A Brief History Of Rights

Rights are core to content. Without clearly defined rights, owners of media content have no way to monetize their intellectual property. Content owners typically focus on creating high quality content, not on delivering it to consumers. Content delivery, i.e., distribution, is left to others. Content owners will sell the right to distribute their content to content distributors, who will in turn monetize their content rights with consumers. This commonly takes the form of selling subscriptions or by selling advertising on the content.

Content distribution has long included entities such as broadcast, cable, IPTV, and satellite TV operators, and has expanded in the internet era to streaming providers such as Netflix, Amazon Prime, Apple TV, DAZN, and Viaplay. In addition, sports leagues and clubs will often stream their own content themselves directly to their consumers, alongside a combination of broadcast and streaming delivery.

Rights have always existed in the Media industry. Over time they have undergone an evolution from simple to ever more complex. They have become more granular and are sold to a wider variety of entities than in the past. Rights today exist for live broadcast versus recorded content, for full programs versus highlight clips, for international versus national versus regional distribution, and many others. Rights are controlled by different levels of content owners, for example by sports leagues, tournaments, clubs, and players. Additionally, rights exist for video content separately from rights to the data associated with the content, in sports this can include play-by-play data, stats, and player data.

Rather than simply selling broadcast rights to a broadcaster, today a content owner may sell data rights and low-resolution video rights to a Sportsbook, domestic live broadcast rights to a broadcaster, domestic non-live rights to another broadcaster, international rights to a streaming provider, and so on.

Over time, content owners have also evolved from selling rights and letting the distributor decide what to do with the content and how to monetize it, to a much more restrictive model. Today’s content owners are more likely to sell narrowly defined rights and include a clause indicating that anything not explicitly mentioned in the contract is not part of the rights.

Throughout the modern media era, rights have consistently attempted to achieve three main goals. First, to accurately describe the way content can be utilized. Second, to define allocation of revenues between content owners and content distributors. Third, to create value for consumers, brands, and all the stakeholders in the creation and distribution of the content.

Today, we are living in a heavily transformed Media industry, even compared to just 5 years ago. While the three core goals of rights remain valid, evolution is needed. The internet age has caused a fundamental shift: viewers’ access to content has exploded, and their consumption has fragmented due to choice. Content, gaming, and social media all compete for people’s attention. A critical question for the Media industry is how to engage today’s viewers against a backdrop of greater choice, smaller attention spans, and changing interests.

The answer appears to be a converged entertainment and social experience. To reuse a theatrical phrase, “Enter stage left: Interactive Rights”. But before we hear what the Interactive Rights actors will say, let’s first consider who began entering “stage right” about 20 years ago: the modern content consumer.

The Modern Content Consumer

A converged entertainment and social experience. It doesn’t sound too complex. It sounds like being at a football match with your friends or sitting with the family in the living room watching a talent show on TV. It could include going to the theater or cinema with the occasional whisper or laugh. But this doesn’t really offer the experience that the modern (and generally younger) consumer expects.

A converged entertainment and social experience means Content + Gaming + Social. The modern generation of consumers has grown up to expect this. The contrast in expectations is stark. Only 40 years ago we had long-form broadcast TV with ads (or not on some channels), with any given content item available on only one channel, and occasionally on VHS/DVD - people over 45 years old know this world well. About 30 years ago, internet streaming allowed us to start finding content online – people aged 35-45 grew up with this norm. About 15 years ago we began to see fragmentation and proliferation of video services, swamping consumers with content, most of it user-created and free, which included lots of spam advertising - today’s under 35s are native to this world.

This proliferation of choice and the availability of free content has placed large pressure on content owners to maintain the value of their content rights. But not only that. The evolution of gaming and the emergence of social media has taken time away from traditional content experiences. However, rather than reducing content consumption it has instead moved eyeballs to the new way of consuming content, one which has a different value exchange.

Today, modern viewers are looking for free content, lots of short-form content, exclusive content, a high degree of convenience to reach all of it, and an experience that creates value for them in a new converged way. This new way of consuming brings together content, gaming, and social experiences. The modern content consumer wants this new type of value exchange.

So, content owners are pivoting.

