By Oliver Darcy, CNN
(CNN) — Three of the biggest sports broadcasters are uniting to create a super-platform that will house their sports assets under a single streaming roof, a seismic and once-unthinkable move as the industry rapidly transitions away from linear television to streaming services.
Disney’s ESPN, Fox Corporation, and Warner Bros. Discovery (CNN’s parent company) announced Tuesday that they will launch the new service in the fall.
The service, which each company will own one-third of, will offer consumers access to a host of sporting events, including NFL, NBA, MLB, NHL, and FIFA World Cup games. It will also feature NASCAR races, UFC matches, and PGA TOUR Golf tournaments.
The companies did not specify how much a subscription to the forthcoming sports platform will cost or what it will be named. Additional information is expected to be announced closer to launch.
An ESPN spokesperson said that the company plans on launching its own robust direct-to-consumer service. And Warner Bros. Discovery has put its sports offerings on its own platform, Max.
Shares in Warner Bros. Discovery and Fox Corp. were up slightly in after-hours trading following the news. Disney, which reports earnings on Wednesday, saw its stock down about 1%.
The three media companies celebrated the tentative deal to launch the service as a major moment for the industry.
Legacy media companies have been working for years to transition away from relying on the traditional cable bundle and toward profitable streaming services as millions of consumers cut the cord each year, a migration prompted by the rapid rise of Netflix.
After pouring billions of dollars into their own streaming services to compete with Netflix, the leaders of several major media companies — including Bob Iger, chief executive of ESPN-parent Disney, and David Zaslav, chief executive of Warner Bros. Discovery — have recently signaled to consumers to expect more bundling.
The executives are banking on the prospect that by teaming up they can together take on Netflix and major technology companies, such as Amazon and Apple, that have far deeper pockets.
Iger called “the launch of this new streaming sports service” an “important step forward for the media business.” Zaslav said the partnership “exemplifies our ability as an industry to drive innovation.” And Lachlan Murdoch, chief executive of Fox Corporation, said he believed the streamer “will provide passionate fans outside of the traditional bundle an array of amazing sports content.”
Making sports available via a direct-to-consumer product is likely to accelerate the decline of the cable subscription business, given that such live events have long been a pillar of consumer demand holding together the traditional bundle.
But as the cost of sports rights has surged in recent years and the television business has deteriorated with cord-cutting, media executives have hunted for innovative ways to retain their highly valued rights while transitioning to the streaming future.
Discussions about the creation of the sports streaming service, which will have an independent management team, began among the executives involved roughly six months ago.
Notably absent from the partnership was NBCUniversal and Paramount Global, both of which have their own services where sporting events are streamed.
The-CNN-Wire
™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.
