BrandArena: Netflix considering live sports streaming investment

Tuesday 13 June 2023

Netflix considering live sports streaming investment

Netflix, a major player in the streaming media industry, is taking a significant move into the area of live sports entertainment, with its first live-streamed sporting event perhaps taking place this autumn. While the firm has received excellent acclaim for its fascinating documentary-style sports programmes like "Drive to Survive" and "Full Swing," it has yet to obtain the rights to broadcast live sporting events.

However, according to recent Wall Street Journal rumours, Netflix is already in talks to live stream a celebrity golf tournament set for the autumn. The event, which will take place in Las Vegas, will feature notable golfers as well as Formula 1 drivers.

The tournament negotiations are still in their basic stages at this time. Nonetheless, this development represents a strategic shift for Netflix. Netflix's member base stands at an astonishing 232.5 million as of the first quarter of 2023, providing the business with significant influence over the streaming industry as a whole.

By expanding into live sports streaming, Netflix hopes to strengthen its position and attract a new audience. Netflix does not want to be left behind when competitors such as Hulu and Apple TV+ enter the live sports market.

The event acts as a testing ground for Netflix, allowing the business to gauge subscriber interest and engagement without incurring the high expenditures and long-term obligations often associated with purchasing top-tier live sports rights. In the past, Netflix faced fierce competition and missed out on negotiating for live rights to athletic properties such as Formula 1.

Netflix co-CEO Ted Sarandos stated at an investment conference last year that the firm is not hostile to sports but rather prioritises profitability. While Netflix recognises the attractiveness and needs for live sports content, it approaches such partnerships with a strategic focus on delivering returns on investment.

Moreover, the celebrity golf tournament presents Netflix with an additional opportunity to expand its advertising business, which is still in its early stages. By live streaming the tournament, Netflix can attract sponsors and advertisers who are eager to reach the tournament’s audience, thereby diversifying its revenue streams and tapping into the growing potential of sports advertising.

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