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Warner Bros. Discovery Could Introduce Sports Tier to Max

“I think generally, our view is sports is such a premium offering with a very focused and passionate fan base.”

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WBD Max
Courtesy: Kevin Mazur, Getty Images Entertainment, Getty Images

As Warner Bros. Discovery moves out of the regional sports network business by the end of the year, the company is reallocating its resources to more effectively compete for ratings and revenue in sports media. On a recent investor call, the company’s chief executive officer, David Zaslav, conveyed that all of the networks would be sold or shuttered in the coming months. The regional sports networks, had they been unable to return teams their broadcast rights, would have entered bankruptcy under Chapter 7 liquidation.

With numerous sources of data reporting a rise in streaming over cable and broadcast television consumption, the company is aiming to expand its offerings available on Max. The streaming platform, which was heavily advertised and promoted at the entity’s Upfront event in May, could soon be the streaming home of several professional sporting events. Currently, Major League Baseball, National Basketball Association and National Hockey League contests are televised on its linear networks – most notably TNT and TBS – without a viable digital offering. Moreover, the enterprise has the rights to NCAA March Madness and inked an eight-year deal to broadcast U.S. soccer games and stream some of them exclusively on Max (then-HBO Max).

Executives are considering adding a sports tier to the novel service, which could potentially engender a rebound after its parent company lost 1.8 million streaming subscribers last quarter. Total streaming subscribers, when combined with other outlets such as discovery+ and HBO, total 95.8 million people. Max launched on May 23 and has yet to amass complete data over multiple quarters.

We are… a global leader in sports, including great sports rights from many of the top leagues in the U.S. that, in many cases, run through 2028 and beyond,” Zaslav said, who hopes to secure NBA rights for the long term. “We have the best digital and social sports platform for younger fans in Bleacher Report and we have significant digital rights in the U.S. that we’re not currently deploying but plan to in the future, and that has a real chance to create meaningful strategic value.”

Working in its favor is the fact that Warner Bros. Discovery has digital rights to all of its sports content, evidenced through innovative and multifaceted purposing of content within its various subsidiaries. Launching this capability could also be enticing to the NBA as its national media rights agreement expires at the conclusion of the 2024-25 campaign. Association Commissioner Adam Silver has been candid about his desire to expand the burgeoning partnership to include over-the-top (OTT) services while also maintaining a linear television presence.

“We’re going to use our sports domestically and globally to create more shareholder value,” Zaslav said, “and help the leagues who all are very interested in reaching more people [and] more demographics.”

According to its latest balance sheet, direct-to-consumer services over the last quarter operated at a loss, consistent with the decline in total subscribers. Conversely, the adjusted EBITDA is $2.17 billion (-7% year-over-year) after generating $5.76 billion in revenue despite a small decrease in distribution revenue due to price adjustments in affiliate rates. Total advertising revenue for the quarter was down 13% – excluding FX – a figure that the company affirms was partially offset due to TNT’s presentation of the Stanley Cup Final.

“I’m very encouraged with the results that effectively breakeven EBITDA and quite a bit better than we expected, notwithstanding the significant investments in the development and marketing of our new Max platform in the U.S.,” Warner Bros. Discovery Chief Financial Officer Gunnar Weidenfels said. “Quarter 2 nicely demonstrates the underlying traction and efficiency from the integration of legacy direct-to-consumer operations and organization.

The sports tier would likely be priced higher than other content, aligning with an approach the company has taken internationally for some of its content. Through this, it hopes to further broaden the scope of offerings available to different sectors of the consumption marketplace.

“I think generally, our view is sports is such a premium offering with a very focused and passionate fan base,” Warner Bros. Discovery Global Chief of Streaming JB Perrette said. “But generally, the model will require some way to find [and] need to find incremental value to get out of it. And so exactly how that comes to market, we will have more to say later in the year, but generally, our view is that it needs to be monetized incrementally.”

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‘Foul Territory’ to Air Live on Bally Sports RSNs as Part of New Partnership

“We are thrilled to partner with Bally Sports to bring Foul Territory to an even wider audience.”

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Courtesy: Make Plays Media

The Foul Territory program has agreed to a new linear and streaming partnership with the Bally Sports regional networks (RSNs) that will launch on Monday, June 24. Make Plays Media, which is the parent company of Foul Territory and several other shows within the network of shows, will air its digital program from 1 to 3 p.m. EST on the Bally Sports RSNs and the company app. The program will also work with Bally Sports to present exclusive guests, unique content and more, which will accompany the live game broadcasts across the Bally Sports portfolio of networks.

“We are thrilled to partner with Bally Sports to bring Foul Territory to an even wider audience,” Marc Weiner, chief executive officer of Make Plays Media, said in a statement. “Bally Sports has the largest daily baseball audience in the country and we can’t wait to work with our new partners to bring FT’s real baseball talk to their passionate fan base live every day.”

The Foul Territory program launched last March and features a roster of former players that provide their insights and opinions to the show, including A.J. Pierzynski, Todd Frazier and Erik Kratz. Scott Braun hosts the show, which frequently features guest appearances by MLB players, managers and general managers. While Foul Territory will now be live every day on the Bally Sports RSNs, the show will still be available across social and audio platforms.

Over the last several months, the Foul Territory Network of programs has expanded with new offerings dedicated to the Los Angeles Dodgers (Dodgers Territory), Atlanta Braves (Hammer Territory) and Chicago Cubs (North Side Territory). Ken Rosenthal, baseball reporter and insider, also hosts his own program, Fair Territory, that covers news and issues around the sport each week. Rosenthal also contributes to the Foul Territory program as well in addition to working with FOX Sports and The Athletic.

