The sports industry is a pillar of the worldwide economy, including franchises and organizations, advertising, merchandise sales, media rights and other related profit centers; all combining to form a $1.3 trillion USD goldmine.
While new technologies like cryptocurrency, blockchain, and smart contracts are becoming more and common in a variety of industries, it was only a matter of time before the sports sector began to evaluate the use of blockchain technology. From licensing rights management to asset tracking, fan engagement and big data exploitation, blockchain has a lot to offer the sports industry.
Let’s examine some of the ways blockchain can improve the sports industry.
A blockchain consists of large distributed data ledgers uncontrolled by a single entity, such as a government or a company, and are freely accessible to all. Instead, they collectively belong to users of common network called miners. Mining nodes lend computing resources to secure the network and are rewarded in the designated cryptocurrency of the network.
This safety measure ensures that no entity in the world can accumulate sufficient computing resources to attack the network in order to modify the information stored in it.
Blockchain networks are constantly evolving, and newer blockchain platforms like Ethereum have added features. Chief among them are smart contracts, which enable code execution on a blockchain network. Smart contracts provide a programmable framework for integrity in transaction governance
The Transition from Finance to Sports
It’s undeniable. Blockchain and cryptocurrency are fundamentally altering the landscape of financial services, opening the door to other industries that may also benefit from autonomous decentralization.
In the future, the sports world could be greatly enhanced by the use of these technologies in anti-doping measures, athlete performance analytics, and even as a means of stimulating fan engagement and protecting broadcast rights.
Big Data Made Useful and Truthful
The sports world produces an unimaginable amount of data that has yet to be fully exploited. To the increasing extent that collected data is exploited, performance analytics can be extremely helpful in establishing an athlete’s coaching and training plan.
This use case also extends to entire teams who rely on data analysis for much of their decision making. We’re likely to see even more analytics in play once blockchains are fully fitted into the equation. Take rugby, for example. Insights derived from blockchain analytics could make a successful team like the West Coast Eagles, 2018’s AFL champions and a top pick of this season’s Oddschecker AFL predictions, even more competitive.
Blockchain serves as a reliable database of biometric and competition data collected from trusted devices and directly recorded in decentralized registers. Similar to the protection it offers anti-doping measures, athletic performance data stored on a blockchain can’t be manipulated, which offers players a true assessment of their abilities.
Putting the Dopers on a Chain Gang
Numerous doping scandals have erupted across sports in recent years. At the 2016 Summer Olympics in Rio de Janeiro, hackers made public several doping cases involving the US contingent, a case that included high-profile medal hopefuls.
Blockchain may mitigate these types of incidents by ensuring national federations do not manipulate data to hide doping cases. A structured, immutable system to record prescriptions and test results guarantees that, once data is recorded into the system, its veracity is verified by the predefined protocols of the blockchain.
Building Blocks for Fans
To stay afloat in today's marketing climate, sports franchises have adopted social media. However, blockchain technology could change the game.
In the near future, one could imagine teams introducing their own exchangeable cryptocurrency for tickets, merchanded, and other benefits. The system could allow more efficient peer-to-peer ticket exchange, making the resale market safer and more equitable, generating more profit for clubs while fostering an improved fan experience.
Blockchain offers teams the opportunity to reward fans by using smart contracts that fully automate the delivery or accreditation of event tickets. This concept can be extended beyond a single team and involve global sports-industry partners teaming up to distribute fan benefits over a unified network.
One such solution is the startup Jetcoin, a “digital fuel” that seeks to connect sports and entertainment fans with ways to benefit from the successes of their favorite athletes or stars.
In the Jetcoin model, partnering athletes and entertainment talent, dubbed “Jetcoin Champions”, donate a portion of their brand rights to the Jetcoin platforms. These brand rights are then released as smart contracts. Fans purchase interest in the smart contracts in Jetcoin currency, either by obtaining it directly from the Jetcoin platform or receiving shares for social media engagement.
Jetcoin promises that revenues generated by Jetcoin Champions are paid out to smart contract holders. Fans are also eligible for special access to their supported Jetcoin Champions.
And any initiative that promises to increase fan engagement is welcome by the major professional sports organizations experiencing declines in interest
For example, attendance at Major League Baseball games in North America in 2018 dropped to a 15-year low, down almost 9-percent from the prior season. The drop-off of fans showing up at ballparks cost teams an estimated $350 million USD in ticket sales revenue, not to mention merchandise sales and marketing opportunities.
Media Rights Made Smart
An interesting use case arises in how blockchain might benefit the broadcast rights of sports events, which is a big-money game.
Consider the billions networks pay for Europa League and Champions League broadcast exclusivity. Pay-per-view events in boxing and the Ultimate Fighting Championship series each rake in millions in revenue. Naturally, some viewers attempt to circumvent the typical broadcast integrity measures of these events.
The cryptography involved in blockchain can help authenticate and authorize viewers while expediting delivery. Only customers with tokens verified by the blockchain would be able to gain access to the live broadcast. Blockchain would also enable viewers to directly access live broadcasts without having to purchase through an intermediary like a cable provider.
Although cryptocurrency, blockchain, and smart contracts have not achieved a significant impact on the sports world to date, the future looks very promising. Expect use cases surrounding crypto technology to pop-up in the ways athletes perform, fans interact with professional teams, and broadcasts are securitized. We don’t know exactly what will happen, but we do know the intersection of sports and blockchain-driven tech will be exciting to watch.
This article was submitted by MB Peco Medija
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