YouTube Just Paid A Ridiculous Amount To Show The Worst Professional Sports Package
YouTube will pay the NFL over $2 billion a year, for 7 years, for exclusive rights to the NFL Sunday Ticket package.
The top provider of live-TV just got significantly richer thanks to a deal with YouTube to stream NFL Sunday Ticket. The Hollywood Reporter broke down the deal, which gives YouTube streaming broadcast rights for seven years, all for the low price of just over $2 billion a year. If that number seems a little insane, that is because it is, but also because the NFL commands high prices for broadcast rights, charging Amazon, Paramount, and Fox $1 billion each to air games, and $50 million for Apple to sponsor the Super Bowl halftime show.
Partnering with YouTube, and not a regular broadcast network, fits in with the NFL’s recent strategy to expand their reach into streaming. This year the NFL made a deal with Amazon to be the exclusive home of Thursday Night Football, an agreement that is in place for the next 11 years. Football fans know that Thursday Night Football is usually the worst game of the week, but even a game between teams like the Houston Texans and Jacksonville Jaguars still get more views than almost any other program each week.
YouTube, in acquiring the NFL Sunday Ticket package, will broadcast the out-of-market afternoon games through the most popular video streaming site on the planet. Currently, subscribers to the package pay roughly $400 for the season, with the last publicly available count topping 2 million subscribers. While the price for next season is unknown, Dhruv Prasad, Senior VP of Media Strategy, says that “YouTube has the freedom to price the product the way they think the market wants it.”
The NFL has been working with YouTube for over 7 years, ever since the organization established official channels for all 32 teams and 10 channels for the league itself, including NFL Films. In addition, NFL Redzone, a special broadcast that shows every team when they are within 20 yards of the endzone, and the NFL Network has been available on YouTube TV for the past two years. NFL Sunday Ticket will be an add-on to YouTube TV, or separately as part of the new Primetime Channels program.
In a statement announcing the YouTube partnership, NFL Commissioner Roger Goodell says “For a number of years we have been focused on increased digital distribution of our games and this partnership is yet another example of us looking towards the future and building the next generation of NFL fans.” While the NFL still brings in record-setting ratings each week on broadcast networks, in 11 years when the majority of the television-rights deals expire, we could be in a very different media landscape. Already, traditional television networks are working streaming deals with new projects and it seems like every channel has a corresponding streaming service of their very own.
Ten years ago, at the start of streaming services becoming widely available, traditional primetime shows on broadcast networks would still have over 10 million viewers a week. Today, 7 million viewers is a hit and 2 million viewers is considered acceptable, reflecting in hard numbers what everyone already knows: streaming television is the future of the medium. YouTube, with the largest reach on the planet, has not traditionally been thought of as a platform for traditional programs, but with this latest $2.5 billion dollar deal, the streamer is looking to expand its already historic reach.
