SBJ/May 12-18, 2014/Media

ESPN takes over out-of-market package

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One unique aspect of MLS’s new media rights deal is that ESPN will manage the league’s out-of-market package.

Neither ESPN nor MLS executives last week knew how the package in its new form will be presented or what it will be named, but what was certain is that operation of the package will shift from MLS to ESPN.

Stevenson
“ESPN will probably offer it to their authenticated subscribers as part of their ESPN3 service,” said Gary Stevenson, president and managing director of MLS Business Ventures. “If sports goes the way music has gone, seven years from now, maybe you can buy a 4-pack of games. Maybe you can buy the Game of the Week for 99 cents.”

A source said ESPN is looking at several potential business models, including potentially making the package available as an over-the-top subscription product.

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ESPN approached MLS with the idea last year, toward the beginning of their larger media negotiations. It took several months for the league to become comfortable with the idea that its out-of-market package will be streamed rather than offered over television.

“We weren’t sure we wanted to do that,” Stevenson said. “But the more we spoke with them and understood [ESPN’s top digital executive] John Kosner’s vision for this, we thought it was a great idea.”

Neither MLS executives nor cable operators would discuss how many subscribers the current out-of-market package, called Direct Kick, has been getting, but distribution sources said its take-up rate pales in comparison to other leagues. MLS currently operates MLS Direct Kick and sells it to distributors. It retails for $79 and carries up to 245 games.

Some of that blame comes down to scheduling. In the past few years, MLS games were scattered across the week.
ESPN executives believe the league’s new schedule, which puts most games on Saturdays, will help support the out-of-market package.

“MLS has a young, male, diverse demographic,” said Scott Guglielmino, ESPN’s senior vice president of programming. “Because the majority of those out-of-market matches — or, local matches — are going to happen on Saturdays, we felt like that was attractive for us to try and secure those rights.”


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