Color grading trends: John Daro looks at AI, the cloud & remote workflows

interview and copy written for Sohonet 

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and in Post Magazine

John Daro, lead digital intermediate colorist with Warner Post Production Creative Services, has helped create and polish the look of feature-length live-action and animated films ranging from Space Jam: A New Legacy to Behind the Candelabra, Contagion and The Boxtrolls to Sea Beast. He began his career at FotoKem in 2001 and worked his way up to senior colorist in 2005. As well as a keen eye for color, John is also a skilled technician, who has invented technology to create the perfect look for each project. These include a technique using machine vision to auto-segment images into mattes, and MatchGrader, an AI tool that artistically color grades based on a given reference image. He is also behind SamurAI, which adds the right amount of detail back to the image based on the quality of the input.

He recently shared insight into the trends affecting the color grading business, including the cloud and AI.

How close are we to achieving MovieLabs’ goal of moving post production, including the grade, into the cloud by 2030?

“It’s the direction that the industry is going, and I definitely think it will be achieved. There's nothing really stopping my Baselight system from being a cloud instance and sending video compressed as a JPEG XS stream to properly-calibrated monitors to a client for remote approvals. It’s a pretty slick workflow, and it gets us away from needing the big iron to live on-prem.

“This transformation will happen organically as cloud economics works itself out. Right now, it's cost prohibitive to be working in the cloud with that much data. But the more people do it, the volume will go up and the price will come down. Then, all of a sudden, it will make sense for productions. The gains we will get from working in the cloud will eventually outweigh that cost.”

What are the principal gains of working entirely in the cloud?

“It’s really all about geography. Often, when I'm working on a project, the DP is already shooting another show. So having the ability to be anywhere in the world and be able to collaborate on the same project will free everyone’s time. And that includes my time too. I can be working or collaborating with colleagues at our Burbank location or in New York or Leavesden Studios in the UK. To be in any one of those places and handle media as if I was here in my bay is a natural progression. It also opens up the talent pool to the entire world. Clients will be able to get the best artists regardless of their location and that’s an exciting prospect.

“Finishing, however, is a different story and you're always going to want to be in the proper environment. For example, if you're working on a Dolby HDR version, there's no gain by doing a cloud Dolby version because you need to be in a Dolby-certified theater. But when you're talking about dailies and being able to make sure that color is maintained from camera all the way through to finish, then the cloud conversation starts to make a lot more sense.”

You are talented both creatively and technically. You program code as well as edit with color. Does that combination make for the most successful filmmaking? 

“I think there's really no difference between artistry and technology when crafting beautiful images. They have gone hand in hand since the inception of film. In the early 1900s, it was all kind of a science project. Chemistry was involved in film processing. So, from the beginning, it's always been a collaboration between the science and the art of trying to bend light.

“There's no higher technical position than the director of photography, but at the end of the day, the output of their work is to tell a story — visually and artistically. We’re hopefully creating a picture that makes you feel something. 

“I see technology and coding as tools in service of making better pictures. My whole goal, my mission statement if you like, would be, ‘Let me show you something you've never seen before.’ That's what gets me out of bed every day. 

“On that note, AI could probably show us things we've never seen before. But what’s the endgame with AI? Where does its functionality stop and human creativity takeover? With each new technology there are concerns that existing processes will be replaced, but it never quite happens that way. Technology is always a tool to be more efficient, more productive, to create projects at greater scale.

“I like to think of it like this: a high-end animation shot 20 years ago took two weeks to render. In 2024, it still takes two weeks to render. It just looks a lot more polished and a lot more photoreal because of the amount of data that it is being created with.”

Can AI replace the colorist? 

“Absolutely not. Clearly AI tools will evolve, but they will assist our job by removing the minutia of the process and freeing up time for more creative work. 

“I break down color into two different areas: color correction and color grading. Color correction, for example, is matching the light for continuity of scenes that could have been shot over a whole day on location, but are supposed to take place in five minutes in the story.  This type of work is necessary, but not stimulating. Color grading on the other hand is always in service of a story. It’s very similar to the editorial process, where we cut things that don't serve the story and enhance the things that are promoting the story.

“AI tools can save us time with color correction. Time can be passed along to the client. The introduction of AI should mean we're not watching paint dry in the theater anymore, and we can more quickly get to the more collaborative enhancements. It will give us more options and, importantly, more time to craft a strong powerful story. Speeding that process up and having it become more interactive will fuel creativity. In addition, it will make the process so much more pleasurable, not just for me, but for the director and DP to hit their vision faster.”

To what extent do you and your clients like to run sessions remotely?

“Four years ago during COVID, the industry was thrust into the best experiment ever — being forced to work remotely. A lot of tools were created to bridge the gap out of necessity. I primarily used ClearView Flex. It was really the only way that folks could have some interaction with the work at that time.  

