We’ve all witnessed ESPN’s slow but sure downfall as the trademark sports network has had to fire many employees in the past years, including celebrity and television icons. As more discharges are expected to keep occuring in the following months, they are looking for strategic partners that will save the company from collapsing entirely.
As Disney is looking for options, Chief Executive Officer Bob Iger and ESPN head Jimmy Pitaro believe that the future relies on bringing professional sport league as minority inventors. They have reportedly held talks with the NBA, NFL and MLB in search of support.
During these meetings, ESPN introduced a variety of new partnership and investment structures while explaining that “we have a longstanding relationship with Disney and look forward to continuing the discussions around the future of our partnership.”
Disney and ESPN have reportedly spoken to the NFL, NBA, and MLB about becoming equity partners in the network. https://t.co/dpK9zK390D
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In an interview with CNBC, Iger said that Disney is preparing itself to transition the sports network into streaming and needs strategic partnerships to work it out. Even though he didn’t have time to elaborate on what types of value the leagues can bring to the table, he did reveal that selling a stake in the business was possible.
“Our position in sports is very unique and we want to stay in that business,” Iger said about the company that’s owned 80% by Disney. “We’re going to be open minded about looking for strategic partners that could either help us with distribution or content. I’m not going to get too detailed about it, but we’re bullish about sports as a media property.”
A sports subscription streaming service could potentially give consumers interesting packages and innovative ways to watch content
If we come to think of it, this idea of a jointly-owned subscription streaming service with several sport leagues could eventually give consumers innovative ways to take in content, as well as new game packages.
“A lot has been said about renting [sports right] versus owning,” the Chief Executive Officer said on air. “If you can rent it and continue to be profitable from renting, which we have been and we believe we will continue to be, then there’s value in staying in it. We have great relationships with Major League Baseball, and the National Hockey League, and various college conferences, and of course the NFL and the NBA.
“It’s not just about the live sports coverage of those leagues, those teams, it’s also about all of the shoulder programming it throws off on ESPN and what you can do with it in a streaming world.”
Disney is convinced that the future of sport entertainment will be in a world dominated by streaming, and gaming rights are crucial to take a step closer, even though that striking a deal this big with the leagues will defintely take time.
“If [a partner] comes to the table with value, whether it’s content value, distribution value, whether it’s capital, whether it just helps derisk the business — that wouldn’t be the primary driver — but if they come to the table with value that enables ESPN to make a transition to a direct-to-consumer offering, we’re going to be very open minded about that,” Iger concluded.
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