Streaming Wars For Live Sports, Entertainment, and Gambling

Of the streaming services with major market share of over 5% as of 4Q2022 in the US, we have been monitoring of course what Disney does with Hulu or not along with ESPN+.

A term had arisen in media circles more a few months ago called a “hard bundle,” which is basically one bundle of streaming apps that you pay for once AND with all the associated brands and apps integrated into one place on your screen so you don’t have to exit between apps to watch something on ESPN+ like now with the “soft bundle.”

As a personal example and fill in for your own apps for yourself, I find it annoying to have to exit from YouTube to watch something on Netflix, and then I have to exit from Netflix to go see what I might watch on Paramount+.

Now these are all different companies so that reality of having to flip between apps that is not as easy as changing channels certainly won’t change any time soon, but when it’s the same company that owns all the apps as does Disney in this case, why is the viewer experience still now with the “soft bundle” as if they are completely different companies!?

So much as Paramount+ (6% share) just did with the Showtime brand to make it all in the same app and a “hard bundle,” either Disney will integrate Disney+ (15% share), Hulu+ (11% share), and ESPN+ into one hard bundle or of course Hulu goes to NBC Universal and Comcast for whatever they will do with it including an integration and rebrand of lowly Peacock.

Then there is HBO Max (14%), which I could easily see going into a larger Warner Brothers Discovery bundle, and sure enough that is projected in the works for this summer.

In other cases, though, media companies are opting to deposit all the shows and movies a company has available into one central place. Warner Bros. Discovery, which operates HBO Max and Discovery+ as separate services that aren’t bundled in any way, is readying to debut a single new service by summer 2023, executives announced earlier this year, although many of the details, including its branding and price, remain under wraps.

Within 7% of the total market share are all the other smaller players, beyond ESPN+ as discussed, that either are going to figure out here in 2023 how to be part of a hard bundle and with possible rebranding, or they are going out of business de facto (small player with a lousy app that is not going to get major market share and just be a corporate slush fund like Comcast’s Peacock) or de juro (Bally Sports+ well on the way now).

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And this one is on the teams and the leagues too for milking the gravy train via local cable subscribers - no tears for them.

I like that now the chickens are coming home to roost after local consumers have not had a fair say in the matter of local cable regulation and pricing practices at all.

Warner Brothers Discovery tells the teams,
“You want your local cable subscriber gravy train or not? Deal us out now, because we’re out and here on the table are the keys as you make up your minds.”

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I would love to be a fly on the wall in some of these meetings that have to be taking place inside the MLB, NBA and NHL in regard to what in the heck do we do now that our whole cash cow business model is collapsing. They are talking about setting up their own streaming services but I don’t think that is going to be nearly as lucrative as the RSN/Cable TV screwing the local fans model was.

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As I watch Lightning at Red Wings tonight via the Bally Sports Detroit feed via Pirate Sports Network, well like millions across the US doing the same via these feeds, I am looking at what will be history very soon.

I think the dominoes will fall in not so much a matter of weeks but in a matter of days once March comes around in only three days, plus note the big player that owns Bally Sports has already missed its first payment to creditors.

Diamond Sports Group, which hold the rights to 42 MLB, NBA and NHL teams on its 19 regional sports networks, looks to be weeks away from filing for bankruptcy protection. Warner Bros. Discovery, which has the rights to 10 pro teams on its four RSNs, is trying to get out of the business entirely and has started negotiating with teams to take back their local rights.

Times are tough in the RSN business, which has huge implications for teams that have depended on that ever-increasing revenue stream over the past several decades.

Many MLB, NBA and NHL teams have been told to expect their local media rights fees to be cut by as much as 70% over the next several years as they try to figure out new ways to make their games available to their local fans. This pending revenue shortfall matters, as most local media revenue is one of the top two or three moneymakers for teams — accounting for as little as 10% of a team’s total revenue to upward of 60 or 70%.

But is there looming upside after all this RSN mess, in which the leagues are complicit as well mind you, unravels?

Given the exorbitant sum that ESPN paid for the rights to the NBA and lagging ratings compared to before the pandemic, what, move to streaming and make it up? I’m not so sure and will believe it when I see it, but then will the media company make money streaming so many games that were formerly on a regional sports network?

I’m not buying the downplaying of the matter by NBA executives, for the money coming in from the RSN’s is high-margin profit that is declining rapidly each month.

If even one financial professional in the room, of which the big leagues have many and some of the best, were to tell you not to worry in such a situation of a loss of significant high-margin revenue,

  1. Fire him or her now
  2. Take a vacation
  3. Go on a solid bender
  4. Hydrate, sleep it off, detox, and clear your head and then get back for a brighter future.

