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Report: Disney Acquires 33% Stake in MLB Tech Company

1 Jul, 2016 By: Erik Gruenwedel

The Walt Disney Co. reportedly has acquired one-third stake in BAM Tech, the non-baseball digital arm of Major League Baseball Advanced Media, or MLBAM. The transaction — first reported by Bloomberg, values BAM Tech at $3.5 billion, and gives Disney the option to become majority stakeholder over the next four years.

A MLBAM representative declined comment.

The national pastime at the professional level is no stranger to digital media, with MLBAM launching 10 years ago. The unit, which is co-owned by the 30 MLB club owners, operates MLB.tv, a subscription streaming service, MLB.com, and the league’s 30 club websites.

MLBAM created BAM Tech in 2015 as a means of marketing its digital services outside of baseball. BAM Tech is also minority (less than 10%) owned by the National Hockey League.

“You see the biggest sports media company moving to greater digital delivery,” Chris Russo, head of sports investment banking at Houlihan Lokey in New York, told Bloomberg. “It really shows they’re trying to get ahead of the digital phenomenon rather than being left behind it.”

Disney eyes BAM Tech assisting its ESPN sports network delivering content digitally to consumers.

Disney CEO Bob Iger has made no secret his desire to sell content from the company’s brands — including Marvel, Star Wars and ESPN — direct to consumers as market conditions warrant. Disney was the first to offer ESPN to online TV platforms such as Dish Networks’ Sling TV and Sony PlayStation Vue.

Iger in May on the company's fiscal call said the SVOD marketplace is rapidly evolving and Disney continues to look for opportunities to sell content. He said Marvel’s original series “Daredevil” and “Jessica Jones” for Netflix underscore IP opportunities in streaming video.

Indeed, upstart SVOD service DisneyLife is the media giant’s experiment to see how consumers react to Disney-branded SVOD, pricing, and whether the technology works. Disney is looking at additional foreign markets to launch DisneyLife.

“There are many opportunities to sell content and a fairly voracious marketplace for that content right now,” Iger said.

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