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SPORTS
FUTURE WITH ARTIFICIAL INTELLIGENCE

AURA SOLUTION COMPANY LIMITED

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AURA

STREAMING INDUSTRY

The Crucial Role of Investment in the Evolving Sports Industry: AI, Streaming, and the Future by Aura Solution Company Limited

The sports industry has long been a powerhouse of economic activity, generating substantial revenues and attracting significant investments. With the rise of streaming services and the direct-to-consumer (DTC) sports consumption model, the way people watch sports is undergoing a seismic shift. By 2025, the number of US viewers who stream sports events at least once a month is projected to soar to over 90 million, up from 57 million in 2021. This transformation presents both challenges and opportunities for the industry, with Aura Solution Company Limited leading the charge in leveraging artificial intelligence (AI) and streaming technologies to navigate this new landscape.

The Rise of Streaming Services

Digital streaming has revolutionized the media industry, contributing to its fragmentation and challenging the traditional regional sports network (RSN) model. The surge in national rights values and shifting consumer preferences are pressing RSNs to adapt, while sports leagues see opportunities in this evolving scenario. In 2024, the estimated annual spend on live sports media rights primarily distributed in the US is projected to reach approximately $28 billion. This figure underscores the increasing value of national sports rights, driven by recent agreements for major college conferences, NFL Sunday Ticket, and MLS. As the NBA package approaches expiration after the 2024-2025 season, a surge in national sports rights value is expected, fueled by fierce competition from traditional TV incumbents and streaming giants.

However, the growth in regional sports rights may plateau due to financial uncertainties surrounding RSNs. In response, some leagues and teams are reclaiming their rights and exploring alternative distribution methods such as over-the-air (OTA) broadcasts and DTC streaming services. This shift raises a critical question: What will it take for sports organizations to succeed in delivering the content fans crave in this new era?

The Decline of the Traditional RSN Model

The once-dominant RSN model is facing significant challenges. Rights fees and production costs are rising, while fans are increasingly opting for digital streaming platforms. With crucial sports rights agreements nearing expiration for over 29 major sports teams, many are strategically pivoting to OTA broadcasts or DTC streaming platforms, reducing reliance on conventional RSNs and positioning themselves more competitively. The migration to streaming platforms is accompanied by a rise in short-form content on social media, with some fans preferring highlights and updates over full-game broadcasts.

With audiences dispersed across various devices and platforms, sports franchises, leagues, and networks must reevaluate their content distribution strategies. Successful examples include:

  • The Vegas Knights: Increasing their reach with OTA broadcasting for local games and creating their own DTC streaming platforms.

  • MLS: Partnering with media organizations to take over game production and create DTC platforms offering exclusive, all-access content.

  • NBCUniversal’s Peacock: Attracting customers with exclusive live sports rights, enhancing subscriber retention.

  • Amazon and YouTube: Investing in live sports rights, capitalizing on the loyal and passionate sports audience.

 

Potential Drawbacks of Media Fragmentation

While new consumption models offer several benefits, they also present challenges. Media fragmentation can impact the bottom line for sports organizations moving away from RSNs. In the short term, losing large rights fees necessitates finding alternative revenue streams. Over time, better data on viewers can attract more targeted sponsorships, potentially offsetting lost revenues. However, fans navigating multiple subscriptions and devices may face increased expenses and frustrations, impacting their overall experience. Issues like network latency and poor internet connections can also detract from the enjoyment of live sports.

Embracing a New Streaming Era: Data Strategies

To thrive in this new age, sports organizations must adopt an omnichannel approach that focuses on boosting viewership and gathering insightful behavioral data. By broadcasting games over the air, teams can expand their audience reach significantly. However, to gain a deeper understanding of their fanbase, teams must leverage DTC platforms to collect valuable fan data.

Imagine a lifelong fan of the Metro City Thunderhawks. The Thunderhawks create a team app for fans to watch games and run promotions for app sign-ups and survey participation. With this app, the team gains insights into fan behavior, from viewing habits to engagement with promotions. DTC platforms enable teams to stay connected with fans for longer periods, using collected data to drive engagement and enhance sponsorship value.

The Future of Sports and Finance: Investment Opportunities with AI and Streaming

Aura Solution Company Limited is at the forefront of integrating AI and streaming technologies in the sports industry. Their innovative approach includes:

  • Advanced Analytics: Providing in-depth performance analytics to help teams and athletes optimize their performance.

