Foxtel’s great hope – its Kayo Sports streaming service – has begun 2020 in a terrible state.
Kayo’s subscriber base dived to only 370,000 as at February, down from just over 400,000 in November 2019. This month it also lost its Rugby rights to Optus Sports, which has more than double Kayo’s subscribers, and follows in the wake of Foxtel losing the broadcasting rights for the English Premier League to Optus in 2016.
Now with the coronavirus pandemic spreading throughout the world, Kayo is facing the real prospect that a large number of its live sports offerings will be cancelled.
We have already seen the National Basketball Association (NBA) suspend its 2020 season. But this is only the tip of the iceberg, with postponements or cancellations running rampant across soccer, golf, rugby, tennis, cricket, motorsport, boxing, UFC, American football, ice hockey, athletics, and winter sports (click here for a full list).
Closer to home, both the National Rugby League and Australian Football League are weighing up whether to postpone their 2020 seasons.
For a service whose competitive advantage is in live sports, the coronavirus presents a cruel blow to Kayo Sports, which unlike other streaming services does not have a catalogue of television shows and movies to fall back on.
To add insult to injury, global sports giant ESPN is looking to muscle in on Kayo Sports’ turf. ESPN is seeking to both acquire the Rugby League rights and establish a foothold in the Australian sports streaming market:
Already concerned about losing subscribers should the NRL be forced to call of its season due to the coronavirus pandemic, news of ESPN’s interest in entering the market place could not have come at a worse time.
As revealed by The Herald on Monday, NRL and ESPN opened discussions this week about the potential for rugby league to be broadcast into the US and other countries around the world.
…a relationship has been forged that is likely to result in the NRL heading to ESPN headquarters in Connecticut once the coronavirus outbreak settles down…
ESPN, which is majority owned by the Walt Disney Company, launched the subscription-based ESPN Plus in April 2018 to focus primarily on overflow sports content from around the world that isn’t usually aired on the network’s main broadcast channels.
ESPN Plus’ entrance into the NRL’s broadcast negotiations, which could have a heavy digital streaming component to it, would be in direct competition with Kayo – a subsidiary of Foxtel…
While regular video-on-demand steaming services like Netflix, Stan, Amazon and Disney are likely to experience subscriber growth from Australians been locked-down in their homes, the widespread loss of sports coverage is likely to see Kayo’s subscriber base shrink even further. That’s the short-term outlook.
Longer-term, Kayo is facing increasing competitive pressure from rivals seeking to steal broadcasting rights to live sports.
There’s no doubt. Both Foxtel and Kayo are fighting a losing war with the internet.
