In this day and age, content is king and live sports are the most valuable properties because very few people record a live sports broadcast so they are more likely to see through the commercials, which of course we know is a major revenue generator.
Want more proof? Check out the dollars being laid out for and the fight over TV deals both national and local in the major sports. The NBA just signed an 11 year $76B TV deal, and the NFL is in the midst of an 11 year $111B TV deal. By comparison the NHL is finishing up a 12 year $5.4B deal in Canada and 7 years $625M per year deal in the U.S. I could spend pages and pages writing about the WWE's deal with Netflix for Monday Night Raw for $5B over 10 years. Suffice it to say the big leagues are being well-compensated for their content, backing up the value of live sports.
All eyes will be on the NHL in a couple of years when the 12 year $5.4B deal in Canada with Rogers ends. Who is going to step up and invest for what is still a coveted property? Well, Rogers just bought out Bell's MLSE shares ( 37.5% of the company) for $4.7B so I'm not sure where that puts them. They did lose money on the national NHL deal, partly because of changing technologies and market patterns and partly because the Leafs only advanced beyond the 1st round once, and like it or not they are the ratings driver in Canada. Bell now has $4.7B from Rogers, but according to Greg O'Brien on Bubba O'Neil's Sportsline podcast much of that is earmarked for dividend sharing for investors. That said, I can see Bell hoping to make a play for one night. That leaves Amazon, who are testing the waters by buying the Monday night national rights from Rogers for the last two years of the deal. They are also putting together their own broadcasts with all new talent which is a mix of Canadian and American sports broadcasters. My guess is they will be a major, major player and I can see Netflix possibly jumping in there too along with AppleTV. Bell might be enticed if they can move some of the content over to Crave. This would not be live game coverage as they have five TSN channels for that but more for ancillary/ support program such as what was done with the Leafs and the Canadiens.
Expect a mix of two or three partners in play and a deal that likely will be less than the 12 years that Rogers signed up for. Rogers has the Blue Jays, and control of all MLSE properties though they ceded some broadcast rights back to Bell. I can't see Rogers being a player but at a shorter term deal and with the Leafs improved, never say never. Despite opinions to the contrary about Bell, I see them sharing national rights with Amazon and perhaps Apple TV. Both Bell and Rogers will likely retain their grip on regional rights between the Canadian teams as Bell has Montreal, Ottawa, Winnipeg an half of Toronto's schedule while Rogers has the Oilers, Canucks, Flames and the other half of Toronto's schedule. That will set off the usual round of grumbling from consumers who will have to pay up if they want to watch their teams or suffer them being subject to blackouts. To which I reply that not everything can be free. I pay for a sports pack as well as the OHL digital TV package and I'm happy to support the product. Most of these teams also have a strong regional audience so while out of market consumers grumble they do pay up for these coveted properties .
So what does all this mean? In my opinion, streaming is the future. Wow! Amazing insight right? Actually while streaming is the future I think fans lose out as ultimately they will be paying more for a product that is harder to find and they might regret cutting the cord. Get ready to sign up for Amazon Prime whether you like it or not, and hope that Bell or at least another over the air station wants to keep Hockey in Night in Canada away from the streaming content companies because Amazon's Hockey Night in Canada just doesn't sound right. That would likely spell the end of Hockey Night in Canada on CBC, which would likely tick off traditionalists unless it's sub- licensed like it was with Rogers or CBC invests a TON of tax payer cash. Sorry all Amazon is the big winner in this and you might have to get ready for a night of Dragons Den and Murdoch Mysteries on Saturday night on the CBC.
Steve Clark
Steve calls games for the Niagara IceDogs on YourTV and has called hockey at the OHL, AHL and international level for a number of years.
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