The Utah Jazz broadcast their games locally on the same regional cable channel for more than 30 years, until AT&T SportsNet Rocky Mountain (as it was known in its last incarnation) announced last October that it would lay off its employees and go out of business. In search of a new broadcast partner, the NBA’s 23rd most valuable team became one of the first to adopt a trend that is sweeping the world of sports media: “streaming and beam.” .
Any broadcast television station, such as Sinclair’s KJZZ channel 14, could produce and “broadcast” the team’s games to anyone in the Salt Lake City market with a pair of rabbit-ear antennas. But streaming was a more complicated proposition. Like many NBA teams whose cable deals fell through, the Jazz suddenly controlled their own digital rights and had to find a way to launch a direct-to-consumer streaming service in a matter of weeks.
“We needed industry experts,” says Jim Olson, president of Jazz. “And as quickly as we had to act, we weren’t prepared to try to do it all ourselves.”
Enter Kiswe, one of several broadcast technology providers positioning itself as a key player in the evolution of the multibillion-dollar local sports media landscape. The New Jersey-based company helped design and launch Jazz+ before the start of last season, fully customized with alternate language streams, data tracking and compatibility with two dozen connected devices.
Similar opportunities exist with dozens of NBA, NHL and MLB teams. By NBA Commissioner Adam Silver’s own admission in September, 18 of his league’s regional sports networks are inactive or bankrupt. And while tech giants like Apple and Amazon could fill that void, they have so far chosen to stay on the sidelines. That leaves several smaller tech companies, including Viewlift, Deltatre, Endeavor Streaming and APMC, all competing to sign as many teams as possible in a very competitive market.
“What we are really obsessed with is growth,” says co-founder Wim Sweldens, the “swe” of Kiswe. (The “Ki” is the name of his partner, former Bell Labs president Jeong Kim.) “We see a lot of opportunities in different teams, different leagues, different countries, different verticals.”
That’s not to say that these streaming products are an instant gold mine. In its first year, Jazz+ has had 21,159 subscribers, according to the team. Considering some who subscribe annually (for $125.50), monthly (for $15.50, although the price has since increased to $19.99), or per game (for $5), Forbes He estimates the team generated a little more than $3 million in subscriptions, a bit more if you include a standalone product bundled with the city’s new NHL team, which has 2,600 subscribers.
For now, that’s nothing compared to the old cable model. AT&T SportsNet Rocky Mountain paid the Jazz about $25 million a year for its linear and digital rights. “Streaming” deals with over-the-air operations like Sinclair, Tegna and Gray reportedly pay about half that amount on average to NBA teams, and for now, streaming is nowhere near making up for the deficit. But the teams believe that more exposure (in its last season, Utah’s RSN had just 37% penetration in the local market) could generate more advertisers, merchandise and ticket sales.
Teams see other benefits in building their streaming presence. Each new sign-up provides fan data they’ve never had access to before, including who each subscriber is and what they like to consume. This “digital intimacy,” as Sweldens calls it, can help teams drive those ancillary businesses and will only improve as subscriber numbers increase.
“Will the teams collectively curb the financial imbalance they were getting from the local RSNs? Probably not anytime soon,” says Will Mao, senior vice president of media rights at marketing firm Octagon. “But they are going to find other ways to market because they are going to reach a broader audience.”
Kiswe’s business, founded in 2013, is also unproven. The startup earns less than 50% of streaming revenue from its partners, after the team recovers a minimum guarantee. Even with one of the largest portfolios in the industry (which also includes the NBA’s New Orleans Pelicans and Phoenix Suns, as well as the WNBA’s Phoenix Mercury, plus the Los Angeles Clippers’ alternate language broadcasts), Forbes Kiswe’s income is estimated to be less than $10 million.
“We think these will end up being very big deals for the teams,” says Rick Allen, CEO of Viewlift.
Still, the opportunity is immense. Diamond Sports Group, a Sinclair cable subsidiary that had been languishing in bankruptcy court since 2023 before receive approval of your reorganization plan last week, it used to control the rights to 42 local sports teams and generated $3.8 billion in revenue in 2018. While the two business models are not the same, local sports remain must-see live programming for millions of fans.
For Kiswe, at least, patience is part of the game plan. The company was founded by Kim and Sweldens (then head of mobile at Bell Labs parent company Alcatel-Lucent) along with sports media veteran Jimmy Lynn, and even a decade ago their goal was to bring sports to the then nascent live streaming space. However, the troika found little room among the airtight long-term contracts that most teams and leagues had.
In 2020, Kiswe opted to host entertainment shows such as virtual concerts, and during the Covid-19 pandemic, he hosted several highly successful online shows for K-pop band BTS. The largest of them sold more than 1.3 million digital tickets and grossed about $70 million in tickets and merchandise. In fall 2021, Kiswe raised $35 million of additional capital at a valuation of $259 million.
Since then, demand for virtual concerts has decreased and sports remain a more competitive arena. In addition to rival tech companies, the NBA has developed an internal streaming platform that it offers to teams for free, funded by the league’s innovation budget. The Dallas Mavericks and Portland Trail Blazers are among the teams trying to do it on their own, at great expense. He Dallas Morning News recently reported that the Mavs have invested 8 million dollars in creating your own service.