A Brief Overview Of Interactive Rights

To remain relevant, or win relevance with a new audience, and thereby sustain the value of their content rights, modern content owners need to enable their content distributors to deliver the converged value exchange. This means changing the rights model.

Interactive Rights (IR) is the term that has been coined for the rights to provide digital, data-driven contextual sponsorship and interactivity. This includes in-program/in-game sponsored QR codes, quizzes, polls, trivia, e-commerce, gaming, and chat. Moreover, Interactive Rights defines rules for when and how interactivity may be delivered, and even what it should look like from a design perspective. These rules may be very granular and complex and include everything from ensuring that interactivity does not interfere with key game moments to ensuring that it avoids brand and style conflicts with advertisers. Interactive Rights have typically not been well-defined by the content owners and have not been packaged and sold to content distributors in a controlled and repeatable manner.

Interactive Rights require specific technical deployments, with specific rules related to how interactivity may be delivered to viewers. Leading content owners are packaging up the technology and the detailed sets of rules in order to provide IR capabilities to their content distributor partners. This IR-as-a-Service approach continues the theme of content owners’ work to produce top quality content for distribution by their partners.

The Fundamental Role Of Clearinghouses

In Media Technology discourse, we put a huge amount of emphasis on the Video and Audio which is the core of the product that we offer to the world – content capture, production, management, storage, preparation, and distribution are where we focus. In the world of rights, the emphasis is on who has the right to do what with the content, and how revenue flows.

Clearinghouses are how money is managed in today’s multi-stakeholder world of content rights. Before clearinghouses existed, revenue flow was based on explicit agreements between parties in the value chain. Any parties that remitted money from one to the other needed a legal contract in place that defined the commercial terms. With more partners getting involved, the more complex the web of agreements would become.

To simplify this situation, and with an aim to increase the value of the rights, clearinghouses were introduced. Clearinghouses in the Media industry enable revenue sharing between entities that may not have any contractual relationship with each other. For example, a sports league may sell broadcast rights to a broadcaster which sells carriage rights to a cable company. The cable company and the sports league may have no relationship in place, but they are both sharing the same ecosystem.

Clearinghouses handle the inflow of money related to rights, and the distribution of that money to each stakeholder based on the business rules. Their introduction in the Media industry coincided with the creation of the channel aggregators of cableTV, satellite TV, and IPTV. They have evolved as content has been segmented into more types (e.g., live content vs. VOD vs. highlights) and been distributed in ever more granular ways via MVPDs, OTT streaming platforms, social media platforms, and content owners’ own Direct to Consumer platforms. The number of stakeholders in the value chain has increased over time, and as their numbers increased so did the need to manage the flow of revenue between them.

Clearinghouses automate the implementation and monitoring of very detailed and complex rights, at significant scale. This has allowed the content stakeholders to jointly track content consumption, share revenue, and more importantly it has given them a reason to jointly create more ways to monetize content. Over time this has generally led to higher rights values as stakeholders have generated a greater value exchange with consumers.

But it’s not all one-directional growth in value. Some content owners have seen downward price pressure on their rights, such as LIGUE 1 in France which saw an 11% reduction in its latest rights sale for the 2024-2029 period with an average value of €660 million per year, while others have seen incredible growth in value, such as the NBA in the USA which saw a 160% increase in its latest rights sale for an 11-year period from 2025-2036 with an average annual value of $6.9 billion.

The rights money flow is shown in the ecosystem diagram. Interactive Rights are pushing this to the next level of dynamic monitoring and revenue sharing. Content owners provide content distributors with the interactive rights technology, the clearinghouse technology, and the rights rules, and within this ecosystem everyone collaborates to maximize revenue and share it according to the rights. 

Driving Extra Value

The new converged entertainment and social experience paradigm is driving the emergence of Interactive Rights. IR’s promise is that it will utilize contextually-relevant digital sponsorship and interactivity to create a new generation of value exchange with consumers that will drive extra value to the content stakeholders. With IR we are now entering into a clear transition moment for the Media & Entertainment industry.

The next article in this series will explore the emerging use of Interactive Rights in leading sports bodies and explore the three core pillars of monetizing outside of today’s norms, creating a new value exchange with consumers, and assuring compliance with content owners’ brands.