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Could ESPN use OTT option to leverage cable providers?
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Could ESPN use OTT option to leverage cable providers?
Interesting article from Awful Announcing...

Could ESPN use planned OTT service as leverage?

I read a while back that ESPN was creating its own OTT service although I don't think I posted about it because what I read said that the offering would only have ESPN3 content that wasn't available on any of their networks. Well, I figured, if it's not already on one of the networks then there probably aren't very many people interested. So I thought maybe this was an experiment for dealing with the future market changes. It's possibly a brilliant stroke for ESPN to create their own OTT service and I think one day that's how they'll deliver all their content, but that was yet to be determined.

Anyway...

Quote:MoffetNathanson says the upcoming ACC Network could have an impact on revenue growth just like the SEC Network did when it launched back in 2014. And there’s the planned ESPN over the top direct-to-consumer service that the Worldwide Leader is developing with BAMTech in which parent company Disney purchased a stake last year.

Some people have theorized or at least suggested that Disney should sell off ESPN. I've never thought that made a lot of sense and the notion was based in the fallacious idea that "ESPN was going bankrupt." Of course, they aren't going bankrupt. They make a crap ton of money for Disney and the cuts that ESPN made were purely to pad the profit margin because the industry changes had created a scenario where ESPN wasn't making quite as much money as before.

Anyway, if Disney is purchasing a stake in the company partnering with ESPN to create the OTT service then it reasons that not only is Disney not selling off ESPN, but that they are doubling down.

I think one day the ESPN OTT service will be a big deal for anyone interested in watching sports and Disney's investment would indicate they believe the same thing. Just as an aside, I've always thought Disney should create their own OTT service with all the content under their roof. Think about this...the ESPN family, original productions from ABC that would appeal to a wide audience, all the children's content you could want from the Disney Channel and all the old movies they've made through the years, and top it all off with their more recent acquisitions of Lucasfilm and Marvel and you've got the nerd/blockbuster film market cornered as well.

The great thing about cable bundles is you've got a variety of content for one flat price. The typical family can indulge in anything they might find interesting and use only one service to do it. It's become quite expensive, however, because every media company worth their salt is selling their product via the same means. IF each media company had their own OTT service though then you can have the best of both worlds...a bundling of various types of content for the varying interests of the typical family, a lower price because the content creators aren't all using the same platform, and you can still get everything on demand. I'd pay good money for that, come out cheaper than a typical cable bill, and still get virtually everything I was interested in watching.

Anyway, I'm getting off topic. The article is mostly about the ACC Network and how ESPN might use the OTT service as leverage to get what they want out of cable companies despite the changing climate. ESPN wins either way basically.

It will also be interesting to see how the ACCN performs and if the SECN might actually get a rate bump out of this deal.
07-12-2017 02:21 PM
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