This is a powerful sign that cord cutting is really hitting these megacorps to the point they would make such a cooperative deal. We’ll have to see what they want to charge for the service, as it will probably be too high. But it’s a nice sign that they’re coming together instead of everyone trying to do their own streaming ventures harming consumers who want to legally pay for content. Consequently, when UFC CEO Dana White disrespected all of us conservatives over the Bud Light deal, I cancelled my ESPN+ subscription to send a message as did many, but I paid for the year and it doesn’t expire until next month. And they’ve raised the price a lot for that streaming service, now $109.99 yearly or $10.99 per month (originally $49.99 a year or $4.99 per month). My original intention was to re-establish it before it expires as I do enjoy the UFC and Formula 1, but I’m leaning towards not renewing it as I might just live with my monthly ONE Championship events on Prime and watch their other events on YouTube. These megacorps are just a bit too greedy and I doubt the increase in fees covers for those they’re forcing to leave.
https://variety.com/2024/tv/news/warner-fox-espn-streaming-spots-joint-venture-1235900161/
By Brian Steinberg
It’s a game-changer.
Fox Corp., Warner Bros. Discovery and Disney are set to launch a new streaming joint venture that will make all of their sports programming available under a single broadband roof, a move that will put content from ESPN, TNT and Fox Sports on a new standalone app and, in the process, likely shake up the world of TV sports.
The three media giants are slated to launch the new service in the fall. Subscribers would get access to linear sports networks including ESPN, ESPN2, ESPNU, SEC Network, ACC Network, ESPNews, ABC, Fox, FS1, FS2, BTN, TNT, TBS, truTV and ESPN+, as well as hundreds of hours from the NFL, NBA, MLB and NHL and many top college divisions. Pricing will be announced at a later date, but the companies will likely set a monthly subscription that is more than a consumer would pay for a standalone regional sports network, which costs $20 to $30 per month, and less than a larger digital programming package such as Hulu + Live TV or YouTube TV, which cost around $75 to $80 per month, according to a person familiar with current discussions.
The new joint venture, currently unnamed, is seen as a way for Disney, Fox and Warner Bros. Discovery to gain back some of the lucrative affiliate fees they have lost as their cable subscribers have cut the cord and moved to streaming outlets as their primary source of video entertainment. The new venture would pay its three corporate parents for licensing rights, essentially creating a new distribution partner.
Each company would own one-third of the new outlet and license their sports content to it on a nonexclusive basis. The service would have a new brand and an independent management team. The concept surfaces as traditional media companies are grappling with the migration of sports — the last TV format that generates steady crowds and sustained ratings — to streaming venues.
The structure is similar to what was in place when NBCUniversal and a predecessor company to Fox launched Hulu in 2008. The streaming hub used content from a wide variety of media platforms and eventually counted Disney and the predecessor to Warner Bros. Discovery as investors as well. In 2024, Disney and Comcast, NBCU’s parent, the last two stakeholders in Hulu, are haggling over terms for the former to buy out the latter’s share, while Disney has operational control.
The concentration of top sports under one roof would be significant. Between them, ESPN and Warner Bros. Discovery have most rights to the NHL and the NBA, while Fox, WBD and ESPN control at present the majority of rights to Major League Baseball. Only the NFL would enjoy a large presence with entities that are not a part of the joint venture, with “Sunday Night Football” at NBCUniversal, “Thursday Night Football” at Amazon and a package of Sunday afternoon games at CBS.
Disney, Fox and Warner Bros. Discovery would continue to control rights and the new entity would not create its own content for the service, according to the person familiar with the matter. And the start-up venture would never compete with its parents for rights deals, this person says.
The announcement of the new business comes as Disney has been examining strategic alternatives for ESPN, which is pushing into new digital venues while its longstanding cable-based subscriber base has been eroding. Disney has been in talks with various sports leagues, including the NFL, about getting more involved in the ESPN business. Those discussions continue, according to the person familiar with the matter, and are independent of plans around the new joint venture, as are discussions around launching a stand-alone ESPN direct-to-consumer product.
The new business also represents a significant move for Fox, which has resisted calls to put its sports content on streaming venues. Indeed, Fox Corp. CEO Lachlan Murdoch tried to tamp down speculation in November that it might decide to put its sports content on its Tubi free, ad-supported streaming hub. “We don’t envisage having significant live sports on Tubi,” Murdoch said.
Warner Bros. Discovery, meanwhile, is poised to launch an add-on pay tier on its Max streaming service devoted to sports under the Bleacher Report brand. Warner was supposed to launch the pay tier in time for the NCAA March Madness men’s basketball tournament, but in early January said it would extend its timeline. The Bleacher Report live sports add-on, which carries telecasts from TBS, TNT and truTV, for now is being offered free on Max under a trial run.
“The launch of this new streaming sports service is a significant moment for Disney and ESPN, a major win for sports fans, and an important step forward for the media business,” Disney CEO Bob Iger said in a statement. “This means the full suite of ESPN channels will be available to consumers alongside the sports programming of other industry leaders as part of a differentiated sports-centric service.”
“We believe the service will provide passionate fans outside of the traditional bundle an array of amazing sports content all in one place,” said Fox’s Lachlan Murdoch in a statement.
“This new sports service exemplifies our ability as an industry to drive innovation and provide consumers with more choice, enjoyment and value and we’re thrilled to deliver it to sports fans,” David Zaslav, Warner Bros. Discovery’s CEO, said in a statement.
The three principals did not make outreach to Comcast or Paramount Global, the person familiar with the matter says, realizing that Disney, Fox and WBD together control approximately 85% of the U.S. sports rights market and feeling that bringing in more partners would make the structure unwieldy and make the price of a subscription too high for many consumers to bear.