What started as a hail-mary by the ⚾️ MLB in order to reach a broader audience amidst plummeting TV ratings in 2002, is now expected to disrupt the entire sports broadcasting market: "Over-the-Top" - delivery. The new technology quickly caught the interest of other sports leagues, individual teams, and legacy sports media companies to build a direct relationship with its fans and customers. BAMTech Media, the MLB-owned subsidiary started to provide its OTT backend technology to those parties including the 🏒 NHL, 📺 ESPN, 🤼‍♂️ WWE, and ⚽️ MLS. Nonetheless, it also kick-started a whole new industry of similar sports media service providers that enabled original rights holders to quickly launch their own OTT services: Sportradar AG, Deltatre, NeuLion, just to name a few. 

With the increased ambitions of technology companies in sports content (think: Amazon, Facebook) and the launch of sports-dedicated OTT offerings (think: DAZN, Eleven Sports), legacy sports media companies (think: ESPN, Turner Sports) and intermediating sports agencies (think: IMG, MP&Silva) have faced the risk of being cut out off the value chain of the sports media market ever since. ❌

As a result, these players started to build viable OTT solutions for the time when the tipping point is reached at which OTT consumption would ultimately enter mainstream society: For many, it came down to either scooping up one of these smaller companies and integrating the newly acquired expertise into their media conglomerates or spending significant resources in in-house developments. When opting for the first option, companies were willing to spend big-time in order to equip themselves with the much-needed streaming and hosting capabilities for the future. The acquisition of a majority stake in BAMTech Media by Disney/ESPN at a valuation of $3.785bn not only resulted in a major financial windfall for each MLB franchise of +/- $50m but headlined that consolidation movement of the fragmented industry. 

Many companies took advantage and sold their business at attractive valuations. 💰

In the second part, which will be up next week, the blog will tackle the risk of sports media service providers (e.g. OTT, data) to remain independent, the current limitations of over-the-top delivery as well as my conclusion: Why do I expect legacy sports media to remain the primary consumption platform for at least the next 3-5 years?