RotoWire Founder Peter Schoenke; Netflix To Air World Baseball Classic in Japan

0:28This is the business of sports. tune into this. If you're playing money ball with a huge bag of money, you're going to be really, really good. Bloomberg Business of Sports from Bloomberg Radio. This is the Bloomberg Business of Sports, where we explore the big money issues in the world of sports. I'm Michael Barr, along with Damian Sassauer and Vanessa Berdomo. Coming up on the show, we'll talk a little fantasy football. Rotowire founder Peter Shanky joins us to talk about the booming industry of fantasy sports as we head into another NFL season. The number one thing I could tell any fantasy player, whether they're a new person or advanced, is really study up on the rules and the format.

1:04You're playing a game. You're not trying to actually play the real NFL. That is on the way on the Bloomberg Business of Sports. But first, we will take a look at a few recent headlines in the sports media world. Netflix is continuing its push into live sports and just inked a deal to broadcast the 2026 World Baseball Classic. Plus, ESPN is creating a new bundle that could get football fans Red Zone at about$40 per month. Joining us to discuss all that and more is Bloomberg News Media and Entertainment reporter Hannah Miller. Hannah, welcome to the Bloomberg Business of Sports. Thank you for having me.

1:43This is going to change the way this old geezer watches TV. The ESPN Online bundle with Red Zone NFL Network costs$40 a month. Is this the way now we're going to watch TV and the cable? That's gone? You know, they're putting out this option for people who are cord cutters and cord nevers. You know, people who are not interested in cable. But they still want to have these cable options for people. So it's not going to go away completely. But, you know, if you're young in your 20s, you're looking for a way to watch sports, this might be the best option for you. It's so interesting to me, Hannah, because I feel like this conversation still keeps coming up, still pops up every single time these deals are signed.

2:27Now we have all these fractured different things that we have to buy. Do these leagues and the commissioners and the owners just not care that their fans have to now go to five different places to watch the games? It's all about the dollar signs for them. I think some of these deals, they might not be the most convenient for fans. It's not like you're switching channels, going from sport, game to game. You have to log out of the app, pick a new one, go in. It's not going to be the same experience for people. You've seen ESPN has tried to have a portal to show where you can watch stuff. I think the big money maker would be having some kind of tool that would allow you to transition between streaming platforms easily.

3:13And that would really help people. Hannah, there's just really one channel that matters. That's Channel 835. That's the Red Zone Network where you get seven hours of commercial free football. What happens to my man Scott Hansen after this deal? I mean, is he going to get paid? I mean, what goes on? Yeah, so there definitely are changes happening, but I know that they're really trying to keep the Red Zone culture, keep things familiar to fans. It's really just going to be this bundle add-on that you can have with the ESPN streaming package. So instead of just paying$30 flat for getting all of ESPN's networks, you can add an additional$10 and get access to Red Zone.

3:53Major League Baseball is doing the happy dance because they scored a lot of great new TV deals. Can you talk more about that? So it's not finalized yet. The ink is not dry, but we're hoping to get more information next month. But there's been a lot of speculation, a lot of reports out there. And the way things are looking right now, it's a huge win for Major League Baseball. They are getting a lot of money from a lot of different partners. And even ESPN, who's the reason that these rights went up for grabs, they did that early opt-out, they are still working with MLB and they're working on this out-of-rights package.

4:34And that's been an out-of-market rights package. And that's been a huge deal. ESPN, Jimmy Pataro, the head of ESPN, he said multiple times that he wants this focus on regional rights when it comes to MLB. So it's been reported that they're still going to pay the same amount of money that they had with the original deal. But it's a different kind of return package. So Hannah, what was that original deal with ESPN? $550 ,000? Is that the number? $550 ,000. And that's what it's going to be with this one, at least based on the reports. So$550 ,000 ,000. But it's ESPN again, right? Yes. So they sold it and bought it in the same...

5:10They shook things up, and it's just the focus on regional rights. So is it because ESPN doesn't see the value of MLB as a premier property? Yeah, I think they wouldn't frame it that way because I asked them about it. And I interviewed Jimmy Pataro a few weeks ago. And he just said, you know, we want these regional rights. That's the way that we're really trying to help fans. And we think this is going to be an asset for a new streaming service. but you know it's just I think with this they're both kind of getting what they want here and then you see special events like the Home Run Derby Netflix has been in talks to get that and that'll help them with their strategy in expanding live sports, these one off events and so ESPN's going to air the out of market games I think that's their I got you so it's their answer to the problem with the regional sports networks.

