The NHL and Major League Baseball Advanced Media formally announced their partnership today, which means big changes for a swath of broadcasting properties including NHL.com, GameCenter Live, NHL Network and individual team apps.
It also means that Neulion - the digital streaming company of which Islanders owner Charles Wang is Chairman of the Board and his wife, Nancy Li, is Executive Vice Chairman - will be out of the NHL streaming business by January.
But first, here are the parameters of the deal, per the press release:
MLBAM receives exclusive rights to distribute live, out-of-market NHL telecasts in the United States and certain international markets, including via the NHL GameCenter LIVE subscription service. MLBAM receives exclusive rights to distribute live, out-of-market telecasts via the NHL Center Ice subscription service in the United States to cable, satellite and over-the-air broadcasters. MLBAM receives exclusive rights to operate the NHL Network as an agent for the NHL. The NHL Network's daily on-air operations will be based out of MLB Network's headquarters in Secaucus, N.J.
Anyone who uses GCL a ton during the season is no doubt intrigued about any potential changes to the platform. The lag time between reality and when it gets beamed to your computer or mobile device via GCL seems to get longer every year. And if you're on Twitter at the same time, prepare to read "OMG WTF!" about two minutes before seeing what everyone was talking about.
For me, I'm also looking forward to seeing how MLBAM handles NHL Network, a barren wasteland in which poor Kathryn Tappen and Kevin Weekes stare at Barry Melrose's suits in-between reruns of Oilers propaganda and WaxVac commercials. I don't even have NHL Network and I have no reason to, given the shocking lack of must-have shows on the league's "flagship."
What is MLB Advanced Media?
For starters, MLBAM isn't "baseball" or Major League Baseball or the California Penal League. It's an independent company that was founded to provide an even playing field for baseball content as outlined in an in-depth profile on The Verge.com.
When baseball's then commissioner, Bud Selig, created BAM back in 2000, he had relatively modest goals in mind. The unit would be in charge of creating websites for each of the teams and consolidating MLB's digital rights. By pooling resources, he would prevent the bigger teams from outpacing their smaller market rivals. And to keep the division honest and efficient, BAM would operate as its own company. The teams agreed to contribute a combined $120 million to the venture, $1 million each over the first four years, with each taking an equal ownership stake.
Over the years, MLBAM (or BAM, for short) grew so prescient and prolific that it was contracted to handle the digital streaming for other entities such as Sony, Microsoft, Apple, the WWE and HBO, who uses their technology to power their mobile HBO Go app.
That head start gives BAM a massive advantage in both speed and cost. When HBO originally set out to create HBO Now, the project was reportedly expected to take three years and cost $900 million. BAM turned the same project around in three and half months for less than $50 million. "We see a lot of things that are repeatable," says Kenny Gursh, the head of business development, who helped BAM close deals with ESPN, Sony, and the NHL. "We applied the learnings from MLB.tv to WWE, and we applied the learnings from WWE to HBO."
In an emergency report no doubt filed from his Hockey Writer Vacation Lodge, Elliotte Friedman spoke with the principals about what the partnership could mean for both the league and viewers. The NHL will make $100 million for the sale of its rights on top of cutting their overhead by no longer doing a lot of the backend stuff themselves. The league also expects a bump in revenue to the tune of $120 million a year, which would filter out to the teams.
For us, there's hope that features like MLB Network's Statcast and the MLB At Bat app can be brought into the hockey world. And if you're afraid of The Man cracking down on those sweet John Tavares gifs and Vines you like pumping out on Twitter, Friedman says the NHL is looking to keep things as they are.
MLBAM is very protective of who uses its videos online. As news of this agreement broke, there were questions about what this could mean for fans who create popular GIFs during games.
"We distribute our content with our logo embeddable and shareable with everyone," Bowman said. "In general, what the league has asked for is ‘Don't roll-back, what's being done is being done.'"
Neulion in Winter?
So what about Neulion, the NHL's old partner in streaming? The Plainview-based company, founded in 2004, started its partnership with the NHL in 2007. Wang was named Chairman in 2008.
The league says Neulion will stay on to help BAM transition before the new guys take over full time in January, 2016.
"NeuLion has been a great relationship and we have been well-served by them," Collins said. "In many respects, they should share a lot of the accolades about getting us to this point, building the value that ultimately someone is stepping up and paying such a significant fee for."
The full extent of the relationship between the NHL and Neulion has never really been fully explored, and its unclear how much, if any, benefit or relief the Islanders ever got via the deal. I'm guessing the answer is "not much." Neulion also handled streaming for the AHL, ECHL, Ontario Hockey League and other entities.
Economics site Midas Letter says Neulion stock has already fallen thanks to the NHL-BAM announcement.
With the transfer of the Islanders to new majority owners Scott Malkin and Jon Ledecky being finalized at the end of next season and now with Neulion out as the NHL's streaming and tech partner, it sure sounds as if Wang is minimizing his hockey business interests in a big way. He'll remain a minority partner of the team even after Ledecky and Malkin take over.
The NHL's online presence is okay. Not terrible, but far from great. Their television network is a joke and their streaming service is tolerable for those of us that need to watch games to survive life.
It will be years before we know if the NHL/MLBAM partnership was a good one. But it's clear that the NHL sought out and wants to work with a company at the top of their game. Let's hope MLBAM is ready for us.
Now, about those damn blackouts.