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Analysis: Amazon US Open setback underscores challenge of streaming live sports

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Analysis: Amazon US Open setback underscores challenge of streaming live sports

Poor reception of Amazon.com Inc.'s coverage of the U.S. Open Tennis Championships in the U.K. and Ireland is drawing attention to the challenge that streaming companies face in the world of live sports as they go head-to-head with traditional TV players.

The Seattle-based tech giant, which this year secured a five-year deal to stream the tournament in the two countries, has been inundated with complaints about poor picture quality, the inability to record matches, technical glitches and restricted choice of courts to watch.

SNL ImageSerena Williams returns a shot at Kaia Kanepi, of Estonia, during the fourth round of the U.S. Open tennis tournament on Sept. 2 in New York
Source: (AP Photo/Carolyn Kaster)

Negative feedback for Amazon's first exclusive broadcast of a sports event in the U.K. is a blow for the company as it ramps up its European portfolio of live sports to boost subscriptions to Amazon Prime, its paid service that offers access to fast delivery, music and video streaming, among other benefits.

Amazon also recently bought the rights to stream 20 Premier League soccer matches per season and weekly highlights in a three-year U.K. deal, starting in 2019.

Amazon's streaming setback is the latest in a string of technical glitches over the years on other digital platforms, including Perform Group Ltd.-owned over-the-top service DAZN, Facebook Inc. and Twitter Inc., as tech companies move to capitalize on the trend in cord-cutting, whereby viewers swap their pay TV subscriptions for on-demand services.

Content delivery network problems and frame rate optimization are just some of the many back end hurdles that digital upstarts face in streaming live sports, according to Daniel Cohen, senior vice president at the global media rights consulting division of sports and entertainment marketing group Octagon.

"The challenge today is that the live streaming technology development of even the [biggest] tech giant is faced with a grueling race to try and keep up with the pace of both consumer consumption and rights holder distribution demand, digitally," he said.

Despite this, observers from the sports marketing industry agree that Amazon's livestream of the National Football League's Thursday Night Football package shows that the group, as well as other OTT entrants, has the proven capability to compete in the live sports market.

"The new generation of broadcasters is coming and — in many cases — is already here," Tim Crow, an independent sports marketing adviser, said in an interview.

The issue is that Amazon and other OTT players are very much in beta phase at the moment, as they test out whether their models will work financially and editorially in live sports, he added.

While selling the rights to the U.S. Open to an established group such as Sky PLC or BT Group would have been a safer option, Crow said the increasingly digital ambitions of online streaming companies and rights holders would ultimately trump the short-term teething problems.

But rather than competing for sports rights, some believe internet platforms should seek partnerships with broadcasters instead.

With live sports now at the intersection between the Youtube-inspired era of short-form, user-generated content and the advanced industry of broadcast production, tech companies will need to invest more to match the production levels of their linear TV counterparts, or else partner with them, according to Antony Marcou, CEO of media rights group Sports Revolution.

Either way, given that tech companies are not yet in the business of broadcast production, any issues with their coverage will ultimately be damaging for the rights holders themselves, he said. As such, sports leagues bear some responsibility.

"Of course Amazon should have thought it out a bit more but it is also the rights holders' responsibility to think beyond the bottom line money they've been given," Marcou added.