Startup DAZN Wants to Stream Sports Online

Startup DAZN Wants to Stream Sports Online
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Music mogul Len Blavatnik has begun to breach broadcasters’ last line of defense against the onslaught of online entertainment: sports. According to Bloomberg, DAZN, a startup backed by billionaire Blavatnik’s Access Industries, has planted its flag in Germany, where the company (pronounced “da zone“) has been offering Bundesliga highlights, live English Premier League soccer and NBA basketball online since August. Soon enough, it intends to go after dominant providers like Sky when prized rights are auctioned.

“Within the next 12 to 18 months, we’ll get pretty aggressive,“ DAZN Chief Executive Officer  James Rushton said in an interview at Bloomberg’s London office. “We don’t see ourselves as a niche platform.“ DAZN, which also operates in Austria, Switzerland and Japan, has set about replicating the formula Netflix did: An array of online sports for one low monthly price. Like Netflix, Rushton has initially filled the queue with the equivalent of reruns, less-expensive highlights and out-of-market games for most sought-after leagues, combined with some marquee material that he hopes will become a bigger and bigger component of the offering.

DAZN’s incursion may be well-timed. Live television viewing of major sports like Premier League soccer in the U.K. and the National Football League in the U.S. has weakened recently, hurting share prices at Sky and Walt Disney, the owner of ESPN. Younger viewers are especially elusive, spending less time in the living room and more on mobile apps like the one DAZN offers.

The startup struck a three-year deal for an undisclosed price with the English Premier League to show matches in Germany, replacing a contract with Sky. It follows Discovery in intensifying competition in the country just as Sky is seeking faster growth in the market. DAZN is also weighing expansion into other European and southeast Asian markets. They paid 210 billion yen ($1.8 billion) for a 10-year deal to show J.League soccer in Japan, the only bidding figure it discloses, as it challenges TV rivals such as SKY Perfect JSAT.

In Germany, DAZN currently pipes the games onto any web-enabled device without a long-term fixed contract for 9.99 euros a month, cheaper than Sky’s lowest-cost monthly sports package of 29.99 euros excluding promotions. DAZN’s subscriber numbers are still small, though rising faster than expected since the August launch. Germany isn’t an easy market to crack for pay-TV providers, as well-funded public broadcasters provide high-quality content for free. While 90 percent of American homes and about two-thirds in the U.K. have pay-TV subscriptions, only about 30 percent of German households do.