Morgan Stanley Investment Banking Department previously issued a report predicting that F1’s newly launched streaming service business will take more than ten years to have the expected 5 million subscribers.
This year's F1 season has started in Australia, and F1's streaming service will be launched. This is the first time in F1 that digital live broadcasts are provided to users in addition to traditional live broadcasts in traditional TV broadcasts. The most important product of
F1 is officially called F1 TV Pro. It can provide real-time car screens for 20 drivers, and can also choose four languages to explain (English, German, French, Spanish). The service is driven by Free Media, which is already listed on Nasdaq under the stock code FWONK. F1 TV Pro provides services in 40 countries, and F1 also has high hopes for it.
"We expect there are 500 million F1 fans around the world, which is a very amazing number. Even if it is conservatively estimated that only 1% of them are loyal fans, it is also a potential user of the 5 million product." Frank Arthofer, director of F1 Digital and New Business, said.
He also said: "I hope all potential users who are interested in this can subscribe to our product. I think we can attract a large number of users in the short term, but I'm not sure we can convert them into real users in the first one or two years. This will be a marketing challenge we will start to deal with."
"We are very optimistic about the prospects. We are not calculating or determining the number of target users now." F1 may not have determined the number of target users, but Morgan Stanley did it for them, and the number calculated is far lower than the 5 million users Frank Arthofer expects.
In a report released on January 30 this year, Morgan Stanley predicted that the increase in F1's OTT service users will be lower than the reference objects such as WWE, CBS online channel All Access, Starz cable station, paid cable TV network Showtime and HBO. In the report, Morgan Stanley predicts that it will take 7 years for the F1 product to reach 1 million users. Its rivals, All Access, the CBS online channel, which has the slowest reaching 1 million users, took only two years.
Morgan Stanley also predicts that F1's OTT streaming service will only attract 10,000 users in the United States this year, while other countries are expected to be 94,000. Both figures are expected to double in 2019, with the United States going to have 27,000 users, while other countries are expected to have a total of 219,000 users. But the user increase will accelerate, that is to say, next year, the 27,000 US users will not become 54,000 in the year after, and the 219,000 international users will not become 438,000 in the year after, or 876,000 in the fourth year. Morgan Stanley predicts that four years after F1's OTT streaming service launches, they will only have 458,000 international users, of which 62,000 are local users. Even if we predict that by 2027, there will be only 227,000 local U.S. and 1.7 million international users.
"We expect the OTT streaming business to have 1.9 million users worldwide by 2027." This is already an optimistic analysis in the Morgan Stanley report. According to the report, 42% of the expected live streaming revenue of US$187 million is still questioned due to conflicting sources and whether it can be realized.
was obviously more cautious when asked about the prospects of OTT services than Frank Arthofer and F1 CEO Chase Cary. "I won't predict this." He said, "We don't know that we think this sport is very suitable for OTT, and this product is also provided for loyal fans. In any case, at this time, this is the time for us to learn and try and detect potential for the first time. We will take this as a starting point, and we will not over-rely rely on projects that have not yet been formed."
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