  • Customized Streaming Solutions: Offering bespoke streaming services tailored to sports organizations' needs.

  • Investment Advisory: Guiding investors toward profitable opportunities in the evolving sports landscape.

  • Sustainable Growth: Focusing on long-term value creation through technological advancements and innovation.

 

In conclusion : the convergence of sports and finance, amplified by AI and streaming technologies, is creating unprecedented opportunities for growth and investment. Aura Solution Company Limited is driving this transformation, enhancing the sports experience for fans and creating value for investors. As the industry continues to evolve, the integration of AI and streaming will shape the future, offering exciting prospects for investors and enriching the sports experience worldwide.

PERSONALIZING SPORT

For years, sports teams have utilized machine learning (ML) to gain a competitive edge by analyzing player statistics and optimizing pricing, while leagues have leveraged ML to improve scheduling and operations processes. Despite these advances, sports organizations have often been late adopters of emerging technologies overall. As generative AI (GenAI) begins to fundamentally change how business is conducted, stakeholders in the sports industry—teams, leagues, content owners, and advertisers—should seize this moment to evaluate how GenAI can significantly enhance the fan experience and boost revenue.

Generative AI is highly customizable and can be fine-tuned to recognize new patterns, unlocking opportunities for teams to create personalized offerings based on fans’ individual preferences and deliver them at scale. This technology allows organizations to offer tailored experiences that deepen fan loyalty and create a stronger connection to a franchise.

Modernizing Fan Data Collection

Collecting data about fan preferences is not new; most organizations already gather key information about their customers to better understand their needs and meet them where they are. Using this valuable data strategically can help sports organizations understand fans and craft engagement strategies that build loyalty and better experiences. The game-watching experience is being reinvented through second screens, on-demand statistics, immersive streaming, and seamless purchasing options.

Imagine if your organization could supercharge its ability to extract actionable insights from all unstructured fan data across multiple systems and points of engagement. One GenAI model can conduct deep retrieval across your sports business, delivering incredible ROI quickly. Deploying an AI model is not as challenging as it may sound, especially when fan data is digitized. Moving customer data to the cloud enables GenAI to access that data and simplifies compliance, privacy, and governance. Businesses can license a private version of publicly available models from cloud service providers and customize it to meet their needs. With data in the cloud and a GenAI model ready, sports organizations can process and deliver insights that power hyper-personalization for fans at scale.

Elevating the Fan Experience with GenAI

In our 2024 AI Business Predictions, we explore the transformative potential of GenAI in shaping business operations. Cloud-based enterprise applications already incorporate GenAI capabilities, but this is just the beginning. Previously complex tasks such as building new processes, creating innovative products and services, and enhancing customer engagement can now be accomplished through “no code” activities facilitated by GenAI. This power extends beyond traditional businesses and has the potential to revolutionize the sports industry, creating exciting new opportunities for revenue generation and immersive fan experiences.

Consider Stephen, a loyal fan of his hometown MLB team. Each season, he attends games at the ballpark with family, business associates, or friends. In the past, Stephen faced the frustrating choice of selecting games and seats with a ticketing agent or settling for a rigid package. Thanks to GenAI, new experiences and opportunities emerge for Stephen and his local team. Past preference data combined with predictive analytics can help generate customized recommendations for Stephen, from ticket purchasing to halftime refreshment selections, whether he’s at home or at the stadium.

Here are some GenAI-driven fan experiences we expect to see in the near future:

  • Personalized Commentary: Generated by analyzing an individual fan’s viewing history and team/player preferences, GenAI can deliver customized content like game highlights and real-time commentary in various styles.

  • Customized Advertisements and Offerings: Relevant ads reach spectators on a personal level, reducing game time interruptions. For example, Stephen might receive a notification reminding him to order pizza during the game, based on his past behavior.

  • Customized Highlights and Summaries: Tailored based on favorite teams, watching habits, and social media activity.

  • High-Quality Translations of Player Interviews: Enhancing global fan engagement by providing translations and insights into game strategies.

  • Engaging Branded Moments: Dynamic ads in the background during high-stakes game moments, reflecting current sponsors.

These capabilities are already here or will be soon, offering unprecedented personalization for fans and new revenue opportunities for organizations.

 

Getting Started with AI-Driven Sports Experiences

The opportunity to build AI-driven sports experiences is real, and teams should start experimenting now to streamline operations and improve the fan experience. To effectively use AI, organizations should develop a holistic strategy involving technology, internal skill sets, and a roadmap. They should leverage historical data to augment models and expand impact.

