NeuLion falls to Endeavor, gifting BAMTech sports streaming glory

A little over a month after Faultline Online Reporter emphasized NeuLion as a potential victim to what we have coined the commoditization of OTT video technologies, the sports streaming specialist has been acquired by holding company Endeavor for $250 million – stripping the industry of its only serious alternative to Disney’s BAMTech.

Such a lucrative market having such an intrinsically unhealthy amount of technology competition is staggering, particularly with the rise and rise of live sports streaming services and the countless $billions being invested in bidding for sports rights globally. This unfortunate scenario is, in part, due to the stranglehold on sports rights by a select few giants in the US and the in-house technologies powering them.

However, none of these drawbacks have quashed rumors Endeavor has bought NeuLion with the intention of using the technology to launch a direct to consumer sports offering.

NeuLion has built much of its own technologies to lead the way in live sports but has also played its own hand in contributing to the consolidation of the industry by amassing technologies from DivX in 2015, for its MainConcept HEVC SDK, and SVoD software and electronic sell-through services from Saffron Digital, which NeuLion bought in 2016.

As well as a CMS and packaging technologies, pre-acquisition Saffron Digital was considered an expert in digital lockers for securely storing digital media in the cloud, and its software is known to work with the UltraViolet digital locker which came out of the Digital Entertainment Consortium Ecosystem (DECE), a consortium of systems integrators and film studios. But Saffron has always claimed it can handle every step of end to end OTT video from encoding to the media player in the app.

All this technology clout has attracted Endeavor’s investment, at a price tag which must be close to what NeuLion has paid out in acquisitions over the years, so the deal is a potential steal. Endeavor first worked with NeuLion last year during the Conor McGregor versus Floyd Mayweather boxing event, streamed live on Fox Sports to millions of viewers.

Endeavor bought rights to the Ultimate Fighting Championship (UFC) in 2016, when the company was called WME-IMG, for $4 billion. Endeavor’s TV deal with Fox expires at the end of this year, and this combination of factors has sparked suggestions Endeavor will launch a direct to consumer sports streaming service powered by NeuLion.

Dedicated sports streaming technology may not be a fierce battleground, unlike the sports viewing landscape which is rapidly shifting from the traditional TV to social media. In addition, UFC viewing figures on Fox declined by 22% last year, so the value of these rights is quickly sliding.

The direct to consumer route would be a high risk strategy for Endeavor. Advertising and media holding companies aren’t renowned for making rash moves, therefore we see Endeavor continuing to cash in on its current rights via third party broadcasters, while it still can, and continuing to develop NeuLion’s client list – preventing the remainder of the market falling exclusively to BAMTech.

Meanwhile, US broadcasters have taken it upon themselves to provide streaming infrastructure to a market void of competition. Early last year, NBC Sports Group and Turner teamed up to provide sports leagues and networks with OTT and VoD services, in a move to keep up the competition with BAMTech. The deal saw NBC’s Playmaker Media tie the knot with Turner’s iStreamPlanet, adding to previous collaborations on the Super Bowl and 2016 Olympics.

Throughout 2016 and 2017, NeuLion talked up its involvement in Nokia’s OZO virtual reality ventures, along with a host of other technology vendors integrating the OZO Reality Platform and OZO Player SDK. Prior to Nokia prematurely shutting down its VR unit, NeuLion had hoped to become a key supplier for Nokia’s VR sports experiences, although the company never managed to oust AWS Elemental, which powered all Nokia’s live 360-degree events, including concerts, music festivals, sports and political events.

NeuLion was emphatic about not relying on the Elemental encoding platform, yet the company is definitely in competition with the encoding hard-hitters like AWS Elemental and Harmonic.

NeuLion has gone quiet in VR, so while it keeps those resources back for a rainy day, analytics has become a high priority for Neulion, having added a new data analytics service last year, available to customers of its Digital Platform. It says ACE Analytics can help prevent cancellations and convert free users to paying subscribers, by identifying the most effective and profitable marketing channels and campaigns, plus the most valuable customers.

“Through our content portfolio, client base, and broader network of rights holders we’ve encountered many different platforms for distributing and monetizing content. NeuLion provides an ideal combination of technology and client services, and we’re excited for the value this brings to our existing partners and the foundation it provides for our future digital growth,” said Endeavor CEO Ariel Emanuel.