It looks like Major League Baseball’s plan to spin off its video-streaming technology into a separate company could get a big boost from a powerful player in the sports world: ESPN parent Disney. Peter Kafka of Re/code reports that Disney’s considering investing in this spin-off, and that talks are in “advanced stages”:
Disney is in talks to invest in pro baseball’s video streaming business — a sign that the media giant wants to own the technology to help it power direct-to-consumer video services.
Sources say Disney is in advanced talks to take an equity stake in BAM Tech, the video technology business MLB Advanced Media has been looking to spin off into a separate company for some time.
MLBAM, which is jointly owned by pro baseball’s 30 teams, runs pro baseball’s Web video subscription service. It also handles video streaming for many large clients, including WatchESPN, the streaming service Disney’s ESPN already operates.
People familiar with the proposed transaction say talks are in advanced stages, but could still fall apart. Sources say Disney is one of multiple bidders who want to invest in MLBAM.
This could matter on a number of fronts. For one, it shows the growing importance of WatchESPN to Disney overall, but perhaps even beyond that, it might help pave the way for ESPN’s much–mulled idea of going over-the-top and selling their channels directly to consumers. Beyond that, Disney investment in BAM Tech might really help them dominate the streaming market (where they already have a substantial portion, including HBO, WWE Network, NHL Center Ice and more). It could bolster ESPN’s desire to do more WatchESPN content and promote that service more, too; if they have an equity stake in the streaming side, they have even more of an incentive to boost it. As Kafka writes, there are plenty of people who want to invest in MLBAM, so this is far from a sure thing. If Disney’s willing to make a big offer, though, this could be a deal that works out well for both sides, and one that has market-altering effects on a number of fronts.