One asset the NBA has is the fact that its national media rights deals with ESPN and Turner are up after the 2024-25 season. Already, the biggest media and tech companies have started jockeying for position to pick up the NBA’s national rights. Top executives from ESPN, Warner Bros. Discovery, Google, Amazon and Apple descended on Salt Lake City this month to partake in All-Star Game festivities and meet with their NBA counterparts.

This kind of auction atmosphere makes it likely that the NBA will at least double the value of its current deal. That influx in national media revenue will do a lot to make up for any shortfalls in local media revenue.


Diamond Sports Group, the corporation which owns the Bally Sports networks responsible for local broadcasts of a number of MLB teams, forewent interest payments worth roughly $140MM to creditors last Wednesday (Associated Press link). The decision kicked off a 30-day window for Diamond to determine whether it is capable of meeting its debt obligations or is going to default on its commitments.

Paywalled article here but some of you I know have it

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I did as you suggested and scrolled down to the bar chart.

For about $25 a month to my cable company (Shaw) I get both TSN and Sportsnet and of the channels that must be paid for individually listed in the bar chart I get HBO, Showtime, Starz, Paramount, Peacock. AMC and Discovery, as well as numerous other specialty channels including the Food Network (a personal favourite) and F/X and free channels such as Tubi. I have access to Netflix. Hulu, Disney and Apple in the unlikely event I would want to watch something on one of those channels and pay for it. After sports and HBO (still the best content channel by very far) I barely have time to watch some excellent series on Showtime, Starz The Food Network and F/X. I also have about 175 movies queued to watch on my PVR.

The cost that is set out in the bar chart for just the specialty channels listed would be over $100 monthly in the US and wouldn’t include the two sports channels. While there might be the odd show I might like to watch on one of the few channels I don’t get, I would need to be retired and spend 20 hours a day watching TV to make any use of the other channels. Call me a dinosaur, and I realize that the landscape might change, but I still don’t get the streaming thing, which has little content value to me and is incredibly expensive.

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European Super League Documentary on Apple TV+

If you happen to have Apple TV+, which I don’t, this one looks worth watching. It amazes me there is already such a documentary less than two years after these events happened, but of course we are now only in Chapter 2 of this sport and entertainment saga.

https://www.cnn.com/2023/02/27/football/super-league-documentary-football-jeff-zimbalist-spt-intl/index.html

The documentary is balanced, offering the ESL architects’ reasoning and plans in extensive interviews, assembling almost the entire cast of characters to face off once more in the court of public opinion.

“That was how we presented it to them,” Zimbalist says.

“We’re going to hopefully have audiences in a tug of war where they, for 15 minutes at a time, are rooting for UEFA and the fans and the next 15 minutes they’re rooting for the Super League because they can identify with the personal experiences of the architects on either side and they understand the arguments.”

But Zimbalist was wary of casting the ESL as a battle between only two sides, constantly reminding himself and his team of the other groups.

“You can very easily just look at UEFA vs. the architects of the Super League,” he says. “But then you’re leaving out, in some ways, the most important voice, which is the fan voice.”

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A Regional Sports Network Not Shutting Down + Add Genius Sports Features =
Higher Ratings For Some Local Games

It's not a complicated idea or brand new at all though the great technology via Genius Sports no doubt has a whole lot to it over a live cable television feed.

Look what is being done in Portland via Root Sports Northwest, which apparently is a regional sports network that is doing just fine. Or so we shall see?

Of course this technology via Genius Sports could simply be implemented via a local broadcast station wherever any given local regional sports network is going to go out of business soon.

At the bottom is a short and mute video clip you can play so as to check it out for yourself.

https://www.geniussports.com/newsroom/genius-sports-transforms-trail-blazer-broadcasts-with-second-spectrum-player-tracking-technology/

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I think that we are in one of those technology transition zones - 8 track to cassette tapes or DVD to streaming. Except we are seeing the death of Cable TV and as that happens, sports are either going to streaming or back to “Over-the-air (OTA) TV” -

Everyone is breaking out the knives and slicing and dicing the CW for their first week of broadcasting LIV Golf and the ratings that they got. I would expect those numbers to rise as the CW transitions from the Green Arrow/Flash DC Superhero channel to more live content like sports. I expect this trend to accelerate over the next six to nine months as the Regional Sports Networks on cable TV are collapsing in on themselves and a lot of those sports teams will be looking for media partners. The CW has stations in big markets and also they have open slots to fill.

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Might be the death of cable tv but a near complete monopoly and takeover of the internet service provider market is less work and probably more money.

