Credit: DisneyA $110 billion company could potentially be the “saving grace” for The Walt Disney Company as it looks toward the future, reports indicate.
The National Football League (NFL), undoubtedly the most popular sports league in the United States, with a massive television revenue stream, is contemplating a groundbreaking partnership with The Walt Disney Company, according to a source familiar with the situation, who spoke on condition of anonymity to The New York Post.
The New York Post’s initial report, which surfaced last week and was reported by Inside the Magic, suggests that discussions have progressed to the point where the league has informed the Players Association and team owners. Disney’s ESPN, a prominent player in the sports media landscape, declined to provide an official comment on the matter.
In exchange for the NFL’s equity stake, ESPN would assume control of NFL Media. This includes the league’s production arm, NFL Films, as well as the NFL Network, RedZone, NFL.com, and NFL+, a recently launched streaming service catering to subscribers eager to enjoy games and related content on mobile devices. Though it hasn’t been confirmed, it would be interesting to see what form the NFL Network could take and if there could be some kind of app merger within the ESPN app and possibly even Disney+, which is undergoing a merger with Hulu right now.
As reported by the LA Times, Disney CEO Bob Iger had previously floated the idea of seeking an equity partner for ESPN. While ESPN remains profitable, it faces an uncertain future due to the threat of cord-cutting, which endangers the subscription revenue that has historically propelled it to immense success in the media industry.
ESPN has long been one of the priciest components of the pay TV bundle, commanding nearly $9.00 per subscriber. However, its reach has diminished, currently residing in 73 million households, a notable decline from 98.5 million in 2013. This shift is occurring within a shrinking pay TV landscape, even as media rights fees continue to rise, fueled by tech giants like Amazon and Apple competing for content to bolster their streaming services.
One critical aspect to consider is the reaction of the NFL’s other media partners, including NBC, CBS, Amazon, YouTube, and Fox, all of whom, like Disney, have committed to substantial payments to the league, exceeding $100 billion over the next decade. Disney’s current package encompasses “Monday Night Football” (which aired on both ABC and ESPN during the last season) and two Super Bowls.
This potential collaboration between the NFL and Disney could reshape the sports media landscape and provide Disney with a new avenue to navigate the evolving entertainment industry.
Disney has continued to share that it values linear television, even in the wake of streaming. Finding a way to strike a deal with the NFL– the most valuable sporting league in the U.S., and possibly the world– seems like a an absolute “must” at this point, especially when you consider the losses that Disney is incurring in areas of entertainment, both in streaming and linear products.
Inside the Magic will keep you updated on the latest developments between Disney and the NFL.