Fubo’s value proposition is evolving to ease of use, SVP says

At the NAB Streaming Summit in New York City this week, Fubo SVP Yale Wang discussed how, in the face of rising prices, the value proposition for the sports-centric virtual MVPD is evolving over time towards ease of use.  

Fubo has taken a sports-first approach to its live streaming TV service and offers over 35 regional sports networks, after adding a collection of Bally Sports RSNs earlier this year. As of the end of Q2 Fubo counted 1.16 million subscribers and is forecasting over 1.5 million by the end of the year.

Fubo has leaned into targeting hardcore sports fan subscribers, aggregating sports content, with Wang, SVP of Marketing, agreeing that sports serve as the linchpin of the TV bundle and saying it’s why Fubo exists.

Another reason Wang believes Fubo has been able to grow is that historically its price point has been a bit more affordable than traditional linear cable - but suggested that could be changing.

“That has been one of our value propositions but over time as prices rise for everybody, Fubo’s value proposition is moving more towards ease of use” and other features-based aspects like 4K quality and multi-view capabilities, Wang said during a fireside chat Wednesday.

Ease of use can be particularly valuable for sports fans who face trouble accessing teams’ and leagues’ games that are spread across services. (Streaming Summit chair and moderator Dan Rayburn noted during the fireside chat that as a Mets fan in New York, he needs five different streaming services to catch all of the team’s games.) Fubo comes into play in somewhat of an aggregator role, going back to a unified sports bundle and aiming to provide as much sports content on the platform as possible.

Wang pointed to fragmentation of the sports bundle as one of the biggest challenges it sees. He cited a recent thrid-party survey of 3,000 sports fans (not just Fubo subscribers), where respondents said they cared about 4K and video quality – but a top answer was not knowing where to find all sporting events.  He also noted that people don’t want to have to jump between five different services to get sports content.

“We’ve kind of zigged when everybody else is zagging,” Wang said, pointing to the addition of RSNs when others in the industry were moving away from them. “We just wanted to be the united place where someone can just come on, make two or three clicks to find their content, whether it’s baseball, football, basketball, even volleyball. We’ve seen a proliferation of the types of sports that we have on Fubo.”

But as streaming services across the board are raising prices, and Fubo needs to cover costs it pays to accumulate sports content, Rayburn questioned what threshold fans are at in terms of willingness to pay for content.

Earlier this year Fubo implemented a $5 price hike to its base plan, bringing it to $75 per month, and tacked on an $11-$14 fee for regional sports networks after the addition of Bally Sports. It’s a price point that generates annualized ARPU (average revenue per user) of around $1,000, Wang noted – not exactly cheap he acknowledged, and means it’s targeting households that primarily come for the sports content but may also have interest in or get value-add from general entertainment. But that means going all in on sports and not always opting to carry certain entertainment packages on the service.

“You’re not going to pay $70-$85 dollars to watch a random show…but you’ll come in for that big football game,” he commented.

As consumers deal with price sensitivity and a fragmented sports landscape, Rayburn questioned if there’s potential for Fubo to offer skinny sports bundles that might slice and dice different types of sports.

Wang cited close ties with leagues such as the MLB, NHL and NBA, adding he thinks Fubo has a way to be a good partner. The same isn’t true for carving football out of the bundle, where the SVP thinks rights will only remain within the TV bundle.

Even though some professional sports teams have come out with their own direct-to-consumer efforts, pursuits have been on a team-by-team basis and Wang contends that larger distributors still have a role.

“What we’ve been able to achieve is, again, make it easy for the user,” Wang said, noting that price points of team-specific DTC efforts haven’t been all that low. “At a certain point you might as well just pony up to get the full bundle.”

Fubo’s efforts to pull in and launch free ad-supported streaming (FAST) channels also plays into the ease of use.

It launched the Fubo Sports Network FAST channel, which offers such sports content such as combat events and where he sees opportunity as streamers in general, and sports fans in particular tend to engage in seasonal churn coinciding with the start and end of sports seasons. He noted that Fubo has a very large install base, where even if a user cancels the service, the app might still be on their Roku or other device.

“We want to make it easy for people to go in and out of the Fubo ecosystem and to broaden the definition [of] what is the Fubo ecosystem,” he said.

FAST channels like Fubo Sports Network offer the chance for users interested in sports content but who Wang suggested might be more price sensitive or not yet willing to pay a full subscription price to get sports like the NFL.