Major professional sports leagues, including the NFL and NBA, were “blindsided” by the new sports streaming venture announced by Disney, FOX, and Warner Bros. Discovery, according to a report by The Wall Street Journal.
What’s Happening:
- Earlier this week, a new venture between Disney-owned ESPN, Warner Bros. Discovery, and Fox to bring thousands of sporting events to fans in a single app was announced.
- According to reports, this news came as a surprise to many of the sports leagues, including some mentioned by name when the new venture was announced, including the NBA and the NFL.
- Considering that networks pay billions of dollars a year for the most valuable sports rights and rely on that programming heavily, the relationships between the leagues and the networks are very sensitive. Some leagues, given the value of their content, often want to be asked to give their blessing on any shift in business strategy – like a multi-company streaming venture.
- Reportedly, an effort to notify the leagues wasn’t made until Tuesday before a planned announcement, but many learned of it when The Wall Street Journal originally broke the news, which was followed shortly by the official joint announcement from the media giants involved.
- According to people familiar with the matter, the leagues were kept in the dark was to avoid the premature leaking of the plans as the media companies were still working out the details.
- An NBA spokesperson told The Wall Street Journal, “While we look forward to learning more about this new venture, we’re encouraged by the opportunity to make premier sports content more accessible to fans who are not subscribers to the traditional cable or satellite bundle.”
- The NBA is in negotiations on new rights deals with Warner Bros. Discovery and Disney’s ESPN.
- As for the NFL, a spokesperson told The Wall Street Journal, “We’re aware of yesterday’s announcement and are still gathering details to understand this proposed new streaming service.”
- The companies involved in the newly announced venture have reportedly said this is strictly about creating a sports streaming bundle, without any intent to negotiate new rights deals together. Sports rights are a highly valuable and delicate relationship, and the companies also say the new service won’t violate any current agreements with either sports leagues or traditional pay-television distributors.
- However, there are some concerns coming from FuboTV, which has their own sports streaming service, with a spokesperson saying, “Every consumer in America should be concerned about the intent behind this joint venture and its impact on fair market competition… [the companies] could dictate market terms in a manner that may not serve the broader interests of consumers” considering their now vast market share in sports programming.
- NBC and CBS are also known for their sports broadcasting, and they have no involvement in the new venture either. Fox Chief Executive Lachlan Murdoch has also reportedly said there aren’t any plans to add additional partners to the venture.
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