• ESPN’s New Streaming Service is for Super-Fans

    On Disney’s earnings call earlier this week, company CEO Bob Iger shared some details about ESPN’s new sports streaming service that will launch this spring and cost $4.99/month. Based on the initial reveal, it seems like a sports super-fan product that will give Disney some incremental revenue, but won’t be a game-changer in the broader pay-TV or online video worlds. It’s a refresh of the existing ESPN app powered by newly-acquired BAMTech technology.

    Iger described 3 main features of the new ESPN app:

    1. Scores/highlights
    Iger talked about the app having “tons of scores and highlights and news stories about sports” that will be “highly personalized, both implicit and explicit.” All of this will be augmented by video, though details weren’t provided.

    2. Authenticated live streaming of the networks
    Same feature as the current WatchESPN app, subscribers will be able to authenticate with their pay-TV credentials to watch networks such as ESPN, ESPN2, etc. on mobile and other connected devices.

    3. Live and library content
    Iger said there will be “thousands of hours of live sports programming” including MLB, MLS, NHL, college sports and tennis, golf, rugby and cricket not on current linear ESPN networks. In addition, there will be on-demand access to the full “30 for 30” library, plus he said “we’ll continue to invest in original and exclusive content just for the app.”

    Though it’s early to assess each one of the features, my initial reaction is the presentation of scores/highlights has to be really breakthrough given the quality of what’s already out there across many different apps. The live and library content could be quite valuable depending on what games actually become available and the quality of the original content. The authentication feature seems a bit incongruous, since it requires a pay-TV subscription and once you have a that subscription, authentication is already available at no charge.

    Put it all together and $4.99 is probably around the right price point for the service. Again, though, this is a service that will likely only appeal to sports super-fans, so it’s not like it will be challenging Netflix or Amazon anytime soon. However, given the uncertainty in the TV world with cord-cutting and on-demand viewing, it’s still a smart move for Disney to get its toe in the water and create some options for itself down the road.

    Disney’s far bigger play will come next year when the entertainment SVOD service is releases. It is virtually guaranteed to be a hit given it will be priced substantially below Netflix and have a rich portfolio of iconic content.