Sports Service DAZN, Streaming Rival to ESPN, Plots Global Expansion
Company known for its boxing content is expanding its sports rights and plans to launch in over 200 markets
The front line of the streaming wars is in Hollywood, but John Skipper—the chairman of sports-streaming service DAZN and former president of ESPN—is concentrating his firepower outside the U.S. DAZN (pronounced “duh zone”) is preparing to launch a global version of its service that will be available in more than 200 markets around the world, Mr. Skipper said in an interview. The service, which will make its debut ahead of a May 2 bout featuring fighter Canelo Álvarez, will also include a catalog of past fights featuring boxing champions such as Floyd Mayweather Jr. and Oscar De La Hoya.
By launching DAZN in dozens of countries at once, Mr. Skipper is trying to get a head start in a race for international subscribers to sports-focused streaming services while some of his competitors—including Walt Disney Co. ’s ESPN+—are still focused primarily on the U.S.
“We’re more interested in being the global leader in sports than the worldwide leader in sports in the United States,” Mr. Skipper said, invoking his former employer’s tag line with a puckish grin.
DAZN, which is based in London and controlled by billionaire Len Blavatnik, is already available in eight markets outside the U.S.: Germany, Austria, Switzerland, Italy, Spain, Japan, Brazil and Canada. The company has about eight million paid subscribers, according to a person familiar with the matter.
ESPN+ had about 7.6 million subscribers as of February, Disney Executive Chairman Bob Iger said on the company’s first-quarter earnings call.
In the interview at his Greenwich Village apartment in New York, Mr. Skipper—barefoot, wearing a T-shirt and khakis and nursing a glass of sparkling water—was recuperating after flying nearly 8,000 miles from an undisclosed continent, where he was drumming up more business.
“Our first-mover [advantage] is huge,” Mr. Skipper said, referring to the length of the company’s rights-deals. “We now have, in Germany and Japan, enough aggregated sports rights that if we lose something, we still have a great bundle and nobody else can catch us for three or four years.”
DAZN’s expanded international business will compete with some of the biggest players in media. Comcast Corp. ’s Sky Sports owns the U.K. rights to stream English Premier League soccer games, Discovery Inc. has the European rights to stream the Olympic Games, and Disney’s Star unit has the rights to stream sports in India, including cricket. Amazon.com Inc. has the rights to stream some English Premier League games in Germany and the U.K.
Mr. Skipper has traveled some 300,000 miles to promote DAZN since he joined, after leaving ESPN in 2017. He said the company plans to bid for National Football League media rights, which are expected to go on the block later this year. Last year, DAZN made a pitch to the NFL to obtain its Sunday Ticket package after the NFL indicated to potential buyers that it was considering shopping the rights, he said.
The company is planning to ask every major sports league in the U.S. to make some of its games available for a streaming package through DAZN, according to the person familiar with the matter.
DAZN, which costs between $10 and $20 a month in most of its markets, generated about $300 million in revenue in the fourth quarter of 2019, according to the person familiar with the matter.
DAZN is betting that it can reach profitability by attracting enough subscribers to offset the enormous cost of accumulating sports rights around the world. The company spends between $1 billion and $1.5 billion on sports rights annually, the person said.
In 2018, it struck a five-year deal with Mr. Álvarez for $365 million and an eight-year, $1 billion deal with Matchroom Boxing. In 2016, the
__ We’re more interested in being the global leader in sports than the world-wide leader in sports in the United States.
JOHN SKIPPER
CHAIRMAN OF DAZN
company struck multiyear agreements for rights in Japan valued at roughly $3 billion over the course of the deals, including for the NFL and Major League Baseball.
Mr. Skipper said DAZN decided to buy global rights for its boxing matches after realizing that purchasing a global license was only slightly more expensive than buying domestic rights.
Focusing on non-U.S. rights is a strategy partly born from necessity. The U.S. rights to show games from the NFL, MLB and the National Basketball
Association are already licensed by major cable and broadcast networks in the U.S.
In the near term, DAZN is planning to spend “in the tens of millions” of dollars on additional sports rights for the global service, the person said. The company is raising about $500 million to fund its expansion, the person said.
In some ways, Mr. Skipper is competing with himself. At ESPN, he took a scorched-earth policy to buying sports rights, snapping up game packages from the major sports leagues that locked competitors out of rights for years at a time.
“The United States are going to be hard because they’re going to stay with the traditional guys, in my opinion,” Mr. Skipper said. “It takes you so long because the deals are so long.”