Posts for 'Sports'

This week we discuss the new ESPN direct-to-consumer app, which was announced this week. Colin thinks that at $30 per month it’s too expensive relative to other streaming services, yet given the breadth of content and features, I think the price seems fair or maybe even low.

A big question is how wide the adoption will be as most hardcore sports fans still have a pay-TV subscription. That leaves cord-cutters and cord-nevers as the primary targets, as well those who will take ESPN as part of a discounted package with Disney+ and Hulu. How many of them will subscribe? We explore these questions, as well as the return of “HBO” to Max’s branding and a few NewFronts items.  

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This week we discuss a number of new developments that contribute to streaming sports’ momentum. These include NBCU making its RSNs available to Peacock Premium subscribers; Disney looking to buy NFL Media which could become a valuable piece of the flagship ESPN app slated to launch later this year; Comcast extending its Olympics rights through 2036, which benefits Peacock; Fubo adding the Texas Rangers RSN, and DirecTV adding RSNs to its My Sports Home tier.

First up we discuss Wurl’s new CTV trends report and new research on political ad spending in CTV from Basis Technologies.

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Peacock subscribers held steady at 36 million from Q3 to Q4, though up from 31 million a year ago. Importantly Peacock’s quarterly loss declined from $825 million in the year ago quarter to $372 million this quarter. Elsewhere at Comcast, the company lost 139K broadband subscribers in Q4, worse than the 34K loss a year ago.

We also discuss Fox’s increase in Super Bowl ad rates to $8 million, and new data showing how FAST apps built into the TVOS are garnering more attention.

Thanks to our sponsor this week, Looper Insights. Click to access their new report, “Streaming Forward: Trends Shaping Digital Entertainment in 2025.” Colin has the QR code on his site to scan for the report as well.

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First up this week we discuss Tubi’s plan to stream the Super Bowl in UHD, a bold move by Fox’s free ad-supported TV service. As we discuss, it’s further evidence of how premium streaming sports experiences are continuing to improve. Next Amazon Prime video set a new viewership record for itself with last weekend’s NFL wild card game. We dive into its ratings gains.

Hub Entertainment Research released new data about consumers sentiments on AI which we dive into. Speaking of AI, complimentary sign up is available for VideoNuze’s next virtual CTV conference on Feb. 25th that will focus on the intersection of CTV and AI.

Last, we discuss VIZIO’s discounted bundle of AMC+ and Starz.

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Talk about events moving fast. Not long after Colin and I recorded and posted this week’s podcast about the Disney-Fubo deal from earlier this week, the three Venu Sports JV partners said they were cancelling the service.

At the end of the podcast we cautioned that with DirecTV and EchoStar raising the possibility of a renewed Venu litigation, the JV partners might have second thoughts. Given the new twist this week’s Inside the Stream is kind of optional listening. Sometimes it’s hard to keep up!

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eMarketer’s latest data reveals that in 2024, 20 million more viewers will consume live sports on streaming than on pay-TV. With a number of marquee games shifting to streaming ahead (notably NBA to Amazon and Peacock), streaming is poised for more gains. eMarketer forecasts that in 2027 over 127 million viewers will consume live sports on streaming vs. just 75 million for pay-TV.

As we explore, the traditional notion of “sports as a firewall” against cord-cutting is becoming more ambiguous. In some cases sports-oriented TV networks are further blurring the lines. A good example we discuss is The Tennis Channel’s new initiative to include a live feed of its linear network in its Tennis Channel+ streaming service. It’s the first time tennis fans will be able to directly access the linear network.


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Four topics for this week’s podcast:

Both Google and Roku announced new streaming media devices this week, with Google launching its Google TV Streamer, which is positioned as the “next generation of Chromecast,” and Roku releasing an updated version of its Roku Ultra. As we discuss, these are two companies at far ends of the TV OS battle, with Google somewhat surprisingly still a laggard, and Roku still a leader.

Next up, Disney+ officially launched its paid sharing globally, following its announcement earlier this year. Disney+ is clearly hoping to emulate the success Netflix had following its rollout of paid sharing, though as we detail, there are important differences between how Disney+ is executing that could lead to much different results.  

Then we discuss a newly announced initiative by Whip Media to bring more transparency to FAST viewership across channels. While this would be a step forward, as Colin explains there are critical challenges to making this a reality.  

Finally, we circle back to a report last Friday about remarks from Netflix’s co-CEO Greg Peters concerning the possibility of the company leaning into live sports. Peters said “never say never” about live sports and with nearly 280 million global subscribers, Netflix would have an immediate impact.

