Some of the biggest sports leaders – Disney, Fox and Warner Bros Discovery – announced a joint venture to create a mega sports streaming service earlier this month. Since this announcement, we’ve heard from pay TV providers as well as local TV providers about what this new company could mean for their business.
We heard from Gray TV last week that they weren’t too keen on a shared streaming service unless they had to pay. Gray TV also gave some compelling reasons in its statement, such as the fact that local sports are streamed through local channels and broadcasters pay for these broadcasts. If Disney, Fox and WBD took it away without any monetary compensation, the local economy would lose jobs.
Now, major pay TV services like Comcast, Charter and DirecTV are making their voices heard. The main question the three have is whether they’ll be able to offer the same narrow set of linear networks that Disney, WBD and Fox announced as part of that streaming service, which includes ABC, ESPN, ESPN2, TNT, TBS, Fox . , FS1 and FS2, among a few other cable channels that feature sports.
If pay TV providers can offer customers a small bundle with these sports services, the opt-out is likely to be small. However, not being able to use those channels on their basic cable subscription, which will likely cost a lot more than shared service, will be quite a hurdle.
Disney, Warner Bros. Discovery and Fox rely on pay TV for most of their revenue
It is doubtful that the joint sports streaming service will allow pay-TV providers to offer a competitive, weak package. These three companies generate most of their pay-TV revenue through these deals they have with pay-TV providers. For example, Disney forces pay-TV providers to provide all of its channels, not just a few. So YouTube TV would have to carry all 14 Disney channels, not just the few ESPN channels that cost the most to carry.
Obviously, some pay TV providers may indirectly benefit from this new venture, but it would probably lead to a lot more cable TV cancellations, which is kind of what this service is all about. Sports streaming has been pretty lacking in recent years. But for companies like Comcast and Charter, that would mean more broadband sales because that streaming service will require high-speed Internet. So not only more internet subscribers, but also more people paying for higher speed packages, which would give these companies more profit.
It is still in the early stages of this service, although it is expected to launch in the fall of 2024. So Disney, Warner Bros Discovery and Fox will have to figure it out pretty quickly. It is expected to begin in the NBA and NHL in 2024-25. in the seasons of the year starting around October.
2024-02-19 05:10:54
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