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Monday, May 08, 2017

Why ESPN Hemorrhaging Money Will Impact The Next Wave Of National TV Deals

Overall, the landscape is seeing a shift with subs dropping from pay-TV. Whether there is a shift in providing skinny bundles or somehow channels being offered ala carte, fees through traditional pay-TV subscribers will likely continue to drop. Disney has made a substantial investment in BAM Tech, the MLB Advanced Media spin-off to provide ESPN an over-the-top (OTT) service platform that can grow, but there is bound to be a period of flux between the pay-TV model and getting to cord-cutters or no-corders that presents a revenue drop before transitions to monetizing just those that have no interest at all in pay-TV.

Right now, the model is pay-TV and premium live sports content to digital are attached at the hip. Yes, you can watch streaming to digital devices, but you’re forced to authenticate by showing that you have a pay-TV subscription. This has left those that have cut the cord with an inability to access the content, and as the MoffettNathenson numbers show, there is an increasing number of subscribers that are willing to walk away from live content if not available through streaming services. This audience can get some live streamed content through deals such as Twitter or Facebook, but it is not expansive, and there is limited programming to bookend live content.

So, unless ESPN gets the ship righted, they could potentially walk away from some content, or at the very least, not be able to be aggressive in bidding, which could allow others to move in and grab content out from underneath them.

RoyalsRetro (AG#1F) Posted: May 08, 2017 at 11:46 AM | 52 comment(s)
  Beats: cable, espn, television rights

Thursday, May 04, 2017

The Unplugged Effect: How cord-cutting could become baseball’s next huge crisis

The biggest disruptor of that perfect storm is technology. As Zimbalist noted, sports fans have so many ways to watch games now; that strips control away from cable networks, and makes it tougher for those network to pass rights fees onto customers. Meanwhile, consumers also have exponentially more entertainment platforms to choose from, sports-related or otherwise. That means fewer people are likely to watch games live—doubly so for younger generations lured away by Twitch and other exploding platforms. Rising numbers for newer sports like eSports and mixed martial arts have also pulled viewers away from traditional big-three viewing.

Even if those worrying trends continue, it could take several years before we see the full negative effects. The NBA’s deal with ESPN and Turner Sports runs through 2025. The NFL’s deals with FOX, NBC, and CBS run through 2022. MLB’s TV deals with
FOX, ESPN, and Turner run through 2021. The Collective Bargaining Agreements for each of those three sports have multiple years left on them too: The NFL’s runs through 2020, and the recently ratified agreements in MLB and the NBA last through 2021 and 2024, respectively.

That leaves the big three sports leagues little choice but to explore alternative broadcast arrangements, if they hope to avoid the potential cord-cutting bloodbath that could look far, far worse three, four, and seven years from now. MLB Advanced Media is a growing force in the sports world, and ESPN has hitched its fortunes to BAM’s growth. You can now stream NFL games on Yahoo! and Twitter. Funneling fans from traditional TV channels to over-the-top devices could absorb some of the blow too.

RoyalsRetro (AG#1F) Posted: May 04, 2017 at 10:22 AM | 177 comment(s)
  Beats: cable, mlb network, mlbam

 

 

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