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On today’s podcast, Colin and I discuss last Friday’s decision by U.S. District Court Judge Margaret Garnett, ruling in favor of Fubo by issuing a preliminary injunction preventing the launch of Venu Sports. Venu is a joint venture of Disney, Fox and Warner Bros. Discovery that includes 14 of the companies’ linear TV sports networks, plus on-demand content, for $43 per month. The companies filed an appeal on Monday.

As is evident from the ruling (thanks to the LightShed team for posting), Disney, Fox and Warner Bros. Discovery have created a “gilded cage” for themselves by - up until Venu - only including their sports networks in pay-TV’s multichannel bundle. Disaggregating these networks exclusively for Venu would create a torrent of cord-cutting, as live sports have become a mainstay for those still committed to pay-TV subscriptions. Judge Garnett agreed Venu would cause an immediate negative impact on Fubo (it would for other pay-TV operators too).

It’s not clear to either of us how specifically the JV partners will address the detailed points Judge Garnett articulated in her ruling, nor how persuasive they’ll be in lifting the injunction, especially given that the criteria for a judge to issue an injunction like this is in the first place is the presumption that an eventual trial would arrive at the same conclusion. All of this leaves Venu’s future highly uncertain.

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Early returns show Olympics viewership is up strongly so far. But while many devoted fans watch the full-length events, many other more casual fans consume just the highlight clips - often after they search for them subsequent to hearing about a particularly exciting moment (e.g. the clutch pommel horse performance, the long match-ending runback in rugby sevens, etc.). Watching highlights can also help drive casual fans to watch full length. 

All this means that for a long duration event like the Olympics, solid strategy/execution highlight clips distribution is imperative. In today’s podcast Colin and I discuss how we’ve been impressed so far with NBC’s Olympics highlight clips distribution across Peacock and YouTube. We’re able to compare and contrast experiences because Colin’s only been watching on the former and I’ve only been watching on the latter.

We discuss NBC’s balancing act of seeking to build value in Peacock, its owned and operated property, while also recognizing and respecting the reality that YouTube is the number one video search destination for hundreds of millions of users, so it simply can’t be ignored. Finally we discuss the business model benefits of distributing on Peacock and YouTube. 

Overall NBC’s Paris Olympics clips execution is far superior to the last games, and provides lessons for others. Still, we see still further room to optimize, which we review toward the end. 

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Comcast reported Q2 ’24 results this week, including an update on Peacock, which cut its loss to $348 million in the quarter from $639 million a year ago. Peacock’s subscriber count increased from 24 million in Q2 ’23 to 33 million at the end of Q2 ’24, but that was actually down a million from the end of Q1 ’24. 

In this week’s podcast we discuss whether and when Peacock will turn the corner and become a scaled, profitable streaming service. Peacock is betting big on expensive sports to deliver, with the Olympics kicking off tonight, and a new multi-billion dollar NBA deal to be announced soon, validating our call for Peacock to "Go Big or Go Home" back in November, 2021.

Peacock was a very late entry to the streaming game, and according to MoffettNathanson, has lost at least $8 billion over the past 14 quarters. Colin and I explain why we aren’t convinced sports can carry the weight of Peacock’s turnaround, and agree that only time will tell. 

We then switch gears to discuss Netflix’s Q2 earnings and the company’s lagging ad-tier performance, which surprises both of us a bit. Veteran podcast listeners will recall that back in October, 2022 Colin and I expressed our optimism about the pending impact of paid sharing and the ad-tier. The former has been a monster success for Netflix, based at least partly on the expert execution of its rollout. The ad tier remains a work in progress but we remain confident Netflix will figure it out. 

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Memorial Day weekend was a disaster for Hollywood, with approximately $128 million in box office, down 36% from 2023’s total, and the worst in decades. There are some specific reasons, such as the steep underperformance of “Furiosa: A Mad Max Saga.” But as we discuss, any poor box office performance these days must always be viewed in the context of streaming’s myriad choices for viewers. Compounding matters for the box office are streaming’s inexpensive new bundles; on last week’s podcast we noted that Xfinity subscribers in particular can now access 6 top streaming services for just $30 per month.  

Next we return to bundling topic, in light of new research from Antenna showing subscriber loyalty to top streaming services. No surprise, Netflix has the highest loyalty, which in turn begs the question: how does Netflix benefit from participating in discounted bundles? We offer our thoughts.

