Despite lucrative TV deals at hand for owners of popular sport properties, changing viewer habits as streaming platforms sign billion-dollar deals has Liberty Media Corp. CEO Greg Maffei, owner of the Formula One circuit, a touch wary over how loyal fans will continue to find their favorite sports.
“There are certainly trends about fragmentation of the market that might give you pause. Nonetheless, we’ve seen pretty good increases at some properties,” Maffei told analysts during a morning call after releasing his third quarter financial results.
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But Maffei added his company’s ownership of the Formula One race car circuit puts him in a good position to buck an overall market where the entry of streaming platforms as major buyers has fans scrambling to follow their favorite sports on an expanding array of platforms.
“I feel very comfortable about the F1 renewals, much more than I do with the overall market,” he argued as the impact on the entertainment industry of the Hollywood strikes and an expanding cost for scripted content continues to make live sport properties an attractive offering for content distributors.
Maffei also poured water on a potential global media rights deal for the Formula One property. “There’s always a trade off between reach and profitability. And there are relatively few if any distributors today who have the global reach that individual players do in their respective markets,” told analysts.
Formula One recently signed a deal with DAZN to stream the property in Spain, and Netflix will stream its first live sporting event, The Netflix Cup, on Nov. 14 when Formula One launches a first-ever race in Las Vegas.
“The increased interest in the sport globally, particularly in the U.S., has given us an opportunity with a broader range of distributors, and the increasing number of digital players who might enter the market. As they get broader awareness as sport players, our willingness to go with them only increases,” Maffei said.
During its third quarter, Liberty Media, which is controlled by billionaire mogul John Malone and also houses assets like audio entertainment giant SiriusXM, posted overall revenue for the three months to Sept. 30 at $3.2 billion. Net earnings attributable to shareholders reached $385 million.
Quarterly revenue at the Formula One Group’s revenue rose to $887 million, compared to a year-earlier 715 million, according to the earnings report. SiriusXM, the home of Howard Stern, saw revenues of $2.27 billion, virtually unchanged from a year-earlier $2.281 billion.
Liberty Media has two main business holdings backed by tracking stocks – SiriusXM and Live Nation Entertainment and Formula One. A third business, the Atlanta Braves, was recently split off into a separate publicly-traded company, Atlanta Braves Holdings.
Liberty Media has also proposed a combination of SiriusXM with its tracking stock for the satellite radio company. “We will provide updates on this potential transaction only if and when an agreement is reached,” Maffei told analysts.
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