Apple, Amazon and Google are in a bidding war to acquire the NFL Sunday Ticket
AYESHA RASCOE, HOST:
A bidding war is brewing between the world's largest tech companies. Apple, Amazon and Google are all pushing to acquire the rights for the same service. And we're not talking about an app or website. We're talking about football, baby. The three tech giants are pushing to become the next home for NFL Sunday Ticket, a subscription package that lets fans watch every Sunday game live. John Ourand is a staff writer at the Sports Business Journal and he joins us now to explain why these companies are turning their attention to football. Welcome to the program.
JOHN OURAND: Thank you, Ayesha. Glad to be here.
RASCOE: So what exactly is this package that Apple, Amazon and Google - that they're all fighting over?
OURAND: It's called the NFL Sunday Ticket package, and they call it an out-of-market package. Let's say you're a football fan of the Minnesota Vikings and you happen to live in Tampa, Florida. This enables you to pay around $300, $400 and you're guaranteed to see every single Minnesota Vikings game regardless of what's shown on your regular broadcast channel. This is a package that DirecTV has held since it launched back in 1994. And the NFL and even DirecTV executives really credit this package for helping DirecTV become as big of a satellite distributor as it is by bringing a lot of young, well-heeled sports fans that really wanted all of this content. And now that relationship is coming to an end. DirecTV has said that it doesn't want to pay as much as the NFL wants it to pay, which is about $2 billion a year.
RASCOE: How is this different than the, you know, the rights that the networks - Fox - already have? You know, my uncle - he's a huge Giants fan, but he lives in Atlanta, so he can't see the Giants games. Like, is that the difference? Like, you have to be, like, in-network for some of those?
OURAND: Well Ayesha, the Giants are going to be terrible this year. So your uncle...
RASCOE: No (laughter).
OURAND: Your uncle in Atlanta - he's not going to be seeing any Giants games, just about, because the package that Fox has and that CBS has - they show the games locally, and they can't show every single game. This package is for every single game that's out there.
RASCOE: For people who, like me, don't watch a lot of sports, they may not understand, like, why this is such a big deal.
OURAND: Right. Sunday Night Football has been the most popular prime-time show going on more than a decade. I think it's had 11 consecutive years now, which is a television record. But what makes the Sunday Ticket package so attractive is that it is a high-priced package. It's going to go - even if Apple gets it or if Amazon gets it - it still is going to go probably for, you know, about $300, $400. And it's a subscriber that makes a lot of money and wants to spend a lot of money. And that's exactly what they want there. And they think that that will also help build out these services, so they can get more viewers and sell more ads and sell more - in the case of Amazon, sell more paper towels.
RASCOE: OK. So if this is so profitable, why is DirecTV letting it go?
OURAND: DirecTV had an out in their contract where they tried to get out of it two years ago because they stopped making money off of it. The NFL is going to these new companies, and they're promising, look what we did with DirecTV back in 1994. If you're trying to build out a video, we can help you build a video. So a service like Apple TV, which is trying to get more into sports, you know, they can take a look at this and say like, OK, we're not going to make money off of this as a package unto itself, but we are going to increase the number of people that subscribe to our service. They're going to start to watch other things. They're going to start to stay within that service a lot more and watch entertainment programming or, you know, other sports programming. And then they have you hooked.
RASCOE: What are the implications in terms of disruption that this could bring for more, I guess, what we would consider traditional broadcasters.
OURAND: Increasingly, you're starting to see these big tech companies step in and try to pick off some sports rights. Apple TV+ - they just did a deal to carry every single Major League Soccer game. Major League Soccer's the U.S. soccer league. Amazon Prime - they have a deal where, exclusively, they're going to carry Thursday Night Football games with the NFL. They've slowly been encroaching onto the market. Just look at how your friends all look at - consume Netflix. And that's how it's going to look with sports, eventually - is what the tech companies believe.
RASCOE: John Ourand, staff writer at the Sports Business Journal, thank you for being with us.
OURAND: Any time, Ayesha. Thanks for asking.
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