6:10I mean, what's going on with that? Is this something still that they see the value in that they need to figure out? Because there's five teams also that are in market games also, right? Yes. So what's going on with the regional sports network problem? So regional sports is a really problematic area. As I'm sure you know, we've seen multiple bankruptcies. They've had to kind of make these deals to get out of bankruptcy. But they still see value in this. You have these local fans. There are people who tune in. This is what they want to watch. So I think ESPN and MLB, they figured that this was a good way to both get positives from it.

6:48You're having a home for these regional games, and then ESPN is like, okay, this is yet another asset that we can add to the streaming platform. So Hannah, is ESPN winning the streaming wars? I mean, look at what they've just done here with the NFL, right? I mean, MLB now, I mean, WWE. I mean, talk to us about, you know, who is winning the wars for streaming premium sporting events today. Yeah, I mean, this new offering from ESPN is, you know, huge for them. This is a big deal. We also saw the launch of Fox One, which is Fox's streaming platform. That's going to have Fox Entertainment, Fox News and Fox Sports offerings.

7:27So, you know, you do see a pretty full field. Obviously, NBC Sports, they're continuing to make a huge push with Peacock. And the NBA is going to be key for that in the fall. So, you know, I wouldn't say ESPN. I think it's too early to say ESPN is number one. Sports really is still at the forefront of streaming, right? And it seems to me that ESPN is still the alpha there for the most part. At least it's holding on. So it's just interesting to see how this is all shaking out. I mean, you've got players like Apple and Amazon knocking down their doors, right? So it's still interesting to see Disney there.

8:01Michael Barr, what do you think? Well, I think, speaking of Netflix, you talk about that, they're going to broadcast the 2026 World Baseball Classic in Japan. How do you get that? I just wonder, there's some guy on the Los Angeles Dodgers. Get out of here. Shohei Otani, I bet that that's going to explode in Japan. Oh, it's all about Shohei. This is a huge, huge event in Japan. It is a big win for Netflix. There's a lot of excitement already about this happening. And Japan loves the World Baseball Classic. They do very well in the World Baseball Classic. So I think this is a great fit. And yeah, it makes total sense.

8:45And yeah, I think it's the first live event in Japan that Netflix is going to be broadcasting. So very exciting. Is there any fear, though, in these big tournaments, some players opt out of playing in them. And Shohei has had his problems with injury and things like that. So what if he doesn't play? Did Netflix just spend a bunch of money for no reason? Oh, God, no. I think it would be a huge disappointment for sure. He's the biggest name. He is a hero there. I mean, we saw with the World Series last year that there were some games that had higher viewership in Japan than in the U.S. It was crazy.

9:23So, you know, Netflix is really capitalizing on that with this deal. Well, to put some context around that, right, the World Baseball Classic has consistently drawn massive national audiences with some games exceeding 30 million viewers. And listen to this, the MLB Tokyo Series in 2025 set new records with over 24 million viewers per game, which is just a massive number for baseball. I mean, by anybody's imagination. Definitely. Well, they're going to also sell, and you talk about this deal with ESPN. and baseball, didn't they just sell a 10 % stake in the Walt Disney Company sports network involved in this to help with trying to bring this to a great audience from an old man who was trying to hang on for dear life with rabbit ears on his television?

10:16Yeah, no, I mean, that was a huge part of the NFL deal was that stake. And this has been speculated about for a long time. So for that to come through was pretty exciting. And yeah, it just shows the closeness between Disney, ESPN and the league. Is this going to be a big boon for the NFL? I mean, they're always killing it. So I think it's just going to continue to add. I mean, that's exactly right to have a seat at that table, right? To just be a shareholder in the NFL in and of itself. I mean, what Disney should really be doing is selling off little bits and pieces, is getting a big fat fee for it like an investment banker would and commoditizing it and all that good stuff.

