Netflix bows out of WBD deal
In the ongoing battle with Paramount to acquire WBD, Netflix suddenly surrendered its bid for the streaming behemoth. Paramount’s most recent proposal rose to $31/share, but they also added additional incentives including a $7 billion regulatory termination fee, and a nearly $3 billion termination fee that WBD would be required to pay to Netflix to terminate the existing agreement. Netflix said it was a “nice to have” deal at the right price, not a “must have” at any price. Now, they receive a $2.8 billion termination fee from Paramount.
The Circana Take:
- While this deal is one step closer, it still needs global regulatory approvals which are said to be difficult. However, this is more likely to extend the timeline and/or alter the business structure, not stop the merger.
- This deal represents considerable industry consolidation and places additional competitive pressure on smaller streaming video providers. Indeed, Paramount+ and HBO Max will also merge.
Gotham Sports price drop on streaming packages
Gotham Sports (the collaboration between MSG Networks and the YES Network), is reducing prices for its DTC streaming packages. The cost for access to both RSN’s is now $300/year (down from $360) or $35/month (down from $42). MSG Networks include the NY Knicks, NY Rangers, NY Islanders, NJ Devils, Buffalo Sabres, and the Brooklyn Nets. Additionally, the Gotham Sports App is debuting a NY Yankees “Season Pass” giving Yankees fans access to all YES Network programming, including Spring Training games, Regular Season games, pregame and postgame shows and Yankees Batting Practice Today. The Gotham Sports app will be available for authenticated TV subscribers at no extra cost.
The Circana Take:
- Price reductions like these make it more affordable for fans to stream their favorite New York teams and will likely attract new customers. In the era of rising streaming costs, this provides much needed cost relief.
- This also suggests significant competitive pressure for the sports fan dollar as ESPN Unlimited and FOX One are now in the market along with numerous skinny sports bundles like that from YouTube TV.
Apple TV live sports expand reach
Apple TV is expanding reach for its live sports offering which includes MLS, MLB, and Formula 1 racing.
First, Apple is partnering with EverPass Media which combines and delivers streaming live sports programming in commercial venues including restaurants, bars, and hotels. That deal brings Apple TV’s live sports to EverPass’ Core package for business customers at no extra cost. The core package currently includes other sports content such as Prime Video’s Thursday Night Football, Peacock Sports Pass, ESPN+, and NFL Sunday Ticket, making it a viable sports medium for business owners. Second, DirecTV announced that it will absorb Apple TV live sports content directly into DirecTV and its UI.
The Circana Take:
- Apple benefits by expanding out-of-home distribution, while EverPass beefs up their live sports offering and DirecTV enhances the user experience.
- Timing seems right with the start of the F1 season this month, and the MLS season underway this past weekend.