March 13, 2010

Live streaming bedfellows: ESPN and MLBAM

The announcement this week that Major League Baseball Advanced Media (MLBAM) will handle all of ESPN’s live streaming video may, at first glance, seem like a case of business making for strange bedfellows.

But for ESPN and MLBAM, that’s hardly the case. These are simply two smart companies who found their digital strategies converging and are leveraging their assets by strengthening a relationship. While competitors, ESPN and MLBAM have long had a solid working relationship, not to mention a rights agreement in place through 2013. Monday’s announcement will simply bring them closer.

(Disclosure moment: I was Vice President and General Manager at MLBAM for eight years)

ESPN, which will be changing the name of its video channel to in April from the current, said it will stream nearly 3,500 live events each year. That lineup will include college football, tennis, NBA, and the headliner for this year, World Cup soccer.

The move should be a win-win for both. ESPN is likely to reduce costs from its previous vendor, and more important, improve the quality of its streaming video.

“Baseball does a terrific job in terms of online video and distribution of their games,” said John Kosner, senior vice president of ESPN Digital Media. “They really are the best in class for sport.”

MLBAM has long had the technology and infrastructure to broadcast live events. In addition to streaming more than 2,500 baseball games a year, the company created a niche in the marketplace. It streams video for a number of its affiliate sites, as well as having had a few dozen other properties the past few years, most notably CBS, which uses MLBAM to stream March Madness.

By adding ESPN and the sheer volume of its events to that mix, MLBAM should be able to reduce its streaming costs. And with few competitors in the marketplace, the company is likely to enjoy stronger profit margins on that business as well.

Major League Baseball to stream ESPN events {N.Y. Times} taps MLBAM for {ESPN MediaZone}

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