-Will Arrive in 2017
-May Offer PPV, Weekend Passes and other Monetization Models
Here are two acronyms you’d never think would go together: ESPN and OTT. But that’s the times we live in. Disney chief Bob Iger this week said the company is piecing together an ESPN direct-to-consumer OTT offering that’ll offer a range of sports matches and digital season passes to subscribers to stream to their connected devices.
Speaking at the Goldman Sachs conference last week, Iger confirmed the streaming video service will launch next year. Iger said the service will leverage the array of digital sports held by ESPN, in order to offer the network new Web-delivered revenue streams around niche programming that doesn’t make it to the linear TV networks. Iger hinted the company will be experimenting with monetization models, from subscription services to pay per view events.
“One of the things that we have been talking about is that it shouldn’t be one-size-fits-all,” he said. “We think where the market could be going in terms of some of these sports is being able to buy it very, very selectively, a specific sport, maybe even for a specific season or a specific date or a specific weekend.”
ESPN’s pay TV network has suffered ratings dips and subscriber losses over recent years, as more sports content has become widely available on non-pay TV platforms. According to Nielsen data, ESPN lost between 1 and 3 million subs in 2015. Despite ESPN’s contracting business, Iger stressed that any future OTT products will be complementary to ESPN’s pay TV business. “We’re looking at this as a complementary service of what we already have. We’re not doing this because we think the current business model is in any way crumbling,” he said. “We’re doing this because we think we have more opportunity to reach more sports fans. And we’re also doing it because we can’t predict where the business goes over time or when it goes someplace over time. But we certainly feel we need to be fully prepared for dramatic shifts should they occur. This is one step in that direction.”
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