Adam Seaborn on the business of sports streaming

On this week’s episode of Free Lunch by The Peak, we sat down with Adam Seaborn of Playmaker Capital to talk about what the streaming era means for the sports media industry.

Why did Disney, ESPN Warner, and Fox partner up to offer a streaming bundle?

“Between the three of them, they account for the majority of national sports rights between the NHL, NBA, and MLB, and own a handful of NFL rights. They might think they’re stronger together as a traditional media bundle business, which is essentially reinventing cable.” 

Is there a sustainable business model that will support these big sports rights deals? 

“I don’t think so. Back in a world of cable bundles, sports content was subsidized by the people who never watched games but still saw a percentage of their fees go towards paying for channels like ESPN. Now that we're unbundling, fans are realizing the real cost of these sports deals. Eventually, the cost of sports rights will have to drop because consumers will pull back against those high prices, taking viewership and advertising dollars with them.” 

What’s the core difference between the U.S. and Canadian sports markets?

“Canada comes down to Rogers, which owns Sportsnet, and Bell, which owns TSN. It's not as fragmented of a market. But in the streaming era, Netflix, Amazon Prime, and Apple have all proven that they can dominate Canada without having to go through TSN or Sportsnet.”

This interview has been edited for clarity and length. Listen to the full conversation here.