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Facebook Inc (NASDAQ: FB) plans to monetize its live online sports leagues broadcasting games via a pay-per-view option instead of a subscription-based model to join the likes of HBO, Showtime WWE, and mixed martial arts company UFC, CNBC reports.
Facebook is planning to tap high school sports teams and minor leagues and enable the event hosts to make money through the feature.
The social media company acknowledged the growth potential of online events while offering a global income source to the event hosts.
Facebook’s paid online events are accessible in 44 global markets.
Facebook reported 2.85 billion monthly active users and 1.8 billion daily active users.
Businesses and users can host live streams for moments, including course-like events like cooking, gaming tournaments, and announcing new products.
Second and third-tier sports leagues and high schools can use the paid feature to draw an audience.
The March professional triathlon event Challenge Miami drew over 17,000 people who bought tickets for $2.99 each, beating the stadium and international broadcasted viewership.
The Verzuz event featuring prominent musical stars in a battle-style event on Instagram also gained traction during the pandemic. Platforms like OnlyFans also hint towards the popularity of the pay-per-view model.
Paid online events generated 28% more revenue for content creators than third-party services, based on a marketing agency observation. The replay feature of the paid online events further contributed to its popularity.
Facebook found more potential in smaller sports companies than top sports leagues, restricted by broadcasting rights.
Facebook’s geofencing could help bypass TV and extend live streaming beyond North America and monetize other content, like team practices and other behind-the-scenes videos. All of which could help them engage a different audience distinct from the TV audience.
Facebook is testing a geofencing feature to help hosts mark specific regions for streaming events.
Facebook will elaborate on the fee structure in the upcoming weeks.
Price action: FB shares traded higher by 0.67% at $312.02 on the last check Wednesday.
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