Streaming service Max to launch sports add-on next month
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Accelerating its shift to streaming, media conglomerate Warner Bros. Discovery announced Tuesday that it would offer its full slate of major sporting events, including NBA, NCAA men's March Madness, NHL, MLB and U.S. soccer games, to customers of its Max streaming service beginning Oct. 5.
The sports tier, called Bleacher Report Sports Add-On, will launch in time for Major League Baseball's National League Division series, which features the Dodgers. The sports tier will cost Max customers an additional $9.99 a month.
As part of a one-time promotion, Warner Bros. Discovery will make the sports add-on available to Max customers at no additional charge through February. The service is available only in the U.S.
Standard subscriptions to Max with commercials sell for $9.99 a month.The ad-free version costs $15.99 a month.
Cable customers will still have access to the sports events on the linear Turner channels, TNT and TBS, that are included in their packages. The Bleacher Report Sports Add-on will be a simulcast of games that run on the linear channels, including the commercials.
The move comes amid much upheaval in the traditional pay-TV landscape as major programmers race to reach consumers who have cut the cable cord or who never signed up for traditional channels. Companies like Warner Bros. Discovery are walking a tightrope because the bulk of their profits come from the programming fees paid by pay-TV distributors (cable and satellite companies) and they don't want to alienate their longtime partners.
Warner Bros. Discovery depends heavily on fees the distributors pay to carry its channels, including TNT, CNN, Food Network, HGTV, Discovery I/D and Animal Planet. The company generated $5.7 billion in revenue from its networks division in the second quarter, more than half of which came from the distribution fees.
Read more: Behind Disney's Spectrum blackout: A 'proxy battle' for the future of television
This year, growth has stalled for Warner Bros. Discovery's streaming products, including Max and Discovery+. The company reported having nearly 96 million global streaming customers at the end of June, compared to 97.6 million in the preceding quarter.
For much of the year, Warner Bros. Discovery Chief Executive David Zaslav and his lieutenants have focused on reducing enormous financial losses in its streaming divisions.
Zaslav has said streaming is now a break-even business. Rolling out a sports add-on follows through on Zaslav's promise to turn Max into a robust service with scripted programming from HBO and other channels, as well as news and sports.
Beginning Sept. 27, the company will offer a live streaming version of CNN on Max, giving consumers content from the news channel without the need for a pay-TV subscription. CNN on Max will be available at no additional charge.
Sports leagues and programmers have embraced streaming as the future of television. The NFL licensed "Thursday Night Football" to Amazon Prime Video, and an NFL playoff game will be featured on NBCUniversal's Peacock early next year. Apple TV+ has professional soccer and Friday night MLB games. For nearly a decade, the Tennis Channel has offered matches on its companion streaming service.
Warner Bros. Discovery said the Bleacher Report Sports Add-On package will include studio shows, such as "Inside the NBA," and other live content, including some international sports events such as cycling and auto racing.
It will include more than 300 live games.
“We’re thrilled to offer WBD’s incredible portfolio of premium U.S. live sports — featuring simulcasts of our must-see MLB, NHL, NBA, NCAA and U.S. Soccer events, among others — as part of B/R Sports Add-On’s wide assortment of compelling multi-sport content on Max,” J.B. Perrette, chief executive and president of the company's global streaming and games division, said in a statement.
Read more: The rise of sports TV costs and why your cable bill keeps going up
The Walt Disney Co., among others, has been weighing the benefits — and risks — of bypassing its longstanding partners, pay-TV distributors including Charter Communications and DirecTV, to offer top-flight sports directly to consumers.
Disney removed its channels from Charter's Spectrum TV service for more than 10 days this month after a dispute erupted over the Burbank entertainment company's plans to eventually offer its flagship ESPN channels directly to consumers. Disney executives have said they have not decided when to begin selling ESPN directly to consumers or the price of the service.
Sports costs, including NFL football, continue to rise. ESPN is the most expensive channel in the cable bundle.
Warner Bros. Discovery executives don't believe their sports add-on will be as disruptive to pay-TV operators because their customers will have little incentive to pay an additional $10 a month for a streaming add-on when they already get those games on TNT and TBS.
This story originally appeared in Los Angeles Times.
