Telstra (ASX:TLS) dumps NRL, AFL streaming

ASX-listed company drops a shock move on the media, telecommunications, sports and entertainment markets. Will it pay off?

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Telstra Corporation Ltd (ASX: TLS) has stopped live streaming of NRL and AFL games, in a major change to its sports and entertainment strategy.

For the last 9 years, the telco had owned the mobile streaming rights to the two most popular football codes in Australia. It was used as a major lure to attract customers to the telco. 

But now that responsibility will shift to Kayo, where Telstra clients will be offered a discounted subscription.

The move also means Telstra will no longer bid for sports broadcast rights.

"While Live Pass has provided a great sporting experience over the years, we are replacing it with Kayo, which has quickly become the premium sports streaming service in Australia, and we're excited to provide an exclusive offer for you to watch a wider range of sports on your choice of screen," said a company spokesperson on a blog post.

The Kayo streaming service is owned and operated by pay television company Foxtel, which itself is jointly owned by Telstra and News Corporation (ASX: NWS).

Telstra shares were up 0.32% at close of trade on Tuesday afternoon. News Corporation dipped 0.4% on the ASX.

Is the new way better or worse for Telstra customers?

Telstra customers who already have NRL and AFL Live Pass access will be offered the basic Kayo plan for $5 per month, which is a $20 discount. The telco's customers who don't currently have footy streaming will be offered the subscription for $15 per month.

The two big changes for Telstra customers will be that:

  • They'll now be able to watch more than 50 sports through Kayo, rather than just 2 
  • They can stream the sports on the television, rather than just mobile devices

The shift was somewhat inevitable, with the NRL last year blocking Telstra from bidding on digital streaming rights from 2023.

The telco is a long-time major sponsor for rugby league, with the competition officially named the NRL Telstra Premiership for many years.

Also, this month Kayo faced a major new rival in live sports streaming as Nine Entertainment Co Holdings Ltd (ASX: NEC) launched Stan Sport. That service starts this year with rugby union as its premium sport.

Telco competitor Optus also owns some sports streaming rights, with the English soccer as its jewel in the crown.

Telstra also possesses live streaming for netball and A-League soccer, but they will also be shifted to Kayo if it wins the broadcast rights.

Motley Fool contributor Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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