Brock Purdy #13 of the San Francisco 49ers prepares to take a snap in the first quarter against the Kansas City Chiefs0 during Super Bowl LVIII at Allegiant Stadium on February 11, 2024 in Las Vegas, Nevada.
Michael Reaves | Getty Images
This is Netflix’s first real foray into traditional live sports, driven by the company’s ambitions to expand its level of advertising. The company signed a deal earlier this year with WWE to host its live “Raw” events, but Netflix called the deal “sports entertainment.” Unlike WWE, Netflix’s deal for NFL Christmas games doesn’t come with a full production team. This left the streamer looking for help.
Netflix has been in contact with broadcasters currently showing NFL games, including Disney’s ESPN, Comcast’s NBCUniversal and Paramount Global’s CBS Sports, said the people familiar, who asked not to be named because the discussions were ongoing. private. Disney won’t produce the games because it already has same-day college football obligations, two of the people said.
In-depth discussions have yet to begin with other streamers, but Netflix’s options may be somewhat limited.
Fox and CBS Sports already produce different games in different regions each week, which could make it difficult for Netflix to purchase additional games, some of the people said.
There is also competition to consider.
Amazon has signed a deal with NBCUniversal to produce its NFL games ahead of its first season of “Thursday Night Football” in 2022, but there may be more resistance among the NFL’s current partners to help Netflix, according to people familiar with the matter. . Indeed, Netflix could be auditioning as a future long-term media rights partner for NFL games, in place of a traditional media company, such as Paramount, Fox or NBC.
The NFL has an opt-out clause in its current media contracts that allows it to select new media partners after the 2029-30 season.
Representatives for Netflix, the NFL, NBCUniversal, CBS, ESPN and Fox declined to comment.
Netflix announced its entry into the NFL in mid-May ahead of its Upfront presentation, when it was trying to woo advertisers for its burgeoning ad-supported platform. Netflix said last month it had reached 40 million active users worldwide for its advertising tier, which costs $6.99 per month in the United States and debuted in November 2022.
In May, co-CEO Ted Sarandos told CNBC that the NFL was the right fit for Netflix because it fit with the streamer’s event strategy, allowing Netflix to own the day. Netflix will pay the NFL approximately $75 million per game, CNBC previously reported.
For the NFL, Netflix represents an opportunity to reach a younger global audience. It’s also possible to lay the groundwork for Netflix to become a future bidder on a larger set of games.
The NFL signed long-term deals in 2021 with Disney, Paramount, NBCUniversal, Fox and Amazon for its five major gaming packages.
While there is some apprehension among current media partners about producing games for a potential rival, pressure from the league – and a big payday from Netflix – could convince broadcasters to strike a deal, according to people close to the case.
“There aren’t a lot of players in the industry that are able to do that at a level that you would want to have confidence in when you’re jumping in as a new partner in a league as big as the NBA or the NFL,” he said. Shirin said. Malkani, co-chair of the sports industry group at law firm Perkins Coie, adds that the production side “can be a big hole for streaming partners.”
Netflix and the league seek to mirror the partnership Amazon’s Prime Video has with Comcast’s NBC Sports for “Thursday Night Football” games.
While NBC Sports’ Fred Gaudelli produced the 2022 season of “Thursday Night Football,” Amazon named Mark Teitelman, one of its own employees, as lead producer of the game in 2023.
Amazon produces all of its pregame, halftime and postgame coverage, but NBC Sports handles the vast production work required for an NFL game and employs the vast majority of those workers.
Netflix wants to find a similar partner, according to people familiar with its plans.
If an agreement cannot be reached with one of the incumbent operators, Netflix could find other options with third-party producers. Endeavor Group Holdings’ IMG is the production partner of Major League Soccer, offered through Apple.
“It’s not easy to do an NFL game at a level that people are used to watching, which is a very high level and well-produced,” said Jonathan Miller, general manager of ‘Integrated Media, specializing in digital media investments. “But there are a number of options that can accomplish that without (Netflix) having a fully staffed sports division.”
Amazon Prime Video was the first streamer to secure exclusive rights to NFL games as the league worked to expand its media partners and offer more streaming offerings to grow its audience.
Amazon closed its deal to stream “Thursday Night Football” in 2021 in conjunction with the rest of the media rights deals for the NFL – an 11-year media rights deal worth more than $100 billion, with opt-out clause after seven years. .
Given the NBA’s recent media rights negotiations, which are attracting large investments from various media companies, many people in and around the industry expect the NFL to exercise this clause and seek new partners.
Since the NFL signed its deal, streaming services for Comcast, ESPN and Paramount have begun simulcasting games and, in some cases, hosting games exclusively. Alphabet’s YouTube TV is also the new home of the “Sunday Ticket” gaming package.
Sports, particularly the NFL, have been the glue for all of traditional television — and have proven to be a booster for streaming as well. NBCUniversal said in April that its exclusive NFL wild card game on Peacock helped add, and then retain, more customers than expected.
The league has been pushing to add more streaming partners in an effort to expand its audience.
That was the idea behind the deal with Netflix to stream these Christmas Day games.
When negotiations over the rights to “Sunday Ticket” were underway, NFL Commissioner Roger Goodell told CNBC that the long-standing package offered only by DirecTV would move to streaming.
“I think it’s best for consumers at this point,” Goodell said at the time.
Disclosure: Comcast is the parent company of NBCUniversal and CNBC.