ESPN, Fox, and Warner Bros. Discovery Form a Joint Venture for New Streaming Sports Platform
FOX, Warner Bros. Discovery, and ESPN, a division of the Walt Disney Company, have come to an agreement on the main terms of forming a new joint venture. They will develop an inventive new platform to house an exciting new streaming sports service. Major college and professional games that are typically only broadcast on traditional TV will be available on the sports-focused streaming service.
New streaming sports service
The platform combines the sports networks, select direct-to-consumer (DTC) sports services, and sports rights portfolios of the companies, which include college and professional sports content from all the major leagues. Final agreements between the parties must be negotiated before the pay service can be formed. The product will be offered to customers directly through a new app. It is slated to go on sale in the fall of 2024. Additionally, subscribers have the option to bundle the product with Disney+, Hulu, and/or Max. The service would be rebranded and run by a separate management group.
Key Features of the new standalone streaming service
Each company will own one-third of the service. We still need to decide on the service’s name and price. The objective is to entice viewers who do not have a pay TV subscription. They will provide them with access to all the sports included in that package. All three companies’ standalone subscription streaming services will feature an unparalleled quantity of live sports programming from their respective sports networks. Its main source of income will be from user subscription fees. On its own networks, each network will still sell advertisements that conflict with its content. For the joint venture, there will be equal board representation for each of the three participating companies. Each of them will grant the joint venture a non-exclusive license to use their sports content.
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Service catered specifically towards sports fans
To give sports fans a fresh and unique experience, the platform would compile content to provide a wide variety of dynamic sports content. Fans could access linear networks, such as ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, ABC, FOX, FS1, FS2, BTN, TNT, TBS, truTV, and ESPN+, by subscribing to this targeted, all-in-one premium sports service. Among the most watched programs that will be included in the package, it will also include Monday Night Football.
Along with NASCAR, the PGA Tour, Grand Slams of tennis, and more, the new service will also broadcast games from the National Football League (NFL), Major League Baseball (MLB), the National Basketball Association (NBA), and the National Hockey League (NHL). Users of Max, Hulu, and Disney Plus will also be able to bundle the new service.
Sports streaming landscape
As some leagues choose to keep broadcasting games on conventional cable networks and others have negotiated agreements with streaming services, the landscape of sports streaming has grown more fragmented. The live sports add-on for Warner Bros. Discovery’s Max streaming service debuted last year and costs an additional $9.99 per month. By combining some of the biggest sports networks, viewers may have access to even more streaming options that aren’t restricted to a smaller number of sports and leagues. It might produce the kind of incredible sports streaming service that fans of sports would love to have in the terrible current climate. Or it might just be a more costly, unfinished, and glitch-filled version of what we already had with cable TV.
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Here’s what they said
Bob Iger, Chief Executive Officer of The Walt Disney Company said,
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. 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. I’m grateful to Jimmy Pitaro and the team at ESPN, who are at the forefront of innovating on behalf of consumers to create new offerings with more choice and greater value.
Lachlan Murdoch, Executive Chair and Chief Executive Officer of FOX added,
We’re pumped to bring the FOX Sports portfolio to this new and exciting platform. We believe the service will provide passionate fans outside of the traditional bundle an array of amazing sports content all in one place.
David Zaslav, Chief Executive Officer of Warner Bros. Discovery, stated,
At WBD, our ambition is always to connect our leading content and brands with as many viewers as possible, and this exciting joint venture and the unparalleled combination of marquee sports rights and access to the greatest sporting events in the world allows us to do just that. 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.
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Disney Agrees to Sell 60% of India Business to Reliance-backed Viacom18
The Walt Disney Company has agreed to sell 60% of its India business to Viacom18 for $3.9 billion (INR 33,000 crore), according to the Wall Street Journal. The deal is expected to close this month. Viacom18 is owned by Mukesh Ambani, chairman of Reliance Industries (RIL). Walt Disney and Reliance Industries have been in deep discussions to combine their Indian entertainment businesses since December 2023. The businesses, however, were unable to come to a consensus regarding structure or valuations.
Disney agrees to sell 60% India business for INR 33,000 crore
Following rumors of Reliance Industries’ interest, Viacom18, owned by Reliance, the largest tycoon in Asia by Mukesh Ambani, has now finalized the deal and signed a non-binding term sheet to combine their India operations last month. The deal’s value was previously estimated by reports to be $10 billion. The decline in value is partially attributable to a write-off of revenue from Disney’s sale of cricket TV rights to struggling Zee Entertainment Enterprises Ltd., which is currently anticipated to be unable to make the payment. But according to a report this week from Bloomberg, Disney’s business in India are only worth about $4.5 billion, not the $10 billion that the US entertainment giant had previously sought.
Disney facing difficulties in India
Disney’s difficulties with streaming in India were made worse when Viacom18 outbid the American corporation for the IPL rights, paying $2.6 billion to stream the competition through 2017. Disney’s quarterly earnings in August 2023 revealed a 12 million decrease in streaming subscribers in the subcontinent, which was primarily ascribed to Hotstar’s decision to discontinue IPL streaming.
Disney+ Hotstar in India is facing difficulties because of this deal. Subscriptions to the platform have steadily decreased, from 61.3 million in September 2022 to 37.6 million a year later. Contributing factors include the loss of important content like HBO and IPL shows as well as competition from Jio Cinema. Although the sale’s official motivations are still unknown, rumors suggest:
- Priority Shifts: Disney may be refocusing its resources on high-growth sectors like Disney+ and core markets.
