ESPN+, DAZN take the lead in OTT streaming and acquiring exclusive rights

Sports TV has reinvented itself many times over since Columbia hosted Princeton in baseball in 1939 in the first live sports event on American television. But it is not quite right to call the latest development television at all.

The industry term is “over the top,” meaning content that is delivered directly via the internet and not through traditional cable, satellite or phone company video packages.

The concept of subscription-based streaming services that acquire exclusive rights to live events and then deliver them still is relatively new, but some key early players have emerged.

One is part of a company you might have heard of. It’s ESPN+, which since launching last April has been adding content aggressively.

Another is DAZN – pronounced “da-zone” – a London-based outfit that has made moves into boxing and mixed martial arts, and recently added a nightly baseball show with “cut-ins” to major league games.

NBC Sports Gold offers sports-specific packages, notably to English Premier League soccer games and golf.

These are different from other live streaming options such as MLB.TV that are subscription-based but exist in television form also.

ESPN+ and DAZN generally offer live programming not available elsewhere, although in ESPN+’s case, it also has access to vast amounts of other material – not to mention reliable cross-promotion – from the mothership.

Hence Russell Wolff, general manager for ESPN+, said the service “is not designed as a cord-cutting product” but rather is “being fully integrated” into the larger ESPN world.

Perhaps so, but if they choose to, ESPN+’s 2 million subscribers can live outside the cable TV bundle, a key part of the industry that ESPN pioneered 40 years ago and that is under threat from “cord cutters” opting out.

Unlike ESPN+, DAZN has no traditional television product attached to it.

“The best answer that I find to anyone who asks [about DAZN] is that it is the Netflix of sports,” said Adnan Virk, the former ESPN announcer who hosts DAZN’s baseball show, “ChangeUp.” “You pay a flat fee, either per month or per year, and you get all that they have.”’

DAZN, which launched in the United States last year, has as one of its top executives John Skipper, the former president of ESPN.

Its most aggressive move has been into boxing, where it is upending the sport’s pay-per-view model. It paid Canelo Alvarez $365 million for 11 fights over five years, with more big money to Gennady Golovkin and others. Why go PPV when DAZN is offering enough to make that option worth a boxer’s while?

DAZN recently announced a change in its pricing, asking $19.99 per month, up from $9.99, or $99.99 for an entire year.

“We are significantly cheaper than pay-per-view boxing broadcasts, and we are significantly cheaper month-to-month tied to cable as well,” said Joseph Markowski, executive vice president for DAZN North America.

“I think we have a platform to use a launch pad to significantly enhance and expand the user experience. We’re early in that journey.”

Markowski said that adding a baseball show was “a statement” because it was DAZN’s first foray into one of the major American team sports. He said he will be “extremely interested” to see how his and other OTT services approach the next round of major sports rights early next decade.

Might they be bidders in that deep financial pool?

“That will be a good litmus test for us,” Markowski said. “We have always been very clear: We are not a niche fight sports business. We are an international business . . . We’ll pick and choose what we go after.”

ESPN+ charges $4.99 a month or $49.99 a year, and recently announced a milestone deal with UFC for rights to carry its pay-per-view events in the U.S. through 2025.

The service offers thousands of live events, including soccer, the NHL, college sports, boxing and more, plus they stream one live MLB game each day. Wolff said ESPN+ has offered more than 10,000 live events in the past year.

Wolff said ESPN+’s UFC package brought hundreds of thousands of new digital users into the ESPN world who had not been a part of it previously and called streaming “a key piece of the puzzle moving forward for us for ESPN and the Walt Disney Company.”

For now, that piece remains secondary to the familiar TV part of the puzzle. Ten years from now? Stay tuned!

By Neil Best

neil.best@newsday.com@sportswatch

Neil Best first worked at Newsday in 1982, returned in 1985 after a detour to Alaska and has been here since, specializing in high schools, college basketball, the NFL and most recently sports media and business.