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In a stunning move, three big names in the world of live sports streaming are teaming up to build a “new and exciting platform” launching later this year. Disney, Fox, and Warner Bros. Discovery are all contributing to a new yet-to-be-named streaming entity in an unprecedented partnership that aims to streamline (or monopolize, depending on how you look at it) the sports-viewing experience.
This has the potential to upset the way many marketers reach their audience through sports broadcasting and programmatic OTT, but Genius Monkey users have nothing to worry about, and can even look forward to the exciting new marketing opportunities it provides. There’s plenty to go over, so let’s dive in:
What Exactly is Happening?
A new company is being formed, its board members and shares split equally among the three media giants. This new company’s main product will be a brand-new streaming service that pulls its content from the contributing companies’ linear and streaming channels. Subscribers will have access to all the ESPN channels, ESPN+, ABC, Fox Sports 1 and 2, TBS, TNT, and more.
Cable-cutting customers would normally need to go through multiple deals or packages in order to watch all these channels; soon they will have it all in one place. This new streaming service doesn’t yet have a name, let alone a price tag, but industry insiders and analysts have predicted it will be at or above $40 a month. Bundling options with Max, Hulu, and Disney+ will be available.
While they have a lot, these companies don’t have everything; notably missing from this partnership is NBC (which hosts Sunday Night Football), Amazon (Thursday Night Football), and Paramount (CBS Sports). Some big names in the sports streaming space suspect that these and others will be hopping in on the bandwagon shortly.
Why Now?
Over the last few years, media rights for sports broadcasting have been skyrocketing in price. The NFL recently signed broadcasting deals with numerous companies amounting to over $125 billion, likely thanks to increased ratings and subsequent bidding wars by the networks that want in. By pooling their resources, these companies can potentially “de-escalate” the bidding wars and lower their overall broadcasting costs.
It helps that consumers have been cutting the cable more than ever before; one survey reported that 6 million people have dropped cable TV each year from 2019 to 2022. By packaging linear channels into a streaming framework, big networks stand to recoup revenue lost when consumers abandoned linear broadcasting.
The Advertiser’s Price for Premium Streaming
Creating a more singular environment for sports creates a new bidding war in their favor: advertising. Sports remain at the very top of US broadcasting viewership, with the NFL in particular nabbing 93 of the top 100 broadcasts in 2023.
A diverse set of networks means advertisers have competition to choose from, keeping prices relatively low and inventory relatively high. A universal consolidation of sports streaming into a single app means many advertisers will have one place to go, and that means prices and inventory could potentially go ultra-premium.
That hasn’t happened yet; as mentioned above, there are plenty of networks who – at time of writing – have not thrown their caps into the venture. Even if every athletic broadcast ever got folded into this new app, there’s still going to be many potential ways to go about buying that inventory. That’s why Genius Monkey isn’t worried: a good programmatic platform is always finding new ways to get quality buying avenues for the client.
A hypothetical example: a single app means that traditionally less-viewed events stand a much greater chance of attracting a new audience. Previously low-valued ad space can get a sudden increase in viewers as niche events are placed in the limelight; it’s an exciting prospect for the OTT space!
Above all, this move signals that the big names are beginning to recognize the potential in OTT channels. Genius Monkey believes that it’s high time for OTT/CTV to have its big break, and this new service could be another step toward that potential uplift.
It’s easy to call doom and gloom at an announcement like this, especially when sporting event CPC prices have already increased YOY – but Genius Monkey expects them to decrease as more network deals and partners are added to the platform.
A Great Programmatic Platform Can Target Better for Less
A dedicated team with solid tools can find the nooks and crannies where savings and great ad placements can be found. Genius Monkey has built its name on dramatically lowering the cost-per-acquisition for businesses of any size and all verticals; come see our case studies and find out how we can help you evolve your digital marketing to the next level!