Also on our radar this week is FreeWheel’s latest research from its Viewer Experience Lab, focusing on factors that diminish the viewer’s ad-supported experience. The testing found that viewers were most bothered by slow or buffering ads (78%), ads that unnaturally interrupt the programming (71%) and “we’ll be right back” slates (33%). The research is important because as CTV advertising becomes an ever more critical revenue stream, delivering top-notch ad experiences will be essential for optimizing monetization.

Last up, we review new research from Horowitz Research which found that of sports viewers, 58% of 18-34 year-olds and 57% of 35-49 year-olds say they’re likely or very likely to subscribe to the new Venu Sports streaming service for $35-$40 per month. While the research validates basic interest in Venu, it still feels early to accurately estimate true demand for Venu. A big looming question for Venu’s value proposition is whether TNT is able to renew its NBA package.

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As has been promised for a while, Hulu has been integrated into Disney+ in a bid to present more content seamlessly to viewers. No doubt the move was a significant undertaking, yet Colin’s early review shows a few key UX features lagging, notably his viewing history. We expect that in time these will be updated.

Elsewhere at Disney, ESPN has taken initial steps toward being a sports hub by incorporating links in its app and web site to regional sports networks’ streams. NESN, Monumental Sports Network and SportsNet Pittsburgh are already available. ESPN could play a vital role in addressing the problem of sports streaming fragmentation.

Finally, Colin and I both noticed the NFL’s chief media/business officer Brian Rolapp’s skepticism about how the sports JV (or “Spulu”) will be priced. Rolapp observes that if it’s priced in the $40-$50 per month range, then subscribing to YouTube TV (for example) would only be another $20 or so per month - and would include more NFL games, plus scripted and unscripted programming. This is exactly the point Colin and I have been making - the JV’s pricing window seems awfully narrow.

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First up on this week’s podcast we discuss Fubo CEO David Gandler’s statement that the company is in a “duel to the death” with Spulu, the new sports JV from Disney, WBD and Fox. He makes a good point that if the 3 companies allow the JV access to their sports networks without requiring the JV to also pay for non-sports networks as companies do with typical pay-TV deals, this would put the JV at a cost advantage compared to pay-TV operators like Fubo.

Next, Variety reported Apple spent $700 million on just 3 movies last year, a bet that Colin and I both believe is far too concentrated for a streaming service that is struggling with high churn and badly needs catalog depth. Finally, both Max and Disney+ are trying to emulate Netflix in cracking down on password sharing and on improving churn. Can they catch up with the clear market leader?

Finally, all the session videos from last week’s VideoNuze CTV Advertising PREVIEW: 2024 virtual are available.

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Earlier this week the WSJ reported that Walmart is seeking to acquire VIZIO for over $2 billion. Colin and I discuss the likely strategic rationale behind the deal. We both like the benefits to both companies with grabbing a bigger share of CTV ad spending a big upside.

Meanwhile, the Super Bowl scored a record 123.4 viewers across all platforms according to Paramount. The company also said it was the most-streamed Super Bowl in history, but didn’t disclose how many streamers there actually were. We dig into the numbers and Colin provides his estimates.

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This week we look through all the buzz around the new Disney/Fox/WBD sports JV to understand the service’s opportunity and likely impact on the TV market.

Two key questions we consider: 1) How big is the target market of sports super-fans for the JV who haven’t maintained their pay-TV subscription (since sports has been a firewall to cord-cutting)? And 2) With ESPN’s own direct-to-consumer service launching in 2025, how will it differentiate itself given ESPN will also be included in the JV’s offering?

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NBCUniversal said that last weekend’s Chiefs-Dolphins wildcard playoff game was a big success, attracting an average audience of approximately 23 million viewers on Peacock. In this episode of Inside the Stream, Colin and I dig into key metrics of how to assess the game’s financial success to Peacock, specifically, how many incremental subscribers did the game add, and how likely are they to stay around and for how long?

Peacock reportedly paid $100 million for rights to stream the game and so getting a strong financial return is essential.   

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This week on Inside the Stream Colin and I cover a number of different topics that have been in the news. First up, NASCAR has signed new rights deals with TV and streaming partners for nearly $8 billion, a huge increase from its current deals.

Next we discuss new research indicating that non-pay-TV viewers will outpace traditional pay-TV viewers by the end of the year. Then, TikTok is encouraging creators to make longer videos, in a move to compete with YouTube. Last, Hub reports that built-in apps on Smart TVs get greater usage.

