As sports entertainment continues to be a massive economic force in human society all over the world, the development of new technology impacts and is impacted by that industry. One example of such a technology is blockchain. Deloitte is leading developments on that front.
In a recent report entitled "Deloitte's sports industry starting lineup," the company laid out its vision for the future of blockchain.
These digital assets have the potential to disrupt the sports industry through their ability to mitigate risk, create new sources of value, and enable new secure transfers of information. Although still in its relative infancy, blockchain offers potential emerging solutions to many challenges the industry is striving to improve.
One such likely application of blockchain technology is the secondary ticket market. Deloitte's US Sports Leader, Pete Giorgio, recently spoke about that possibility.
"What blockchain does is provide a level of trust," Giorgio stated. "We are very passionate about blockchain at Deloitte. It's a new way of thinking about trust. The exchange of those values can be very scary for organizations who are making a lot of money on fees. Blockchain delivers content directly to the user. It will take time for those companies who provide that trust to adjust. The cost of trust is going down. At some point companies like StubHub might still be in business but they might do that on top of the blockchain platform."
Another arena in which the blockchain could become a crucial technology is sports betting, especially as it becomes legalized in the United States of America.
"Some startups are already working on this," Giorgio added. "What you can build are smart contracts. For example, you send me money and I put it in Escrow. The smart contract will then automatically disperse the funds. It's not only cheaper and faster but more trustworthy because you can see what's happening in real time. It's instantly verifiable and the smart contract is immutable. It's increased service that is better."
There will be a learning curve for both professional sport entertainment businesses and consumers alike, as blockchain technology has only been around for about five years and is still being developed by companies like Deloitte, but the likelihood it will soon become a massive part of the sports entertainment industry is high because of the enormous potential. With that potential comes growing pains, however, like how states will regulate its use.
"Governments who will govern the platform will have a lot to look at," Giorgio continued. "There is no 800 number to call if something is wrong and you can't afford that in the business platform. In applying regulations, it will be interesting to see the different levels of governance we can put on the blockchain. At the end of day, it is an incentive platform. How do we incentivize different parties to take part while keeping the price of governing and running platform low? Consumers are going to decide how the platform is going to work. We play with many new business models. It's an exciting time because the technology doesn't exist today but it will tomorrow."
As Deloitte continues to test the limits and build new models for the blockchain with the hundreds of people it has employed to do so, consumers can look forward to a time when technology not only enables their transactions they take part in during consuming sport entertainment to be more efficient and transparent, but also empower them to control the cost and speed of those transactions.
"A lot of the businesses we serve and our own business will focus on the value added to customers in the move to a higher level of service because our access to data will be higher and we can rely on the data better. The supply chain will be completely transformed by blockchain," Giorgio said.