Disney announced today that it was buying one-third of the streaming video company BAMTech, which provides technology for HBO, the WWE, the National Hockey League, Major League Baseball, and others.
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Walt Disney announced two OTT initiatives for its powerful ESPN network group – hoping to combat criticism the sports group might have when it comes to carriage on future low-priced “skinny” digital TV services. It said that AT&T’s DirecTV will feature channels like ESPN, ESPN2, ABC, Freeform, Disney Channel, Disney XD as well as Disney Junior in their subscription packages in the upcoming DirecTV Now OTT service. It will begin with an ESPN subscription streaming service by the end of the year.
The investment will help “allay investors fears about Disney’s relevance in a world where content is delivered online”, Pivotal Research Group analyst Brian Wieser said. The American entertainment company will pay $1bn (£765m; €897m). The company holds earnings per share of -2.24 for the twelve months. The network does not want to run the risk of having a new streaming endeavor override the prominence of its cable channels, but at the same time, consumer trends more or less dictate that the endeavor of increasing streaming options should be undertaken by networks.
Founded in 2000, BamTech grew out the MLB’s interactive media and internet company known as MLBam. The company confirmed that its cash cow, ESPN, had once again lost pay-TV subscribers in the second quarter, offsetting gains made in advertising and MVPD affiliate fees.
The network is part of Disney’s cable networks division and accounts for more than half of the division’s revenue, and that revenue was up 1% in the third quarter to $4.2 billion.
Disney CEO Bob Iger was bullish Tuesday on Shanghai Disneyland, which opened in June. Revenue rose 9 percent to $14.28 billion, including a 40 percent jump in studio revenue, also beating expectations.
Compared with Q3 2015, revenues rose 9% to $14.3 billion.
“Our goal is to ensure that our brands, notably ESPN, remain strong, vital and relevant in a totally changed media landscape”, Iger said of the investment.
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The Walt Disney Company incorporated on July 28 1995 together with its subsidiaries and affiliates is a diversified global family entertainment and media enterprise with five business segments: media networks parks and resorts studio entertainment consumer products and interactive media.