10:56Well, that's your money, man. You could get in there. Securitize finance. You got the wallet. I've seen your wallet. It is thick as all get-off. Structure some synthetic total return swamps. It'd be beautiful, you and me, Michael Barr, once again, on a beach somewhere. You know what, man? Sipping mohiba. And we're both saying the same thing. Private equity, here we go. Which brings me to the next question, Hannah. private equity has changed the whole landscape of everything in sports ownership. 100%. And, you know, you can see that sort of play out, too, with CBS Sports. You know, we had the Paramount merger with Skydance Media, and, you know, Redbird has huge involvement in that.

11:37So it's everywhere, you know, and we're going to see it, I think, more and more in media. Well, we've also seen the Bills, the Niners, the Finns. They've all sold equity stakes, right? And it's really, I mean, if you look at some of the numbers and what it means for the Dallas Cowboys, for example, who at year-end Sportico had them at$10 billion. I think we have them at$14.5 now. If you revise everything up, that is insane. It's interesting because the Cowboys will never, or seemingly, they're not going to sell, but they will consistently stay at the top no matter who else sells their stakes. That's right.

12:03And we don't even have to talk about how owners in the NFL have the ability to write off the IP for their brands against gains from other businesses. I'm just saying that is something we've written about in the past here at Bloomberg. It's a fact. It was actually in the big, beautiful bill, and then it got pulled out of there. They can't advertise that IP over, anyway, whatever. Our thanks to Hannah Miller for joining us. She covers media and entertainment for Bloomberg News. Up next, we stick with sports media and do a deeper dive on some of the latest headlines with research from our friends at Bloomberg Intelligence.

12:36For Damian Sassauer and Vanessa Perdomo, I'm Michael Barr. You're listening to the Bloomberg Business of Sports, Bloomberg Radio around the world.

12:49This is Bloomberg Business of Sports from Bloomberg Radio. This is the Bloomberg Business of Sports, where we explore the big money issues in the world of sports. I'm Michael Barr, along with Damian Sassauer and Vanessa Perdomo. Streamers are going big on live sports, with YouTube TV continuing to grow its portfolio of live sports programming. Bloomberg Intelligence Senior Media Analyst Geetha Raghunathat has all the research to back this and more. And she's here now to break it all down. Geetha, welcome to the Bloomberg Business of Sports. Thank you so much for having me. YouTube TV, the rising strength in sports programming.

13:29What are they doing right? So, you know, this is the whole rise of what we call the virtual pay TV operators. And YouTube TV absolutely leads in that space. So they basically provide you everything that a traditional pay TV operator like a Comcast or Verizon would provide, except that this is going to be over streaming. So it's over the top. And what people really like about it is, you know, the ease of signing on and signing off. Remember all the times that you can never get through to your cable company or that you can never cancel service? Well, you don't really have that problem here. You don't get locked in for years and years.

14:05You can sign on, you can sign off whenever you want. And the price up until this point, like now it's getting a little bit pricey, but up until this point, it actually was pretty economical and made a lot of sense. And one of the reasons that people really like YouTube TV is just because the user interface is top notch. And especially if you're watching sports, it's absolutely great. So that's kind of been one of the reasons why YouTube TV has been such a popular service. And we actually think it might be the third largest. is they don't report subscriber numbers very often, but we think they have close to almost 9.5 to 10 million subscribers, which makes them possibly the third largest pay TV operator in the United States.

14:46Wow. I love YouTube TV. I personally have it, and I feel that it's great for game day, especially NFL Sundays for the multi-view service, which I definitely want to talk to you about later on when we talk about how all these different games are on streaming and things like that. But right now they're in this problem with Fox and they might not be able to have games this weekend. Tell us about that. Yeah. So, Vanessa, I mean, this is nothing new. So year in and year out right before the start of college football and right before the start of the all important NFL season, we typically have some high profile carriage renewal that comes up this year.

15:27It happens to be YouTube TV and Fox. And basically what it is, is August 27th. where actually is the carriage expiration. So that's when their deal, typically it's a three-year deal, kind of comes up for expiration. Both sides are playing hardball this time. YouTube TV is claiming that Fox is charging a whole lot more than it was before. And Fox, of course, is holding its ground and saying that it has must-have programming and therefore is entitled to that kind of a price hike. So, you know, you have both sides that, you know, Obviously, they both wield a lot of power. Fox, of course, has the content.