“Flash forward and a lot of remote work has stayed with us because people are now comfortable with the tools. For many project notes, it is not critical to be in a correctly tuned display environment. We all know that once you release a project to the world, filmmakers have little control over how it will be viewed. For quick approvals, ClearView is great because all we need on the client side is a calibrated iPad Pro. But for final finish, the theatrical, Dolby and HDR versions, ultimately, you do have to come back in a properly-calibrated environment for no other reason than to ensure you are hitting your target and are all in agreement.”

What recent film or show inspires you from a color perspective?

“I think infrared (IR) is having a moment. Ad Astra was one of the first in recent time where Hoyte Van Hoytema, ASC, used a stereo beam splitter rig to produce an IR version and a RGB version of the same shot film. The whole moon sequence in that film blew me away. The Zone of Interest [DP Łukasz Żal, PSC] used IR in a really interesting way to present another aspect to the story. It’s very striking and super effective while being sensitive to the story. Dune: Part 2 [Greig Fraser, ASC, ACS] features a stunning IR sequence that captures the essence of the colorless planet and stark fascistic rule of the Harkonnens. They hit on a visually-immediate way to show that world without having to go into great detail describing it. You got that vibe really, really fast. It’s very cool.”

Ad-supported streaming interest, uptake rises in Europe

Stream TV Insider

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As major streamers introduce ad-supported subscription plans in Europe, research from BB Media shows they’re capturing a growing proportion of the market, while consumers also indicate preference for streaming with ads in exchange for lower costs.

In key European markets of the UK, France, Germany, Italy and Spain streamers are swaying users to cheaper ad-supported subscription tiers.

From Q2 2022 to Q4 2023, ad-based revenue models experienced significant growth in several major markets within the EMEA region, according to figures from research and analysis firm BB Media.

“There has been consistent growth in AVOD as European consumers opt to pay less for services that contain ads,” Delfina Gianibelli, media analyst at BB Media, told Stream TV Insider.

Netflix led the way among major SVODs when it launched its AVOD subscription tier at the end of 2022. Between Q2 2022 to Q4 2023 the percentage of its users who pay for an ad-free plan dipped 9 percentage points to 81% in the markets surveyed, while those opting for lower-cost Netflix with ads increased by the same amount (rising from 10% to 19%) in the period.

Netflix this month disclosed the latest figures for users on its plan with ads, now counting 40 million monthly active users across the 12 countries where its available.

Of the countries surveyed by BB Media, more Italian Netflix users have adopted the cheaper ad plan but all markets exhibit the same trend.

Of the major streamers in EMEA, Amazon Prime Video has demonstrated the highest rate of adoption. Amazon took a different approach than other streamers, where it made Prime Video with ads the default subscription choice for all users, automatically creating a large ad-supported base where consumers need to proactively opt to pay more to upgrade to an ad-free plan. In contrast, SVODs like Netflix and Disney+ introduced lower-cost subscription plans with ads as an option for users alongside existing ad-free tiers. Prime Video rolled out its ad-supported SVOD in UK and Germany in February, following a late January launch in the US.  In Germany 23% of users are now on the cheaper ad plan and 27% of users are in the UK; In contrast Netflix has 18% of users in Germany and 19% in UK on the standard plan with ads (which costs £4.99 per month/USD6.38), per BB Media.

Warner Bros. Discovery only recently rolled out Max in some countries in Europe. Its basic plan with ads has been most successful in Finland where 19% of users have opted for it. Max has yet to launch in Italy, UK and Germany due to contract conflict with Sky.

Overall, BB Media analyst Gianibelli identified “remarkable” increases in AVOD viewing in Europe, highlighting Germany (which grew 10.44%) and Spain (5.21%). AVOD tiers have been adopted by 63% of the viewers in Italy and 71% in the UK.

Also in the UK, ITVX and My5 (the free streaming VOD services of broadcasters ITV and Channel 5) increased their shares from 19% and 14% in Q2 2023 to 21% and 17% in Q4 2023, respectively. Completely free services supported by ads – including linear-style free streaming services known as FASTs (free ad-supported streaming TV) have also benefited. Excluding YouTube, in the EMEA region in Q4 2023, Paramount’s Pluto TV FAST was the advertising-based model market leader with a 10% regional share. And Amazon’s Freevee marked share gains in Germany – rising from 31% in Q2 2023 to 39% in Q4 – as well as the UK, where it reached 15% share in the final quarter of 2023, up from 10% in Q2 that year.  

In the period from Q2 2022 to Q4 2023 SVOD penetration has also grown but less dramatically. In Germany, Spain, and the UK, SVOD models grew by 9%, 4%, and 1.7% respectively. The situation appears to be particularly challenging in Italy, where SVOD penetration declined by 2.1% during the period.

“Analyzing the composition of each country’s market share, excluding YouTube, many streaming platforms have benefited from the rising demand for advertising based models,” said Gianibelli. “When asked about the option of adding commercial ads to their subscription plan to reduce costs, half of the French and Spanish respondents said they preferred more affordable plans, even if it meant having ads interrupting the content.”

