It's only been a few days since the news broke that Amazon is rolling out its Prime Video streaming service in more than 200 countries to go head-to-head with Netflix. And now the e-commerce giant is said to be looking at putting together a premium sports package to go with it.
The company has been in talks with a wide range of different sports leagues about acquiring broadcasting rights, according to a report in the Wall Street Journal.
Obviously, Amazon would probably be most interested in the top National Basketball Association, Major League Baseball, and National Football League events, but it is also talking to the National Lacrosse League and the World Surf League, the newspaper's sources said.
The big problem with trying to buy up basketball, football, and baseball programming is that the major networks—especially ESPN—have already locked up most of them for the next decade or so.
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For example, the deal that ESPN has with the NBA doesn't end until 2024, and the rights packages that ESPN, CBS and NBC have for National Football League games run into the next decade as well. Even college football teams have locked up rights with various cable networks.
ESPN's parent Disney is also looking to expand its streaming offerings, including a new service that is expected to be launched soon. That's why the entertainment giant recently spent $1 billion to buy a stake in BAMTech, the tech provider that handles streaming for Major League Baseball and a number of other clients including ESPN.
According to the Journal, Amazon is "keenly aware" that the NFL Sunday Ticket games offered by DirecTV helped give that cable competitor a boost when it first launched, and therefore Amazon wants to do something similar by signing up whatever sports it can.
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As with almost everything Amazon does, the content in this case is just a lure to get customers to sign up for its Prime subscription service, which generates significant returns for the company and now incorporates everything from free shipping on products to a Spotify-style music service.
There's one big reason why we shouldn't dismiss either the online giant's sports ambitions or its global Netflix competitor: Namely, Amazon's $380 billion market capitalization, and the massive river of cash that spins out of its Amazon Web Services division, where hundreds of Fortune 500 companies store their data. It generates about $10 billion in revenue every year.
That's definitely enough to spend buying up sporting rights. All Amazon has to do is find someone who is willing to sell and who hasn't already cut a deal with an existing network.