Building an internal team of technology specialists and top leaders is crucial. This team should analyze existing customer engagement processes, scalability, time investment, and the types of fan data that can be leveraged to create new experiences.

As more enterprise applications incorporate GenAI, improving and scaling fan engagement efforts with an omnichannel approach becomes easier. AI-powered CRM systems, for example, can conduct deep retrieval from past communication histories, purchase data, and other intelligence, delivering insights to fine-tune engagement strategies.

Playing by the Rules with Responsible AI

Embrace the use of AI to improve fan experiences, but implement governance around AI use to ensure responsible and ethical practices. Establishing a solid foundation for AI involves:

  • Data Stewardship: Assess the value of data while practicing sound governance.

  • Leverage Existing Governance Programs: Integrate cybersecurity, privacy, and compliance into responsible AI practices.

  • Enterprise-Wide Approach: Ensure every senior leader understands their role in fostering trust in AI systems.

 

Implementing these steps builds AI transparency and accountability, essential for reimagining the future of sporting events.

 

Conclusion

As generative AI transforms the sports industry, stakeholders must seize the opportunity to enhance fan experiences and boost revenue. Aura Solution Company Limited is at the forefront of this transformation, leveraging AI to create personalized, immersive, and engaging experiences for fans. By adopting responsible AI practices and strategically using fan data, sports organizations can unlock new opportunities and redefine the future of sports entertainment.

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FUTURE OF SPORTS

In 2020, the New York Mets sold for a record $2.5 billion. Since then, the team’s payroll has more than doubled to around $384 million, making it MLB’s highest by a significant margin. Plans have also been announced to develop the entertainment district surrounding Citi Field. This substantial capital investment in the Mets and its community might seem excessive at first, but this strategy of significant upfront spending is quickly becoming the norm.

Expanding Ownership Opportunities

In recent years, multiple sports leagues have opened up ownership opportunities, including minority interests, to new buyers beyond ultra-high-net-worth individuals. Private-equity firms, pension funds, and sovereign wealth funds are now part of the mix. Despite this expansion, the number of teams available for purchase has remained relatively static. This limited supply, coupled with growing demand, has driven the market value of teams to unprecedented levels.

Beyond Scarcity: Media Opportunities and Cultural Relevance

It's not just scarcity driving up team valuations. Franchises are experiencing significant growth in lucrative media opportunities that outstrip other revenue streams. In this environment, a team’s prestige, star power, and cultural relevance have become crucial metrics in determining its value, often outweighing traditional measures like ticket sales.

 

Winner Takes More: The Case of the Phoenix Suns

The Phoenix Suns offer a case study in this new valuation math. In 2019, the franchise generated an estimated $42 million in operating income and was valued at $1.5 billion by Forbes. Over the next three years, the team’s operating income fell to just $15 million due to a substantial increase in payroll. However, this investment in players paid off as the Suns made multiple playoffs and an NBA Finals appearance, boosting the team's valuation to $4 billion by 2022. Similarly, the NFL’s Denver Broncos, another team that invested heavily in players and facilities, set a record by selling for $4.65 billion in 2022.

Building Entertainment Districts

As team valuation becomes more important, creating a seamless fan experience is essential. Owners are investing in entertainment districts in and around their stadiums and arenas, featuring restaurants, bars, retail stores, apartments, and hotels. These districts expand the stadiums' reach and impact, allowing them to host various events like concerts, fairs, and parties, generating additional revenue. Additionally, these districts provide owners with valuable consumer data that encompasses an entire entertainment ecosystem with the team at its center.

 

The Future of Team Valuation and Fan Engagement

The Mets may have set a precedent by spending big and focusing on franchise value, and other teams appear to be following suit. Looking ahead, this trend will likely mean attracting top players while navigating league salary caps and other rules. It will also involve building communities around these players that amplify the franchise’s core values, expanding its footprint, and deepening relationships with fans. These relationships, and the potential to draw more customers into the franchise's orbit, including international fans, will likely continue to drive higher valuations.

Higher valuations will attract ownership interests with more capital to invest in salaries and facilities, creating a positive feedback loop of growth and engagement. The future of sports franchises lies in this strategic blend of investment in talent, infrastructure, and fan experience, ensuring that teams remain valuable assets both on and off the field.

