Facebook-Major League Baseball Is Latest Sign of Streaming Things to Come

Facebook-Major League Baseball Is Latest Sign of Streaming Things to Come

Original Article on TheStreet

Major League Baseball had a terrific season in 2016 as the Chicago Cubs won their first World Series since 1908. Viewership for the seven-game series pitting the Cubs against the slightly less star-crossed Cleveland Indians averaged more than 21 million viewers, with the final game drawing an audience of 25.2 million viewers, the largest since 1991.

21st Century Fox‘s fourth-quarter revenue and profit received a big boost as its Fox network posted advertising sales that exceeded forecasts.

Not every baseball season is likely to be as popular as 2016, however. Some years, baseball viewership slips as teams from small markets advance through the playoffs, or embraceable story lines fail to emerge. The National Football League suffered a decline in viewing during its recently completed season, raising questions about the long-term strength of sports viewership.

With those dips in mind, Major League Baseball was said to be “in advanced talks” with Facebook, the world’s largest social media platform, to stream one game per week, according to a report earlier this week from Reuters.

An MLB official declined to comment on the report, while representatives from Fox and Facebook weren’t immediately available for comment.

Streaming a game a week on Facebook stands to benefit both MLB and Fox, which spends billions of dollars each year on the rights to broadcast sports events, by expanding its audience to viewers who might not normally choose to watch a game. At the end of 2016, Facebook said it had more than 1.7 billion monthly viewers worldwide.

Facebook “is where advertisers and marketers want to be, and the company’s continued innovation across its platforms demands more share of the advertising pie, both from traditional avenues and from other digital media platforms,”

“It would be great for MLB to get a huge outlet to distribute their content to a set of audiences they might not have gotten otherwise,” said Shahid Khan, the New York-based founder of media platform and data services provider Mediamorph. “For Fox, if you spend a lot of money on content rights and you’re ad-supported, you need to monetize that content in as many places as possible.” 

A deal between MLB and Facebook would come at a point of sweeping transition in how viewers access television programming, especially sports. Over the past 18 months, Disney has expanded the availability of its ESPN sports behemoth, licensing the network to standalone multichannel streaming services such as Dish Network‘s Sling TV and AT&T‘s DirecTV Now in an effort to win over so-called cord-cutters and cord-nevers who choose not to subscribe to traditional pay-TV.

Sports enthusiasts also have the option of subscribing to streaming services such as FloSports and fuboTV, which has deals with Fox and Comcast‘s NBCUniversal. While FloSports concentrates on niche athletics such as wrestling, track and field and gymnastics, fuboTV’s concentration is soccer from all parts of the world. And while both have less than 1 million subscribers, ESPN’s subscription base had fallen to 90 million at the end of 2016 from nearly 100 million in 2010, according to recent Disney corporate filings. 

The fragmenting of audiences, especially for sports, may be best represented by the success of World Wrestling Entertainment‘s WWE Network, which has grown its standalone streaming service into the fifth-largest in the country, according to a study released in October by industry monitoring group Parks Associates. MLB.tv, incidentally, stands one spot ahead in fourth.

“Cord-cutting is happening, and sports are not immune,” said Martin Floreani, CEO and co-founder of FloSports in Austin, Texas. “There’s a growing disconnect between what cable TV delivers and what people want to have on digital, plus it no longer makes sense for how people want to spend their entertainment dollars.”

Facebook already has begun streaming other sports, having entered into a recent deal with Univision Communications to carry Mexican soccer matches in English. Facebook also has live-streamed soccer matches, basketball and table tennis events, while MLB successfully built one of the most widely used streaming networks in the world, BAMTech, the force behind MLB.tv. Disney last year acquired a one-third stake in BAMTech for $1 billion.

“MLB could be the first major sport league in this country to do a deal, but if Fox has negotiated cross-platform rights, there’s no reason they shouldn’t expand on [other] social media platforms,” Khan said. “Social media used to be a way to drive traffic to your home page or portal, but today social media is the platform.