This week’s announcement of the WarnerMedia and Discovery Inc. merger could have ripple effects for sports streaming. AT&T is spinning off its entire media arm and selling it to Discovery in an industry-shaking move. The deal won’t go through until next year but analysts believe the merger could reshape sports streaming.
AT&T pulled the trigger on the deal to relieve debt and generate roughly $43 billion. The agreement includes TurnerSports assets.
“This deal has profound implications on the sports industry,” Bruin Capital founder George Pyne said on Twitter. “The new entity can invest in adding more global sports rights to its NHL, NBA, MLB, PGA Tour and NCAA [Division I Men’s Basketball] Tournament content and create a must-have sports streaming service.”
The merger likely means an eventual combination of Discovery+ and HBO Max into one app for all of Discovery’s subscribers. The question is whether WarnerMedia’s sports-media holdings are going to move to a Discovery-branded over-the-top service. Our neighbors across the pond are bullish on this path. Discovery is the owner of Eurosport, the continent’s exclusive broadcaster of the Olympics.
“With the news that AT&T and Discovery are to merge, the landscape for sports media rights and sports broadcasting in the largest media rights market on earth is changing significantly,” said Conrad Wiacek, head of sports analysis at the London-based data and analytics firm Global data. “With sports content at the forefront of the OTT revolution, Discovery and AT&T merging now will create a new ecosystem for sports, such as esports, to gain a foothold in the US.”
The board of directors for both companies have approved the deal, creating the second-largest media company in the country behind Disney. Discovery president and CEO David Zaslav and AT&T chief John Stankey didn’t go into much detail about sports programming in the announcement, but did say sports is one of the “true differentiators of the future.”