Second-Screen Sports Options Circumventing TV Rights Pacts

Can ESPN steal the show without paying astronomical broadcast rights fees?

NBCUniversal has committed $4.38 billion to broadcast the next four Olympics. Could ESPN steal those rights by hardly spending a dime?

Not a chance. But ESPN has every right to go after the Olympics and every other major sporting event via its second-screen companion viewing apps like the popular GameCast. In fact, as social TV continues to explode, it’s opened up the next battleground in the sports media world, where those exorbitant broadcast rights fees don’t guarantee anything. “We want to see ESPN as second screen for all sports,” said Eric Johnson, evp of multimedia sales at ESPN. “We know we have a lot of companion [mobile] usage, even when it’s not our event. We want to take co-viewing to the next level.”

There’s no doubt that more and more sports fans are sitting in front of the tube with iPads or iPhones in hand—some just texting or tweeting, while others are consuming complementary content via apps or engaging with mini sports fan social nets.

ESPN knows, for example, that its mobile usage spikes for just about every live event. During NFL Sundays, visits to its mobile properties more than quadruple compared to the average weekday afternoon. Are all these people in front of the TV? Who knows? But it’s a good bet that a lot are, even though ESPN doesn’t air games at that time.

Meanwhile, upstarts in the space like Yahoo’s IntoNow employ new technology tools that recognize, in real time, what fans are watching. “That’s a huge differentiator,” said Adam Cahan, the company’s founder and vp. “We don’t have to get rights for these games. All I need to know is that you are watching football.”

That has to irk networks that shell out billions for TV rights and then build their own co-viewing apps. “There are plenty of second-screen apps out there,” Rick Cordella, vp and gm of NBC Sports Digital, said at an event last week. “What we have are the rights.” For the Olympics that means an app featuring an exclusive Twitter integration and unique camera angles.

Is that enough to pull away ESPN mobile regulars? That’s a big question—and one for which the stat-light, female-skewing Olympics may not provide the answer. And while ESPN isn't sharing any Olympic plans just yet, it's doubtful that the network's co-viewing experiences will be 100 percent synchronized with NBC's broadcasts of the games.

More likely, social TV will continue to be highly fragmented, as networks, sports leagues, startups, Twitter and Facebook vie for fans’ co-viewing attention.

“I think social TV is likely to play out closer to an individual brand [or network] rather than a startup,” said Jason Kint, svp and gm, CBS Interactive. "But I don’t know that I believe anyone is aligned for victory or there will be a victor."