Amazon Scores Big With Regional Sports Network Deal: Prime Video To Feature MLB, NBA, NHL Games
Portfolio Pulse from Chris Katje
Amazon.com Inc (NASDAQ:AMZN) has acquired a minority stake in Diamond Sports Group, a subsidiary of Sinclair Broadcast Group Inc (NASDAQ:SBGI), as part of a deal to become the primary partner for streaming regional sports networks. This move follows Amazon's success with NFL Thursday Night Football and includes Sinclair's $495 million cash payment to Diamond Sports to settle litigation. The deal is part of Diamond Sports' bankruptcy restructuring and will allow Amazon to stream MLB, NBA, and NHL games on Prime Video. Sinclair will provide management and transition services during Diamond's reorganization. The Walt Disney Company (NYSE:DIS) previously divested Diamond Sports, which was then known as Fox Sports Networks.
January 17, 2024 | 3:57 pm
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NEUTRAL IMPACT
The Walt Disney Company previously divested Diamond Sports, which was part of its acquisition of 21st Century Fox. Diamond Sports was originally valued at $9.6 billion.
Disney's mention in the context of the historical divestiture of Diamond Sports has a neutral impact on its stock, as the current deal primarily involves Amazon and Sinclair.
CONFIDENCE 75
IMPORTANCE 40
RELEVANCE 30
NEUTRAL IMPACT
Sinclair Broadcast Group's subsidiary, Diamond Sports Group, is restructuring through bankruptcy with Amazon's investment. The deal includes a $495 million cash payment from Sinclair to Diamond Sports.
While the cash payment is a significant outlay for Sinclair, the partnership with Amazon could stabilize Diamond Sports' operations. However, the impact on Sinclair's stock is uncertain due to the costs involved and the complexity of bankruptcy restructuring.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Amazon's acquisition of a minority stake in Diamond Sports Group and the deal to stream regional sports networks could boost Prime Video's content offering and potentially increase subscriptions.
Amazon's previous success with NFL streaming suggests that expanding into other major sports could attract more subscribers and increase viewer engagement, which is likely to have a positive impact on the stock in the short term.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90