.5 billion. This comes on the tailwinds of high growth in audience for esports events and streaming. However, the commercialization and monetization of these large audiences has lagged behind. We are currently seeing the first attempt to properly value an esports team through the IPO via SPAC of FaZe Clan, an esports team leaning heavily into the creator economy through esports streaming, branded merchandise, and corporate sponsorships. Depending on their level of success, this could very well be a catalyst for other esports teams to increase their monetization, professionalism, and ultimately push the entire industry forward. The emerging value of the creator economy has given way to innovation in all forms of media — and we will continue to see niche creator-led platforms grow as well as innovations in sports entertainment and commercialization.

 

  • The pandemic has accelerated the growth of sports OTT streaming. Nearly every major U.S. broadcaster has launched an OTT platform over the last 18 months, according to SportsPro Media. This is largely due to consumers cutting the cord, with 15% of legacy cable customer opting to do so in just the last two years. These former cable customers are moving over to YouTube TV, Hulu and Amazon, which signed a $1.2 billion Thursday Night NFL deal to stream on its platform.

 


 

Source : https://icrinc.com