The NBA’s latest direct-to-consumer streaming service has gone live.
The New Orleans Pelicans have launched Pelicans+ ahead of the upcoming season, a direct-to-consumer streaming app that will air all local broadcasts for the team this year. The move comes after the Pelicans and Diamond Sports Group, owner of the formerly named-Bally Sports RSNs, ended its relationship last month.
New Orleans is the fifth NBA franchise that has moved to a combination of over-the-air broadcast television and digital streaming for its local distribution. The other teams include the Utah Jazz, Phoenix Suns, Portland Trail Blazers, and Dallas Mavericks. In addition to the new streaming app, Pelicans games will be available on a local Fox affiliate WVUE, owned by Gray Television.
The app is available to subscribers at a price of $99.99 annually, or $14.99 per month.
Despite being available to a wider audience with the combo-distribution plan, the Pelicans can expect to see a decrease in revenue earned from media rights as a result of ditching its RSN. Per Sports Business Journal, the Pelicans earned around $25 million in media rights fees from Diamond per season, while the deal with Gray Television will bring in less than $10 million.
Pelicans+ subscribers will not likely be able to make up the >$15 million gap in local media rights revenue from its previous deal. But the team is banking that its increased reach in surrounding markets like Mississippi and Alabama will result in more merchandise sales and an increase in ad rates given the broader audience.
According to the SBJ report, the Utah Jazz, who underwent a similar transition for its local media distribution last season, only reached about 60% of its financial projections for its streaming service Jazz+. The landscape for local broadcasts is undoubtedly shifting towards streaming and over-the-air broadcast, making games more accessible for fans. But the financial windfall of these arrangements has yet to come close to that offered from traditional RSNs.
