YouTube’s deal with the NFL turns up the heat in the battle for sports rights

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YouTube’s $14bn (£11.6bn) deal to stream National Football League (NFL) games marks the latest foray by a Silicon Valley giant into territory traditionally dominated by broadcasters and media outlets. pay-TV companies as live sport becomes the latest battleground for audiences and profits. promised by the streaming revolution.

Google-owned YouTube’s seven-year deal in which the world’s largest video platform will take over the “Sunday Ticket” game package held by US satellite service company Apple.

The deal is the latest in a series of commercially appealing deals for the NFL, the world’s most expensive live sports rights, after 11-year, $113 billion deals struck with broadcast partners last year, in which Amazon it was made with $1 billion. value of games per year.

The appetite shown for YouTube, which cements another stratospheric rise in the value of rights for the NFL, will buoy Premier League bosses in hopes that a new big spender will reignite the lucrative bidding wars for UK rights. that marked the last decade.

While the Premier League nearly doubled the value of the US rights in a £2bn deal last year with NBC, which mainly broadcasts matches on its streaming service, Peacock, bosses were forced to renew an agreement with existing partners in the UK to avoid potentially losing hundreds of millions of pounds on an auction that lacks new competition.

Beyond Sky and BT, the only new player to buy UK Premier League rights in recent years has been Amazon, though the owner of Prime Video hasn’t sought to make a knockout offer.

While the recently launched YouTube TV and YouTube Primetime Channels, an aggregator of third-party subscription services like Showtime and Starz similar to Amazon’s offering, are focused on the US.

“The threat of Google’s free capital entering the rights market is clearly good news for rights sellers around the world, including the Premier League,” says Peter Hutton, former sporting director at Meta, Facebook’s parent company. , Instagram and WhatsApp.

While the global streaming wars have largely focused on the hundreds of billions being spent on TV series and movies in the battle for subscribers, traditional TV companies from Sky and ITV to Comcast, Disney and Paramount in the US, they have faced increasing competition for sports rights. .

Pay TV and cable companies continue to face budget cuts due to the inexorable decline in the number of subscribers disconnected by the high prices of subscription TV packages.

Earlier this year, Comcast wrote off $8.6bn of Sky’s value less than four years after winning a £30bn bidding war for Rupert Murdoch’s pan-European pay-TV empire.

Roger Goodell, the NFL commissioner, toyed with the organization’s move to embrace younger viewers leading the so-called “cable cut” of traditional television in favor of streaming, describing the deal as a “new age.” …looking to the future and building the next generation of NFL fans.”

Meanwhile, deep-pocketed tech companies like Facebook and YouTube are diversifying their business models after reporting their first drops in ad revenue on which they have relied almost entirely.

“This is an aggressive move to continue to take more market share from cable TV operators,” says Hutton.

Earlier this year, Apple reached a deal worth $2.5 billion over 10 years to broadcast US Major League Soccer games, following an earlier deal with Major League Baseball for US games. Fridays.

Meta has held sports rights in a number of international markets and has previously bid for cricket rights to the hugely popular Indian Premier League in India.

Amazon continues to invest in a variety of rights including tennis, rugby, and Champions League soccer in countries like the UK, Germany, and Italy.

Even Netflix, which has publicly firmly ruled out bidding for live sports, was revealed in November that it was looking at rights including the ATP tennis tour, cycling and the Women’s Tennis Association, as well as looking to buy the World Surfing League.

This year has seen an abrupt end to the seemingly inexorable rise of global streaming, leading to a focus on cost and profitability, which is cutting huge budgets on content that can be costly flops, putting certainty and reliability into practice. predictability of fan loyalty. sport in the spotlight.

At the same time, Amazon, Disney and Netflix have also seen the huge success and viewer loyalty that sports-themed content can provide, including series like All or Nothing and Formula One: Drive to Survive.

“YouTube’s deal recognizes the unique ability of sport to bring a fan base to any service, regardless of delivery technology,” says Hutton. “We have seen Warner Bros Discovery invest directly in the Professional Triathlete Organization this week.

“I think we will see more broadcasters and streamers building capital positions in the sports industry where they can.”

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