The e-commerce giant is said to have bid for the 22 regional sports networks that 21st Century Fox is offloading as part of its sale to The Walt Disney Co. Together, the networks air the games of 44 teams in the NBA, Major League Baseball and the NHL.
Amazon is reportedly interested in buying nearly two dozen regional sports networks. That would be a bold gamble on the future of how viewers consume sports content.
The e-commerce giant is said to have bid for the 22 regional sports networks that 21st Century Fox is offloading as part of its sale to The Walt Disney Co., CNBC reported, citing unnamed sources. Together, the networks air the games of 44 teams in the NBA, Major League Baseball and the NHL. An earlier report by Reuters that also cited unnamed sources suggested the networks could be valued at over $20 billion, which would make the purchase Amazon’s biggest deal ever.
CNBC said other bidders include investment firms Apollo Global Management, KKR & Co., and Blackstone Group, as well as media companies Sinclair Broadcast Group and Tegna.
At a time when pay TV is in decline, sports content drives viewership across platforms. Owning rights to big franchises would help Amazon market its Prime program (which costs $119 a year), especially if that membership included access to those games. That, in turn, could add more revenue, as Prime members tend to buy more on Amazon.
Most Read Business Stories
- Seattle-area employers rethink the rules on masking, vaccines as pandemic takes a new turn
- Oprah sells Orcas Island estate for $14 million
- San Francisco tenants get 6-figure buyout to leave luxe unit
- Downtown Seattle office vacancies still high as virus variant clouds real estate outlook
- When we say 'affordable housing,' we mean one of America's biggest dilemmas
Growth in the number of Amazon Prime members in the United States has slowed recently. A pickup in membership growth would be welcome.
Why would Amazon pay up for a business in which it has little experience?
One theory is Amazon could take the games off the cable and satellite systems and make them exclusively available to Prime members. There are two problems with that idea. First, Fox has already negotiated agreements for its 22 regional sports networks with most of the major pay-TV carriers. Second, even after those contracts run out, team owners may not want to limit the visibility of their games to a single online service.
Another option would be for Amazon to make games available to Prime subscribers in addition to being carried on the local cable system. That way team owners don’t lose out on audience. But the cable operators are sure to balk.
The obvious answer is that Amazon expects — or plans to create — disruption.
Streaming could become the dominant media business in the next few years, which could mean that streaming companies become the leading sports broadcasters if they line up the right deals.