Respondents in Germany and Italy were even more inclined to choose lower-cost plans with ads, where 6 out of every 10 users showed a preference for ad-supported plans. That preference was particularly strong in the UK, where 69% of users favored cheaper plans with ads.

And while ad-supported streaming uptake and interest in on the rise in Europe, separate recent findings from Teads show that UK marketers aren’t yet fully capitalizing on the CTV advertising opportunity, as challenges with measurement and perceived costs are impeding investment

The Seemingly Endless (Commercial) Possibilities for Podcasts

NAB

More people than ever are listening to podcasts and with a diverse, young and increasingly female-skewed audience the media should be prized by advertisers, according to the latest annual research from Edison Research, with support from Cumulus Media and Sirius XM Media.

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According to the study, 67% of Americans aged 12 and over has ever listened to a podcast; 47% of them are monthly podcast listeners and 34% listen weekly. That’s an estimated 98 million weekly podcast listeners ages 12 and older in the country.

In addition, listeners are spending more time than ever with podcasts. In 2014, out of the daily time spent listening to all audio by those age 13+, 2% was spent with podcasts. In 2024, that number more than quadrupled and podcasts now account for 11% of daily time with audio. Twenty-three percent of weekly podcast listeners spend 10 hours or more listening to the medium each week.

“Each one of these figures are record highs,” Megan Lazovick, VP at Edison Research, said in a recent webinar. “In 2006, we first started collecting information about podcasts listening. That year 11% of the US population had ever listened to a podcast.

“At first we saw relatively slow growth year over year. And then in the late 2010s, there was much more generous growth. We have now reached the highest point ever in 2024 with 67% of those in the US — an estimated 192 million people — listening to podcasts.”

Podcasts reach all generations: 29% of kids ages 6-12, 59% of those aged 12-34, 55% of those aged 35-54, and 27% of those aged 55+ are monthly podcast listeners.

“The composition of podcast listeners has drastically changed over the past decade,” said Lazovick.

Forty-eight percent of Black Americans and 43% of Latino Americans are monthly podcast listeners. — both at an all time high. In 2014, 67% of monthly listeners were white. In 2024 that percentage has dropped to 58%.Cr: Edison Research

“Monthly podcast listeners aged 12 and older have become more diverse in the last decade,” she said. “The racial composition of monthly podcast listeners 12 and older now closely mirrors that of the general US population.”

 

The number of US women listening to podcasts has also hit a new high as 45% of women are monthly podcast listeners (six points up on 2023), and 32% are weekly podcast listeners.

“The gap that used to exist between male monthly listeners and female monthly listeners is nearly eliminated. This is a big part of the story for podcasts in 2024. The growth in podcasts reach is driven by large increases among the number of female listeners.”

Since 2014, the average time spent listening to podcasts has grown by 450% and podcast’s share of the entire audio market has risen, too: from 11% in 2020 to 20% today.

“At least 20% of audio [advertising] buys should be on podcast content,” Lazovick underscored. “I said ‘at least’ 20% because we found that podcast audiences are especially receptive to ads.”Cr: Edison Research

Not surprisingly, The Record, Nielsen’s audio listening report made in conjunction with Edison’s research, agrees with this stat.

It found Americans are spending more than four hours with audio every day, with radio taking 70% of that and 20% devoted to podcasts, while the rest goes to streaming audio (music services) or satellite radio (select channels). Most radio listening happens in the car.Cr: Edison Research

“There are more podcast listeners than ever. Americans are spending more time than ever with the medium. Podcasts reach all generations and Podcasts are equitable with diverse and increasingly female listeners,” Lazovick summed up.

“Those listeners are desirable,” she said. “Podcast listeners are a highly coveted audience for advertisers. They’re affluent and they’re educated. Finally, podcasts are effective. They reach receptive audiences and podcasters have the metrics to help advertisers match the consumers they need to reach.”

 

DMC switches RallyX to remote production based on GV AMPP

SVG Europe

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The tenth anniversary of the Nordic-based motorsport RallyX has been given a remote production shake-up by facilities provider DMC in the form of Grass Valley AMPP. Mats Berggren, COO, DMC Norway calls it “a small revolution and a totally new workflow approach.”

He says, “So far, the biggest limitation for proper remote production has been the need for large bandwidth connectivity to get all the camera signals to your remote centre. With a remote vehicle installed with AMPP servers, it is a totally new ballgame. You can do high-quality TV coverage over a regular internet line as long as there’s enough bandwidth for the PGM output, a multiview feed and some control signals. It is a revolution in a way.”

Previous championships, which run across five weekends in the Spring, have been produced as a conventional outside broadcast. Last year, for example, DMC was sending two larger trucks to venues in Finland, Sweden, Norway and Denmark but have this year gone entirely remote saving considerable cost and Co2 on travel while giving rights holders RallyX greater scope to increase production value.

DMC is no stranger to remote, doing 600-800 productions that way a year in Norway alone ranging from 2-3 cameras mainly for football, ice hockey and handball. It produces a further 2000 remote productions out of Finland each year, mainly covering ice hockey and horse harness racing.

