MLB’s new in-market online streaming service, launched recently with two teams, has the potential to rival the $40 million or so that MLBAM gets from its online video service MLB.tv, according to SBJ, citing league execs (sub. req.). That’s based on the number of subscribers it could attract, on a pricing model similar to its current subscription, assuming a critical mass of teams sign on—way too many factors to really come to a solid conclusion, but let’s run with it anyway.
The numbers are a ballpark—a mid-eight-figure sum—that Allen & Co, who did a study on the in-market streaming potential, cited in its report to the league. The reasoning: Most fans root for a single team, and the sports fan base is roughly split nationwide between being geographically near their favorite club and being dislocated. Assuming most online subs are out-of-market fans, this presents a chance to “essentially double the market for sales of streaming video subscriptions,” with the hometown fans. It also assumes that the additional marketing the in-market product is getting already from partners would go a long way in getting subscribers.
So far, only two clubs have signed on: New York Yankees with YES and Cablevision (NYSE: CVC), and San Diego Padres, working with Cox Communications. Signing additional teams and RSNs won’t be easy, mainly because RSNs want to work with teams directly, not MLBAM. Also, the pricing of the in-game streaming is almost the same as the regular online video subscription, which makes it pricey for the fans who have to pay for the local TV package. But let that not prevent anyone from jumping to conclusions ...
By Rafat Ali