16:07YouTube TV has the scale. And so it's going to be a game of chicken. And to talk more about content, Fox holds the NFL card, which, Geetha, that's a very important card. Oh, absolutely. Fox has a great sports lineup, Michael. So whether we're talking college football, we're talking NFL, we're talking the MLB playoffs and the World Series, Fox has it all. So they absolutely know that they have a lot to offer when it comes to their broadcast network, when it comes to Fox Sports. And then, of course, you have Fox News, which, you know, is by far the biggest cable network. So it's, you know, it's their whole live TV lineup, sports and news, and they have the best of both.

16:53Which, yeah, to that point, though, Geetha, doesn't that give then Fox the upper hand in terms of negotiating here? I mean, if they have these dates blocked out and you weren't able to watch, I'm I'm a Buckeye fan. Right. So if I can't watch the Ohio State football game this weekend, I'll be really upset about it. So if you have people like that who aren't able to watch their games, you're not able to watch the NFL. Now we're not able to watch football on YouTube TV. Don't you think they'll see YouTube TV would then see like massive subscriber drops? So they need to get that deal done for them.

17:24Really? Yeah, you're right, Vanessa. So, you know, in the past, we obviously used to see the content owners. So a company like Fox or Disney or Paramount kind of wield all of the power in this kind of an equation. What has happened, though, is because we are having so much of cord cutting, you know, losing subscribers is not good for anybody. Of course, it's not good for the pay TV operator. But then remember, YouTube TV here is really, you know, they're not a Comcast. They're not a charter. They're owned by Google, one of the largest companies in the world with very, very deep pockets. And so, yes, YouTube TV, I mean, it is a big business.

18:02But at the end of the day, even if they lose a few subscribers this way or that way, it doesn't necessarily break the business. So that's where YouTube TV is a little bit different from, let's say, a Dish or a DirecTV. I still think that Fox does hold a fairly good amount of power, as most content owners do. But I also think at the same time that the balance of power, that whole equation is changing a little bit. And now, especially if you're a distributor like YouTube TV that has so much of scale, that has millions of subscribers, nearly 10 million subscribers, they have a pretty loud voice as well.

18:36So that's why these kind of skirmishes become really interesting because we then get to know who really, you know, holds the trump card, if you will. Well, that goes to the subscribers, as you mentioned earlier. Right now, they have about 9.4 million YouTube TV, and they're about to increase, which has got to throw fear now, obviously, in the cable providers. What can they do to save themselves? Yeah, this is a really great question. I mean, what we're seeing, Michael, is more and more content is moving away from the linear TV bundle to the streaming outlets. And that's really bad news for a cable provider.

19:18It's bad news even actually for a YouTube TV, any provider who is basically redistributing linear TV content. This comes at a really interesting time. And I say that because just a few days ago, or maybe a couple of weeks ago, we had both ESPN and Fox debut their streaming services. And, you know, this is huge for the sports ecosystem because at the end of last year, if you kind of just look at the sports ecosystem, we had only about 40 percent of U.S. sports rights that were available to stream. So you basically needed a cable TV subscription to watch the remaining 60%. But with the introduction of both ESPN and Fox One, which is Fox's streaming service, 100 % of US ports are now available to be streamed.

20:10And so this is kind of a really precarious time, I would say, for both the content owners as well as the pay TV distributors, because anybody who now wants a streaming subscription can basically get one. They're no longer tied to the traditional TV bundle. So, again, that's why I say this is a this is a really a one of a kind fight just because of the time at which it comes. Yeah, I'm so glad you brought up that point because I saw that in your report from the other day that 100 percent of sports viewership is available on streaming, which which is absolutely insane. But it obviously does make sense as we've seen all these different, you know, Netflix and Prime and Peacock and whoever all get into sports in a different way.

20:51but YouTube TV, does it basically just make them obsolete? Do they even need to exist anymore? Or is the next actual thing someone like a YouTube TV should really do is try and become the platform in which you can flip through all these different streaming platforms? Like someone needs to create that, it feels like. Oh, yeah. And you bring up an excellent point, Vanessa. I think they are eventually kind of moving to that model. I don't know whether it's going to be a YouTube TV or whether it's going to be an Amazon or whether it even is going to be a Netflix. I mean, I think ESPN is trying to do that now for sports.

