Sinclair Must Renew Deal With NBA, NHL to Keep In-Market Streaming For Bally Sports App
Sinclair President and CEO Chris Ripley said during the company’s 2Q 2021 Earnings Call on Wednesday that the company remains committed to launching a direct-to-consumer Bally Sports App in the first half of 2022, but they have another streaming deal to worry about.
Ripley said streaming rights for the NBA and NHL on the Bally RSNs were up for renewal in the coming months. These are to continue offering TV Everywhere access via the Bally Sports App.
Despite this, he was confident of Sinclair’s position, pointing out that they are the only bidder in place for the digital rights for the two leagues.
“You know we are the only buyer for those, you know, there is no one else they can be sold to,” Ripley said. “So, we have a relatively good position.”
Ripley wouldn’t go into detail regarding specifics surrounding the negotiations, other than to say that negotiations were “productive.”
“We’re having productive conversations and negotiations … at this point, the existence of a deadline, being the next season, we think will be a helpful forcing factor to finish those drive them to the finish line,” he said. “I would point back to my comments around what goes into the dynamics of a negotiation around market competition and comparables and you know it as it relates to the digital rights.”
Additionally, Ripley remained quiet on pricing for a direct-to-consumer product. However, paperwork filed with the Securities and Exchange Commission earlier this summer suggested they could expect to make about $19.58 per customer from such a product. This price point is well above monthly fees for Netflix, HBO Max, or the Disney Bundle that includes Disney+, Hulu, and ESPN+. Moreover, it assumes customers would stick around for a full year as opposed to coming and going.
Ripley believes that the company will be able to acquire net new direct-to-consumer subscribers, who no longer subscribe to a cable bundle, rather than cannibalize it. He believes that the wholesale price will continue to be a good value for cable, satellite, and Live TV Streaming distributors.
He also feels that while subscription revenue is part of the equation, a direct-to-consumer subscriber can be more lucrative than a cable one.