Amazon’s Diamond Sports Investment Comes as Streaming Services Seek Game Day Boost

Amazon is partnering with Diamond Sports Group, a move that comes as video streaming platforms see huge boosts from their sports offerings.

The eCommerce giant is making a minority investment in the sports media company, and in turn it will make the latter’s content, which includes MLB, NHL ad NBA games, available for purchase via Prime Video, according to an announcement from Diamond on Wednesday (Jan. 17).

It seems likely that these offerings will be outside Prime Video’s basic subscription, given that the news release states that consumers will have the option to “purchase direct-to-consumer (D2C) access” to this content through Prime Video channels.

“We are grateful for the support from Amazon and a group of our largest creditors who clearly believe in the value-creating potential of this business,” Diamond CEO David Preschlack said in a statement. “Diamond’s near-term focus will be on implementing the [Restructuring Support Agreement (RSA)] and emerging from bankruptcy as a going concern for the benefit of our investors, our employees, our team, league and distribution partners, and the millions of fans who will continue to enjoy our broadcasts.”

The move comes roughly 10 months after Diamond initially filed for Chapter 11 bankruptcy in March, and is part of a restructuring support agreement to provide a framework for the company to emerge from Chapter 11.

According to the Associated Press, Amazon’s investment is expected to be around $115 million to start, and it could be some time before the streaming service is able to provide the sports media company’s content.

Amazon’s investment comes as streaming services are discovering just how powerful live sports can be as a draw for consumers. For instance, NBCUniversal streaming service Peacock announced Sunday (Jan. 14) that the AFC wild-card playoff game between the Kansas City Chiefs and the Miami Dolphins, to which it had exclusive rights, averaged 23 million viewers across Peacock, Miami and Kansas City’s local NBC stations and on mobile devices via NFL+, reaching 27.6 million viewers overall and becoming the most-streamed event in U.S. history.

Plus, in November, it was reported that Netflix was exploring the possibility of streaming a live boxing match. Moreover, Apple TV+ has seen its partnership with Major League Soccer’s MLS Season Pass drive customer acquisition and retention.

Access to these kinds of highly anticipated events can be especially crucial given consumers’ tendency to unsubscribe from streaming services when times get tough. Recent reports show that roughly 1 in 4 U.S. subscribers to major services like Netflix, Hulu and Disney+ have canceled at least three subscriptions in the last two years, and streaming service cancellations are on the rise.

Plus, the PYMNTS Intelligence report “The One-Stop Bill Pay Playbook: Drivers of Consumers’ Bill Payment Priorities,” which drew from a survey of more than 2,100 U.S. consumers, found that when consumers are unable to pay all their bills, streaming subscriptions get the axe, with 55% of participants saying they would cancel streaming subscriptions if they needed to reduce the bills they received each month. This share was greater than said the same of any other monthly bill.