DAZN Reactivates Global Expansion Plan, Updates Strategy For Sports Streaming In COVID-19 Comeback

Dade Hayes
·6-min read

EXCLUSIVE: Sports streaming service DAZN is expanding to 200 countries and territories on December 1, with initial monthly pricing of £1.99 or less.

Launched in 2016 and backed by billionaire Len Blavatnik, DAZN has thus far reached the U.S., Brazil, Spain, Germany, Austria, Switzerland, Canada, Italy and Japan with a monthly price between $10 and $20. Boxing has been a calling card, and the global rollout is tied to two fights included in the regular subscription price: Ryan Garcia vs. Luke Campbell on December 5, and Anthony Joshua vs. Kubrat Pulev on December 12. (The latter bout will not be available on DAZN in the UK or Ireland.)

DAZN in early March had declared its intention to go global, but COVID-19 then threw everything into question. The other aspect of the previous framework that has dropped out for now is a fight featuring Canelo Alvarez to help kick off the global move. Alvarez, DAZN and Oscar De La Hoya’s Golden Boy Promotions have been in a dispute over details of the $365 million deal between Alvarez and the streaming service. The process has just entered arbitration.

John Skipper, who joined DAZN as its executive chairman in 2018 after a 27-year run at Disney and ESPN, said the challenges of COVID-19 have not spared the company but have ended up giving it a chance to regroup.

“I have wanted to be international,” Skipper told Deadline in an interview. “I’m not going to pretend this was the road map. I do think that COVID gave us a chance to evaluate our plans.” During the pandemic, which hit Asia and Europe in January and February and then the U.S. in March, “we didn’t have live events. We really weren’t producing anything, we weren’t marketing anything. We weren’t buying new rights. So we did have a genuine chance to stop and kind of go, ‘What’s working and not working?’”

A range of connected-TV and digital platforms will distribute the new global app, with additional distribution deals to follow. Initially, most content will be available in either English or Spanish, with further localization possible down the line. An “open browse” feature will let potential subscribers sample video content through a web browser, though not marquee events like the Saturday night fights.

By the end of 2019, DAZN had reached 8 million global subscribers. After losing ground without live sports, the subscriber count dropped in the first half of 2020 but then stabilized, and the company is on track to end 2020 back at the 8 million mark.

Financial pressures forced a few dozen layoffs earlier in the year, and DAZN has also been in discussions with investors to raise as much as $1 billion in new funding. It has explored selling a stake in its Japanese operation. The global expansion will involve a consolidation of DAZN’s unprofitable Brazil presence into the global platform. Subscribers in that region will still be able to get the service, but its staffing will be streamlined and its program offering will not prioritize local fare.

While there have been whispers by competitors about DAZN’s status, Blavatnik’s already massive net worth got a boost in June when Warner Music Group went public. The Ukraine-born businessman made a counter-intuitive purchase of the music company in 2011 for $3.3 billion at a time of growing piracy and plunging CD sales. With subscription streaming now exploding, the company’s IPO netted Blavatnik $7.5 billion. DAZN has also gotten some incoming feelers from investors, and various scenarios for reworking the company’s financial structure are under consideration, though Blavatnik’s Access Industries remains in control.

Skipper, who spearheaded initiatives like 30 for 30 as head of programming and then president of ESPN, is looking to push DAZN deeper into non-live original programming. Budding franchises like 40 Days and One Night will grow and be accompanied by new titles — and some new rights — in 2021. Soccer, including top-tier outfits like Bundesliga, Champions League and Serie A, has been a cornerstone in Europe, where DAZN sees growth potential.

“The opportunities are in the rest of the world,” Skipper said. In various global territories, DAZN has rights to the NFL, Major League Baseball and other top leagues, but not in the U.S., where they are the costliest.

A recent extension by Turner of its Major League Baseball rights, at a sizable increase, points to the direction of things Stateside. “When you analyze the landscape, the biggest opportunities are in the rest of the world,” Skipper said. Recent deals suggest the price of rights outside the U.S. is on a downward trajectory, due to various regulatory and distribution factors.

In the U.S., media companies are coping with a continued hothouse environment. All of them, nevertheless, are eager to renew their NFL deals when the expire in 2022. NBCUniversal, Disney, ViacomCBS and Fox — have been hit by a wider array of COVID-19-related challenges than smaller pure-play companies like DAZN but are still expected to shell out steeply increased amounts to keep football. While Skipper, a charismatic presence on the sports media scene for decades, has managed to seed the idea that DAZN was waiting in the wings to possibly make a splashy U.S. rights grab, the new direction will be more strategic and targeted.

It was important to finally go global, Skipper said, so that “we stake the territory and we know that it works, the currency, the regulatory environment.” In cases like the Anthony Joshua fight, where his opponent is Bulgarian, “We’re going to be in Bulgaria. Maybe 100,000 people will subscribe. Maybe that’ll make us think about going into Bulgaria and buying — I’m making this up — Greco-Roman wrestling. And maybe we have a little business. Maybe it’s 250,000 subscribers and we get $2 a month, so it’s a $6 million-a-year business. But we’re there.”

Unlike legacy media competitors managing linear networks and other assets, DAZN is a digital company with a singular focus. “I do believe we relish our first-mover advantage,” Skipper said. “We don’t think anybody else is going to move. They’re going to double down domestically.”

Initially, the global product will be the same in every country. But it will evolve, Skipper said. “The second wave is going to be, we’re going to get calls from 8,000 rights holders in 173 countries who say, ‘Have you thought about the diving championships in the Tiwi Islands?’” Skipper said with a laugh.

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