NFL Takes Bidders To Live-Stream Regular Season Games
KELLY MCEVERS, HOST:
The NFL sees a future in the Internet. They must because they're taking bidders for the rights to 18 regular-season football games. And when we talk about rights, we're talking about digital rights. That is the right to live stream a football game. That means you could eventually end up watching football on sites like Facebook. Peter Kafka wrote about this for the tech news site ReCode. Hi there, Peter.
PETER KAFKA: Hi. How are you?
MCEVERS: Tell us a little more about where things stand with this. Facebook and Amazon are among the big tech companies that want to live stream NFL games. Is that right?
KAFKA: That's right. The NFL has allowed various people to stream its games on the Internet for several years now. There hasn't been a lot of interest in doing it, but you could watch the Super Bowl via a CBS app this year. You could watch - NBC streams games on Sunday nights. You can watch those for free. The big deal this year is the NFL has said we're going to auction off specific digital rights; we really want digital players to come in here. And so you might see people who don't traditionally show live video and who've never shown live NFL game, like Facebook, like Amazon, getting into this market for the first time.
MCEVERS: Well, what is in it for the NFL to break this out like this as a separate package?
KAFKA: Oh, this - that equation's really easy. The NFL gets more money or games they've already sold at least once and multiple times. The NFL's been very, very smart about taking very, very valuable asset - its games - and maximizing its value by sort of slicing and dicing and offering different people different access to these games. And now, for the first time, they've said there's a specific digital package. What do you want to pay us?
MCEVERS: And so, then, what is in it for the companies who might be bidding for this - Facebook, Amazon, Verizon?
KAFKA: That is a really good question. In theory, there's some advertising revenues these guys can generate. There isn't going to be a giant audience for this stuff because if you can watch a football game on TV, traditionally that's probably where you're going to want to watch it. I'm not sure there's going to be a huge demand to stream an NFL game on your phone via a Facebook app. But that said, there's some interest in this stuff. Yahoo did this last fall as sort of an experiment with the NFL and got a couple million people watching at least a portion of a really boring regular season game. There's an asterisk there because Yahoo made it nearly impossible to use any part of Yahoo - Yahoo Mail, Tumblr, anything - without seeing it. They were auto-playing it. So there's still big question about much demand there is to watch this stuff over the Internet, but there's some. And the NFL is really looking forward to a few years from now, when some of its existing TV contracts come up. And they're imagining a scenario where not only do they have CBS and NBC, ABC bidding for the rights to show these games, but they might actually have Facebook or Apple or Verizon coming in and saying, no, no, we want the exclusive rights to these games. And that's very exciting for the NFL, at least as a business.
MCEVERS: You're right about that Yahoo deal. I mean, they paid something like $20 million to stream just one game, and that's for a million or two viewers. How does that math work out?
KAFKA: That math is sort of a shrug, right? The NFL said this is an experiment. Yahoo said this is an experiment. Yahoo would say, privately, we're not going to cover our costs on this, so it's not a moneymaking exercise. I think they want the bragging rights. I think there's some of this year - for Amazon, Facebook, other folks that might be entering this, they're probably not going to make a ton of money the first year or so streaming these games, but they want to distinguish themselves. And again, you've got a bunch of people who are all very interested in sort of jumping on the web video boom. They don't really know what it looks like, but they know there's a boom there. And if you can have NFL games and no one else has them, or at least you can say that, that's a way to distinguish yourself. It's a really could branding exercise, I think, is a lot of ways some of these folks are going to think about it.
MCEVERS: Right. So its sounds like the NFL is kind of saying, you know, get in on the ground floor.
KAFKA: Get in on the ground floor, and you will have a shiny bauble that none of your competitors will be able to say they have.
MCEVERS: That's peter Kafka. He's senior editor for media at ReCode. Thank you very much.
KAFKA: Thanks for having me.
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