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The National Football League is on the verge of signing new rights deals with media partners who may see Amazon.com Inc.
AMZN -2.89%
Exclusively broadcast many games, and TV networks are paying up to twice their current price, people familiar with the matter have said.
New deals could be in place as early as next week, the people said. TV deals for the league’s Sunday and Monday franchises with Fox, CBS, NBC and ESPN are expected to last up to 11 years, they said.
ESPN’s deal would go into effect after the 2021-22 season, while the Fox, CBS, and NBC deal would come into effect after the 2022-23 season.
A deal with Amazon would result in a significant number of Thursday night games exclusively on its Prime Video platform and represent the league’s deepest foray into streaming, some people have said. These games would not be available on traditional television outside of the local markets of the two playing teams, they said.
Amazon has become an aggressive bidder for sports rights at home and abroad. The company already has a relationship with the NFL as it has held the streaming rights for Thursday night football since 2017. These games have also been televised by the league-owned NFL Network, and more recently by the Fox Network. , whose parent company Fox Corp. FOX 2.88%
shares common property with News Corp, the parent company of Wall Street Journal publisher Dow Jones & Co.
If done, an Amazon deal would not take effect until after the 2022 season, when Fox’s current Thursday night football pact expires. Fox is now paying $ 660 million per season for this package, the Wall Street Journal previously reported. If the Thursday games are sent to Amazon and there is no other video component beyond the local TV markets of the teams playing, the annual fee paid by Amazon could reach $ 1 billion, said people with knowledge of the discussions.
Amazon currently pays between $ 75 million and $ 100 million to stream the Thursday games, a person familiar with the deal said. As with Fox, this contract has two more seasons. The NFL Network would continue to offer a handful of exclusive Saturday and Thursday games as its deal with distributors requires it to host at least five games per season, people familiar with the thinking of the league have said.
A deal with Amazon for most Thursday night games would solve a potential problem for the NFL. While the Thursday Games score high compared to any other programming, the high price tag made it a tough sell with broadcasters who already offer NFL programs such as Fox, which analysts and industry insiders say , loses $ 250 million per season. Prior to the Fox deal, CBS and NBC shared Thursday’s games and their combined losses were over $ 200 million, people familiar with the deals said.
The long-term deals could be the last time the NFL can push for huge fee increases from its broadcast and cable partners amidst viewership fragmentation and cord cuts. Dominique Dafney of Green Bay hit a touchdown pass on Jan. 3.
Photo:
Charles Rex Arbogast / Associated press
A decision to place some of the NFL games – which typically dominate television ratings – exclusively on a streaming platform is not without risk. Amazon broadcast a game exclusively last year and attracted an average audience of less than five million, well below that of the typical NFL game broadcast on television or ESPN’s “Monday Night Football”.
The league tries to strike a balance between adopting new platforms and the revenue they represent while keeping most of its games on traditional television.
Fox Corp.’s average annual fee for its Sunday afternoon games is expected to rise to around $ 2 billion from the current $ 1.1 billion, people familiar with the negotiations said. ViacomCBS Inc.
AFTER 3.19%
will likely see its average cost per Sunday afternoon game season drop from $ 1 billion to $ 2 billion, the people said.
The new contract for Comcast Corp.
CMCSA -0.96%
NBC is also expected to more than double, from the current average of $ 960 million paid per season to around $ 2 billion, a person familiar with the pact said. NBC’s streaming service Peacock will also broadcast an exclusive game and simultaneously broadcast NBC’s Sunday night games, the person said.
The league further expects to get a big fee hike from Walt Disney Co.
Dis -0.87%
ESPN, said people familiar with the matter.
The fee increases come after a season in which ratings were down for the regular season, playoffs and the Super Bowl. Network executives say they believe the coronavirus pandemic played a big part in the declines and believe the numbers will improve once normalcy returns.
In addition, CBS, Fox, NBC, and ESPN all face challenges in retaining viewers, which makes live sports increasingly important.
This next round of long-term deals could be the last time the NFL is able to ask its broadcast and cable partners for such giant fee increases, as viewership fragmentation and cord cuts won’t. are expected to increase in the coming years, said media analyst MoffettNathanson. Michael Nathanson.
“It’s a sign the NFL wants to take as much as it can for as long as it can. Ten years from now the world will surely be different and a new set of bidders will have to emerge, ”Nathanson said.
One televised deal that the NFL is yet to renegotiate is the Sunday Ticket package, which allows fans to watch any game on Sunday afternoon. AT&T Inc.of
T 1.77%
DirecTV is offering the package throughout the 2022 season for $ 1.5 billion annually. AT&T Managing Director John Stankey said Sunday Ticket is not the growth engine it once was and is no longer essential for DirecTV. In addition, AT & T’s own interest in the satellite broadcaster is also waning. Last week he struck a deal to sell a 30% stake in DirecTV to private equity firm TPG for $ 1.8 billion.
Write to Joe Flint at [email protected]
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