Connect with us

International Circuit

Major US broadcasters to combine on new streaming service

ESPN, FOX and Warner Bros. Discovery have formed a joint venture “to develop, launch and operate a streaming sports bundle of linear networks and certain DTC sports content and services” is a major disruptive play in the US market.

Each company will own one-third of the new joint venture, have equal board representation, and license their sports content to the joint venture on a non-exclusive basis. The service will also have a new brand with an independent management team. There are no details as yet on revenue share.

The service is slated to launch in fall 2024 and will include sports linear networks and the Direct-to-Consumer Service ESPN+. Given the companies involved, the breadth of sports to be distributed via the newly created app is pretty huge and covers NFL, NBA, WNBA, MLB, NHL, NASCAR, College Sports, UFC, PGA TOUR Golf, Grand Slam Tennis, the FIFA World Cup, some major cycling events, F1, and more.

There are no details on pricing yet. Expect around $50 with promos and discounts to be a reasonable price. Subscribers would also have the ability to bundle the product with other services such as Disney+, Hulu and/or Max.

Given the complex nature of the sports landscape and the parties involved, unsurprisingly the companies are still finalising details. This begs the question: why not wait and announce the deal when everything is confirmed? This has many moving parts, from tech development to managing ad inventory, data analysis and more. Hence, it looks like moving early now is a tactic to generate maximum awareness when the US is fixated on all things sports during Super Bowl week. Conceivably, it might also put pressure on other streamers and right holders to come on board to build an even more all-encompassing offering.

The omission of some major players is notable, and it doesn’t include NBCUniversal and Paramount. NBC has Sunday Night Football NFL rights, college rights, and the Olympics, while Paramount’s CBS Sports has Sunday afternoon NFL games, live soccer, and other college rights.

This will be the first time Fox’s live sports are available in a streaming offering. And it’s worth noting that Disney still plans to bring its own broader streaming service to market for ESPN.

This feels like a slightly defensive move that reflects the ever-changing world of the US TV landscape and the massive shift towards streaming. Netflix, Amazon, and Apple are all showing increasing interest in sporting properties, and users’ behavioural patterns are changing rapidly, forcing traditional providers and rivals to react, partner, and evolve quickly in turn.

For many, aggregation is the holy grail, and it is evident that we are returning to the big bundle being offered via the Internet. This has the noted benefit of being a far simpler model for the consumer to understand. Consumers have had enough of signing up for multiple services, paying for different subscriptions, and downloading a slew of apps.

This is especially true in sports, which is one of the few genres driving sign-ups. While competition seems to be healthy, the battle for rights and subscribers is leading to a hugely fragmented landscape. Many companies have made huge gambles, which will take many years to come to fruition, let alone think about making a profit.

Deals such as this represent one of the key routes available to providers to reduce fragmentation, reduce risk, and take greater control. There is a huge focus in the US industry on cutting costs and driving greater efficiencies to improve margins for the year ahead. We can expect more bumps ahead. We can also expect other companies and markets to follow developments closely with a view of replicating it in other territories should it prove to be successful. Paolo Pescatore

Click to comment

You must be logged in to post a comment Login

Leave a Reply

Copyright © 2024 Communications Today

error: Content is protected !!