Paul Stenhouse: ESPN plans to cut ties with Pay TV operators, US Govt wants a stake in Intel

US Sports giant ESPN is signalling its TV days are numbered  

The media company has announced it's going direct to fans with exactly the same thing you can get through a Pay TV provider. In the USA, the leagues make deals with networks, who then make deals with Pay TV operators, who sell bundles of networks to consumers. ESPN has just announced it’s cutting out its old friend the Pay TV operator – ouch. Why? About 35 million households have stopped paying for the sports cable channel ESPN over the past 15 years, and they think they can win them back if they don't need to buy all the other cable stuff just to get the thing they want.  

In NZ terms —not that this deal is international yet— it would mean instead of only being able to get ESPN through Sky, you would be able to get exactly the same channels directly from ESPN.  

A digital environment means that you're not constrained by the number of channels – you could have 50 events taking place at the same time, instead of being forced to make decisions about what to show on your 5 channels. It comes with risks too, sports streaming can be laggy and grainy, sometimes struggling with the fast motion of a game. Linear broadcast has had that solved for decades.  

 

The US Government wants a piece of Intel?  

According to Bloomberg, the US Government is reportedly in discussions to take stake in Intel to help the company expand its US manufacturing efforts, including its much-delayed Ohio chip factory. It's the latest instalment in the tech tariff and China-AI arms race story, where chip giants Nvidia and AMD will pay the US Government 15% of Chinese revenue to secure export licenses to China. The US had previously banned the sale of powerful chips used in areas like artificial intelligence (AI) to China under export controls usually related to national security concerns, and had threatened large blanket tariffs on the import of semiconductor chips.   

 

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Episode Transcript

Speaker 1 (00:07):
You're listening to the Saturday Morning with Jack Tame podcast
from News Talks at b US.

Speaker 2 (00:13):
Sports giant ESPN says that it's TV days are number.
Don't worry. It's not getting out of the business of
sports broadcasting, but it might be getting out of the
business of TV. Our Textbert Paul Stenhouse is here with
the details. What's happening?

Speaker 3 (00:25):
Paul. Yeah, It's funny, isn't it, Because when I first
kind of thought about this, it's like, well, haven't we
already been going direct to the consumer? Haven't all of
these companies been trying to go direct? And they have,
but they haven't. And it's a really key point, Jack,
because they never give you the actual thing you get
that they had on TV, right, And that's what ESPN

(00:46):
is actually going to give you right whenever they try
to do one of these digital things over here in
the States. They're trying to protect that relationship they have
with the middleman. They don't want to give up the
thing that gives them literally billions of dollars, right because
they buy the rights from the sports companies, they on
sell that to the PATV operators and that is a lucrative,
lucrative business. But ESPN is finally bit the bullet and

(01:10):
they have said that ESPN will go direct to the consumer,
So they are cutting out that PTV provider who has
been a friend of theirs maybe friendly foe for a
very very long time. And if you're a fan of sports,
you will now just be able to scrap the entire
TV bundle. You don't have to worry about getting channels

(01:30):
you don't want. You're just going to get ESPN and
all your sports. And in the US, it's like thirty
bucks a month is where it's launching or something like that.
And it's really interesting, right, yeah, because so many people
have said, na, cable, don't want it, too hard, too expensive,
You've got things I don't want although I've never had cable.
Their kids and they're saying, well, everything I get is

(01:51):
on my phone. This will be ESPN's way of actually
being able to now say to those fans who've ditched
cable or never had cable, come over here, give me
your credit card and you can actually start watching some
of this.

Speaker 2 (02:04):
Yeah, it is pretty remarkable, isn't it. I mean, in
New Zealand, we're kind of, you know, we're halfway there
in that you can get Sky Sports now, so you
can just pay for Sky Sport basically and stream it
rather than paying for all of the Sky channels. You know,
they've kind of got a breakoff product there where you know,
where they can and there's you know, there's some scuttle

(02:26):
but publicly reported scuttle, but that for example, TV and
Z might be looking at having sports rights and putting
it behind the paywall in the future. I don't know
anything about that from being inside TV and Z, but
you know, that's at least what's been publicly reported. So
I guess this is kind of a trend that's happening
in lots of places. But I suppose we could, like,
if we take this trend to its nth degree, it's

(02:49):
not unreasonable to think that before too long you will
just be paying for individual sports, right, so you're just
going to go like, for example, I am happy to
pay forty dollars a year for the All Blacks, but
I'm not going to pay another forty dollars for cricket rights,
or I'm not going to pay an the thirty dollars
for other sports. Like you could see how it kind

(03:09):
of becomes bulcanized, you know, So.

Speaker 3 (03:12):
Here's how it gets. Here's where it gets even crazier.
So you would think that, but in the States, the
NFL now wants to get out of the media business.
They actually used to have a thing called the NFL Network,
And part of this plan of ESPN going direct to
the consumer is that NFL Network will give ESPN a
whole bunch of channels and additional content, even some additional games,

(03:34):
and in return they're trying to get I think it's
about ten percent of ESPN, which has to get you know,
go through the regulators and all that stuff. But what's
interesting is that it's a sports league who has previously
really tried to double down and not just be a
sports league but also be a media company, and now
they're moving away from it. So I actually think it's
almost interesting to see if someone like the All Blacks

(03:55):
would almost do the reverse. Right, Hey, it's too hard.
We don't want to be a media company. Yeah, we
don't know if to worry about subscriptions. We are good
at finding amazing rugby players, bringing them through from high
school right the way through to pro and we're really
good at creating an in stadium experience. That's your business.
So It is interesting because that was absolutely the trend.

(04:18):
And then what you're starting to see now is that
as each of these companies decide they want to go
direct to consumer, especially here in the States, they're now
starting to bundle, which is kind of like a digital
effectively cable channel, right where you can buy your Disney
Plus maybe mixed with your Paramount Plus, mixed with your Peacock,
and then you pay a set fee, and then you
can go over here and do an Amazon Prime and

(04:40):
it's something else in a Discovery Plus. It's like it's
almost become more confusing for people. It was some simplicity
that you get Sky, you get all the channels, and
you got all.

Speaker 2 (04:48):
The ten and that's that. Yeah, that was nice.

Speaker 3 (04:50):
Now it's like, who am I paying? How much? Is
there a bit of deal?

Speaker 2 (04:53):
Huh? It's gonna be very interesting. All right, Thanks so much, Paul,
appreciate your time. Our Techsbert Paul Steinhouse. So you know,
we're still waiting for this press conference with President Trump
and Vladimir Putin to begin in Alaska. They've set up
sort of stay area in front of all the media
and there's a big banner down the back. There's a
US flag, there's a Russian flag, and there's a couple

(05:13):
of different podiums, and then there's a big banner down
the back that says pursuing peace. So we will see
how they've gone in their one on one meetings this morning.
Very short lived.

Speaker 1 (05:23):
For more from Saturday Morning with Jack Tame, listen live
to News Talks at B from nine am Saturday, or
follow the podcast on iHeartRadio.