Why Netflix Won’t Stream Live Sports
Online Video Streaming: Rapidly Changing How We Watch TV
Live sporting events: No value for the money?
Netflix (NFLX) is by far the leader when it comes to on-demand video streaming. But Netflix currently has no presence in live sports streaming. Last week, Netflix said it isn’t interested in streaming live sporting events because it provides on-demand streaming, not live streaming. Ted Sarandos, head of content acquisition at Netflix, also said, “I don’t think the on-demand to sports is enough of an addition to the value proposition to chase.”
Media companies compete fiercely for exclusive Super Bowl rights
Live sporting events are quite valuable for TV networks. Competition is fierce for exclusive rights to major events such as the Super Bowl. Last year, 21st Century Fox (FOXA) had rights to Super Bowl XLVIII. This year’s Super Bowl XLIX was broadcast by Comcast’s (CMCSA) NBC Sports channel.
The Super Bowl has a big impact on a network’s TV ratings. As you can see in the above graph, in the 2014–2015 season, Fox had the lowest primetime Nielson ratings among the four largest US networks in the 18–49 years age group. NBC had the highest ranking because it broadcast Super Bowl XLIX this year.
CBS (CBS) and Walt Disney’s (DIS) ABC got the second and third highest ratings, respectively, in this key 18–49 years adult demographic, the most sought after by advertisers. If you want to take a diversified exposure to 21st Century Fox, you may invest in the Consumer Discretionary Select Sector SPDR Fund (XLY). The ETF held ~2.7% in the company as of April 30, 2015.
Browse this series on Market Realist:
