One of the most interesting elements of the new MLS television contract is ESPN buying all the digital rights for the league. It’s a unique situation because usually digital rights are offered and controlled by the leagues themselves, and MLS currently does that with their MLS Live package.
The conventional wisdom was that ESPN would offer out-of-market rights on ESPN3 to authenticated subscribers and/or on the Watch ESPN app like other sports offerings. ESPN3 has a wealth of international soccer streaming rights and the MLS package would fit in very well with a burgeoning portfolio.
However, according to a report from Reuters, ESPN is pondering doing something new. Bristol may offer their package of out-of-market MLS games straight to consumers without the need to authenticate a cable or satellite subscription, which could be a revolutionary step in sports television.
The league currently sells a package of games that can be watched on television through cable and satellite operators for $79 per year, or an Internet-based package of these games that costs consumers $65 a year or a monthly charge of $16.
“You saw us buy MLS digital rights. It was a clue, but we still don’t know what we will do with that. That’s a direct-to-consumer package we bought. We could do it just like it’s done now through multichannel distributors or we can do something different with it to go direct to consumer,” he said.
When ESPN announced the MLS deal, the sports network said it could run the out of market games on ESPN3, an online network that is free to those who subscribe to a U.S. broadband or pay TV package, such as cable. But it also said it might explore alternative distribution models.
ESPN will make a decision in the next few months regarding how the network will package and distribute the soccer games, according to a source familiar with the matter.
A straight-to-consumer or over-the-top MLS package would be a fascinating development in the sports broadcasting landscape because it wouldn’t be offered by the league itself, but by one of their network partners. It’s something that is reminiscent of the Netflix model and more recently in the sports/entertainment world, WWE Network.
If this does go through and ESPN offers MLS games as they do an ESPN Insider subscription on their website, it would be a boon for cord cutters and a way for soccer fans to bypass the middle men of cable and satellite providers. Making those games available to more of those fans would be a positive development for MLS as well.
ESPN isn’t about to throw away that monthly subscriber fee business model that provides them billions of dollars of revenue. That would just be stupid. Nevertheless, for something that’s relatively inexpensive as MLS rights are in the grand scheme of things, it’s a great opportunity to experiment a little bit. If ESPN can reach more fans by going the direct route, it might open up other opportunities for more diverse offerings in the future. You could see a day where networks or leagues offer games or packages on an a la carte or team basis. With the advent of the likes of Netflix and WWE Network and Apple and Google sniffing around sports rights, the digital field seems like the next great frontier in the broadcasting world. Given ESPN’s history of innovation, it’s one where Bristol would desperately want to be at the forefront.
[Reuters]
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