- Content Challenges: It may have been challenging to navigate the intricate Indian media environment and obtain well-liked content.
- Financial considerations: Simplifying operations and increasing financial flexibility are two benefits of offloading a part of the company.
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Increasing Opportunities for Viacom18
The media behemoth is now poised to take a leading role in the streaming wars. This is all thanks to its agreement with Reliance Industries’ Viacom18. Disney, on the other hand, will keep working with other companies. It will create and distribute content while holding a 40% share. Reliance holds a 51% stake, while Bodhi Tree Systems, a venture led by Uday Shankar, the former head of Disney India, and James Murdoch, holds a 9% stake. With this decision, both businesses enter a new chapter in the ever-changing Indian media landscape. The exact course of this strategic change remains to be seen, but the entertainment sector in the area will undoubtedly be greatly impacted.
Other Business Investment Plans
Viacom18 plans to invest approximately $1.5 billion in cash and equity in the stake. Disney owns a portion of the Tata Sky, Hotstar streaming, and Star India networks. The deal, which is expected to close in February, highlights the difficulties in navigating India’s vast 1.4-billion-person market. Disney Star and Viacom18 were reportedly preparing to battle it out for the right to advertise in the upcoming IPL 2024 earlier this month. Disney Star, which will broadcast the IPL matches on its sports channels, is reportedly requesting INR 167 crore and 83 crore for associate and co-presenting sponsorships on standard definition (SD) channels, respectively, according to a report in the Economic Times.
The broadcaster is requesting INR 35 crore for associate sponsorship and INR 71 crore for co-presenting sponsorship for HD channels. In contrast, Viacom18 has maintained its advertising rates at the same level to attract more advertisers. Viacom18 will continue to stream IPL matches for free on JioCinema. For the 2023 Indian Premier League, the company reportedly signed over 500 advertisers.
Hotstar a few years back
For a few quarters, Hotstar ruled the Indian video streaming scene. However, since then, Viacom18, supported by Reliance, has gained traction by paying roughly $3 billion to secure the five-year rights to stream the IPL cricket matches. Disney paid $3 billion to broadcast the content on television for the same five-year rights.
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Roku and Unity Announce Collaboration to Aid Mobile App Marketers
Roku, the top streaming service in the US and the world’s top platform for producing and managing real-time 3D (RT3D) content, and Unity have announced a strategic product and commercial partnership. This partnership will make it easier for mobile app marketers to extend their app install campaigns to TV streaming inventory. Through this partnership, mobile app marketers will have the only seamless TV streaming campaign execution experience possible by combining Unity’s user acquisition technology and experience with Roku’s premium inventory.
Roku – Unity solution for app marketers
The solution, which is currently in beta testing, links Unity’s Luna app marketing platform to Roku’s premium TV streaming inventory by fusing Unity’s campaign management and optimization technology with Roku’s Action Ads. With a smooth transition from ad view to download, Roku’s Action Ads offer advertisers the advantages of click-through measurement along with an easy-to-use discovery flow for viewers. They can therefore evaluate the effectiveness of their streaming TV campaigns from the point of initial ad exposure to the download of mobile apps.
TV streaming and Roku Action Ads
The first-to-market collaboration coincides with the expansion of TV streaming advertising. GroupM projects that global TV streaming ad revenue will reach $25.9 billion in 2023, an increase of 13.2%. Given that, at least 82 of the top 100 games use Unity to expand their user bases and that Roku has nearly half of all broadband homes in the United States, these two platforms are ideally positioned to assist app marketers in utilizing more screens and devices to engage potential users and spur incremental growth. Through this partnership, marketers can now take advantage of Roku Action Ads for a seamless experience in addition to closing the measurement loop for improved optimization.
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App marketers and TV streaming campaigns
With the Roku remote, users can start the game download on any mobile device and go back to watching TV shows without any hassles. Additionally, app marketers can now track every aspect of their TV streaming campaigns, from the first TV ad exposure to the final mobile app download, which opens up new, more affordable growth strategies. When Roku’s scaled inventory is combined with Luna’s campaign management technology, app marketers hoping to boost performance on home TVs will have never-before-seen opportunities.
After logging in from Unity, app marketers will go to Luna and choose Roku from a list of marketing channels. This makes it simple for marketers of mobile apps to purchase cross-channel advertising on a single platform. After the beta test, Luna will collaborate with a select group of partners to expand to Roku.
Here’s what they said
Miles Fisher, Senior Director, Head of Emerging and Programmatic Sales at Roku said,
Mobile app marketers seek to maximize their budgets and ad opportunities. TV streaming has become the right performance channel to enable growth and provide channel diversity in a highly competitive market. Roku’s scale, tech, and direct connection with the viewer are uniquely positioned to make the largest screen in the home work harder for mobile performance marketers on Unity.
Omer Kaplan, SVP of Revenue and Operations for Unity Grow added,
The driving force behind this partnership is to turn CTV into a high-scale performance channel for apps and games. Savvy app marketers today know that they have to harness every available channel to drive truly incremental and cost-efficient growth, and CTV represents a huge and largely untapped opportunity. By coupling that scaled inventory with Luna from Unity’s robust campaign management and optimization technology, this partnership unlocks unique value for app marketers who are looking to drive performance on home TVs. We believe that there is no better combination of partners more suited to making CTV a successful performance marketing channel to add to app advertisers’ UA toolkit.
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