As you’d expect, RallyX does not take place in cities or generally in stadia but typically on circuits “in the middle of nowhere,” says Jens Envall, CTO of DMC Sweden.

Examples include Nysum, one of the most spectacular in the championship, located 40 km south of Aalborg in Denmark and the Tierp Arena two hours from Stockholm and 30 minutes from Scandivania’s oldest university city of Uppsala.

Since RallyX occurs once a year at each venue it’s not cost effective to install permanent broadcast connections.

“We need to rely on existing internet connectivity for these tracks,” explains Envall. “Some of them have good connectivity but others are really poor so we decided our remote set-up would need around 100 Mb/s.”

Earlier this year DMC Production went on air for one of the Netherlands’ largest sports channels from a DMC-built and equipped live, post and playout production centre at Hilversum outside of Amsterdam. The centre is based on GV AMPP giving the team confidence to expand the use of the technology for RallyX live sport production.

The production uses LDX 98 series cameras with Fujinon 14x to 107x lenses, including 3x super slo-mo and a wireless link from Vislink and PTZs. Action is produced in 1080p 50 and distributed to the RallyX YouTube channel.

From this year two small vans equipped with two production servers are running AMPP apps for vision mixing, audio mixing, replay, multiview and graphics as well as for processing outgoing RTMP streams to YouTube and monitoring – essentially the entire AMPP ecosystem. It means that the main production crew including the director, chief audio engineer, replay op, vision engineer and graphics operator can now work from DMC’s broadcast centres cutting travel and hotel costs.

This means broadcast centres (plural) since DMC is unusually remote producing from its centres in Norway and Sweden.

“We’re utilising the crew we already have at the broadcast centres,” explains Berggren. “Since we already have vision engineers [shaders] in Oslo working on 800 productions a year, we’re just adding RallyX production on top. The rest of the production including the director and the client who likes to come and supervise production, are based in or near Stockholm. We have the flexibility of going remote across borders and between DMC broadcast hubs.”

It also means that RallyX maintains editorial consistency by using the same director for each race – saving that director the task of flying to each location too.

RallyX is the first on location production for which GV AMPP has been used by DMC but if successful then it might switch more of its productions over. Many of its current remote productions are 1-2 person productions where operators remote control PTZs and studio cameras using a Simplylive or EVS station. It also means a shader at a broadcast centre can work on multiple games.

Currently, RallyX is covered by approximately eight cameras including studio cameras and PTZs. RallyX is exploring the use of onboard cameras and Envall says the number of cameras can be increased thanks to the GV AMPP set-up. “We can set up 8, 16 or 24 cameras using the same bandwidth. It means we can scale up and down without additional investment.”

Adds Berggren, “One of the biggest challenges with remote is high bandwidth connectivity, especially with venues we do not visit so regularly but with the AMPP approach we can reduce the need for bandwidth tremendously. We can still do a 10-camera or larger production using limited bandwidth.”

Instead of having to feed 10 cameras back to the broadcast centre, the signals are processed by the server on-site with the control remote back.

“Now we can retain high-quality coverage with all the camera signals fed straight into the server and send one high-quality output via existing 100Mb/s connectivity.”

Reducing the number of on-site staff also goes some way to achieving RallyX sustainability goals.

As Peter Hellman Strand, head of broadcast and media for the rights holder explained, “This advancement enables us to drastically reduce our on-site presence, aligning with our commitment to an eco-friendly production minimising our environmental impact. Our decision to embrace this remote solution and utilise YouTube for broadcasting reflects our dedication to innovation, sustainability, and inclusivity.”

The 2024 RallyX championship features a race in Germany at Estering and with an expanded lineup of drivers representing Sweden (with 34 drivers), Norway (22), Finland (19), Denmark (17), Estonia (7), Belgium and the Netherlands (4 each), France, Great Britain and Latvia (2 each) as well as one from Germany, Lithuania, Poland and USA.

They compete in various classes over each RallyX weekend including the Supercar class described as a combination of a tank and a dragster. Its cars are manufactured on the basis of ordinary passenger cars but with engines of 600hp and four-wheel drive giving them an acceleration on par with an F1 car.

The regulations for supercar are the same in Rallycross in the European Championships and the World Championships. Several of the cars running in RallyX also participate in World RX and the European Championships.

 

Behind the Scenes: Eric

IBC

Muppetry and misery in Manhattan: the recipe for new Netflix drama Eric explained by DP Benedict Spence.

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A script about a missing child, a TV show puppeteer and a giant monster puppet set in the seedy underbelly of 1980s New York “sounded incredibly exciting and batshit - in a good way,” to cinematographer Benedict Spence BSC. “There was no way I wouldn’t do that.”

He’d received the script by award winning screenwriter Abi Morgan (The Iron Lady, Shame) from director Lucy Forbes and production company SISTER with whom he had just made This Is Going To Hurt.

That was in summer 2022 and six months later Spence was in Budapest with star Benedict Cumberbatch as bereaved father Vincent and larger than life puppet, Eric, a creature of his imagination.

