Disney launches ESPN+ streaming service with live sports and a show from Kobe Bryant

Key Points
  • ESPN+ will include live sports and other programming, including a basketball show hosted by Kobe Bryant, and will cost $4.99 per month or $49.99 for the year.
  • ESPN President Jimmy Pitaro says it's the "beginning of a new era of innovation" at ESPN.
ESPN President on new direct-to-consumer platform

Disney's ESPN is rolling out ESPN+ on Thursday, its first ever direct-to-consumer service in the United States.

The service will feature 10,000 live sporting events in its first year, including Major League Baseball and NHL Hockey, as well as exclusive studio programming that won't be available on the network's linear channels, a library of on-demand programs, and past sporting events.

One show ESPN expects to be popular is a basketball analysis show called "Detail," written, produced and hosted by Kobe Bryant, where the former basketball star breaks down NBA games played the day before.

The service will cost $4.99 per month or $49.99 per year.

Disney's Direct-to-consumer and International Chairman Kevin Mayer said ESPN+ has a "bulletproof and robust technology" that he expects to be a real bottom-line contributor, although there are going to be a "number of years where it is in a loss-making position but it will be profitable in the not too distant future."

Mayer said there isn't enough space for all the sports on linear television, so fans who have been underserved will now have access to what they've been missing out on.

"We have been a wholesaler in the past, and now we are going to be a retailer. ... We are going to be able to capture a lot of value for shareholders," Mayer told reporters this week.

Although the app will be launching with a robust amount of content, ESPN President Jimmy Pitaro said the company will be adding more on a regular basis.

"We are going to learn, we are going to examine the data daily, and make changes both on the product side and also on the content side, look and see what's working, what's not, what's resonating what's not, and go out there and try to secure additional rights," Pitaro said in an interview with CNBC.

What's included?

The live events will include more than 180 MLB games and NHL games throughout the season ( package will be available for an additional $24.99 per month), the entire MLS Live out-of-market schedule with more than 250 games, and thousands of college sports from swimming to track and field to volleyball.

College sports will range from 20 different athletic conferences across the country and other live sports include rugby, cricket, boxing, tennis and golf. The app will also have a built-in DVR function so fans can record sporting events to watch later.

With the service's launch, ESPN will also be releasing a new "30 for 30" documentary titled "The Last Days of Knight" exclusively on ESPN+. The platform will be home to the entire archive of over 100 "30 for 30" documentaries and will be the only place fans can access the entire library.

ESPN will also be producing daily studio shows exclusively for the app that will not be available on its linear channels. In addition to Bryant's "Detail," ESPN will produce a nightly NHL highlight show called "In the Crease" and a daily soccer news show called "ESPN FC."

Disney and ESPN say the focus of building ESPN+ has been on the consumers, so the new service will have a limited ad experience. There will be no display ads or preroll ads throughout the entire experience on all connected devices, though there will be ads during game breaks as you would see on television.

One risk is that ESPN+ could cannibalize the network's existing multichannel business, which Pitaro says the company will continue to invest in.

But Pitaro said it would be "complementary and additive to the existing cable and satellite model. That model has been very good to our business and we expect it to continue to be so. We are continuing to invest in it, we are embracing it."

With CBS Sports recently launching CBS Sports HQ, and Turner Sports planning to roll out its own direct to consumer service, Bleacher Report Live, the competition in the sports streaming market is heating up.

Pitaro says he likes his hand against the competitors. "When you combine the actual product with the broad array of rights and then the ESPN brand, which is the most beloved brand in sports, we feel really optimistic."

Not everyone is as optimistic. Evercore ISI analyst Vijay Jayant cited his concerns in a recent note, saying that ESPN+ is "unlikely to gain traction beyond a small cohort of sports super fans." But he thinks the ability to monetize will make it a sound strategic move for Disney.

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