Although literature exists that profiles the effects of technology on sport, there has been little exploration into the specific effects of media technologies. This case study contributes to the existing literature on the convergence of technology and sport by examining which of five key media technologies will have the greatest impact upon the televised ice hockey product. The results demonstrate the importance of forecasting media technology in sport.
National Hockey League (NHL)
The relationship between sport and the media has received considerable attention both in academic literature and in management practice, leading to sports organisation interest in a variety of media technology applications. In Canada, ice hockey's stars are national heroes; its games are among the nation's most watched television programmes; and its important role in Canada's identity, society and culture is well documented. This makes Canadian ice hockey an ideal case to forecast future impacts of media technologies.
This case study involves a four-stage implementation. First, in conferring with experts, five major media technologies with the potential to impact upon the televised hockey product were identified. These were High Definition television (HDTV), interactive television (iTV), video on demand (VOD), personal video recorders (PVRs) and mobile multimedia devices (MMDs). Second, a comprehensive review of the National Hockey League (NHL) broadcasts in Canada was carried out in February 2004, revealing a very high rate of diffusion. Third, six in-depth expert interviews were carried out: three media technology experts and three sports management experts revealed HDTV to be the technology with the potential to affect televised ice hockey te most. They cited viewer- and production-centric factors as well as economic forces to support this view. Finally, this analysis is complemented by a Bass model forecast of future diffusion.
Results support that sports managers and marketers must understand both current and developing media technologies and continually forecast their potential impact on their sport. The use of forecasting tools and consultation with experts (in sport and media) are shown to be methods for achieving such understanding, and a six-stage model for using such methods for media technology decisions is articulated. For ice hockey, managers and marketers must support and plan for the diffusion of HDTV as a mass-market technology, since the case study reveals that it will provide greater benefit to the televised ice hockey product than other televised products.
The concept of bringing enhanced technology into sport is flush with optimism (Silk et al, 2000). With regard to media technology research, the realisation that sports marketing encompasses the duality of the sports industry (see Mullin et al, 2000; Shank, 2002) is important, as media technologies enable and enhance both the direct exchange of sports products to sports consumers (e.g. watching a game on HDTV) and the indirect marketing of non-sports products through sport (e.g. a beer company's corporate sponsorship of a professional sports franchise enhanced by iTV). Sports management researchers have devoted attention to technology's use in live situations (Siegel, 2000; Moore et al, 1999) and in the indirect marketing of non-sports products through sport (Moore et al, 1999; Mendez, 1999). Yet practitioners are also keen on learning how decisions can be made regarding the implementation of technology in the direct exchange of sport products. This decision is not easy for the following reasons:
1 revenues from new technologies may simply be cannibalising those from old or existing ones
2 senior management may view media as a secondary concern
3 forecasting consumer adoption is difficult when many overlapping variables must be considered (see Boyd & Mason, 1999)
4 adoption may be required from other stakeholders
5 data on which to base a decision may be difficult to acquire.
This paper demonstrates how qualitative research can be used to aid in media technology selection decisions in sport by examining the case of ice hockey, specifically, the NHL in Canada.
Why ice hockey and the televised NHL?
Ice hockey plays an important role in Canada's identity, society, economy and culture (Whitson et al, 2000; Gruneau & Whitson, 1993). It is broadcast by four national networks, its games are among the most watched programmes in Canadian television history (Canadian Broadcasting Corporation, 2002; Hockey Canada, 2004), and its leagues and tournaments (in the professional, junior and international realms) garner widespread public interest.
The NHL is ice hockey's most commercialised media property. It had revenues of $1.996 billion in the 2002-03 season (Levitt, 2004), including a five-year, $600 million television rights contract in the United States with ABC/ESPN that expired after the 2003-04 season (Street & Smith's Sports Business Journal, 2005). In Canada, television revenues are lower and from a number of networks (e.g. CTV, Rogers Sportsnet, TSN and CBC). Once content rights to broadcast an event have been purchased, the broadcaster sells advertising to cover the costs of rights. Thus the ability to attract desirable and sizeable audience segments is essential for selling the advertising time around telecasts (Chalip et al, 2000; Shoham & Kahle, 1996). Ratings, measured as a percentage by Nielsen Media Research, are used to assess audience size in Canada and the United States. The higher the ratings, the higher the revenue a broadcaster can earn from the sport (Chalip et al, 2000).
In examining trends in rights fees and ratings, a surprising result emerges. While rights fees have increased, television ratings for all the major professional sports leagues in North America, including the NHL, have declined noticeably over the past decade (Sandomir, 2004).
Over the course of the NHL's recent six-year TV deal with ABC/ESPN (1999-2004), regular-season cable ratings decreased 31% on ESPN and 38% on ESPN2, with network broadcast ratings on ABC also slipping 21% over that period (The Sports Network, 2005). Furthermore, the ratings demonstrate that the National Basketball Association (NBA) and professional basketball have been and are clearly outperforming the NHL and professional ice hockey. In 2002-03 the NBA had ratings of 1.2 (ESPN), 2.6 (ABC) and 6.5 (NBA Finals) as compared to the NHL with 0.46 (ESPN regular season), 1.1 (ABC) and 2.9 (NHL Finals). In all three cases, the NBA drew at least double the viewership of the NHL (Sadomir, 2004). In recent years, this gap has continued to widen (The Sports Network, 2005; Soloman, 2005).
The comparison to the NBA is important for the NHL, as the NBA is often considered its closest competitor--they are of similar size and scope, have similar schedules at the same time of year and have experienced similar growth patterns. Therefore, it could be said that the NHL is underperforming in the televised media.
A nascent issue here is the impact of digital technology. Digitisation enables the combination of computing and broadcasting technologies and has been posited to be well suited to sport (Chalaby & Segell, 1999; Barnard, 1996; Wolfe et al, 1998). For example, horse-racing (Kruse, 2002), basketball (Silver & Sutton, 2000) and Formula One (Dransfeld et al, 1999) have all dabbled in some form of digital web-enabled television, a delivery paradigm that is forecast to be important to sport for years to come (Turner, 1999). Stakeholders in the ice hockey industry also understand the importance of new media, as shown by the Shanahan Summit (2004), where players, coaches, administrators and broadcasters made recommendations for the future of ice hockey, including those related to television. Indeed, careful consideration by any sporting organisation is needed when deciding upon new technologies, as these opportunities are extended with increasingly incalculable risks (Chalaby & Segell, 1999)
Overview of key media technologies
Preliminary consultation with experts (Peddie, 2004; Anselmi, 2004) and the literature revealed five major media technologies with the potential to impact upon televised sport: VOD, PVRs, MMDs, iTV and HDTV.
Video on Demand (VOD)
Ling et al (1999) describe VOD as "a technology through which video material can be ordered and retrieved over the traditional telephone lines from a central server". In essence, the viewer determines the viewing schedule, deciding which programmes ("televised products") should be broadcast at any given time. The benefits of VOD are accrued by broadcasters, who can charge premium fees from advertisers privy to a targeted and distinct market, independent of time constraints.
For televised ice hockey, the impacts of VOD are debatable. …