“It's a psychological thriller bordering on a fantasy with a lot of world building because of its period setting,” says Spence who shot all six episodes with Forbes directing. “The puppetry scenes were incredibly rewarding and very complicated.”

The Netflix production designed two versions of Eric: a suit that fitted the design parameters of a Sesame Street style children's television show, and a hallucinatory Eric that would interact with Vincent and look more grounded in a public world.

Experienced puppeteer Olly Taylor is mostly inside the hallucinatory Eric suit performing the body, face and left arm. Yet he couldn’t see from outside the 20kg suit except via video piped into first person view drone goggles. Nor could he see his hands and feet. The goggles were fed with four camera feeds, three from lipstick cameras trained on Olly/Eric from the set plus a fourth view from the main camera monitor.

An external operator remotely controlled the animatronic eyes and mouth of Eric's head with a third operator handling the right arm of Eric's suit for times when he needed to be multi-dexterous.

“He and Benedict would rehearse the scene on set,” Spence explains. “Benedict would perform the scene and Eric would mimic it.

“When the suit was on Eric would come to life. It was amazing to be able to integrate this giant puppet monster with practical lighting rather than working with a shiny ball on a stick.”

Films like Taxi Driver and The French Connection were early references but their aim was not to make it look like it was shot in the ‘80s so much as wanting the story to feel as if it was from the past.

“We wanted to give the impression of something from the past but nothing explicitly vintage; a feeling of something gently out of time,” Spence says. “New York is a place that I grew up with in my mind’s eye. Dozens of films and TV shows have shot there. As we went deeper into the script it was obvious the scope of our story included family apartments, a police station, dark clubs, an underground village populated by homeless people.”

A particular still photograph that Forbes found of a subway with a graffiti covered train with a man inside holding brightly coloured balloons summed up the essence of the show as a pure, joyful and colourful bubble encased in the rusty, gritty and dangerous world outside.

It was never going to be an option to shoot a production that extensive in New York because of its expense. In addition to which very little of Manhattan resembles the city of half a century ago. Budapest on the other hand had an existing New York backlot originally built for Hellboy II in 2008 which they were able to adapt, plus the city has several kilometres of underground beer tunnels.

After four months in Budapest shooting interiors at Korda Studios and Astra Film Studio as well as a number of civic buildings doubling for 1980s Manhattan they shot another five weeks in New Jersey and one week in Manhattan itself.

“Lucy and I like to shoot on wider lenses and to put the camera in the middle of the action. The image had to have both immediacy and a roughness to it. All our characters are broken in some way so we wanted to inject that.”

But with so many characters and plotlines to juggle across six hours attempting a single style felt too much of a straitjacket.

“It would have done the show a disservice to be too strict when we have raw handheld scenes, lots of Technocrane and Steadicam, large sets, green screen and some virtual production work for a subway train scene.”

ARRI Alexa tends to be Spence’s go-to camera and Eric was his first use of the Alexa 35. “I trust Arri to make a good camera. The main thing for me on this show was the highlights protection. When shooting with lots of practicals and lighting faces the extra latitude of the Alexa 35 means you’re not burning out [over exposing] the image but retaining all the information.

“You can get most cameras to look like each other in the grade but being able to shoot and light the way I want on set without have to worry about it was a bonus.”

For example, scenes in the Lux nightclub were lit with a red colour wash. “Normally I’d be worried about clipping the colour channel but I had complete confidence that the Alexa 35 would hold all the detail.” 

A set of Zeis Supreme Primes offered the speed (T1.5), focal lengths and compact build suitable for his camera plan. “This is a mystery thriller and a police procedural so to show clues as well as misdirection we wanted a visual motif to draw people’s attention. The simple answer was a zoom.”

He put on a Fujinon ZK19-90mm to draw attention to real clues or red herrings and sometimes extended the optical zoom in post: “Using a zoom is also a cool retro thing that echoes eighties movies.”

Good Day Sunshine, the kids TV puppet show in Eric, was shot using older Ikegami studio cameras. Broadcast TV news segments at the opening to episode 2 were shot on DigiBeta tape.

Stitches & Glue, who also built creatures for Stranger Things and The Last of Us, built the puppets from initial designs by illustrator Poppy Kay based on Forbes’ vision. Since Eric had to exist in Vincent's imagination but had to feel like he belonged in the Good Day Sunshine world, there was a lot of thought about his colouring.

Burgundy, browns and cornflower blue and buttery yellow seemed to populate the New York landscape which is why Eric has a buttery hair colour combined with cornflower blue. His eyes are direct copies of Cumberbatch’s.

It’s a first major Netflix commission for SISTER which Spence admits made for a degree of tension at the outset.

“I’m a great believer in screen tests so the week before we started principal photography we took the main cast in costume and lit them on set. We graded that and sent it off to Netflix. That reel was a validation for everyone. We could see this show come to life.”

That test reel was used as the basis for the show LUT designed in concert with Spence’s long term collaborator Toby Tomkins at Harbor Picture Company.

