FloSports CEO on live sports streaming: ESPN 'lost its way'

Senior Writer
Yahoo Finance

ESPN has been steadily losing subscribers, a fact that no one disputes. What people do love to dispute these days is the cause: many contend the network has alienated sports fans by getting too political.

But the true business reason for ESPN’s subscriber losses is the same trend afflicting all of cable: cord-cutting and the fragmentation of live television.

As that trend has continued, digital sports media outlets have bought up live sports rights: Twitter streamed NFL games last season; Amazon is streaming NFL games this season; SlingTV, PlayStation Vue, DirecTV Now, and Hulu have all launched or plan to launch over-the-top services that will include ESPN.

Here’s another example: FloSports, a network of sports news sites and forums (including FloTrack and FloCombat) that first launched in 2006, has been buying up digital video rights.

FloSports signs deal for Big Ten Network streaming rights

Last month, FloSports announced a new four-year deal with Big Ten Network that allows FloSports to live-stream non-televised Big Ten Conference games in a wide range of sports, including basketball, hockey, and wrestling. (The deal does not cover football.)

“This is a great deal for us,” says FloSports CEO Martin Floreani. “We found our opening because your traditional major media companies’ model is flawed. They’re a mile wide, an inch deep, across a whole slew of verticals… Our structure is, we’re vertical, and we’re an inch wide and we go really deep within the vertical.”

[Floreani is the guest on our latest Sportsbook podcast; you can listen on iTunes or scroll to the bottom of this post.]

The streaming will be for FloSports premium members only, a la Amazon Prime’s NFL streaming: FloSports offers a lot of content free, but a monthly FloPro subscription is $30, and an annual subscription is $150. The fact that FloSports is finding success by charging for premium content (The Athletic, a network of local sports blogs, is trying it too) is encouraging to many in digital media.

FloTrack homepage on Oct. 27, 2017
FloTrack homepage on Oct. 27, 2017

FloSports has devoted verticals to sports that are often underrepresented at mainstream sites, like volleyball, wrestling, track, boxing, tennis, cycling, and swimming. Its model is to offer everything under the sun that a fan of those sports could want: chat forums, granular local news, national news, opinion, and scores. Floreani says FloSports sites cater to hardcore fans of niche sports; he calls those people “mavens.”

Last year, the Austin-based company raised a new $21 million in funding to keep buying up digital streaming rights. That brings its total funding to $32.2 million, from investors including Discovery Communications and WWE.

ESPN is “lost without a rudder”

“Sports deserve to be on digital,” says Floreani. “The cable experience is broken. Your traditional broadcasters have lost their way. ESPN, I feel like, has lost its way. You can see that through this recent news of the Barstool debacle.”

When he says “Barstool debacle,” he is referring to ESPN signing a deal with sports blog and podcast company Barstool Sports to launch a new late-night show on ESPN2 hosted by two Barstool personalities. After airing just one episode, ESPN canceled the show under pressure from inside and outside the company over its association with Barstool, a controversial and often inflammatory brand online.

“Before, I had a strong hypothesis that ESPN didn’t know what was going on,” Floreani says. “Now I know for sure. I say that because, sports are supposed to be fun. They’re supposed to be funny! They tap into people’s passion. And yeah, sometimes they’re lowbrow, just like Barstool Sports. But ESPN is missing that. They’re trying to sanitize all sports and make them un-fun, un-funny… They’re lost without a rudder.”

“I think it pays to be substantive”

To be sure, FloSports is still a very small player in the wider world of digital sports media and live sports rights. The company has 260 employees and the websites got a total of 30 million unique visitors in the first half of 2017, up 45% from the same period in 2016.

“We cater to the in-depth,” says Floreani. “And I think [in the near future] you’re going to have a harder time getting people to pay for the surface-level. So I think it pays to be authentic, it pays to be substantive. I think in the end, it’s a better business model. But you’ll always have both.”

Daniel Roberts is the sports business writer at Yahoo Finance. Follow him on Twitter at @readDanwriteSportsbook is our sports business video and podcast series.

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