The National Football League is about to sign new rights agreements with media partners who can see Amazon.com Inc.
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they carry many games exclusively and TV networks pay up to double their current rate, people familiar with the matter said.
New deals could be signed as early as next week, people said. Television 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.
The ESPN deal would go into effect after the 2021-22 season, while the Fox, CBS and NBC deals would go into effect after the 2022-23 season.
A deal with Amazon would result in a significant number of games on Thursday nights exclusively on its Prime Video platform and would represent the league’s deepest onslaught in streaming, some people said. These games would not be available on traditional television outside the local markets for the two teams at stake, they said.
Amazon has become an aggressive bidder for sports rights here and abroad. The company already has a relationship with the NFL, as it has streaming rights to Thursday night football since 2017. These games have also been televised by the league’s NFL Network, and more recently by Fox network, whose parent company Fox Corp. FOX 2.88%
shares common ownership with News Corp, parent company of the Wall Street Journal publisher Dow Jones & Co.
If concluded, a deal with Amazon would not go into effect until after the 2022 season, when Fox’s current Thursday night football pact expires. Fox is now paying $ 660 million a season for this package, The Wall Street Journal previously reported. If Thursday’s games go to Amazon and there is no other video component besides the teams’ local TV markets playing, the annual fee Amazon pays could reach $ 1 billion, people with knowledge of the discussions said. .
Amazon currently pays between $ 75 million and $ 100 million to broadcast Thursday’s games, said a person with knowledge of the business. As with Fox, that contract still has two seasons. The NFL Network would continue to play a handful of exclusive games on Saturday and Thursday, as its contract with distributors requires it to play at least five games per season, said people familiar with the league’s thinking.
A deal with Amazon for most Thursday night games would solve a potential problem for the NFL. Although Thursday’s games received strong ratings compared to any other programming, the high price was making it difficult to sell to broadcasters that already sell NFL packages like Fox, which analysts and industry experts estimate will lose $ 250 million a year. season. Before the deal with Fox, CBS and NBC shared Thursday’s games and their combined losses were more than $ 200 million, said people familiar with those deals.
The long-term deals could be the last time the NFL could demand huge rate hikes from its broadcast and cable partners amid audience fragmentation and cable cutting. Dominique Dafney of Green Bay got a touchdown pass on January 3.
Photograph:
Charles Rex Arbogast / Associated Press
A move to place a portion of NFL games – which typically dominate television ratings – exclusively on a streaming platform is not without its risks. Amazon ran a game exclusively last year and attracted an average audience of less than five million, much less than the typical NFL game on television or ESPN’s “Monday Night Football”.
The league is trying to strike a balance between embracing new platforms and the revenue they represent, while maintaining most of its games on traditional television.
Fox Corp.’s average annual fee. for its Sunday afternoon games it is expected to jump from $ 1.1 billion to about $ 2 billion, said people familiar with the talks. ViacomCBS Inc.
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it’s likely to see its average Sunday afternoon game season rate go from $ 1 billion to $ 2 billion, people said.
The new deal for Comcast Corp.
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NBC is also likely to more than double, going from the average of $ 960 million it pays per season now to about $ 2 billion, said a person familiar with the pact. NBC’s streaming service, Peacock, will also have an exclusive game and will simultaneously stream NBC games on Sunday nights, the person said.
In addition, the league expects to see a huge increase in fees from Walt Disney Co.
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ESPN, people familiar with the matter said.
Rate hikes come after a season in which ratings dropped for the regular season, playoffs and Super Bowl. Network executives say they believe the coronavirus pandemic has played a big role in the declines and believe the numbers will improve when normalcy returns.
In addition, CBS, Fox, NBC and ESPN are facing challenges to keep viewers, making live sports increasingly important.
This next round of long-term deals may be the last time that the NFL will be able to command such gigantic rate increases from its broadcast and cable TV partners, as audience fragmentation and cable cutting are expected to increase only in the next few years, said MoffettNathanson media analyst Michael Nathanson.
“This is a sign that the NFL wants to take as long as it can for as long as it can. A decade from now, the world will certainly look different and a new set of bidders will need to emerge, ”said Nathanson.
A TV deal that the NFL is not yet renegotiating is the Sunday Ticket package, which allows fans to watch any game on Sunday afternoon. AT&T Inc.in
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DirecTV has the package through the 2022 season at an annual price of $ 1.5 billion. AT&T Chief Executive John Stankey has indicated that the Sunday Ticket is not the growth engine it was and is no longer critical to DirecTV. In addition, AT&T’s own interest in the satellite broadcaster is also disappearing. Last week, it 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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