Los Angeles Chargers running back Austin Ekeler, center, runs for extra yard as Tennessee Titans linebacker Monty Rice, left, and safety Andrew Adams (47) attempt a tackle during the second half at SoFi Stadium on Sunday, December 12. February 18, 2022 in Los Angeles, California.
Allen J. Schaben | Los Angeles Times | Getty Images
The National Football League had a streaming service in mind when it was looking for a new home for the rights to its “Sunday Ticket” subscription gaming package.
The league achieved the desired result in an agreement with Googleis YouTube. Traditional television channels also got what they wanted.
From next season, “Sunday Ticket” will be offered in two ways through YouTube: either as an add-on to its YouTube TV service, a digital TV package that mirrors the traditional pay-TV package, or à la carte. via YouTube’s Primetime channels. . .
YouTube pays around $2 billion a year for residential rights over the next seven years, CNBC reported. The process concluded this week after months of negotiations with potential winners like Apple, Amazon and Disney, which operate ESPN streaming service ESPN+.
While pricing hasn’t been determined, consumers will likely get more for their money by subscribing to YouTubeTV and adding “Sunday Ticket,” which airs out-of-market NFL games on Sunday afternoons. It will also give them access to almost all NFL games in one place. Google’s YouTube TV package includes broadcast stations such as CBS, Fox, and NBC. Other tech giants Apple and Amazon don’t offer a similar bundle with broadcast or pay-TV networks, such as ESPN and NFL Network.
Sports, and the NFL in particular, have long been seen as the glue that holds the traditional television bouquet together. Sports networks, and those that offer live gaming, attract some of the highest fees from pay-TV operators, and they get some of the highest ratings. The NFL makes big bucks for live game streaming.
For that reason, longtime broadcast and pay-TV network executives, who declined to be named because they weren’t authorized to speak publicly, found the deal with YouTube a favorable outcome. versus Apple or Amazon getting the package.
YouTube and the NFL did not immediately comment.
Long live the lot
PrimordialSCS and Fox broadcast weekly Sunday afternoon matches. ComcastNBC’s is the birthplace of “Sunday Night Football” and disneywhich owns ESPN and ABC, owns the rights to “Monday Night Football.”
Each paid heavy sums for these rights. Last year, collectively, the four agreed to pay more than 100 billion dollars during 11-year packages to broadcast NFL games.
For networks like NBC, CBS, and ESPN, they simulcast NFL games on their fledgling streaming platforms for audiences that have turned away from the pay-TV package.
All of these games are available through Google’s YouTube TV package, with the exception of “Thursday Night Football,” which now streams exclusively on Amazon Prime.
“YouTube is in many ways a very unique and interesting platform,” said Dhruv Prasad, senior vice president of media strategy and strategic investments for the NFL, during a call with the media this week, “ because we’ve chosen a partner that really supports, in many ways, our existing distribution with Sunday afternoon and evening, and Monday evening. We actually think that’s a model where this will result in a real advantage with existing partners.
While deals with legacy carriers are hugely lucrative for the NFL, the league has been open about wanting more streaming partners. NFL commissioner Roger Goodell said long before the outcome of negotiations that the league considered a streaming partner the future of ‘Sunday Ticket’, which is only offered by the satellite TV operator Direc TV since 1994.
Although YouTube only streams, it offers a package that keeps the TV package alive – paying similar rates to typical distributors, which in turn has caused the price of subscriptions to skyrocket. YouTube TV had more than 5.3 million subscribers in the third quarter, putting it above competitors like Disney’s Hulu Live TV+, Fubo TV and Dish’s Sling, according to data from MoffettNathanson.
“It’s a win for YouTube TV because it serves a larger purpose for them to get more subscribers. And ultimately it helps a set of linear channels,” said Pat Crakes, sports media consultant. , noting that YouTube also got the rights “at a good price,” to help them bolster their streaming service.
Adding another NFL property to the equation to make a TV package stickier with customers is a plus for the networks, executives told CNBC.
The streaming business, especially for traditional media companies, has come under pressure recently. As companies rushed to build and strengthen their own services, lagging behind netflix, fierce competition is now weighing on subscriber numbers and content costs are soaring. Although streaming remains a priority, some media CEOs are rethinking the amount of content to pull from the traditional bundle and stream.
The package is dead
For some in mainstream media, however, YouTube becoming the home of “Sunday Ticket” wasn’t good news.
For pay-TV operators, it could lead to more customers cutting their traditional packages and replacing them with YouTube TV, people close to the distributors said.
In the third quarter, cord cutting hit all-time worst levels, according to research firm MoffettNathanson.
“The linear model will not die of old age, rather it will die of neglect,” analyst Craig Moffett said in a recent note. “If essential content – read: branded sports programming – is exclusively available on linear platforms, then the linear model will be preserved, at least for a time, and at least for a segment.”
Pushing customers towards YouTube TV subscriptions, or simply pay-per-view options, only amplifies the bleed of pay-TV customers from traditional cable and telecom operators, like Charter Communications, Comcast and Dish. Executives on this side of the industry had hoped Apple would get the “Sunday Ticket” rights, people close to some distributors said, because it wouldn’t provide another linear bundle option.
A silver lining for distributors is that while YouTube TV has broadcast and pay-TV networks offering sports and NFL games, the streamer still doesn’t offer regional sports networks as part of its offering. For an all-around sports fan, that still makes the traditional pack a better bet.
Yet that could change. This week, Sinclair’s regional sports networks signed a deal with Fubo TV, putting its portfolio of networks on a digital pay-TV package. Such a deal with YouTube TV may not be far behind given the recent “Sunday Ticket” package.
Disclosure: Comcast is the parent company of NBCUniversal and CNBC.
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