Comcast, Paramount exploring streaming deal – report

Comcast and Paramount Global have discussed forming a streaming partnership or joint venture that would seemingly be in response to a new sports streaming bundle from ESPN, Fox and Warner Bros. Discovery that's slated to launch this fall, The Wall Street Journal reported.

Such a combination could see a melding of services such as Paramount+ and NBCU's Peacock, which both stream out large libraries of movies and TV shows and also hold important sports streaming rights.

The WSJ noted that putting those services together would also generate "significant cost savings" in areas such as programming and marketing while also creating a new, bigger home for live sports.

Forging a commercial partnership or a joint venture are among the options being pursued, the WSJ said. Back in 2021, Comcast and ViacomCBS (now part of Paramount Global) introduced SkyShowtime, a streaming service for parts of Europe that features content from both companies.

Those talks are reportedly underway as Disney-owned ESPN, Fox and Warner Bros. Discovery (WBD) push ahead with a plan to launch a sports streaming bundle this fall that would be sold as a standalone or in a bundle with Disney+ and Hulu. That streaming service effectively would become a new virtual multichannel video programmer (vMVPD), a category that also includes YouTube TV, Fubo TV, Sling TV, Hulu + Live TV, Philo and DirecTV Stream. It's not clear if other distributors, such as cable operators, will also be afforded the option to sell the new sports streaming bundle or create a similar sports package featuring content from ESPN, Fox and WBD.

A deal with Comcast would also give Paramount a new dance partner at a time when the company is cutting costs and figuring out ways to turn streaming into a profitable business. Paramount reportedly is in the process of laying off about 800 employees in the US.

Distributors already complaining: CNBC

ESPN, Fox and WBD have already been hearing private complaints from distributors over concerns that the new "skinny" sports streaming bundle could accelerate pay-TV cord-cutting, according to CNBC.

MoffettNathanson analyst Craig Moffett told CNBC that the new sports streaming bundle might violate "most favored nation" deals that allow certain distributors to get access to similar contract terms for programming.

"I would be surprised if there aren't some lawsuits," Moffett told CNBC.

New Street Research policy analyst and former FCC exec Blair Levin doesn't expect the FCC or DoJ to take any direct action against the service being developed by ESPN, Fox and WBD. But Levin warns that they could be prompted by other distributors to scrutinize it.

Members of ACA Connects, an organization that represents independent cable operators, "have serious concerns and will continue to pressure the Justice Department to intervene," CEO Grant Spellmeyer said.