Netflix (Nasdaq: NFLX) is quietly exploring ways to expand its offerings. The streaming giant has recently been looking into acquiring rights to some live sports events, according to a report by the Wall Street Journal.
People familiar with the matter said that the company has been exploring bidding for the streaming rights of some tennis tours, and cycling competitions, but none have yet to push forward.
And as sports streaming rights can get very expensive, the company is also looking into acquiring lower-profile leagues, the people said. Insiders say that Netflix co-Chief Executive Reed Hastings has reiterated that he doesn’t want to get caught in bidding wars for streaming rights every few years.
The company was reportedly negotiating to buy the World Surf League but the two parties weren’t able to reach an agreement on the price. With the platform’s size, executives see potential in bringing smaller leagues and lesser-known sports out into the mainstream, and eventually creating big franchises.
Netflix isn’t breaking any ceilings with the move, but is mostly finding a more cost-efficient way — or a clever workaround — to follow its rivals who’ve put in considerable investments in the space. Amazon Prime Video has “Thursday Night Football,” while Apple TV+ and Comcast Corp’s Peacock both acquired exclusive rights to show some Major League Baseball games last season.
But this isn’t to say that they’re closing their doors to the big games. Insiders say that the streamer bid for the live US streaming rights to Formula One but lost to Walt Disney’s ESPN. Notably, Netflix also contributed to boosting mainstream awareness of the sport through the highly-rated documentary series Formula 1: Drive to Survive.
Netflix has been under a lot of pressure to take its subscribers back from the many streaming rivals that didn’t exist during the company’s rapid growth. In the first quarter of the year, the company reported losing as many as 200,000 subscribers. In the following quarter, Walt Disney’s Disney+ topped Netflix’s number of subscribers at 221.1 million versus 220.7 million.
The company has also back pedaled on “not competing for ad revenue” when it launched its ad-supported lower-cost tier in mid-October.
Information for this briefing was found via the Wall Street Journal, and the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.