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Back in our Oct. 21, 2022 podcast, “Netflix is Poised for 2023 Revenue Growth,” Colin and I articulated all the reasons we were optimistic about Netflix’s upside in the new year. Primarily we were focused on its newly launched $7/month “Basic with ads” tier and its plans to eliminate password sharing throughout the world.

Flash forward 7 months, and Netflix provided its first tangible results and commentary from the initiatives, as well as optimistic signs of where things go from here. In today’s podcast, Colin and I dig into these signs, including most prominently Netflix’s disclosure that $7/month "Basic with ads" subscribers already produce a higher average monthly revenue than do its $15.50/month "Standard" plan (ad-free) subscribers. Some basic math reveals that "Basic with ads" subscribers drive at least $8.50/month in ad revenue for Netflix, which in turn means that aproximately 55% ($8.50 / $15.50) of "Basic with ads" subscribers’ total revenue is already derived from ads, not subscriber payments.

That Netflix accomplished all of this despite 1) it still being very early days for the ad offering, 2) a massive headwind in the ad business due to recession/etc. worries, 3) all of its ad revenue being “linear TV replacement” or upper-funnel reach and frequency inventory, with nothing yet from more valuable full/lower funnel offerings, suggests the ad business is already a big win for Netflix and has huge potential.

(At this point I can’t resist noting that I have been badgering Netflix for years to launch a lower-priced ad-supported tier because of the upside…see “Why Netflix Will Launch an Ad-Supported Tier in 2020” from Dec. ’19, “6 Reasons Why Netflix Should Launch an Ad-Supported Tier Now” from Mar. ’20, and “Revisiting Why Netflix Should Launch an Ad-Supported Tier” from Mar. ’21 for a sample of my haranguing. So, in the category of “better late than never,” hallelujah, Netflix finally, finally put aside its religious objections to advertising and saw the light.)

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This week on Inside the Stream Colin and I do an “around the horn” of four significant industry topics. We lead off with the expected bankruptcy filing of Diamond Sports Group earlier this week, the largest owner of regional sports networks (RSNs), resulting in a complete wipeout of the equity-holders. Where to from here is anyone’s best guess; but I reiterate my stance that sports teams’ franchise values and players’ salaries have already peaked. When the dominant player in an industry - with over 50% market share - goes belly up, nothing good happens next.

Next up is an update on WBD’s planned pricing strategy for its combined HBO Max and discovery+ streaming service launching soon. Colin’s been all over this one for months and is really scratching his head, as am I.

In time for March Madness, YouTube TV has launched a new feature called “multiview” allowing subscribers to stream a mosaic of four pre-selected games and choose which audio feed they prefer. I think it’s really cool, and as you’ll hear in real-time I realize that it might mean YouTube TV “automagically” just quadrupled its ad inventory for multiview users. If so, that’s a neat trick; new CEO Neal Mohan is off to an even stronger start than I expected!

Finally, Colin gives a short wrap-up of the latest doings in the burgeoning FAST market. It’s getting harder and harder to keep up.

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Pay-TV providers lost another 7 million subscribers (approximately) in 2022 as losses accelerated from 2021. The losses span those actually cutting the cord, plus those that simply don’t take on a pay-TV subscription in the first place.

On this week’s podcast Colin and I discuss pay-TV’s melting iceberg, and among its consequences, what’s it mean for sports teams’ valuations and players’ salaries. Since cord-cutting came along, there’s always been a notion of sports providing a “firewall” bottom on pay-TV subscribers. But with so many sports rights now leaking into the streaming domain - having been snapped up by Big Tech - the paradigm-busting question looms larger.

Another, related consequence of pay-TV’s implosion is the demise of regional sports networks (RSNs). They’re also experiencing financial turmoil due to bad deal-making, disconnects with audiences and sub-par demand. Even mighty ESPN has been the subject of M&A rumormongering as newly restored CEO Bob Iger has to pick his priorities.

All of this is to say that the economics of the sports business are changing in front of our eyes. If sports networks’ financial viability is impaired, rendering them unable to competitively bid for rights, then the question becomes, will Big Tech step in as a backstop, building on their current commitment? As I assert in the podcast, I think their commitment to becoming a viable backstop will only become known as the ultimate CTV ad monetization opportunity crystallizes. Specifically, if CTV can legitimately become full/lower funnel - bringing in buckets of cash with it - then backstop viability is far more likely. Absent that it’s jump ball. We’ll see.

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