The Bally Sports regional networks, which are owned by Diamond Sports Group, has the linear broadcasting rights to 12 Major League Baseball teams. Diamond Sports Group has been in Ch. 11 bankruptcy proceedings for over a year and is approaching a confirmation hearing in late-July. The company was unable to reach a renewed distribution agreement with Comcast Corporation, resulting in the channels not being on the service for more than a month.

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Stanley Cup Final Game 6 Draws 4.2 Million U.S. Viewers

The game peaked at 4.9 million viewers as the Oilers evened the series at three games apiece after being down three games to none in the series.

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Logo for the 2024 Stanley Cup Playoffs

Friday night’s Game 6 of the Stanley Cup Final series between the Edmonton Oilers and the Florida Panthers delivered the highest number of viewers of the series with 4.2 million people tuning in in the United States according to Nielsen fast-nationals. The number was reported by Sports Media Watch’s Jon Lewis who said the game drew 28% less viewers than the last Game 6 two years ago between the Colorado Avalanche and the Tampa Bay Lightning.

The game peaked at 4.9 million viewers as the Oilers evened the series at three games apiece after being down three games to none in the series. While a high for the series, Lewis reports there have been 20 Game 6’s in the past 30 years and this game had the fifth-lowest audience.

Lewis also said three of the bottom five games on the list involved a Canadian team. The Carolina Hurricanes-Edmonton Oilers series in 2006 and the New York Rangers-Vancouver Canucks series in 1994 were the other two in addition to Friday night’s game.

Game 7 of the series will be played tonight at 8 p.m. ET on ABC and ESPN+. The Oilers will be looking for their sixth Stanley Cup win and first since 1990. The Florida Panthers will be looking to hoist the Stanley Cup trophy for the first time in franchise history.

Sean McDonough is calling the games on ABC along with Ray Ferraro and Emily Kaplan. Steve Levy, Mark Messier and PK Subban provide analysis before the game and in between periods.

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Miami Marlins Offer Two Months of Bally Sports+ as Diamond Sports Group Ch. 11 Bankruptcy Continues

“It’s not summer without Marlins baseball, and we want to ensure that Marlins fans have access to watch our games whether at loanDepot park, at home or on-the-go.”

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Bally Sports Logo
(Illustration) | Courtesy: Diamond Sports Group

As Diamond Sports Group moves closer to a confirmation hearing in late-July amid its Ch. 11 bankruptcy, the Bally Sports RSN operator will need to provide its league partners with documentation of its carriage agreements with certain distributors, albeit with restrictions to safeguard against divulging sensitive information. Attorneys for Major League Baseball, the National Basketball Association and National Hockey League will be given access to Diamond Sports Group contracts with Cox, Charter and DirecTV with strict levels of confidentiality following a ruling by Judge Christopher Lopez within U.S. Bankruptcy Court for the Southern District of Texas. The most-favored nation clauses within these deals will be released in an anonymized manner to be reviewed by non-staff counsel of the leagues.

Diamond Sports Group and Comcast Corporation were unable to come to terms on a new carriage agreement before the expiration of the deal at the end of April, limiting the consumer footprint in certain marketplaces. Comcast had moved several of its regional sports network partners to its “Ultimate TV” tier in the past, which requires consumers to pay a premium to receive those channels. As the bankruptcy proceedings continue, the Miami Marlins have introduced an offer to pay for consumers to receive two months of games through Bally Sports+, the company’s direct-to-consumer streaming service.

“It’s not summer without Marlins baseball, and we want to ensure that Marlins fans have access to watch our games whether at loanDepot park, at home or on-the-go. With thanks to our ownership, we are proud to offer two months of Bally Sports+ for our fans to catch every pitch of Marlins Baseball,” Caroline O’Connor, Marlins President of Business Operations, said in a statement. “With this incredible offer, fans can catch our games and follow along throughout the summer months – on us.”

Bally Sports+ provides fans a means to watch the games without a television provider and currently has direct-to-consumer broadcast rights for five of the 12 MLB teams it carries on linear television. Major League Baseball Commissioner Robert D. Manfred Jr. testified in bankruptcy court last year that Diamond Sports Group threatened bankruptcy and the subsequent selective rejecting of contracts if the league did not grant it direct-to-consumer broadcast rights to strengthen the Bally Sports+ offering. Manfred declined this proposal and established a local media department, which began producing and disseminating games for the San Diego Padres and Arizona Diamondbacks following the teams being dropped by Diamond Sports Group.

Diamond Sports Group agreed to a streaming deal with Amazon that would make Prime Video the means for consumers to purchase direct-to-consumer access to stream local regional sports networks and live game broadcasts. Earlier this year, Diamond was approved to receive $450 million in debtor-in-possession financing, and Amazon agreed to pay $115 million in convertible notes, some of which are expected to be used to pay back the DIP financing it receives. Junior creditors would then assume operations of the subsidiary if it is able to emerge and successfully execute its restructuring support agreement (RSA).

Diamond also reached an amended management services agreement with Sinclair, its parent company, that was approved by Judge Lopez. The pact dropped litigation that Diamond had brought against Sinclair and provided the plaintiff a cash payment of $495 million, along with ongoing management and transitional services in support of its reorganization and partition from parent company operations.

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