NFL gets ESPN stake in deal with Disney

What happened

The Walt Disney Co. and National Football League Tuesday announced a deal that would give the NFL a 10% stake in Disney's ESPN sports empire and give ESPN ownership of NFL Network and rights to other NFL media properties, notably the fan-favorite RedZone channel.

Who said what

The "tie-up between two of the biggest names in entertainment and sports" takes the "symbiotic relationship between media companies and athletic leagues" up a level, said The Wall Street Journal. ESPN will strengthen its bond with its "most important content provider" as it prepares to launch a new $30-a-month streaming service, while the NFL "gets a piece of a key Disney asset" and "ensures the future" of its two "popular" but isolated channels. RedZone was reportedly "a key component of the deal," The Washington Post said.

The NFL also has distribution deals for certain games with NBC, CBS, Fox, Amazon, Netflix and YouTube, and its stake in ESPN "should raise the question of whether that entity is getting favorable treatment relative to other networks and streamers," Guggenheim Securities analyst Michael Morris told the Journal.

What next?

The "no-cash deal," valued at an estimated $2 billion to $3 billion, is "subject to regulatory approval, which could take nine months or more," The New York Times said. If regulators approve, Disney would own 72% of ESPN, from 80%, and minority stakeholder Hearst would own 20%, from 18%.

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