The Strategist

Amazon to broadcast sports events

11/22/2016 - 14:28

The world's largest Internet retailer Amazon is preparing to launch live broadcasts of sports events, available for Amazon Prime subscribers. The American company is currently in talks to acquire rights to broadcast live from the National Basketball Association, National Football League, Major League Baseball and other sporting organizations.

Silus Grok
Silus Grok
According to The Wall Street Journal, the world's largest online retailer in negotiating with a number of sports organizations to acquire broadcast rights on major sporting events. According to the newspaper’s sources, in recent weeks the company has had talks with with National Basketball Association (NBA), National Football League (NFL), Major League Baseball (MLB), as well as a few leagues of football, lacrosse and surf. 

In addition, of and conventional television networks are discussing possibility to acquire rights on broadcast sporting events, which broadcasters do not use. Among them is Univision Communications, which owns rights on broadcasting the Mexican Football League, yet is not doing it. Other broadcasters are ESPN, owned by Walt Disney, and cable and satellite TV channel ONE World Sports. According to the WSJ, the talks with TV and sports organizations are supervised by Head of Amazon’s sports department James Delorentso, a former manager of Time Warner’s Sports Illustrated.

Striving to leave no stone unturned and attract a larger audience to its Prime package, Amazon even held talks with organizations such as sports student league Atlantic Coast Conference, Internet channel Campus Insiders, covers sporting events at colleges, website sports 120, National Lacrosse League, Major League Lacrosse, and World Surfing League.

So far, traditional and cable channels have been exclusive broadcasters of popular games and tournaments. Sport has been a major source of motivation for millions of viewers to pay for rather expensive services of cable operators. There’s no doubt media managers understand this.

In case of success, Amazon will receive strong contenders. Similar attempts have already been made by Facebook and Twitter; BAMTech, MLB's digital media company, is also an online broadcaster. However, ratings of even the most popular tournaments are falling, so new partnership will allow sports leagues to maintain royalties at the same level.

Net profit of online retailer Amazon in the first nine months of 2016 increased by 14 times yoy, and reached 1.622 billion dollars, according to the company’s statements.

Diluted earnings per share were $ 3.36 versus $ 0.24 in the same period of 2015. Revenue from sales increased by 29.5%, up to 92.246 billion dollars.

In the third quarter, net profit of Amazon increased by 3.2 times in annual terms - up to 252 million dollars. Diluted earnings per share were $ 0.52 versus $ 0.17 in the third quarter of 2015. Experts expected to see the rate at $ 0.78 per share. Revenue from sales increased by 29%, up to 32.714 billion dollars. This coincided with Amazon's own forecast for this indicator, which was in the range 31-33,5 billion.

At the end of the fourth quarter of 2016, the company expects sales growth of 17-27% in annual terms, up to 42-45,5 billion.