21:25They eventually want to do that. That's why they did the deal with NFL. That's why they went after some MLB rights. They're trying to get as much content as they can on their platform. But it's going to be interesting to see how all of that plays out. But you bring up an important point, which is, is YouTube TV or are pay TV operators like YouTube TV, like Comcast going to become obsolete? I don't think so. I think there is still that traditional viewer who kind of likes everything in one place. You know, you don't want to have to sign up for, you know, seven or eight or 10 different services.

21:58And so I think there is always going to be a place for the traditional cable bundle. And so I don't necessarily think they're going to become obsolete. We are definitely in a very, very fragmented marketplace. That is for sure. And Hulu Plus Live is saying, hey, don't forget about us because they've got a merger coming up. Right now, they are behind YouTube TV. They only have 4.3 million users. But this merger, Geetha, is going to put them there a very close second. Yeah, it is. And what's really interesting about the merger with Hulu and Fubo is, again, that Fubo, Michael, is a very, very sports-oriented service.

22:35They have everything, you know, that they initially started trying to cater to the football fan. and now they've expanded to all of the different sports. So again, it's going to be really interesting because again, YouTube TV, we know, tends to be fairly sports-centric. Fubo and Hulu is also going to be sports-centric. So I think we're going to see more and more people kind of gravitate to those services. And that's going to be actually good, I think, overall for the consumer because it just makes the process of signing on, signing off so much more smooth and seamless. Most people who have any sort of live TV are using it for sports.

23:14I mean, that's really what's keeping live TV afloat in general. You're absolutely right. You know, people, they just they do want to have all of their sports in one place. And the only way you can do that right now is through live TV. You can you know, you have all these cable TV operators. you have most pay TV distributors basically selling you skinny packages and packages just tailored for the sports enthusiast. So yeah, I mean, you do have to still very much rely on live TV. That may change three, four, five years down the road, but right now it's still very much is tied to the linear TV bundle.

23:53Keith, I'd love to switch gears here and ask you about the new Major League Baseball deal and what that means for team valuations. And the reason I ask is this, We're refreshing our numbers here with all the private equity dealings in the NFL, the recent sales in the NBA of the Celtics and the Lakers. And we're trying to wrap our brains around what this new MLB deal will mean for some of these baseball teams that, you know, were so heavily reliant on local programming. Any thoughts to share there? I think this deal, Davian, is really good for Major League Baseball. Remember, just, you know, a few months ago, they were really in a tight spot.

24:25They had lost a lot of their deals on the local side because of the bankruptcy of, you know, Diamond Sports. And then suddenly, you know, on the national side, they lost the ESPN contract. ESPN basically opted out of its$550 million deal, which kind of really left them in a tough spot. And so what they did is they went back to the drawing board, you know, rejiggered a couple of the packages. And now they're basically making more than what they were before. They have another deal with ESPN in place, which focuses a little bit more on streaming. And then they have new partners on board. So they now have NBC and Netflix.

25:02And that basically gives them over two billion dollars in annual rights fees. And, you know, from our viewpoint, that's a great deal for the MLB. And we think that finally trickles over or trickles down rather to team valuations as well. So I think it's good news actually all around. It's a win win for everyone here. Our thanks to Bloomberg Intelligence Senior Media Analyst Geetha Raganathan for joining us. Up next, we turn to the world of fantasy sports with Roto-Wire founder and President Peter Schenke. For Damien Sassauer and Vanessa Perdomo, I'm Michael Barr. You're listening to the Bloomberg Business of Sports from Bloomberg Radio around the world.

25:44This is Bloomberg Business of Sports from Bloomberg Radio. Thanks for joining us on the Bloomberg Business of Sports. We explore the big money issues in the world of sports. I'm Michael Barr, along with Damien Sassauer and Vanessa Perdomo. It's just about fantasy football time. Fantasy sports is a multi-billion dollar industry and it continues to grow. Here to take us through the latest and explore some of the newest trends in the fantasy sports world is Peter Schenke. He's founder and president of Rotowire, a leading content and tech provider to fantasy sports consumers and media companies. Peter, welcome to the Bloomberg Business of Sports.