With the DirecTV's programming lineup and one of the US sports world's most valuable assets, ends up as the league looks for new partners.now behind us, the next big football event may not be the NFL Draft in April. It's seeing where NFL Sunday Ticket, the crown jewel in
Long a staple for DirecTV, the package allows fans to watch or stream every out-of-market NFL game, every Sunday, starting at around $300 for the season. With the Amazon and Disney, NFL Sunday Ticket could command a massive premium.with the likes of NBC, CBS, Fox,
Where these rights land could impact how you watch Sunday football in the future. The potential bidding war for such a lucrative asset underscores a growing competitive landscape between traditional pay-TV providers and streaming services, in a world where you're just as likely to watch a game on your phone as the big-screen TV in your living room. The possible entry of newer, deep-pocketed entrants like Amazon or Apple means the NFL stands to bring in quite a lot of money.
"I think that for Direct TV, they have a lot to lose if they don't have it," says Brett Sappington, vice president of research firm Interpret. "The real question for the others is what do they feel like they have to gain? A number of companies, I think, see the NFL and potentially streaming rights for NFL out-of-market services as being a real key to how they could really extend what they're doing in the streaming space."
Sappington adds that a number of these companies have "reorganized themselves to where the streaming part of the business is really driving a lot of the other decisions in the business," with Wall Street paying close attention.
But where does that leave DirecTV, the current exclusive broadcaster for Sunday Ticket? The nation's largest satellite-TV provider pays the NFL more than $1.5 billion per year, but heads into the final year of its contract with the 2022 football season. Some reports state that the league is looking for up to $2.5 billion annually in its next deal.
"DirecTV could certainly survive without it," Sappington says, "but DirecTV has lost subscribers and I think not getting the NFL Sunday Ticket would be a blow."
The company appears to be already preparing for a world where it's no longer the sole provider of Sunday Ticket. With so many people choosing to cut the pay-TV cord, the league also may look to split the rights by partnering with one company for streaming and another for a traditional "linear" cable or satellite delivery.
"The NFL … I don't think they were interested in an exclusive relationship beyond the term of our underlying deal," Rob Thun, DirecTV's chief content officer, said in an interview with CNET last week. "And what form the licensing takes with one partner or many is still undetermined, and we'll see how that plays out."
Thun says that his company is still interested in offering the service even if it means it's through what he says the league calls a "co-exclusive" where the rights would be split between companies.
"They understand that the money still largely comes through the traditional TV bill, pay-TV doors, and they don't want to close the door on that entirely," he said.
A loaded, crowded field
Thun says that while his company is still looking to keep some hold on Sunday Ticket, it isn't interested in being the sole exclusive holder going forward given how people are continuing to cut the cord. Paying more for the rights with that backdrop "doesn't make any sense for us."
Thun is right to anticipate another partner, with a field eager to hop on the Sunday Ticket train. Other rumored names include media companies like ESPN owner Disney and tech giants Apple and Amazon. Following its earnings call on Feb. 9, Disney CEO Bob Chapek confirmed that his company was bidding for the rights.
"We're bidding for it," Chapek said when asked specifically about Sunday Ticket on CNBC's Closing Bell. "And you know, we always say that if an investment is accretive to our shareholders, we'll go ahead and do it. But the moment that it's not we'll back out and we hope it is."
All would be logical landing spots. Amazon has been getting increasingly chummy with the NFL. Prior to becoming the sole home to Thursday Night Football, the e-commerce giant was broadcasting Thursday night games in conjunction with Fox and this past season streamed a playoff game.
Adding in Sunday Ticket would only further boost the ties between the two behemoths and be a potential boon for luring more people to sign up for Amazon's soon-to-be $139 annual Prime membership.
If it does get the rights, it remains to be seen whether Amazon would include the package as part of Prime, which it does for its Thursday games, or make the package available for an extra fee. The company seemingly has no problems shelling out big bucks to acquire or build out exclusives that it offers in the Prime package. Its upcoming cost $465 million for just its first season and will air on Prime Video.is said to have
Apple, meanwhile, has been looking to build out its own streaming bona fides. Since first announcing its $5-per-month Apple TV Plus service three years ago the iPhone-maker has frequently partnered with A-list celebrities such as Tom Hanks, Reese Witherspoon, Denzel Washington and Jennifer Aniston. Its most successful product, perhaps a little ironically, is " ," a comedy show starring Jason Sudeikis, which is about an American football coach heading to the UK to lead a soccer club.
Apple has long tried to integrate sports into products, including adding notifications for close games to its Apple TV app. The company has a cash pile that as of January was , though it has not dabbled in live sports to this point.
Should either win, Sappington sees Apple or Amazon including the package in their base streaming offerings. "For Apple, they're trying to become a significant player in the streaming wars," he says.
"Amazon is trying to maintain or grow its position there and to really deepen its consumers' reliance on Amazon as a retailer and a content producer," he says. Both companies would also stand to gain by further tying consumers into their respective ecosystems.
Apple and Amazon declined to comment.
As for traditional media players, Disney bulking up ESPN Plus with Sunday Ticket makes the most sense. The service, which runs $7 per month or $70 per year on its own, already streams select MLB games and this past year took over the NHL's streaming version of Sunday Ticket, which was previously called NHL.TV. It will also stream Monday Night Football games next season.
While Chapek's comments show his company's interest in the Sunday Ticket rights, how it would distribute them isn't as clear. Whereas NHL games are included with the regular ESPN Plus subscription, big pay-per-view UFC fights are often sold separately for additional fees. The upcoming UFC 272 event will run subscribers an extra one-time fee of $75. Sunday Ticket could go either way.
"I think that Disney would probably bundle it into ESPN Plus, but I don't know whether they would charge a premium for it," Sappington says.
Warner Media Discovery (the soon-to-be-combined company that operates HBO Max and Discovery Plus), Comcast (owner of NBC and Peacock), Paramount Global (owner of CBS and Paramount Plus) and Google are other possible dark horses for Sunday Ticket, though most attention and media reports have focused on Apple, Amazon, DirecTV or Disney ending up as the victors.
For his part, Thun doesn't have a preference for a partner.
"We bring a linear experience to the table as well as digital, but, you know, the large portion of our base is linear. And presumably, the other partners are going to be digital," he said. "So there's a natural partnership to be had given our platforms, and whoever ultimately is the digital player who would take those rights."
What about RedZone and NFL Media?
Reports speculate that in addition to acquiring the Sunday Ticket rights the NFL might also be looking to bundle in its NFL Media arm. This division runs the NFL Network and NFL RedZone channels and league commissioner Roger Goodell has spoken in the past that a Sunday Ticket deal might potentially also include equity in those assets.
Acquiring RedZone, however, could be complicated – as DirecTV found out. The channel is widely available on competing cable, satellite and streaming platforms and provides live look-ins to every NFL game for a fraction of the Sunday Ticket price.
"We were the first to launch RedZone, the NFL decided to launch (the cable version) under our nose and cable operators enjoy that product set that frankly impairs the value of Sunday Ticket," Thun said.
As for when the NFL might make its decision, that remains possibly the biggest mystery of them all. Some at DirecTV thought the league would've made the announcement prior to the Super Bowl. But with the big game behind us, it appears a decision could come at any moment.
The NFL declined to comment on the status or timing of a new Sunday Ticket deal.