In its continuing efforts to seemingly take over the world — or at least virtually every form of media we consume — Disney has acquired a major stake in MLB Advanced Media.
As reported by Bloomberg’s Scott Soshnick and Christopher Palmeri, Walt Disney Co. has purchased a one-third stake in MLB’s streaming video operation, BAM Tech, which might eventually lead to a spinoff into a separate company. The entire venture is valued at $3.5 billion and Disney has a four-year option to purchase another 33 percent of MLBAM.
BREAKING: Disney gets 1/3 of MLB's Bam Tech at $3.5B valuation. Four year option to buy another 1/3, source says #sportsbiz #MLB
— Scott Soshnick (@soshnick) June 30, 2016
For MLB, the money is obviously a significant windfall to be divided among each of its 30 teams, all of whom own an equal stake in MLB Advanced Media. With its one-third stake valued at $1.1 billion, that works out to $36.7 million per club, which would cover about half the 2016 payrolls of the Miami Marlins and Milwaukee Brewers.
Right now, how much do baseball’s owners love Bob Bowman, who created MLB’s digital wing and turned it into an extremely lucrative business?
The two companies already had a working relationship, as MLB Advanced Media runs ESPN’s WatchESPN streaming arm.So this is seemingly a natural next step. This deal is surely geared toward building a more robust streaming product (particularly in offering sports and events that might not have a place in ESPN’s on-air schedule) to attract and keep subscribers who have turned their back on cable and satellite providers.
Additionally, MLBAM runs WWE Network, HBO Now, March Madness On Demand, Glenn Beck’s TheBlaze, and also has a digital partnership with the NHL and PGA in creating streaming content.
For the past few months, industry scuttlebutt has centered on Disney looking to purchase a major stake in MLBAM with ambitions toward eventually buying a controlling portion of the company. From there, the next step would likely be spinning off BAM Tech into a separate venture that could partner up with more entities to create streaming content, likely even beyond sports.
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About Ian Casselberry
Ian is a writer, editor, and podcaster. You can find his work at Awful Announcing and The Comeback. He's written for Sports Illustrated, Yahoo Sports, MLive, Bleacher Report, and SB Nation.