NHL skates toward a new video reality

The new National Hockey League TV rights reshuffle shines the spotlight on two influences that weren’t in play the last time the league negotiated its on-screen future: Namely, ESPN+ and Hulu. It also raises questions about the future role of league-owned SVOD services.

Disney’s ESPN+ and Hulu will divvy up exclusive rights to 75 NHL games starting with the 2021-22 season. Another 25 games will show up exclusively on a combination of ABC and ESPN. There’s a big playoffs component, too: ABC will televise the Stanley Cup final series for four of the seven years involved in the contract, and the ABC/ESPN duo also has rights to show half of the overall NHL playoff games.

Besides these games listed above, ESPN+ will subsume the NHL’s role as provider of the out-of-market games package called NHL.TV. That’s a big shift, and it will surely make ESPN+ all but synonymous with NHL hockey.

When ESPN+ launched in the summer of 2018, the public premise was that it would aggregate a deep schedule of professional and amateur sports, sprinkling in just enough A-list baseball, college football, and other games to entice discriminating fans. What really fuel-injected growth for the service, however, was the 2019 addition of pay-per-view access to UFC fights that previously were available from multiple video distributors. In November 2019, ESPN+ had 3.5 million subscribers. By the end of the year, the number had soared to 6.6 million as UFC fans digested the news that ESPN+ was now the exclusive on-ramp for accessing premiere UFC events.

Now, Disney may be hoping for a similar surge tied to another component of the deal outlined this week. Starting with the 2021 season, NHL loyalists who want to purchase the former NHL.TV out-of-market package must have an underlying ESPN+ subscription. Both of these arrangements, along with a similar-looking deal involving Major League Soccer’s out-of-market package, make ESPN+ look less like a standalone streaming service and more like multi-purpose aggregation center for sports.

There’s a bundling enticement at work, too, as the appearance of some NHL games on sister streaming service Hulu could compel fans to sign up for the discounted Hulu, ESPN+, and Disney+ bundle. That discounted trio of services remains attractively priced, with a rate of $14/mo following a planned March increase of $1/mo. This week Disney signaled it’s further consolidating the services by making ESPN+ available within the Hulu environment as an add-on service.

Regardless of where the subscriber totals end up, it’s clear that the ability to extend its monetization model across the fastest-growing component of the video economy (streaming video) helped to support what the Wall Street Journal reported as a $2.8 billion bid. Absent the growth trajectory for its streaming services, it’s unlikely Disney could have mustered that level of economic bravado.

Led by the pioneering work from Major League Baseball, sports leagues have embraced the model for standalone Internet subscription packages tracing back to 2003. These offshoots of cable/satellite TV packages brought the leagues into the direct-to-consumer video realm in a big way. Now, a new model seems to be emerging where leagues hand over responsibility to ESPN+, and possibly other streaming providers. Given that a separate division of Disney (the former BAMTech) already handles back-office streaming infrastructure for NHL.TV and MLB.TV, the handoff isn’t terribly tricky from an operations standpoint. What’s meaningful, though, is that a category of league-run SVOD services once believed to be an emerging competitor to Big TV now looks to be heading back into the arms of third-party providers. With that in mind, our guess that ESPN+ could emerge as a serious candidate to take over the NFL’s Sunday Ticket package starts to look a bit more real.


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