Its one of the areas that the CRTC did not plan well for given that there was previous free access to radio and tv which has now become another abused captive market imo.

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There is a whole lot to unpack here with Disney’s complete restructuring, as announced by CEO Bob Iger on 8 February, as the plot thickens for ESPN and for Hulu and in turn also NBCUniversal - Comcast.

It is not to be overlooked that Comcast and NBC are partners with Disney for Hulu yet competitors for the lucrative live sports content.

Siphoning off ESPN into its own sector also gave rise to questions about selling that segment, even if live sports still reliably draws an audience (and advertisers), with the profits ultimately going to support Disney’s streaming efforts. And, as Iger acknowledged, the goal is to transition more of ESPN to streaming eventually, where its live sports content will likely be a draw for streaming subscribers. Additionally, as Ehrlich notes, selling ESPN at this time, given the pressure on the linear business, could mean that Disney would have to sell at a much lower price than what the cable network may even be worth. The Bank of America analyst adds, “It just, financially, doesn’t really make sense.”

The restructuring also gives Iger alternatives and flexibility in achieving that profitability goal. One possibility, which appears to be increasingly in play, is the sale of Hulu. Disney retains a 66 percent stake in the streamer, while Comcast owns the rest. Starting in January 2024, Comcast can use its put option to require Disney to buy its stake, or Disney can use its buy option to tell Comcast to sell its stake. Chapek had expressed an interest in buying out Comcast during his tenure (and Comcast had also expressed an interest in ownership), but now Iger appears less sure, going on CNBC on Feb. 9 to say that “everything is on the table right” in terms of Hulu’s fate.

In fact, Disney is said to have hired Goldman Sachs to explore different paths, even as some analysts are skeptical of Iger’s maneuvering. “While Iger has expressed in recent interviews that Hulu is less of a priority, we think this is posturing,” J.P. Morgan analysts wrote in a Feb. 10 note, mentioning that it’s more likely that Disney buys Comcast’s stake for around $9 billion.

Nevertheless, selling Hulu, rather than having to write a multibillion-dollar check, could bring an influx of cash as Disney tries to stem its streaming losses and clarify its streaming strategy. As analyst Rich Greenfield’s Lightshed Partners noted Feb. 7, even though there has been some notable programming on Hulu, including The Bear and Fleishman Is in Trouble, these shows still have not charted within Nielsen’s most watched streaming shows. “It is hard to see why Hulu is a must-have asset regardless of whether or not Disney chooses to continue investing in adult-focused programming for Disney+ or pivot solely to kids/family programming,” the analysts wrote.

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I really want to see what happens to both ESPN and Hulu. I really can’t see Disney holding onto both of those. And that is more of a hunch than anything else at this point in time. My prediction based on just my opinions and hunches at this point is that Disney holds onto one of those properties and disposes of the other one. I am thinking that Disney holds ESPN and sells Hulu for the cash. Just my wild ass guess on that one.

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I tend to agree with you; HOWEVER, look at Hulu’s average revenue per subscriber that is more than double the other two!

Now we don’t know the profit margin figure and they do, but there’s a lot more room for a profit there per user than per user with the other services.

But of course Disney+ has about 3.25 times the subscribers than does Hulu, but ESPN+ has only about half the subscribers of Hulu.

Akin to as you explain it and given what we know about Disney’s current predicament financially with media assets like to some degree for the entire industry, the valuation of Hulu looks like an awful lot of somewhat easy money to turn away right now for any media company.

I am on board with you as with Disney - I could see them go any direction and not be shocked at what they do. Who knows maybe they sell both ESPN and Hulu and go another direction or keep both of them.

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@Paolo_X I guess these two characters are what Disney wants back and might be willing to give up Hulu to get the rights to these two mainstays of Marvel back into the fold. There are so many moving parts in this thing.

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@Paolo_X - I have been hashing and rehashing the gambling side of these leagues. And I wonder what the NFL take is in the gambling related income for these two leagues? The NFL gets gambling money for 6.5 months a year when the games are being played, I would venture a bet that the NFL makes money from the gambling that happens with both these leagues - I am starting to wonder if the NFL is approaching the USFL/XFL as passive income streams like Rental properties. Is the NFL going to be raking in big money like they do for their season - no nothing that big but if they do have a stream of revenue coming in from these leagues and the betting it keeps the gamblers addicted and money flowing in the off season until the NFL season comes back around.

I might be wrong on this one but I have a difficult time with the idea that the NFL is not taking a skim cut off the top of any gambling revenues that are generated by these two leagues.

