YouTube has entered the advanced stage of its negotiations with the National Football League for streaming rights to NFL Sunday Ticket, a subscription-based package that allows fans to watch almost all Sunday afternoon games.
DirecTV, the current NFL Sunday Ticket streaming rights holder, is paying $1.5 billion annually for the opportunity to host non-local Sunday games. In essence, Sunday Ticket “allows subscribers to view all out-of-market Sunday afternoon games, meaning games that don’t involve their local teams,” according to The Wall Street Journal (WSJ).
As per the WSJ’s report, the “potential move of Sunday Ticket to YouTube is further evidence of major sports migrating from traditional TV, which has been hit by cord-cutting, to streaming, and tech companies that are willing to spend heavily on content.”
As for DirecTV, a company co-owned by AT&T Inc. and private-equity firm TPG Inc., it is experiencing subscriber declines that are making it increasingly challenging to justify spending $1.5 billion on the rights to NFL Sunday Ticket, which has around 1.5 million subscribers.
The recent uptick in partnerships between major sports leagues and streaming services is due to the changing marketing landscape which is prioritizing online streaming over traditional cable.
For major sports leagues, this is an opportunity to get in front of a new and larger auditorium, but also to retain its existing viewership that is migrating to livestreaming.
Streaming services, on the other hand, stand to benefit from exclusive access to premium content in order to diversify their income streams. YouTube is the perfect example of this trend, seeing as how its advertising business declined in the third quarter for the first time. That is why YouTube is now looking to broaden its subscription revenue with exclusive content.
Google’s YouTube isn’t the only video platform NFL will be cooperating with if the deal goes through. Amazon Prime Video has its own NFL deal for “Thursday Night Football,” which is a huge 11-year agreement for the streaming right. Apple has rights to some Major League Baseball games and is working out a new deal for Major League Soccer. Both Apple and Amazon showed interest in Sunday Ticket as well.
If NFL Sunday Ticket does come to YouTube, the content will be available as an add-on for YouTube TV. There are also talks of a new feature called YouTube Primetime Channels beginning next season.
