ESPN FOX And WBD Launching New Sports Service

Three of the biggest media companies in the world have announced a plan to launch a sports streaming service that will combine the assets of ESPN, FOX Sports and Warner Brothers Discovery. The yet un-named app is expected to launch in the fall of 2024 and will be owned equally 1/3 each by each company. When it launches an independent management team would run the show. There has also been no pricing announced for the service.

If this idea sounds familiar, it should. It’s essentially the same idea as Hulu when it originally launched with the backing of Disney, Newscorp and NBC Universal. Hulu eventually ended up being owned 100% by Disney after a merger that acquired most of FOX’s assets and an agreement to buy Comcast out of its third of the service. Now here we go again with the most important part of the TV landscape. Live sports.

The plan for the service is that the new app would offer all of the major cable sports channels in one app while also offering channels that carry specific sports action such as TNT with its NBA telecasts. This is a very interesting and potentially complicated development that puts the service at odds with an industry that has either bundled sports channels with the rest of the TV offerings or even gone the opposite direction entirely with services like Philo, which famously offers a TV service with no sports or 24-hour news channels in order to bring general entertainment services to consumers as a far lower cost than other large bundle cable replacements. According to a press release subscribers would also have the ability to bundle the product, including with Disney+, Hulu and/or Max.

The sports assets that are planned to be included in the new service include;  ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, ABC, FOX, FS1, FS2, BTN, TNT, TBS, truTV, as well as ESPN+. Notice the listing includes ABC and FOX. A major question should be does that mean that the service is going to offer full access to those networks or does it mean that there will be a way to see the sports content that is otherwise available through those networks? There is already an example of how that would work as seen on Paramount+ and Peacock which both offer live sports action available through CBS and NBC respectively but no access to the respective networks otherwise, with an option for subscribers to go all in on a $9.99 service that does allow access to the linear local affiliates. The access also includes TruTV, which is a cable channel owned by Warner Brothers Discovery that only comes into play for sports fans during the NCAA tournament because a number of early-round games are broadcasted on TruTV. Otherwise, TruTV has no sports content. Disney CEO Bob Iger voiced excitement at the new venture.

“The launch of this new streaming sports service is a significant moment for Disney and ESPN, a major win for sports fans, and an important step forward for the media business. This means the full suite of ESPN channels will be available to consumers alongside the sports programming of other industry leaders as part of a differentiated sports-centric service. I’m grateful to Jimmy Pitaro and the team at ESPN, who are at the forefront of innovating on behalf of consumers to create new offerings with more choice and greater value.”

More questions that need to be answered

• Is this what Bob Iger had in mind when he discussed ESPN becoming a direct-to-consumer product or is something separate coming down the line?
• Will there be more than one tier to the service?
• Will services like Disney+ or Max cost less when purchased through the new app than they do on their own?
• Will the other services be offered ad-free and with commercials?
• If ABC and FOX are not offered as full channels in the basic service will there be an option to get the linear channels in the same way Peacock and Paramount+ subscribers can?
• Will the respective parties still promote competing services like Hulu with Live TV and Max?
• How will the service keep costs competitive VS cable replacement services like YouTube TV, Sling TV and Disney’s own Hulu With Live TV?

The Great Rebundling? Comcast and Paramount are not involved

As mentioned earlier, Peacock and Paramount+ both offer access to live sports that include NCAA basketball, College Football, The NFL, Golf, Racing and many others. Neither company is involved with this new joint venture meaning if a cord cutter without access to live TV with an antenna wants to pull in the full breadth of content they will still need at least two more services not including Amazon Prime, which holds the rights to a Thursday Night Football game.  See the chart below to get a feel of the kind of sports access subscribers will have access to.