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The legal skimming might just come from Genius Sports. NFL owns 5% of that and GS takes a cut from the CFL and XFL. I don’t know if there’s an official betting partner of the XFL but if there is then that promotional sponsorship will eventually partially trickle down to the NFL.

Naturally there are under the table deals that have sketchy details.

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There’s no theory here and you are spot on.

Note this linked article from a year ago as I posted in a post in this thread on 3 February 2023. The NFL is amongst the last to want any given sports betting reforms much as have taken place in the UK due to the unsurprisingly new wave of addiction especially in young men.

https://www.cnbc.com/2022/01/26/tech-gambling-alcohol-helped-nfl-earn-almost-2-billion-in-sponsorships.html#:~:text=DraftKings%2C%20FanDuel%20and%20Caesars%20became,WynnBET%2C%20Fox%20Bet%20and%20PointsBet.

When the NFL has had the means and ability to do it after shunning any scent of gambling in its entire history, for which it was revealed two NFL owners Kraft and Jones by 2015 had made otherwise allowed investments separately in those “daily fantasy sports” firms that became online casinos, which was always their true intent anyway after the ruse of “daily fantasy sports.”

The two biggest firms involved then are now two of the three prime official NFL sports betting partners plus the NFL has a host of secondary partners. Of course at least some of the owners would have such additional betting interests in action on spring football, but some like the Glazers have had such interests in the UK and beyond for some time now via ownership of teams outside the US. Those casinos have long had betting on the NFL as well of course, and many used to use the offshore sports books before federal legalization of single-game and other sports betting in the US and Canada.

All the same let’s keep in mind that some of the money bet on spring football is likely to have been bet on other games without spring football in the mix, but in any case there has only been upside on this front for those with vested interests via ownership or sponsorship stakes in casinos.

Oh and did we forget that Fox has its own sports betting operation FoxBet as well?

Also not to be overlooked are any holdings that any of the American NFL owners and various media partners have had in such gaming operations based outside of the US and likely very well hidden historically as well.

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This article explains quite well why Netflix remains king of streaming and likely will continue despite some recent subscription challenges.

Netflix remains one of the two major streaming firms operating that are known or suspected to be also profitable. The other one is Amazon Prime via especially the very successful recent new deal for NFL Thursday Night Football that starting with the 2022 season.

It just so happens that the article mentions one of the miniseries produced in France that is entitled “Lupin,” which I am watching now.

Dubbing from the original French has come a very long way so that it’s not like watching 1970’s martial arts films and the translation is not awkward. I always use subtitles anyway including in English and Italian and sometimes in Spanish. It just makes it easier to catch all that was said especially when somebody says something in a muffled voice or with a strong accent. You can also choose the language for the dubbing as well if you prefer.

As the article explains, more and more stories that you can enjoy in your preferred language simply have not had to come out of Hollywood any more especially if not set in the United States.

EMEA quietly became the streamer’s biggest region in terms of subscribers in 2022, overtaking the combined user figure of 74.3 million for the U.S. and Canada with its 76.7 million. Its revenue for last year reached $9.75 billion, with average revenue per user (ARPU) of $10.99, compared to $15.86 for the U.S. and Canada.

In early 2021, Ampere Analysis said that Netflix had become the second-largest TV company in Europe in terms of European revenue in 2020. It accounted for 6.1 percent of total European TV revenue back then, only ranking behind Comcast’s 12.0 percent. In 2022, Comcast represented 10.3 percent of all European TV revenue across subscription streaming, pay TV, public TV and TV advertising, the firm has told THR, while Netflix had grown to 7.7 percent before including online video advertising revenue, which the streamer just started recording.

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Sirius XM - It's good in your car, but otherwise, I'm still saying no.

I figured to post this one because I think more of us than has been counted have Sirius and if you are like me, though I could listen to it anywhere, it is all in my car.

I'm not surprised at this news at all, for the content took a serious slide with the pandemic as well as the audio quality on too many broadcasts. I did not feel there was a good excuse for that reality either beyond perhaps two months.

It's not our cars or the satellites that are worse on reception. It's the lousy booth set-up of too many including especially the generally awful "guest deejays" of yore. Nobody wants to listen to a literal echo chamber, and nobody is going to pay for that very long.

And so there it is they had it coming and they should focus on improving their content back to like it was in 2018 more than anything else if they want to keep subscribers around more.

And they are not taking off via other platforms than in cars now, for they were about five years late in those campaigns as otherwise the rest of us have already too many other options including for free.

The biggest reason I keep it is live sports. Even their music catalogue has suffered on my favourite stations. Sure I have Pandora too, but the sound is better via satellite radio plus it's just easier to use when driving.

Your thoughts or a review of your experience including especially since 2020?