Ben Gilbert: prediction

Transcript context

…Yeah, that's what Advanced Media has gotten really good at over the past decade. So that was in April 2015 and then later in 2015, the first really other big 4 professional sports league does another deal with BAM and this is the NHL. So the NHL announces that they’re going to contract with BAM to power all of their streaming. But what’s interesting here, and this is where really the cable industry really starts to get nervous, is it’s not just powering the backend but they actually do a right steal. So the NHL takes a rumored to be about a 7 to 10 percent equity stake actually in BAM, in Major League Baseball Advanced Media. And in return, BAM promises to pay them a certain amount of money each year and then they get to monetize all of the content. So the subscriptions that people pay to subscribe to NHL, that’s BAM that's monetizing that just like it’s ESPN that gets the cable subscription fees and all the advertising that they run on top of it. This is really a watershed moment where BAM starts to look like a next generation cable provider itself. Yeah, you can totally see why this makes you nervous because if you’re in ESPN or any sort of rights acquirer, your whole business model is taking a look and saying okay, well if we buy these rights, what can we get for them in terms of the advertisements we’re going to show viewers and the subscriptions, whatever vehicle you want to use to monetize that, like okay, I’m going to pay hundreds of millions of dollars upfront for these rights for X years. I really hope we can architect a business that’s going to generate more than that. And I think that on its own feel is kind of like a tenuous business model but as that moves closer and closer to the source of the actual rights holder, you can see that that totally looks like it’s going to disintermediate you as someone whose business it is to take on the risk of buying those rights and monetize it if those organizations themselves are getting better and better at monetizing their own unique IP rather than potentially licensing it out to you to figure out. This is disruption of the middle man, this is the internet at work here.…

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