The Walt Disney Company announced plans on Tuesday to acquire a majority stake in BAMtech, a technology and video streaming company previously owned by MLBAM, for $1.58 billion.
As part of the deal, Disney said it will launch an ESPN-branded multi-sport video streaming service in early 2018 and a new Disney-branded direct-to-consumer Netflix-like streaming service in 2019.
Disney’s purchase increases its stake in BAMtech by 42 percent, lifting its total stake to 75 percent. The company previously held a 33 percent stake in the company under an agreement that included an option to acquire a majority stake over several years. Disney said this deal marks an acceleration of that timetable.
“The media landscape is increasingly defined by direct relationships between content creators and consumers, and our control of BAMTech’s full array of innovative technology will give us the power to forge those connections, along with the flexibility to quickly adapt to shifts in the market,” Disney CEO Robert Iger said in a statement.
The ESPN streaming service due early next year will offer an array of sports programming, featuring roughly 10,000 live regional, national, and international games and events every year, including from the majors leagues, notably Major League Baseball, National Hockey League, Major League Soccer, Grand Slam tennis and college sports. Consumers who pay for ESPN television networks will be able to access those streams through the platform as well.
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Additional sports packages will also be available for purchase, such as MLB.TV, NHL.TV and MLS Live. The new service, which will be rolled out as part of an enhanced version of the current ESPN mobile app, will also include all of the news, highlights and real-time scores that fans access through the app today.
“For many sports fans, this app will become the premier digital destination for all their sports content,” Disney said in a statement.
MLB Commissioner Robert Manfred said the MLB will continue to work with Disney and ESPN to grow BAMtech, even after the deal, subject to regulatory approval, closes. MLBAM and NHL will continue as minority stakeholders in BAMTech, with seats on the board.
Upon closing, Iger will serve as chairman of the BAMTech board. ESPN President John Skipper will manage the new ESPN-branded service.
“This is an exciting validation of our team, its achievements and the customer-centric platform it’s built,” said BAMTech CEO Michael Paull. “Yet, we’ve merely scratched the surface of what can be accomplished in a future where we combine Disney and ESPN’s world-class IP and our proprietary direct-to-consumer ecosystem.”
As part of the separate direct-to-consumer streaming service that Disney plans to launch in 2019, Disney said it will end its distribution agreement with Netflix for subscription streaming of new releases, beginning with the 2019 calendar year theatrical slate.