The National Football League (NFL) has joined forces with Disney to create a new sports media powerhouse. The deal sees the NFL take a minority stake in Disney’s ESPN, which will gain control over the NFL Network and NFL RedZone highlights service.
The Historic Disney Deal
This unorthodox partnership has significant implications for the sports media landscape. It allows Disney to tap into the NFL’s vast following, while the league gains a foothold in the world of sports media.
‘They have to come out of the gate for that launch with some big bang, and clearly, this is it,’ says Daniel Cohen, executive vice president of media rights advisory at Octagon. ‘The arrangement will give Disney more heft at the negotiating table with distributors and new firepower in its effort to outmaneuver streaming rivals.’
The pact is the latest example of sports entities and media companies combining forces to stay competitive in the ever-changing media landscape. Fox recently acquired a stake in Penske Entertainment, which owns the IndyCar motor racing series, while ESPN has taken stakes in the Premier Lacrosse League and the Unrivaled women’s basketball league.
The deal is likely to boost the appeal of a new direct-to-consumer streaming service ESPN plans to unveil in the weeks leading up to the next NFL season. The service would be turbo-charged over time if it included RedZone and more football.
Robert A. Iger, CEO of Walt Disney, said in a statement, ‘Today’s announcement paves the way for the world’s leading sports media brand and America’s most popular sport to deliver an even more compelling experience for NFL fans, in a way that only ESPN and Disney can.
Final Thoughts
The alliance may also serve Disney well in the not-too-distant future. In its last set of rights deals struck for a 11-year period starting with the 2022 season, the NFL won the right to overhaul its contracts and seek better terms after 2029. Owning a piece of ESPN is likely to keep the league from seeking a re-do of rights for ‘Monday Night Football.’
Source: Variety
