This past week, sport streaming service, DAZN announced that it would expand its service to 200 countries and territories worldwide. The expansion will begin with the May 2nd boxing event featuring Canelo Alvarez.
This is a dramatic expansion as the service currently serves 9 countries. The global rollout will be of an English-language service focused on boxing according to a report from The Hollywood Reporter.
The new service will offer an on-demand archive of fights as well as original programming.
Payout Perspective:
From a business perspective, one has to wonder how will this impact the company’s finances. Last spring it was announced that it had reduced its debt burden by 93% from 2018. This was due in part to the reported $2.2 billion in funding it received to launch the service in 2016. In 2018, according to SportsPro Media, DAZN’s revenue increased over 130% to $277.6 million. Ad revenue increased 4.4% to $77.2 million. But documents revealed by Chris Williamson show that DAZN lost $634 million dollars in 2018 and $482 million dollars in 2017.
This past fall, DAZN was looking for $500 million for expansion efforts and it apparently has obtained it. The question for DAZN is whether this strategy will equate to increase subscriptions and ad revenue. And how soon will they be able to turn a profit?
With DAZN touting 8 million subscribers world-wide including about 1 million in the U.S. per a December 2019 WSJ article, DAZN will have to continue this type of momentum. This will mean highlighting its content and acquiring more. This is a bold strategy by DAZN and for those involved it’s a gamble they hope pays off.