DISCA Discovery Inc

By Keach Hagey 

Discovery Inc. is making a big bet on international interest in golf.

The media company, which owns channels like the Discovery channel, TLC and Eurosport, has signed a 12-year deal with the PGA Tour for rights to air its events outside the U.S. on TV and digital platforms.

Discovery expects to spend $2 billion over the course of the alliance, which begins in 2019, including the media rights and investments to build a streaming-video platform for golf in international markets.

The deal marks a continuation of Discovery's strategy of investing in sports rights outside of its home market of the U.S., where it has long been priced out of the top sports.

In 2015, Discovery took control of pan-European sports broadcaster Eurosport -- best known for its coverage of sports like cycling and tennis -- and later won rights to the Olympic Games, which it broadcast on Eurosport as well as over various free-to-air and digital platforms.

As cord cutting has pinched all media businesses in the U.S., Discovery has been among the most aggressive in diversifying into international markets where pay-TV is far less mature and still growing.

Many media companies invest in sports content because it is valuable to advertisers -- it is generally watched live, and therefore viewers don't skip over ads -- and because for fans it is must-see content that they would expect to be in any major pay TV package.

In the U.S., Discovery has focused on building more scale to contend with giant distributors and cutthroat programming competition. The company recently closed its acquisition of HGTV and Food Network-parent Scripps Networks Interactive, which, provided it with increased free cash flow to do deals.

Discovery believes it can use its expertise with Eurosport's streaming video service, Eurosport, to build out a similar offering for golf fans.

The PGA deal includes approximately 2,000 hours of content a year, including the Players Championship, the

FedExCup Playoffs, and the Presidents Cup. It doesn't include major tournaments including the Masters and U.S. Open.

In the U.S. the PGA Tour's media partners include CBS, NBC and the Golf Channel.

Bloomberg earlier reported on the Discovery deal with PGA Tour.

Discovery will broadcast PGA Tour content on its portfolio of pay-TV channels, free-to-air channels and digital platforms and work with the tour on how to best put forward its content library.

"This long-term partnership between the PGA Tour and Discovery will create the new global home of golf," said David Zaslav, chief executive of Discovery, in a statement.

Jay Monahan, commissioner of PGA Tour, called the deal "a tremendous opportunity to accelerate and expand our media business outside the United States."

(END) Dow Jones Newswires

June 03, 2018 22:20 ET (02:20 GMT)

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