Having shot all interiors in Budapest in the winter they shot exteriors in New York in late Spring. Marrying those two was a matter of skill and luck.

“You can’t predict the weather that far ahead so do you light interiors for weather which may or may not be sunny or overcast or do you light more neutrally? There’s no right answer so I lit interiors for the mood I felt was right for character and story. We got lucky in that for the most part the exteriors matched what we had already shot.”

 

 

Live sports unite audiences in “cultural moments” worth fighting for

IBC

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In a media landscape of rapid change and dire predictions live sports offer a measure of relative certainty. Consumer appetite is arguably at an all-time high. Almost half of us spent more time watching live sports content last year than we did the year before, reports Accenture. Advertising-led streaming services lead the march to profitability and sports offer the most predictable audience. It’s why rights remain in high demand as streamers and broadcasters compete for the most valuable content on the planet.

Netflix’ global deal to air live NFL matches for the next three Christmases should be seen in this light. Sports remain light among the platform’s library but it has made repeat recent moves to test the appetite for live events. This includes November’s inaugural Netflix Cup - which pitted leading golfers against F1 drivers; and the clash between boxer Mike Tyson and social media star Jake Paul coming in July. Earlier this year the company paid more than $5 billion to be the home of WWE which it is billing as “sports entertainment.”

Tellingly, Netflix bosses have said live programming creates “cultural moments” relevant not only to viewers, but to advertisers, a new revenue stream that Netflix hopes to scale.

That’s the same as the “watercooler moments” that broadcasters have long used to differentiate their one time monopoly of mass appeal sports events from OTT competition.

At a recent earnings call Netflix joint CEO Ted Sarandos said, “Our North Star is to grow engagement, revenue and profit, and if we find opportunities we will do that across an increasingly wide variety of quality entertainment… including sports.”

Bloomberg reported that Netflix is paying less than $150 million for each NFL game, which is less than it spends on original movies like The Gray Man but with the advantage of a built-in audience to targets ads to.

The company's huge content repository can also help retain viewers who might have subscribed just for live sports, according to Parrot Analytics strategist Brandon Katz.

That may give Netflix an edge but it is far from the only streamer widening their live portfolio to stem churn with the stickiness and appointment to view of live sports.

Amazon Prime Video already streams NFL games and YouTube has paid around $14 billion to stream NFL Sunday games until 2029. AppleTV is in year two of a ten-year $2.5 billion deal to stream MLS games.

The NBA is the next major US sports property up for grabs. The current deal with Disney and Warner Bros. Discovery expires after the 2024–25 season and valuations for rights run as high as $8 billion a year.

That’s because, with over 32 billion views across social media last season the NBA has a proven ability to secure valuable younger demographics. Moreover, the league performs far better overseas than even the NFL which is why Ampere Analysis has dubbed it “America’s most globally relevant sports property.”

For legacy media like Warner.Bros Discovery, Disney and Fox which are allying to create uber-sports streamer Venu, live sports is seen as near as surefire way as it’s possible to get in retaining and growing subscribers.

There’s a pronounced halo effect for streaming platforms that offer live sports. Ampere Analysis picked up on this with startling data that showed all streaming platforms with NFL rights grew their monthly viewers 4% more between Q3 2023 and Q1 2024, over other SVOD platforms. Paramount+, which had rights to Super Bowl LVIII, saw the biggest boost, with its overall monthly viewer base growing 22% in the six months to February 2024.

The data showed how important tier 1 sports rights can be to streaming platforms. Ampere analyst Minal Modha, said, “As streamers try to diversify revenue streams through advertising, live sports will play a bigger role in helping to guarantee large audiences, thereby pushing up advertising value.”

NBCU will be hoping its SVOD platform Peacock exhibits the same boost when streaming the Paris Olympics this Summer.

Over a quarter of all SVOD subscribers will sign up to a new streaming service just to watch the Games from Paris, according to research from Bango. Its report also found that a vast majority (87%) of those paying for sports VOD subscriptions want a single platform to centralise all of their sports interests into one place.

“As some of the highest value customers in the subscription service market, sports fans are a lucrative audience worth acquiring and retaining. But with higher costs come higher expectations, and there’s only so far that subscribers can be pushed before they hit the unsubscribe button,” the report advised.

Adam Silver, who heads negotiations for rights for the NBA, has said there will be more changes in media technology over the next five years than there has been in the last thirty years. In particular, fans will be increasingly able to tailor their viewing via personalisation.

“To the extent you want to follow a particular player, you want more data as you’re watching the game, you want to be chatting with your friends or part of a larger conversation with experts,” Silver said. “All of those things are beginning to happen now in sports, but I feel like we’re just scratching the surface.”

Another sign of the heated demand for sports is that piracy is growing at its fastest rate since 2018, according to research published by consultants Kearney in January.

Last week’s Fury vs Usyk became one of the most illegally streamed sports events in history with 20 million viewers illegally streaming the fight costing broadcasters an estimated £95 million.