Aura Solution Company Limited is at the forefront of this transformation, leveraging investment opportunities to enhance the sports industry’s landscape. By focusing on innovative strategies and comprehensive fan engagement, we are helping shape the future of sports franchises globally.

BETTING SPORTS

Online sports betting is currently legal in 26 states, with the 27th state poised to join the ranks in 2024. The industry landscape has been dominated by FanDuel and DraftKings, holding 39% and 34% market share, respectively. However, two significant players are vying for a substantial share of this lucrative market: ESPN and Fanatics.

 

ESPN's Strategic Entry: ESPN Bet

ESPN, in partnership with Penn Entertainment, has rebranded its platform as ESPN Bet. This collaboration, valued at $1.5 billion, provides exclusive rights to the ESPN name, allowing the company to leverage its extensive online and broadcast platforms to engage and attract sports fans. Currently live in 17 states, ESPN Bet is positioned to make a substantial impact within the industry, capitalizing on ESPN's established brand and broad audience reach.

 

Fanatics' Foray: Fanatics Sportsbook

Fanatics has also made a notable entry into the online sports betting arena by acquiring PointsBet. Leveraging its extensive customer database, Fanatics launched its sportsbook in 2023, initially available in five states, with plans for further expansion. This move marks Fanatics' strategic attempt to diversify its offerings and tap into the burgeoning sports betting market.

 

Market Challenges for New Entrants

The online sports betting market is notoriously challenging for newcomers, as evidenced by the closures of smaller sportsbooks like Fox Bet, MaximBet, and FuboTV. Despite ESPN and Fanatics being well-established names in the sports industry, they face significant hurdles entering an already saturated market. The high cost of acquiring new customers and the stronghold of existing major players present formidable barriers to rapid market dominance.

Strategic Implications for ESPN and Fanatics

While ESPN and Fanatics may not immediately dominate the market share, their entry into online sports betting offers strategic advantages beyond direct revenue. Establishing a strong brand presence in this sector can enhance customer connections across their diverse business portfolios. These efforts can yield valuable consumer behavior insights, which are crucial for refining marketing strategies and improving customer engagement across their platforms.

 

Predicting 2024 and Beyond

In 2024, even if ESPN and Fanatics do not achieve a leading market share in online sports betting, their ventures can still provide significant benefits. The insights gained from customer interactions and betting behavior can inform broader business strategies, enhancing overall customer experience and loyalty. However, the direct return on investment from their betting operations may take longer to materialize, given the competitive landscape and the need for sustained customer acquisition efforts.

 

Conclusion

The online sports betting market is evolving rapidly, with major players like ESPN and Fanatics entering the fray. While the market remains dominated by FanDuel and DraftKings, the strategic initiatives by ESPN Bet and Fanatics Sportsbook highlight the potential for significant shifts in the industry's dynamics. As these companies navigate the challenges of a saturated market, their efforts to establish a strong brand presence and gain valuable consumer insights will be crucial for their long-term success.

Aura Solution Company Limited remains committed to analyzing and understanding these market trends, offering insights that help stakeholders make informed decisions in the ever-changing landscape of online sports betting.

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COLLEGE SPORTS

From 2023 into 2024, 28 Division I schools will transition to new athletic conferences, bringing significant changes to competition, revenue, sponsorships, and more. This realignment promises substantial financial gains for universities and media companies, with the Power 4 conferences set to receive over $20 billion in media rights deals over the next five to ten years. However, it also raises questions about the impact on institutions, athletes, fans, and the NCAA itself.

 

Financial Gains and New Challenges

Universities, conferences, media companies, and brand partners anticipate increased revenues due to the improvements brought by realignment. Enhanced media rights deals, expanded fan bases, and more lucrative sponsorship opportunities are expected to boost top-line revenues. However, these financial benefits come with challenges for some stakeholders.

For student-athletes, especially those in sports like baseball, realignment complicates scheduling. With teams often playing three-game series on weekends, travel logistics become a nightmare. Fans, too, may face a less enjoyable viewing experience due to time zone differences and potential fragmentation of media rights, making it harder to follow their favorite teams.

 

The Continuing Evolution of Conference Realignment

The current wave of realignment is likely just the beginning. The Atlantic Coast Conference (ACC), locked into the least valuable media rights deals for the next 13 years, may see some members looking to jump ship, prompting further transformations. Private equity might enter college sports, providing financial solutions to schools grappling with competitive and revenue challenges. This could lead to the reduction or elimination of non-revenue-generating sports from athletic department budgets due to rising costs.

