By making key 2019 Rugby World Cup games only available through its streaming platform, Spark forced these old-school couch potatoes to engage with the digital age.
And there’s no doubt it forced Sky to finally upgrade its own streaming efforts, which were miserable at the time.
Was it good for Spark?
Undoubtedly no. There was way too much kicking and screaming involved in trying to school-up those couch potatoes. Spark left its pre-2019 World Cup education campaign way too late, and there was no way it could have ever got enough hands on deck, regardless.
Gaining rights to, say, Super Rugby, would have given Spark Sport the opportunity to prove its chops over a season, and gain long-term subscribers. The World Cup was a short, sharp, make-or-break affair.
I called it a “huge, possibly mortal blow” for Spark’s streaming ambitions when the service fell over during the New Zealand-South Africa clash on September 21, 2019, and the decision was made to screen the second half free-to-air on TVNZ.
It was definitely a PR disaster of epic proportions. I suspect a humiliated Spark Sport board decided at that moment streaming sport was not the company’s future.
Simon Moutter - the only Spark executive who spoke passionately about Spark Sport (his successor rarely mentioned it unless prompted) - was not around for comment.
He had quit as CEO three months prior, amid the build-up to the cup. His abrupt exit caught the markets by surprise, but Moutter - who had been in the big chair since 2012, said he had simply only ever intended to stay in the big chair for five to seven years and no one event triggered his exit.
Was there an urban-rural divide?
Yes. In urban areas, with good broadband, a lot of people came to appreciate Spark Sport as a slick, dependable well-thought-out platform over the two years following the World Cup debacle.
I was one of them. It’s not perfect. A few frills like 4K available on offshore services are missing. But as it enters its final few months of existence, it’s still the benchmark for sports streaming in NZ, even including Sky’s recent Sky Sport Now upgrade.
But in rural areas, where broadband is often patchy, resentment lingered.
Has Sky regained its monopoly?
Certainly, from July next year, Sky will be the only provider of sporting content that you have to pay to view.
But cricket - and most other Spark Sport content - is not going to Sky. It’s going to TVNZ.
Free-to-air broadcasters around the world have renewed their interest in free-to-air sport, mindful that the likes of Netflix+, Disney+ and Amazon’s Prime are globalising entertainment content.
Yes, Sky has seized back Formula 1 rights from Spark Sport, just at its death, so you won’t see any Grand Prix action on TVNZ.
But notably, and crucially, Sky’s streaming deal with Formula 1 is not exclusive. The pay TV broadcaster will have to compete against the official F1 app, which offers livestreams of races globally.
That’s becoming the norm for most offshore sports, and it will keep Sky on its toes with its own app, Sky Sport Now - and, yes, it does have to be on its toes.
Is the end of Sky-Spark competition bad for sports bodies?
NZ Rugby and NZ Cricket certainly made hay playing Sky and Spark against each other for record rights deals.
But records rights deals also meant price rises for viewers, and fans of most codes had to buy both services to see every competition in most sports.
Jarden head of research Arie Dekker noted the end of Spark Sport is not the end of NZ Rugby or other local sports bodies’ bargaining power.
The likes of Apple, Amazon, Google and now even Netflix are making multi-billion dabbles into sports rights in the United States, United Kingdom, India and elsewhere.
It’s within the realms of possibility that one of these tech giants could, say, partner with TVNZ or Warner Bros. Discovery here in a bid for top-tier sports rights.
Is it good for sports fans?
Even if that doesn’t happen, a team of Forsyth Barr analysts said about the shift of content from Spark Sport to TVNZ: “We view this as good news for New Zealand sports fans. With more sport content on free-to-air, and only one pay TV service, accessing all the sport you want will be cheaper and easier.”
Free-to-air sport also means a larger audience, which should open a richer vein of sponsor opportunities for NZ Cricket.
Did Spark Sport lose money?
Oh boy, yes.
“The financial disclosure of Spark Sport is near non-existent but we have a reasonable degree of confidence that it is loss-making to the tune of tens of millions, or a low single-digit percentage of ebitda,” Forsyth Barr’s analyst team said.
How many people will lose their jobs?
On the outside-broadcast front, Spark contracted Whisper to produce local cricket games. TVNZ will also use Whisper when it takes over cricket, so no one will be culled in the OB arena.
Spark has a floor full of people working on the other aspects of Spark Sport but how many people will leave the building on July 1?
“We are currently consulting with and supporting our people through these changes,” the company said.
“As the Spark Sport platform winds down, our primary focus will be working with our people to look for redeployment opportunities across our broader business wherever possible.”
Promises to redeploy or retrain staff are often no more than PR blather, but in the context of the current hiring squeeze, it’s credible.
It’s also notable that while Spark also threw in the towel on its Lightbox entertainment streaming service, it still served as something of a career springboard for several of the protagonists.
Former Lightbox head Kim Niblock is now TVNZ’s chief information officer. Former Lightbox CTO Jean-Louis Açafrão now fills the same role at TVNZ.
Other ex-Lightboxers have turned up everywhere from The Spinoff (an Auckland-based website) to fast-growing startups like Parkable.
Is the end of Spark Sport good for Spark investors?
Yes. See above. Also, Jarden’s Dekker called sport a relatively high-risk, low-reward pursuit for the telco. It’s better off without the distraction as it focuses on its much larger, well-performing divisions.
Spark shares closed at $5.24 on Thursday December 8 - the day before it announced its exit from sport. When the news came, they pepped up to $5.34. The stock at the time of writing was up 16 per cent for the year.
Is the end of Spark Sport good for Sky investors?
Sky shares were near flat at a $2.24 pre-announcement and $2.25 afterwards. The social media mob might see their bank accounts affected by Sky Sport price rises in the year ahead but, so far, investors aren’t buying the theory.
Dekker said it was too soon to say if the Spark-TVNZ deal was a threat to Sky, with it representing the start of a broader TVNZ push into sport that could ultimately include rugby rights. Or it could be a positive in that Spark’s retreat might signal the market had passed peak sports rights costs after years of escalation.