Sports Center: Sinclair Could Launch RSN Direct-to-Consumer Service

摘要

A week after Charlie Ergen lamented that Sinclair didn’t own the Fox RSNs when their contract expired with DISH,Sinclair offered further optimism. “We continue to have discussions with DISH for the carriage of the RSNs and remainconfident that our two companies will eventually reach a mutually acceptable carriage agreement,” Sinclair pres/CEOChris Ripley said on the company’s 4Q earnings call. Sinclair stock tumbled nearly 15 points Wednesday after it failedto meet 4Q19 profit expectations. Investors are concerned over the RSN environment, but Ripley is confident and toldinvestors the company would be aggressive in buying back stock due to its current valuation on the market. “If you do asum of the parts on us, you will find that our current stock price ascribes no value to our sports segment… Based on thecurrent trading levels of our stock, it’s hard to argue that there is a better return for us than repurchasing our own shares,”Ripley said. He also responded to rumors that Sinclair is nearing a deal with video streaming service Deltatre to serve asa digital video provider for the 21 Fox RSNs (and yes, Sinclair is planning to rebrand them in the coming months). Accordingto reports, Deltatre would provide the underlying technology for live sports broadcasts across its various networks.While he wouldn’t confirm a Deltatre deal, Ripley did say Sinclair’s plans would make a sports streamer possible. “Weare doing a lot of work around a digital reboot, which we think is a fantastic opportunity to create something on the scaleof ESPN Digital. Not only would that include various, different content types aside from just video, but would be the ideallaunching point for any direct-to-consumer offering, be that super fan upsell packages or the entirety of the RSN on adirect-to-consumer basis,” he said. “That’s not being done today, we have no plans to do that, but the new digital footprintthat we’re building out would be fully capable of doing that.” He also believes that investments in the sports arena willopen up new monetization opportunities. “Sports betting we think will have a large new revenue pool associated with itthat would ultimately be bigger than advertising, but not as big as subscription.” Ripley only briefly mentioned last week’slaunch of Chicago Cubs jv Marquee Sports Network, saying “very good progress” is being made on carriage. The biggesthold-out is Comcast, but Ripley is optimistic that an agreement will be reached ahead of the regular season. For thequarter, Sinclair’s revenues rose 82% YOY to $1.62bln, with a large portion coming from media assets. But net incomedropped to $44mln from 4Q18’s $206mln figure. Distribution revenues jumped to $1.104bln from $334mln YOY. Sinclair continues moving full-speed ahead with plans to deploy ATSC 3.0 this year. It joined Pearl TV, an organization comprisedof broadcasters dedicated to deploying the technology, earlier this month. It also teamed up with SK Telecom in Januaryto form Cast.era, a jv focused on cloud infrastructure for broadcasting, ultra-low latency OTT broadcasting and targetedadvertising. “The industry is on track to deploy Next Gen TV in many markets this year, while the consumer electronicsmanufacturers have announced plans to bring in 20 Next Gen-enabled TVs to the market this year,” Ripley said.