Liquid Assets
I have been thinking about this Ben Thompson comment while watching the World Cup:
...enterprises are paying for their employees’ time, so of course they are willing to pay for tools that make those employees more productive; consumers, on the other hand, are mostly looking to waste time, which is why attention-harvesting advertising is the only software business model that works at scale for consumer services.
This lens makes the tournament's introduction of hydration breaks easier to understand, even if you don't like them. From the Boardroom Ball newsletter:
FIFA announced in December that it would introduce three-minute breaks midway through each 45-minute half of every match, and it removed the condition that previously justified them. In its own words, there would be “no weather or temperature condition in place, with the breaks being called by the referee in all games.” The measure was promoted as one of “player welfare.”[...]
The welfare framing is worth taking seriously rather than dismissing, because parts of it hold up and parts do not... The difficulty is that the rule no longer tracks the conditions it was written for... A measure justified by heat that is applied identically in the cold and indoors has come to serve some other purpose, and the question is whose.
[...]
Three minutes in each half is six minutes per match, and across the 104 games of an expanded tournament that is more than ten hours of newly created stoppage, dropped into the middle of passages of play that previously could not be interrupted at all.
[...]
The hydration break does something a rights holder could not previously buy at any price: it opens a clean, predictable, mid-half window in which a broadcaster can cut to a full-screen advertisement and, in theory, not miss a goal. FIFA’s guidance allows four 30-second spots in each three-minute break, eight per match and, across 104 games, some 832 in-game commercials. At the roughly 300,000 dollars Fox is reported to be charging for a 30-second slot, Awful Announcing has estimated the network could take in upwards of 250 million dollars from the breaks, more than half of what it paid for the entire tournament.
$300K × 832 in-game commercials = $249.6M.
The hydration break does not just interrupt the experience. It creates three minutes of "attention-harvesting advertising".
I have written before that attention is your banker. FIFA has manufactured a new way for broadcasters to underwrite their rights investment.
Interestingly, not all broadcasters are following the Fox playbook:
FIFA created the inventory but left the decision to sell it with each market, and the markets have split. Fox cut to roughly two minutes of advertising in each break, within the window it was allotted. In Germany, Magenta TV went to a full break; DAZN and beIN Sports have said they will air commercials market by market depending on demand. Against that, Telemundo, the Spanish-language rights holder in the United States, kept players on screen with an L-shaped graphic carrying a Lay’s advertisement around the edges and has said it will not cut away for the duration. ITV in the United Kingdom stayed with the players and commentators, constrained in any case by British rules limiting advertising minutes per broadcast hour; the BBC, Australian and Danish broadcasters, and Argentina’s DirecTV Sports all stayed with the feed, while Telefé in Argentina went to a full break. The rule is uniform. The behaviour is not, which means the cutaway is a commercial choice rather than a FIFA instruction, and each broadcaster is making it in public.
The rule is uniform, but extraction is optional.
In real time, each broadcaster is revealing how much of the audience relationship it is willing to cash out.