New Zealand telecommunications company Spark will give up streaming sports content when it shuts its Spark Sports unit in July next year.
(Bloomberg) — New Zealand telecommunications company Spark will give up streaming sports content when it shuts its Spark Sports unit in July next year.
Auckland-based Spark said escalating content rights costs and a broader range of investment opportunities across its business were the key drivers of the decision, according to an NZX filing Friday. It announced a content partnering agreement with state-owned broadcaster TVNZ, which it said will become the home of the majority of Spark content from July 1, 2023.
The decision ends four years of disruption in New Zealand sports broadcasting that saw Spark emulating global phone companies like the UK’s BT Group by securing sports content, betting it would drive more customers to its broadband and mobile streaming services. Spark ruffled the feathers of established pay-television company Sky Network Television by winning the rights to the Rugby World Cup in 2019 and then securing a six-year deal with New Zealand Cricket.
“It has been challenging to reach the scale we aspired to across the Spark Sport platform, with Covid causing major disruption to sporting codes globally just a year after launch,” Spark Chief Executive Officer Jolie Hodson said. “That slower than expected start, coupled with the escalating costs of content rights globally, makes it difficult to justify the type of investment Spark Sport requires when we have a wider range of investment opportunities across our broader business.”
Spark said it will make a NZ$52 million provision in the current financial year to cover ongoing obligations under content rights agreements that extend to 2028. Its shares rose 0.5% in Wellington trading Friday.
During its existence, Spark has held the rights to English Premier League, Formula-1 and a range of other sports. Sky, which won back the Premier League rights last year, today announced a multi-year agreement to deliver Formula 1 from early 2023.
Spark said agreement has already been reached with New Zealand Cricket, meaning TVNZ will show and produce all mens and womens internationals and domestic T20 matches for three years from the start of the 2023-24 season.
The deal means more than 300 matches will be screened on free-to-air television over the period, NZ Cricket said in a statement. The sport’s administrator had been criticized for the decision to switch to the streaming service because of the potential impact on viewer numbers.
“This is a very good outcome for the game of cricket in New Zealand,” Chief Executive David White said. “We’re delighted New Zealanders can look forward to this level of free-to-air coverage. It’s a game-changer for the sport in this country.”
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