Saga of American Live Sporting Events, Streaming Platforms, and Cybersecurity Law

Misha Solodovnikov

The global Over-The-Top (OTT) Sports[1] Streaming market[2] is projected to soar to $325 billion by 2024 and $420 billion by 2028[3]. However, amidst this growth[4], the industry faces staggering losses. Key players in the streaming market include Paramount+, ESPN+, Peacock, Prime Video, Apple TV+ and regional streaming services such as Monumental Sports. Sports content stands as the final stronghold within the linear TV ecosystem, dominated by live events such as the Super Bowl and NCAA's March Madness, which collectively commanded over 95% of viewership last year. Rapid shift towards streaming is underway, as direct-to-consumer services progressively infiltrate the live sports broadcasting arena. As consumption habits of sports enthusiasts evolve, media rights agreements and network economic models are adapting to embrace the opportunities afforded by the digital age. 
           

However, transitioning from cable to streaming poses significant security risks for licensors and IP rights owners. Many exploit readily available devices to intercept cable and satellite feeds, redistributing them illicitly. Piracy[5] extends beyond simple password sharing; sophisticated users employ advanced coding skills or screen-recording programs to extract online streams from official sources like ESPN+. The streams, once stolen and redistributed, often undergo further dissemination, frequently in an automated manner, creating a complex network of unauthorized activity. Free websites and pirate subscription services are increasingly interconnected, amplifying the scope of illicit redistribution.

Conservative estimates indicate that this year alone, losses from streaming leaks, particularly in sports content, will surpass $25 billion. Intellectual Property Rights (IPR) infringements[6], especially through bypassing geo-blocked content, remain rampant, posing significant challenges to content owners and distributors.

Conventional business models in sports and premium television inadvertently facilitate content leakage, especially during live sports broadcasts. Current security measures, such as fingerprinting or watermarking technologies, are ineffective. It could be argued that within the context of news media distribution, video streaming represents a vital aspect of critical infrastructure, making it susceptible to malicious software attacks. Malware, “usually delivered through an infected email attachment or link, the nimble and ever mutating code was able to slip past most virus detection software".[7]        

The concept of "appointment viewing"[8] exposes live sports content to significant risks of intellectual property (IP) rights violations. Sports leagues and media conglomerates stand to lose substantial audiences within minutes. This is due to the brief time it takes for viewers to search for alternative, unauthorized, free, or very cheap streams to watch live games, matches, or fights. Preventing such leaks is time-critical, as audience interest rapidly declines once a live event concludes. Content is particularly vulnerable to unauthorized live redistribution while a sporting event is in progress.

Is the centralization of video distribution the problem here? In traditional a video streaming platform, where one of the users pays for using the platform nothing stops that person to redistribute that televised live sport event.

With the help of blockchain, the issue of ownership can be addressed at a protocol level. Blockchain helps the creators and the audience encrypt their videos and store those videos permanently using the IPFS swarm[9]. Blockchain broadcasts the live sporting event in an autonomous manner with the help of various relay nodes and IPFS, thereby maintaining transparency and integrity of ownership in a decentralized way. It echoes overall US Government strategy. The United States acknowledges the potential inherent in the modernization of its cryptographic technologies, which shall now encompass blockchain technology and its capacity to augment security and transparency. As President of United States earlier defined, “digital connectivity should be a tool that uplifts and empowers people everywhere, not one used for repression and coercion.”^[10]

Furthermore, according to National Cybersecurity Strategy, “new and updated cybersecurity regulations must be calibrated to meet the needs of national security and public safety, in addition to the security and safety of individuals, regulated entities, and their employees, customers, operations, and data.”[11]

Implementing blockchain technology will inevitably help sport broadcasting giants to grow subscription numbers. Once streaming sporting event is “live”, the blocks, which are stored on a multitude of servers throughout the world, cannot be changed. As a result, sport Leagues and producers of the live broadcasts will have total control over their work. Blockchain-based television streaming systems is a new generation of digital infrastructure[12], that offer transparency through decentralization, allowing participating parties to verify data and transactions, avoid harmful cyber incidents[13]. It is example of “sector-specific engagement with industry to construct consistent, predictable regulatory frameworks for cybersecurity that focus on achieving security outcomes and enabling continuity of operations and functions, while promoting collaboration and innovation”[14]. Put simply, it is a matter of national interest.


The world of live sports video streaming, Major Professional Sport Leagues and OTT giants face a pivotal decision: relinquish control to decentralized networks to secure their profits.

At the heart of this transformation lies the architecture of video streaming—a distributed network governed by blockchain technology.