Kearney advised rights holders to distinguish themselves from illegal free live streams by offering additional viewer experiences, such as interactive features.

Mega-events at a crossroads

Huge sports events themselves such as the Olympics, the ICC Cricket World Cup, Rugby World Cup, and FIFA World Cup, also need to make big decisions if they are to remain viable.

A report by Deloitte last month noted that while such events can bring people together “in global solidarity and fair play” their complexity and cost “may be reaching a breaking point.”

Though these goals appear to be at odds, technology integration and digitalisation may be key to achieving both objectives concurrently, said Deloitte, pointing to the Paris Olympics as a potential blueprint.

The most significant challenge to bidding for, and hosting, sports mega-events is cost. Such events have a long history of “overspending and building waste that is often seen as unsustainable, both economically and ecologically,” Deloitte noted.

The cost of the Tokyo Olympics 2021 was US$13 billion, while Qatar spent roughly US$200 billion preparing to host the FIFA World Cup in 2022.

By comparison, the current estimate for the capex associated with Paris is around US$4 billion, split half and half between private and public finance.

Among other efforts the Paris Games will use primarily preexisting or temporary venues for competition, keeping costs down and limiting the event’s overall carbon footprint.

New builds—like the athlete village and an aquatics centre—in Saint-Denis, just outside the capital, stand to benefit from the facilities and housing long term.

On the production side, Paris will be the first Olympics where Cloud is the main distribution method. Alibaba, the Chinese group partnered with Olympic Broadcaster Services, anticipate that physical space at the IBC will be reduced by 13% from Tokyo, and power consumption will be 44% less. OBS had seen a 279% increase in bookings by rights holders for cloud services over 2020.

Yet cutting cost mustn’t come at the expense of the fan experience if such events are going to last.

Getting spectators involved is a key recommendation from the IOC—one that the Paris Games is honouring with a mass participation Olympic marathon.

Technology is expected to play a key role in this objective, too: “Digitalisation can help make these experiences accessible to fans, both in the crowd and at home, with enhanced and expanded broadcast coverage, athlete performance data displayed in real time, and “digital twins” of major Olympic venues,” said Deloitte.

Future events should build on this by investing in digital experiences that will draw a crowd—both in venue and at home. Deloitte points to virtual experiences in venues and expects AI integrations to become commonplace—"revolutionising sports broadcasting, amplifying digital engagement and campaigns, and improving how mega-events are planned and organised.”

But questions remain: How can these experiences that bring global audiences together be replicated, with minimal costs and complexity? And how can technological capabilities make these efforts a reality?

“If successful, the Paris Games may illustrate a new model for the future,” said Deloitte. “Potential host countries and organising committees around the world will be watching.”

 

Sports Fans Want More Interactivity. And That’s Where AI Can Come In.

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Sports fans want the in-venue experience to have the same features they see while watching on streaming video at home. Gen-AI might be able to help.

Data analysis from Deloitte’s latest Sports Fans Insights survey revealed that fans prefer more interaction with the event while in the venue. In fact, 58% of sports fans said that when they are at a live professional sporting event, they wish they had access to the same statistics, analysis, and replays that they get while watching at home. This figure jumps closer to 70% for Gen Z and millennial sports fans surveyed.

“While the at-home viewing experience continues to improve, sports leagues and organizations should think about how to give fans more of what they want when they’re attending events in-venue,” the consultancy advises.

Overwhelmingly (82%) sports fans say they use their mobile phones in some way while at the game either to post to social media or check player or team statistics.

77% said they would like the ability to watch replays on their mobile while at the game, 68% would want the ability to view the action from a different angle, 59% want to watch the game from a player’s point-of-view, and 35% of respondents would want to look at augmented reality overlays with player stats.

This means sports stadia need upgrading to private 5G networks while also thinking ahead to potential partnerships around 6G technology, advise Deloitte.

At the same time, 68% of sports fans say people are on their mobile devices too much during the game events, suggesting that venues and organizations face a balancing act.

“Finding ways to engage attendees digitally in the stadium — without taking away from the event and the electricity of the atmosphere — will likely not only improve fans’ experience at the venue but could also keep them coming back for more.

“The future lies in integrating the physical and digital worlds and offering the best of both to sports fans, regardless of where they’re sitting.”

 

Deloitte suggests augmented reality technology can be used to make experiences interactive — ”think holographic displays, immersive games that put attendees into action with digital twins, and real-time statistics.”

GenAI could also be used to boost the at the game experience — but that is just one of its potential applications.

Warming Up for Generative AI

In another report highlighting sports business trends, Deloitte expects generative AI to “quickly permeate” many aspects from stadium to streaming.

“Over the course of the next 12–18 months, we expect to see a groundswell of innovative applications involving content generation and management, live sports coverage, player evaluation, sports betting, fan engagement, and back-office operations.”

For example, generative AI tools and applications can be used to create customized videos and highlights by fans of their favorite teams and players.

The tech could provide them with promotions based on their behaviors and interests, as well as power chatbots and digital avatars to help them engage with game content in new ways.

