ESPN’s Justin Connolly (third from right) addresses the future of sports rights on the opening panel with (from left) moderator Abe Madkour, DAZN’s John Skipper, Sarah Hirshland of the USOC, StubHub’s Sukhinder Singh Cassidy and Jeanie Buss of the Los Angeles Lakers.tony florez
The proliferation of streaming services has provided viewers with seemingly endless options in the new cord-cutting era. Netflix, HBO, Disney/ESPN and scores of other media companies are investing heavily in their direct-to-consumer products and programming for them.
With that comes a cautionary tale for the companies in the OTT space, said John Skipper, the DAZN Group executive chairman and former ESPN president. There’s a limit to the number of streaming services that viewers will subscribe to.
“You see people saying, ‘I want this one and that one’ and before you know it, you’re getting nine new emails a day from your OTTs,” Skipper said. “People aren’t willing to buy more than two or three or four things. So, I think what you’re going to see in the next three years is a winnowing down of the number of companies that play in this. And it’s going to get down to three or four instead of eight to 10.”
That was the message from Skipper and other high-level media executives at the CAA World Congress of Sports last week in Dana Point, Calif.
The fluctuating future of media was front and center through the two-day event, beginning with a lively discussion between Skipper and Justin Connolly, ESPN’s executive vice president for affiliate sales and marketing. Connolly and ESPN have built its OTT product, ESPN+, into a streaming force with 2 million subscribers in a year, and his company has taken a bullish stance on how the direct-to-consumer model will transform ESPN from a legacy media company into one that is just as focused on digital.
“The biggest story I’m following is the launch of direct-to-consumer, over-the-top streaming services for sports fans, led by ESPN+,” Connolly said. “That’s been a focus and priority of ours, and I think it’s going to change the landscape as it relates to how we engage sports fans moving forward.”
Connolly objected to any notion of ESPN being called a “traditional media company.”
“I’m not knocking new media or DAZN specifically, but I think it’s interesting how ESPN is called traditional or legacy media; I just think it misses the mark,” he said. “If you look at our scale, we have billions of minutes streamed every month.”
Skipper, looking relaxed in a green sweater and khaki pants, said that while his new London-based digital company is spending millions on sports rights, his experience prior to TV running ESPN The Magazine tells him that “consumers won’t subscribe to five, six, seven services” just like they wouldn’t subscribe to that many magazines in his print days.
It’s just too many to keep up with, and that will open the door for a new kind of bundled model, Skipper predicted.
“It’s a funny world,” he said. “People were really unhappy about pay [cable] television, but it turns out that it was a spectacular consumer model where you got a lot of content before it got too expensive.”
As more and more companies like Amazon, Apple, NBC, Discovery, AT&T and others enter the OTT battle for subscribers, “there will be a need for a platform that aggregates these services that people buy,” Skipper said. “That’ll happen in the next three years or so.”
Meanwhile, DAZN will go on gobbling up rights wherever it can, trying to play at the highest levels so that the service will become a household name.
The digital network just launched a new MLB live look-in show through a deal with the league, a move that’s “clearly intended to send a signal that we’re interested in the major sports in this country,” Skipper said. “They don’t happen to have their live events available, but we basically hung up a sign that says we expect to be a player in the next round of deals.”
