Disney, Apple and Amazon continue to wait as NFL reviews Sunday Ticket deals

DK Metcalf, of the Seattle Seahawks, during a Meet & Greet with DIRECTV NFL SUNDAY TICKET registrants at the DIRECTV NFL SUNDAY TICKET Lounge on Saturday, February 1, 2020, in Miami, FL.

Peter Barreras | AP

Disney, Apple and Amazon all have submitted bids to be the new broadcast rights holders of the National Football League’s Out-of-Market Sunday Ticket. They are just waiting to find out who wins.

The three companies submitted bids a few weeks ago, according to people familiar with the matter. The NFL continues to discuss with all three bidders to decide which partner they will choose, the people who requested anonymity said because the negotiations are private.

The NFL wants any buyer to pay more than $2 billion for the rights and shares of NFL Media, which is being bundled with Sunday Ticket, three of the people said. NFL Mobile Rights may also be part of the package, since last time mobile deal with Verizon finished.

DirecTV pay $1.5 billion per year for Sunday Tickets for existing rights, ending after the upcoming 2022-23 season. NFL pushed to increase 100% for its main game bundles last year, but there is little chance the league will get $3 billion for the Sunday Ticket, which has been at historic losses for DirecTV, sources said.

Many observers, including some contractors, have expressed surprise that a deal has yet to be done. The two said the delay was related to the mix of assets and conversations about the partnership that came with negotiations over the deal. If discussions had focused solely on Ticket Sunday, an agreement could have been reached, one of the people said.

There’s nothing urgent about an announcement, as DirecTV will already be offering Sunday Tickets for next season. Bidders want to close the deal sooner rather than later because they want enough time to alert consumers that the owner of the Sunday Ticket right will change.

Spokespersons for Amazon, Apple, Disney and the NFL declined to comment.

The role of DirecTV

DirecTV requires all owners of Sunday Pass packages to also become DirecTV customers. That condition will no longer apply to this new deal, opening up the plan to many new subscribers who will no longer be afraid to spend hundreds of dollars on a plan because they don’t want DirecTV.

DirecTV is not bidding for the current rights package but is willing to cut a deal with the winning buyer, two of them said. An agreement, if reached, could ease the financial burden on the winning streaming platform.

DirecTV is interested in maintaining relationships with bars and restaurants. Sunday Tickets are a staple in sports bars that use game packs to attract fans of non-local games, most of whom have no other way to watch their favorite football team. surname. Sunday Tickets are also popular with sportspeople who want to watch multiple games at once.

DirecTV will also consider operating as a residential media. Under such an arrangement, it could transfer all of the revenue for Sunday Tickets to the right holder but still make it available to customers. This will allow DirecTV to minimize disruption while reducing switching costs for consumers. It will also prevent any potential streaming latency or reliability issues that can occur with broadband football streaming.

However, it remains unclear whether the winning bidder is interested in such a partnership. Building a commercial relationship can be exciting for Disney, Apple, or Amazon, and winners may want to be the direct contact for all Sunday Ticket subscribers.

AT&T pull DirecTV last year. It is now an independent private company jointly owned by AT&T and private equity firm TPG. When AT&T acquired DirecTV in 2015, Sunday Ticket Rights were so important that the entire deal was worth $49 billion. dependent on a long-term contract extension with the NFL. But fewer than 2 million subscribers typically sign up for the package each year, making Sunday Ticket a loser for the satellite TV provider, which is no longer interested in bidding for full rights, according to a person familiar with the matter. this problem.

A spokesman for DirecTV declined to comment.

Various obstacles

While Amazon won the exclusive rights to Thursday Night Football and Disney’s ESPN owns Monday Night Football, Apple will represent a new global partner for the NFL – with the largest corporate balance sheet in the world. That’s attractive to the NFL because it could potentially bring in a new bidder for future deal negotiations.

Apple showed off its ability to broadcast live sports this year by streaming League Baseball games, though some fans, especially the older ones, already Complain about the exclusive streaming package. Apple also agreed to stream Major League Soccer games in a 10-year deal announcement earlier this month. Amazon will be the first exclusive streaming provider for NFL games when it started carrying Thursday Night Football this year.

Apple wants to own the global rights to Sunday Ticket, two of them said. The NFL hasn’t reached a stage in its discussions with Apple where it decides whether it will give those things to the company or sell them individually, one of the people said. DirecTV currently owns US copyright only.

It’s also unclear if Apple or Amazon would be interested in buying a minority stake in NFL Media, which includes cable networks NFL Network and RedZone, and digital website Both tech companies may not be much interested in the legacy pay-TV business, which is hemorrhaging millions of subscribers every year. But if the league links the Sunday Ticket to an NFL Media deal, both companies could head off each other to close a deal.

It’s also possible that the league may eventually decide to sell its shares of NFL Media separately, one of the people said.

Buyers will also have limited flexibility in pricing, according to people familiar with the matter.

When the NFL signed with CBS and Fox, the deals included language that said Sunday tickets had to be priced high so as not to pull too many eyeballs away from the local market Sunday afternoon games were purchased by broadcast networks. Again, three of them said.

That means any owner of Sunday Ticket Rights won’t be able to offer a substantial discount on the out-of-market package, which typically costs around $300 per year. It also prevents an existing streaming service, such as ESPN+, from simply adding to the Sunday Pass for little or no extra charge to increase subscribers.

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