The consultant warns teams, leagues and organizations not to rush into GenAI. Instead, they should look at ways to address both their shorter- and longer-term needs, it said, not only across strategy and technology infrastructure, but also around risk management, governance, and talent.

Key questions to consider include: How can GenAI can build upon existing AI and data capabilities? And will they need to improve their computing infrastructure and data platforms as a result?

How can organizations best leverage their proprietary data in combination with increasingly commoditized large language models to enhance and create new revenue streams?

There are also risk mitigation strategies to consider “to handle uncertainties and unanticipated consequences” around intellectual property issues and multiple regulations.

 

How Sports Streamers Should Be Optimizing Their Tech Stacks

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Live sports streamers want to deliver the highest quality stream that a user’s device will support in the available bandwidth, but a panel of industry experts at NAB Show’s Streaming Summit said that many are losing millions of dollars in the process.

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“A lot of streamers are putting unnecessary bits across networks that cost them tens of millions of dollars, where they’re over optimizing for things that aren’t perceivable by users,” said Rob Gelick, former chief product officer at Paramount.

That’s because they are either attempting to stream 4K across networks when there’s little way of monetizing that resolution and/or they are using inefficient delivery and compression techniques.

James Burt SVP of broadcast products at live streaming and VOD platform JW Player, said, “From my perspective 4K comes up little. I mean, the amount of 4K streaming we do very small. Technically, we can do it. We just don’t. The [standard] is 1080p 60. It’s good enough for most of our customers ranging all the way from the tier one sportscasters down to the smaller ones.”

Gelick said that AI technologies could help dial down or dial up the bitrate of each stream to maximize quality depending on the variabilities of end-user bandwidth and device capability.

“So that you can come down to a level where you’re not over delivering. You can dial back the quality just to the level where people can’t perceive that there’s any drop in it. But that material saving, even if that’s five percent, 10 percent, 15 percent of your data costs, is incredible for operators. Streamers are looking to where they can save costs today and that’ll be a big part.”

There’s no problem in terms of production capturing in 4K or upscaling an HD feed to 4K, but the consumer might not see any benefit.

The result, said Gelick, “is doing the exact opposite of you want to do in streaming, which is to put an unnecessarily fat stream through limited pipes and spending a lot of money doing it. Now I think people are getting a little smarter.”

Gelick also decried the “patchwork quilt of third-party technology and homegrown solutions in sports workflows,” as he put it.

“You would probably would be hard pressed to find an end to end video workflow that is actually the same anywhere,” he said. “The good thing is that that means there’s a bunch of really flexible tools out there, where you don’t have to conform to a set standard, or architecture, or platform.”

Most technologies like encoders and packagers are now software defined enabling them to be swapped as needs changed.

“That has worked really well for us since it means we’re not solely reliant on one vendor,” said B. “There are a lot of streamers out there that are all in one technology stack and sometimes that locks you in and it’s very difficult to get out of. We like to have a more modular approach where if this isn’t working for us, we’ll rip that bit out and pop another one back in.”

Overriding any other aspect of the live experience is reliability. They said, the stream simply has to work.

“With VOD you get loads of chances but with live you get one chance,” said Burt. “It has to work. One of the things we focus on a lot is reliability — making sure that the stream is always available. If there’s a problem downstream, that you can manage it.”

A second important consideration is flexibility. “With the way that the market is changing we really need to have flexible solutions to be able to offer live to VOD and to offer multiple monetization techniques,” he said. “Being both flexible and reliable is sort of supercritical in my view.”

If platforms are encouraging fans to sign up to stream the game they had also better be prepared for the last minute peak in traffic. Surprisingly, this remains a trapdoor for some.

“Take The Masters or the Super Bowl or even March Madness, and someone’s coming in to watch — you’d like to think that if they’re a new subscriber that the platform has planned for that ahead of time, but typically, they don’t,” Gelick shared.

“So where you see a lot of the market getting into trouble is if they don’t plan for these peak sign ups. You have a very compressed window, like a minute or two, with a massive amount of people coming into the service, and that impacts everything, not just your video workflow, but how quickly you can write to your database to get someone registered.”

Doubling down on this point, Luciano Escudero, VP of media engineering at services company Sportian Globant, said, “If you’ve invested heavily in sports as a vehicle, maybe it’s the beginning of a season, there’s a good chance that they’re going to stick around for the whole season. But if you have one moment on a key marquee event, then a question is how do you capture that person and expose them to the whole household service not just a dedicated sports service? How can keep them in the service?”

The panelists also discussed the introduction of sports betting into live sports applications, noting that latency is still a major issue. You can’t have someone betting on an event in one location or from a live to air broadcast versus someone watching the live event being streamed if the time delay isn’t matched.

They further noted the arrival of joint sports app between Disney, Warner Bros. Discovery and Fox, adding that content discovery for sports still has room for improvement.

“We still haven’t cracked the code on the best way to find content,” said Gelick. “I think we will see a lot of experimentation with bundles and more genre sports verticals appear from niche streamers.”