This week Disney, FOX, and Warner Bros. Discovery announced a partnership that would see a new sports-focused TV streaming service launch this fall. This service would offer 14 live channels of sports, including ESPN, BTN, FOX Sports, and sports from TNT—to name a few. It would address one of the main complaints of streaming services—the need to switch between apps to see all the games.
Now local TV stations are weighing in on this new plan in a way that they make it clear that they would also be paid for the local games that stream on it. In a statement, Gray Television made it clear that it wants Disney, FOX, and Warner Bros. Discovery to pay for any games that will air on local TV stations. “Gray welcomes any venture that expands the reach of local broadcasting stations, which in turn supports the ability of local stations to maintain trusted local news operations that benefit everyone.”
This argument about maintaining trusted local news has been the same argument used by local TV stations to reclassify streaming services as cable TV. In the end, maintaining trusted local news means local stations get paid.
Here is the full statement from Gray Television:
The potential launch of a new live streaming service from Disney, FOX, and WBD that would include the live signals of the local affiliates of the ABC and FOX broadcast networks owned by local broadcasters such as Gray as well as those companies’ sports-focused cable channels could be a significant opportunity to expand the pay-TV ecosystem.
Local affiliated stations not only carry nationally televised sports but also provide local sports coverage, local news and weather, local jobs, and extensive community service. We believe that including ABC and FOX stations in a new virtual multichannel video programming service could offer benefits to viewers, their local communities, and local broadcasters. Local affiliates and their audiences could also benefit if the venture provides additional resources and scale that enables the venture to compete successfully and expand the sports programming available on the ABC and FOX broadcast networks and the affiliates of those networks.
Finally, we understand that the proposed new streaming service is expected to target sports fans who do not currently subscribe to a pay-TV package, complementing the wider programming offerings available from existing pay-TV providers. Gray welcomes any venture that expands the reach of local broadcasting stations, which in turn supports the ability of local stations to maintain trusted local news operations that benefit everyone.
Fubo has also raised concerns over the motives of this new service. With Fubo and other streaming services focusing heavily on sports streaming, it is easy to understand how Fubo could be worried this new joint venture would undercut them. Also, it removes the middleman costs of a service like Fubo, potentially allowing it to be less expensive than Fubo. Lastly, typically, companies like Disney force you to carry many other channels to get ESPN. Now Disney is going to start selling it directly without the big bundle.
Look for cable TV companies, other streaming services, and even local TV stations to push back against this planned streaming service. The problem now is what leverage over Disney, FOX, and Warner Bros. Discovery they have if the companies start going directly to the consumers.
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