Details about Venu Sports, the joint venture sports streaming program to be offered by ESPN, Fox, and Warner Bros. Discovery, have emerged. The offering will be priced at $42.99 per month and include 14 linear networks at launch: ABC, ACC Network, Big Ten Network, ESPN, ESPN2, ESPNEWS, ESPNU, FOX, FS1, FS2, SEC Network, TBS, TNT, and truTV. The service will also include access to ESPN+ content.
Given Venu’s pricing and channel lineup, the service’s potential customer appeal and impact on other streaming services is clearer. Here are a few insights:
- Assuming a fully priced $10.99 fee for ESPN+, the linear channels comprise $32 of the new bundled offering. The actual revenue split is likely larger for linear channels, with ESPN taking a smaller margin on ESPN+.
- At a price point above $40 per month, Venu will be the most tempting to sports fans who (1) are price sensitive and want to cut the cord, (2) are open to watching over-the-air broadcast TV (for NBC and CBS), and (3) find non-sports channels unappealing. Older sports fans may be a fit, if they don’t care about getting Fox News or CNN. Younger sport fans may also be a fit, though their willingness to watch over-the-air content may be a stretch.
- Venu is a subset of Hulu with Live TV’s sports content (with the $1 ESPN+ add on). Disney must expect Venu to be a net addition rather than a cannibalization of Hulu with Live TV subscribers.
- YouTube TV and Sling TV seem to be the cost-competitive alternatives to Venu. YouTube TV includes all the Venu channels (but not ESPN+), but also provides CBS, NBC, other sports networks, and a big bundle of non-sports channels for only $20 per month more. Sling TV’s Orange+Blue package is $12 more, and includes WBD’s sports channels, the most popular ESPN and Fox sports channels, and a bundle of other sports and non-sports channels. At the same time, Venu could be a substitution threat to subscribers who only take YouTube TV and Sling TV so that they can watch sports.
- DIRECTV Stream’s least expensive package includes the most popular Venu channels along with other niche sports channels. The service relies much more heavily on non-sports content for this tier (thus the name).
- Despite its lawsuit with ESPN, Fox, and Warner Bros. Discovery, Fubo TV actually has the broadest set of sports channels among vMVPDs (though many are niche channels). The fact that Fubo is crying foul over the Venu JV speaks to the dominance that the ESPN and Fox Sports channels have in sports viewership and linear sports channel demand. Venu’s presence will likely erode Fubo’s position as the vMVPD option for sports fans, particularly since Fubo TV is almost twice the price of Venu.
College sports seem to be the strong suit for Venu, but fans will need to have options beyond Venu for the most popular professional sports. The split of rights across services, and broadcast TV channels, will ultimately drive today’s pro sport fans to full pay-TV services or self-bundled packages (or OTA antennas).
Will all sports be brought together under one unified streaming service? Don’t bet on it…at least not anytime soon. NBC and Paramount likely don’t want to crater the US pay-TV world and hurt their cable networks (or broadcast retransmission fees). The cable TV world would have to fall apart on its own before NBC and Paramount decided to join up with the Venu crowd. Also, as sports rights come up for bid, you can expect larger streaming giants such as Amazon, Apple, and Netflix to be in the mix.
In the end Venu will grow a customer base, particularly given consumer interest in lowering their overall monthly streaming costs. However, it will be one player among many for a while to come.
Brett Sappington is Founder and Principal Analyst for Sappington Media, which provides market insights, thought leadership, market research, and strategy consulting services for leading companies in the entertainment and telecommunications space.
Industry Voices are opinion columns written by outside contributors—often industry experts or analysts—who are invited to the conversation by StreamTV Insider staff. They do not represent the opinions of StreamTV Insider.