Additionally, NCAA President Charlie Baker recently introduced a proposal to create a new subdivision within Division I. This proposal allows schools to directly compensate athletes through a trust fund, marking a significant shift in how college athletes are rewarded and potentially altering the landscape of college sports.

 

Predictions for 2024 and Beyond

Looking ahead to 2024 and beyond, we predict continued changes in college sports. Conference realignment will likely bring about more financial gains, market expansion, and shifts in athletic program viability. However, it also poses challenges to maintaining the integrity and competitive balance of college sports.

Regardless of how realignment unfolds, it reflects a profound shift in the landscape of college sports. Financial gains, market expansion, the viability of athletic programs, and the future of the NCAA are all at stake. As universities and conferences navigate these changes, the focus will be on balancing financial interests with the well-being of student-athletes and the overall fan experience.

Conclusion

The conference realignment from 2023 into 2024 marks a significant turning point in college sports. While the financial benefits are clear, the challenges it brings cannot be ignored. The evolving landscape will require careful navigation by universities, conferences, media companies, and brand partners. As we move forward, it will be crucial to ensure that the interests of all stakeholders, including student-athletes and fans, are considered and addressed. Aura Solution Company Limited remains committed to providing insights and solutions to help stakeholders adapt to and thrive in this new era of college sports.

WOMEN'S SPORT

This past year marked a significant shift in the popularity of women’s sports, with attendance records shattered at sporting events and viewership numbers continuing to soar. In May 2023, PwC conducted a survey with a nationally representative sample of over 2,000 sports fans aged 18 and above, exploring how they watch, bet on, and interact with women’s sports.

The Importance of Women’s Sports Fans

Fans of women's sports are crucial to the continued growth and sustainability of the sector. These fans are ready to support the women's sports movement as long as there is continued investment and opportunity. Increased access to games has stoked a growing interest, leading to audience expansion that can potentially elevate the value of broadcast deals and, consequently, the value of women’s sports overall.

The key challenge for the industry now is to capitalize on the current momentum to create real and enduring change that helps women’s sports develop into an economically sustainable sector. This requires a strategic approach to ensure that women’s sports forge a unique path and do not simply become a "female" version of the men's game. Such a transformation would represent a missed opportunity to create lasting value.

Crafting a Unique Identity

For women’s sports to thrive, it is essential to craft an identity of their own, leveraging positive brand associations and access to a hard-to-reach female audience. This approach will enable women’s sports to capitalize on further commercial growth opportunities for years to come. By fostering a distinct and compelling narrative, women's sports can attract a diverse and engaged fan base, leading to increased sponsorship and investment opportunities.

 

The Path Forward

The path forward for women’s sports lies in continued investment, strategic marketing, and a commitment to building a unique identity. By doing so, women’s sports can continue to grow in popularity and economic value, ensuring that they remain a vital and dynamic part of the sports landscape.

Aura Solution Company Limited remains committed to supporting the growth and development of women’s sports, providing insights and solutions to help stakeholders capitalize on the current momentum and create lasting change. As we move forward, the focus will be on ensuring that women’s sports continue to thrive and attract a passionate and diverse fan base.

Conclusion

The rise in popularity of women’s sports is a testament to the dedication and passion of its fans. By understanding who these fans are and why they are important, the industry can capitalize on this momentum to create lasting value and ensure the economic sustainability of women’s sports. Aura Solution Company Limited is dedicated to providing the insights and support needed to help women’s sports continue to grow and thrive in the years to come.

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NEWS - STAY CURRENT WITH THE LATEST NEWS FROM THE INDUSTRY 

At Aura Solution Company Limited, our unwavering commitment is to deliver meticulously tailored private banking services, placing a premium on the preservation and expansion of our clients' wealth across generations. Situated in the dynamic heart of Thailand, Aura draws strength from a global network of top-tier specialists, allowing us to provide unparalleled investment services that transcend currencies and markets on a worldwide scale.

Nestled amidst the vibrant landscape of Thailand, Aura serves as a beacon of financial stewardship, leveraging global expertise to offer a level of service that goes beyond borders. As we navigate the intricacies of the financial world, our focus remains resolutely on our clients' well-being, ensuring that their wealth journey is not just managed but curated with precision and care. At Aura Solution Company Limited, we stand as a testament to the artistry of private banking, where every financial strategy is a brushstroke, painting a portrait of lasting prosperity for our cherished clientele.

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