Early deals licensing mobile rights for sports content favor medium-range terms of 2-5 years, exclusivity, minimum guarantees instead of revenue-sharing and are constrained by technology, industry leaders said in a Kagan Research mobile sports rights audio conference 1/26.

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In these early days for rich content and mobile video, cellular operators tend to set consumer prices high in part to limit consumer usage so network infrastructures don't get jammed. In another tech issue, once mobile technologists perfect techniques to limit geographic dispersion of their content, then individual sports teams will be more able to engage in local licensing deals. Because cell signals are received from short-range tower antennae, content dispersion can be restricted to only those antennae clusters in a desired region.

Sports leagues are disposed to exclusive deals at present, because in these early days exclusivity will spur the cell carrier to aggressively market its sports content. However, the financial gain from any exclusivity premium has to be balanced against reduced promotional punch resulting from narrower penetration of the 200+ million cell phone subscribers in the U.S.

Income from revenue sharing has so far disappointed sports outfits, in part because of a paucity of data, so they are oriented to contracts setting substantial minimum guarantees, said Christopher Russo, president of consultancy CR Media Ventures. One type of revenue sharing deal gives 25% to the sports rights owner, 25% to a middleman aggregator and 50% to the carrier. Deals can also be made directly with the carrier.

Mobile sports are expected to be additive to consumer consumption, and will not siphon sports audiences from other media. Today, sports rights holders get over eight billion per year for national and local rights, said Kagan Research senior analyst John Mansell. "Mobile sports audio, data, and video content is generating tens of millions of dollars a year, but is typically part of larger sponsorships, like the 600 million, five-year deal between Sprint and the NFL and the NASCAR-Nextel sponsorship."

Until the full extent of consumer appetite for sports content is established, which will take 2-4 years of experience, nobody will be sure about the long-term value of rights, noted Russo. For example, years ago few expected that fantasy league content would become so popular.