That’s part of the reason why Kiswe, in addition to customizable features and device compatibility, offers a minimum guarantee estimated between $1 million and $2 million to incentivize teams.
“They were investing in us,” says Olson, the Jazz president. “And seeing their commitment to helping us succeed definitely helped us want to partner with them.”
Viewlift, one of Kiswe’s main competitors, has a completely different model for regional sports broadcasting. It sells its product packages for a fixed monthly fee (similar to Microsoft Office or other so-called “software as a service” products). Teams can keep 100% of the income they earn from subscriptions, advertising or any other category.
The company was co-founded in 2008 by former AOL executive Ted Leonsis, who now owns the NBA, WNBA and NHL teams in Washington, D.C., as well as the teams’ RSN cable network, Monumental Sports. Network, so partnering with those two companies was a no-brainer. But the company has also signed contracts with LIV Golf; with the Las Vegas Golden Knights, Florida Panthers and Colorado Avalanche of the NHL; and with the Denver Nuggets of the NBA.
According to Viewlift CEO and co-founder Rick Allen, the price a team has to pay in the first year is roughly equivalent to what they would get under the revenue-sharing model. But since the cost of his product is not scalable, he offers teams a potential advantage and his company boasts profitability for the last five years.
“We think these are going to end up being great deals for the teams,” Allen says. “Our teams have realized that a minimum guarantee of one or two million dollars per season is extremely small compared to the value of this media company that they are creating in this new world. And choosing your partner based on who gives you that check is not a smart long-term decision.”
The question is, of course, whether streaming and beam is really here to stay or is simply a temporary measure. MLB Commissioner Rob Manfred has made clear that he wants to bundle as many teams as possible into a national streaming product, rather than on team-by-team platforms, which would leave little room for technology partners. The NHL’s domestic rights deal includes 1,000 games on ESPN+, and Silver, the NBA commissioner, says his league will take the next six months to evaluate its options.
Rumors that big tech companies like Apple and Amazon could buy a package of broadcast rights are hanging over all three leagues, and former cable operator Diamond Sports Group is managing to stay afloat for now. The company is emerging from bankruptcy, and its new naming rights partnership with FanDuel and content partnership with Amazon Prime could signal a death rattle of the old guard.
In this limbo, Altitude Sports, Kroenke Sports & Entertainment’s RSN in the Denver market, has opted to broadcast some Nuggets and Avalanche games on cable (although not through Comcast, with whom it has been in a streaming dispute. streaming since 2019) and some over-the-air games, and in late October announced an Altitude+ streaming service in partnership with Viewlift. (Like Leonsis, billionaire Stan Kroenke owns both teams and the RSN.)
“We want to make sure we’re in every lane, depending on what wins or doesn’t win,” says Steve Smith, president of KSE Media Ventures. “We will see in five years how all this turns out. “There’s really no right answer right now.”
This article was originally published by Forbes US.
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* How significant is the potential for personalized fan experiences and engagement through data analysis in streaming, and what ethical considerations should teams address when leveraging this data?
## Open Ended Discussion Questions for Streaming Sports:
Here are some open-ended questions, grouped by topic, to stimulate discussion about the future of watching sports:
**I. The Shift to Streaming and its Challenges:**
* **The article mentions that streaming revenue may not immediately offset losses from declining cable viewership. How vital is it for teams to explore other revenue streams beyond broadcasting rights, and what are some innovative ways they could achieve this?**
* **What are the potential long-term implications for team finances if they rely heavily on streaming revenue, which is often less predictable than cable deals?**
**II. Competition and Collaboration in the Streaming Landscape:**
* **The article highlights different models for sports streaming, from minimum guarantees to SaaS subscriptions. Which of these models do you believe is most sustainable in the long run, and why?**
* **Big tech companies like Apple and Amazon are rumored to be interested in acquiring broadcast rights. How would their involvement change the landscape for both teams and fans? What are the potential benefits and drawbacks of having these tech giants control access to sports?**
* **What are the risks and rewards for teams that choose to go it alone with their own streaming platforms, as the Dallas Mavericks are doing? What infrastructure and expertise is needed to succeed in this model?**
**III. The Role of Data and Fan Engagement:**
* **The article mentions that streaming provides teams with valuable fan data. How can teams leverage this data to personalize fan experiences and drive engagement in creative ways? Should fans have more control over how their data is used by teams?**
**IV. The Future of Sports Viewing:**
* **Do you believe bundled national streaming packages, like the one MLB commissioner Rob Manfred envisions, are the inevitable future of watching sports, or will team-specific platforms continue to thrive? Why?**
* **Beyond streaming, what other technologies or trends could revolutionize how we consume sports in the future? (e.g., VR/AR, interactive experiences, metaverse integrations).**
**V. Implications for Viewers:**
* **Do you think the shift to streaming will ultimately make sports more accessible to fans or lead to higher costs and fragmented viewing experiences?**
* **What are your personal preferences for watching sports? What factors are most important to you (e.g., cost, convenience, quality of the stream)?**
These questions are designed to encourage critical thinking, debate, and future-oriented discussion.
Remember, the goal is not to find definitive answers but to explore the complexities and possibilities of this changing landscape.
