Spark's [NZX: SPK] Lightbox and Coliseum Sports Media (CSM) have formed a 50-50 joint venture called Lightbox Sport, says Tim Martin — the man who until today was CEO of CSM, and is now managing director of Lightbox Sport.
Neither side will say how much capital is being put into the JV, but Lightbox CEO Kim Nyblock says there will be dedicated content and license budgets forLightbox Sport content. Spark has previously said its launch year budget for Lightbox is $20 million [UPDATE: at Spark's half-year result briefing, it said it had increased its launch-year budget for Lightbox from $20 million to $35 million].
CSM NZ will cease to exist as a standalone company, Mr Martin says, although its international operation will continue (it recently launched its PremierLeaguePass.com in Malaysia, with the Philippines next on its list).
All of Coliseum Sports Media NZ's assets and intellectual property are being folded into the joint venture, Mr Martin says.
Ms Nyblock says CSM staff (currently in Britomart) will move to Lightbox's office, which is in the basement of Spark's Auckland headquarters.
No time has been set to integrate Lightbox and CSM's online content.
But it has been confirmed that subscribers to Lightbox will have to pay extra to access Coliseum's online sports content, which currently includes English Premier League soccer and French rugby, and will expand to PGA and LPGA golf in January. There will be technology and brand integration, but two separate subscriptions for Lightbox and Lightbox Sports.
Neither company has made any public announcement about its subscriber numbers, but Spark CEO Simon Moutter said at an annual results presentation that Lightbox has the goal of 70,000 paying customers by next June.
JV makes sense
With neither side releasing subscriber numbers or financials, it's hard to say if the joint-venture is being done from positions of strength or weakness.
But either way, it makes sense for both companies.
Streaming video on demand services like Netflix (launching in NZ in March) and Quickflix have traditionally been weak in sport, or ignored the segment altogether. The Lightbox Sport joint venture will give Lightbox a real point of difference.
Mr Martin says Lightbox Sports will look to expand its content rights to major sports events — although he also notes Sky TV has just locked up All Blacks rights for another six years.
"We want to be a major media player," he says.
The Spark hookup will put more financial heft behind Mr Martin's ambitions — not that CSM was ever poor (to this point it's been mainly bankrolled by its major shareholder, NBR Rich Lister Peter Cooper, the Britomart developer whose wealth is estimated at $720 million). And both players will gain scale.
The JV partners
Lightbox offers all the TV shows you can want via broadband for $15 a month. Today it said it is extending its device support from iPad, computer and Samsung Smart TVs to include Playstation4.
Spark told shareholders it has budgetted $20 million for Lightbox's launch year, but not detailed spending plans beyond that.
Coliseum Sport's Media's PremierLeaguePass.com offers streaming and on-demand access to all games in the English Premier League for $149 a season, with some content also running on free-to-air partner TVNZ. CSM's French TOP14 rugby service costs $5 a month.
Sky TV has yet to reveal the final line-up for its own streaming video on-demand service, Neon, due to launch by the end of this month — but now the pressure could be on to add a little sport to the mix.
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