ESPN will sell its own streaming live TV package directly to consumers, a source with knowledge of the plans told The Information.
While this new package won’t include blockbuster items like basketball and football, it will include “niche leagues” and “possibly some types of college sports,” The Information’sAmir Efrati and Tom Dotan report.
This report is in line with previous comments from Disney CEO Bob Iger, who said earlier this year that Disney needed to improve on the digital front, and that selling ESPN direct-to-consumer was on table.
ESPN’s goal with the new service, according to The Information, is to grab an audience that doesn’t currently subscribe to pay TV (and learn what works in streaming). This pitch is similar to that of other streaming services that offer programming you can get on TV, such as Hulu and HBO Now, and lets ESPN skirt the issue of potentially driving people away from the cable bundle. It also seems plausible given the niche focus of this new package.
Earlier this year, ESPN president John Skipper admitted his company had been hurt by people ditching cable.
As of the end of 2015, ESPN had lost about 7 million subscribers in the previous two years. That means ESPN left an estimated $1.3 billion in subscriber revenue on the table in 2015, compared with what it would have made with steady cable company growth.