BAM is for Billions

By Brad Hubbard | @bradhubbard


BAMIt wasn’t a secret that Disney was looking to take a stake in MLBAM (BAM) but the end number may surprise some folks. According to Bloomberg Disney is buying 33% of BAM for $3.5 billion with an option to buy more in a few years. That is a valuation of over $10 billion. Not bad for an entity that doesn’t even turn a profit yet.

A few years ago Fast Company did a profile on BAM and within that article there was an estimated IPO price for BAM in 2005. That number was $2.5 billion so the company has essentially increased around $8 billion over the last 11 years. If you did some loose math based on that article you could see that BAM was more or less breaking even.

That’s not to say that MLBAM isn’t worth a $10 billion valuation. They are a white label solution as their CEO Bob Bowman would say. They are the streaming backend for MLB, WWE, NHL, Watch ESPN and have even done the Super Bowl. They made bets that paid off and with this purchase by Disney, it puts them in a position to stay in the lead when it comes to live video streaming.

Disney for it’s part made another shrewd investment. It’s no secret that their cash cow, ESPN, is having to adjust to the new realities of cord cutting. Enter an investment by it’s parent company and Disney has created an A to Z revenue stream when it comes to over the top video. It’s like selling the car and the gas that goes in it.

This is a very smart purchase by Disney. They have the cash to do it and it’s very well timed. It’s no wonder that the Disney board wants Bob Iger to stick around a bit longer. It will be interesting to see if BAM competitors like NeuLion look to cut deals or merge with CDN or network. In the meantime the only one doing better in this space is probably Amazon.com.

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DirecTV, Not For Sports Fans Anymore

By Brad Hubbard | @bradhubbard

DirecTV use to claim in it’s advertising that ‘if you’re a sports fan, you gotta get DirecTV’. That may have been the case two years ago but it isn’t now. DirecTV in fact may be the worse place for sports fans.

For a lot of people, it doesn’t get better than DirecTV if you’re a sports fan. They have NFL Sunday Ticket and that alone is worth it. NFL Sunday Ticket mind you is $330 for the ‘Max’ package.  For some, this is worth every penny. For others, that’s a pretty good chunk of change.

Watch ESPN

While DirecTV has NFL Sunday Ticket it doesn’t carry the Pac-12 Network nor does a DirecTV subscription give you access to ESPN3, FoxSportsGo or the Pac-12 Network online. In other words, if you are not sitting in front of the TV connected to your DirecTV receiver you are S.O.L. when it comes to viewing sports.

But wait, they have an app right?

Yes they do and you cannot stream any sports channels outside of your house. In fact you cannot stream any ESPN channel at all. Basically, if you’re a sports fan, the app is a glorified remote control and a pretty dumb one at that. God forbid you go into the next room and try to watch a Mountain West game on your tablet!

DirecTV app

What this comes down to, as usual, is money. DirecTV makes enough to not have to worry about digital stuff or something as ‘niche’ as the Pac-12 Network. They also make enough to not have to worry about giving their customers what they really want, the ability to truly watch what you want wherever you want. Probably all the more reason that they do not run the campaign anymore claiming’ if you’re a sports fan, you gotta get DirecTV.

 

There’s a Subscription For That

By Brad Hubbard | @bradhubbard

Every game of the NBA Finals will be televised on ABC which is available without a cable or satellite subscription. Five of the seven games of the Stanley Cup Final will be broadcast on NBC which is also available without a cable or satellite subscription. Does it matter anymore if a game is televised on broadcast or cable/satellite? Yes and not for the reasons you think.

The Finals

Even with the NBA Finals and the Stanley Cup Final available on over-the-air television channels, you still need either an internet provider subscription or a cable/satellite subscription in order to watch online. Yes. Even though the games are available over-the-air for FREE, you have to pay somebody to watch on your laptop or tablet.

This is not new. NBC does this during the Olympics and while the number of people who don’t pay for either a cable/satellite or internet subscription is small it is still a point of concern.

Why should you have to have a subscription if the game is on FREE TV? That’s almost like saying, ‘well you have to have a monitor in order to watch the game so you have to type in the serial number on the TV before you can watch.’

Just because you have a cable/satellite and/or an internet subscription doesn’t even guarantee you the ability to watch a game online. It all depends on the provider and the network. So if DirecTV doesn’t have an online agreement with ESPN then good luck watching something on the much promoted Watch ESPN app.

If you go back a decade ago when streaming live sports was just getting up and running, you could watch just about anything without so much as a log-in. ESPN Gameplan was free if you were watching online but almost $100 to watch on television.

Last season though, it got to the point that if a college football game is being shown on any of ESPN networks you cannot watch it online at all.

What about the fans? What about the promise of watching anything you want, anywhere you want on any device? You almost can. Just make sure you have a cable or satellite subscription.

 

 

 

Relying on the Dedicated Fan

By Brad Hubbard | @bradhubbard

MLS recently announced a new TV deal with ESPN, Fox and Univision. Besides the money (MLS is looking at $90 million a year give or take) the two major points of the deal are 1) the Sunday night block of games on ESPN & Fox and 2) the digital rights.

MLS TV Press Conference

MLS is now going to get a Sunday night block of games. One on ESPN at 5pm EST and then one on Fox Sports 1 at 7pm EST. This will finally provide some regularity to MLS’s schedule.

Now for the bad news.

MLS and the networks believe that this will increase viewership for MLS. But it is asking a lot of the viewer. It may not seem like a lot to ask a viewer to change the channel from one channel to another but why should the viewer do all the work?

This is not ground-breaking or abnormal. Viewers have been conditioned over the years to flip around for the games or shows they want to see. But it’s getting beyond the pale. The NFL makes viewers jump between five channels, the NBA four, and the NHL between three during the regular season and four during the playoffs. Let’s not forget the NCAA Tournament that has games on four channels or the UFC which makes users jump from an online channel to a cable channel to a pay-per-view channel in a matter of hours.

You get the feeling that you’ll watch the first half of a game on one channel and then have to click over to another to watch the second half.

The digital rights are going to go to ESPN. This apparently is still in the works because it’s still pretty vague in the media reports.

Right now MLS has THE best digital deal. You can get MLS Live for around $60 a season and watch any out of market/non national TV game on any device from your Apple TV to your phone.

Now ESPN is getting that.

That means that DirecTV customers, who cannot get certain content on ESPN3 or the Watch ESPN app, are in big trouble. That’s 20 million subscribers MLS is leaving in the dark. Add that to the brilliant TV deal the Columbus Crew cut this off season and less fans will be able to watch games.

While the TV deal is a windfall for MLS a good portion of fans have good reason to be sceptical. ESPN and FOX do not bat 1000 however they will hopefully kick the ball off at the scheduled time unlike NBC Sports.