We kick things off with Neil’s thoughts on Amazon talking with Disney about a potential ESPN deal. The update goes over Disney’s motivation with ESPN, where Big Tech becomes involved, and Apple’s connection. The discussion then turns to how live sports consumption can become a major use case for Apple Vision Pro. We go over two big questions about live sports as immersive experiences. We conclude with Apple changing the theatrical release plan for “Killers of the Flower Moon.”

Hello everyone. Happy Wednesday. Apple sent invites for its next product event. September 12th at Steve Jobs Theater. New iPhones and Apple Watches are expected.

Let’s jump into today’s update.

Amazon Reportedly Interested in ESPN Deal

Here’s The Information:

“Amazon has had early talks with The Walt Disney Company about working on the streaming version of ESPN it is developing, said people familiar with the matter. The tech giant could offer the service through one of its streaming offerings, helping to expand its distribution, while possibly also taking a minority stake in ESPN.

Such an arrangement could shore up ESPN’s status as the biggest force in sports media, even as declining TV viewership and advertising, combined with rising sports programming costs, have squeezed the sports channel and Disney, its majority owner. It could also reposition the tech behemoth, which has been trying to make a dent in sports streaming, as more friend than foe to ESPN. And it could weaken the sports leagues’ bargaining power.

ESPN is considering charging between $20 and $35 a month for the new streaming service, said people familiar with the matter, a potential price range that could make it the most expensive streaming service in the U.S. and add pressure on already-stagnant growth in the streaming sector."

The Information went on to say “multiple current and former Disney and ESPN insiders” value ESPN at between $25B and $35B. My first reaction was to wonder if former executives are running with ultra conservative assumptions when coming up with that $25B figure. While we don’t have a whole lot to go off of from a Disney financials perspective, my math (discussed in the July 19th update) pegged ESPN as potentially being valued at anywhere from $40B to $100B depending on one’s assumptions about future performance.

While there seems to be a throw everything against the wall and see what happens complex going on with Disney and ESPN, the crux of the situation is somewhat straightforward.

An Above Avalon membership is required to continue reading this update. Members can read the full update here. An audio version of this update is available to members who have the podcast add-on attached to their membership. More information about the podcast add-on is found here.

(Members: Daily Updates are always accessible by logging into Slack. If you haven’t logged into Slack before, fill out this form to receive an invite.)

Above Avalon Membership

Subscribe $20/month

Subscribe $200/year

Payment is processed and secured by Stripe. Apple Pay and other mobile payment options are accepted. Special Inside Orchard bundle pricing is available for Above Avalon members.

More information about Above Avalon membership, including the full list of benefits and privileges, is available here.