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

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

The Google-owned YouTube’s seven-year deal, which will see the world’s largest video platform take over the “Sunday Ticket” package of games held by the US satellite service DirecTV since 1994, followed an auction that included heavy interest from its fellow big tech company Apple.

The deal is the latest in a series of commercially eye-popping deals by the NFL, the most expensive live sports rights in the world, after its $113bn, 11-year agreements struck with broadcast partners last year that saw Amazon snap up $1bn worth of games annually.

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

While the Premier League almost doubled the value of the US rights in a £2bn deal last year with NBC, which is mostly airing matches on its streaming service, Peacock, bosses were forced to roll over a deal with existing partners in the UK to avoid losing potentially hundreds of millions of pounds in an auction lacking new competition.

Beyond Sky and BT, the only new player to buy Premier League rights in the UK in recent years has been Amazon, though the Prime Video-owner has not looked to make a knockout bid.

While YouTube TV and the recently launched YouTube Primetime Channels, an aggregator of third-party subscription services such as Showtime and Starz akin to Amazon’s offering, are US focused the prospect of the $1.2tn parent company Google going for international sports deals now looms large.

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

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

Pay-TV and cable companies continue to face budget cuts due to the inexorable decline in subscriber numbers switched off by the high prices for subscription TV packages.

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

Roger Goodell, the NFL commissioner, played on the organisation’s move to embrace the younger viewers leading the so-called “cord-cutting” of traditional TV in favour of streaming, describing the deal as a “new era … looking towards the future and building the next generation of NFL fans”.

Meanwhile, deep-pocketed tech companies such as Facebook and YouTube are diversifying their business models after reporting their first-ever declines in the advertising income on which they have been almost completely reliant.

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

Earlier this year, Apple agreed a deal worth $2.5bn over 10 years to broadcast US Major League Soccer matches, after an earlier deal with Major League Baseball for Friday games.

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

Amazon continues to invest in an array of rights including tennis, rugby and Champions League football in countries including the UK, Germany and Italy.

Even Netflix, which has publicly steadfastly ruled out bidding for live sport, was revealed in November to have looked at rights including the ATP tennis tour, cycling and Women’s Tennis Association as well as looking to buy the World Surf League.

This year has seen the seemingly inexorable global streaming boom come to an abrupt end, leading to a focus on costs and profitability, which is curtailing huge budgets on content that may prove to be expensive flops, putting the certainty and predictability of fan loyalty to live sport in the spotlight.

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

“YouTube’s deal recognises the unique ability of sport to bring a body of fans with it to any service, regardless of delivery technology,” says Hutton. “We’ve seen Warner Bros Discovery invest directly in the Professional Triathletes Organisation this week.

“I think we’ll see more of broadcasters and streamers building equity positions in the sports industry where they can.”

Francis McGee

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