The NFL's Old School TV Model Meets New-School Streaming

On Thursday, the NFL kicked off its 2018-19 season with a nationally-televised broadcast of the Atlanta @ Philadelphia game. In this week’s TTalk, we look at two “off-the-field” developments:

  1. Sunday Ticket package availability to DIRECTV NOW customers in seven markets

  2. Expansion of mobile streaming of in-market local and nationally broadcast games

Unlike other sports leagues that have created consumer-centric streaming offerings, the NFL has remained firmly on the sidelines of the direct-to-consumer OTT trend, choosing instead of collect billions of licensing dollars from CBS, FOX, NBC, ESPN, for the rights to its regional and nationally-televised games. AT&T, meanwhile, will continue to pay for exclusive rights to the Sunday Ticket out-of-market game package through the 2022-23 season.

Sunday Ticket for the OTT Crowd

Sunday Ticket DIRECTV NOW.jpg

Before that first kickoff on Thursday, a sideline play caught industry-watchers' eyes: NFLSundayTicket.TV was made available to DIRECTV NOW customers in a handful of markets. The app-based streaming version of Sunday Ticket has been around for years, available only to customers where satellite service was not permitted, but for the first time, AT&T has modestly extended its availability to DIRECTV NOW customers in Los Angeles, Phoenix, Boston, Philadelphia, San Antonio, Hartford, and Louisville areas.

This apparent trial, launched in those seven markets without fanfare, should give AT&T an idea of whether its fast-growing vMVPD service can benefit Sunday Ticket sales without cannibalizing its legacy satellite service. In an apparent nod to that concern, $40/month “Live A Little” customers in those markets are not eligible to subscribe to Sunday Ticket-- customers must have $55 "Just Right" or higher packages.

Sunday Ticket Pricing Table.jpg

Mobile Streaming for the Masses

Lurching into the modern era of streaming media, the NFL found partners with deep pockets to pick up streaming rights. Amazon coughed up millions for streaming rights to Thursday Night Football games (televised on The NFL Network) while Verizon—previously the exclusive provider of mobile streaming to its wireless customers—now offers local and nationally televised games through its Yahoo Sports platform to all mobile device users, regardless of network provider.
The new local/national game streaming deal started in January with last season's playoffs, but with a new season and increasing consumer awareness of streaming options, expect more attention to be paid to this option. 

Mobile streaming rights stay on the small screen. App restrictions kick in to prevent NFL games from being displayed on a TV via direct connection or Airplay.

Mobile streaming rights stay on the small screen. App restrictions kick in to prevent NFL games from being displayed on a TV via direct connection or Airplay.

Competitive Threat to the Traditional Bundle

Of great interest to industry stakeholders who care about the durability of traditional video bundles is the overlap of viewing options for the same content. This happens more as customers engage with OTT options. For instance, TBS airs three hours of Friends reruns each day, while Netflix has the entire catalog in its library. Arguably, the syndicated rights provide less value to TBS due to the overlap. 

Critically, the ESPN Monday Night Football game will be streamed via Yahoo Sports or NFL Mobile apps with no authentication needed. (The app relies on Location Services to determine local broadcasts.) 

ESPN continues to invest in and promote its ESPN+ OTT service, but the flagship network's revenues rely on "eyeballs" subscribed to video packages. The availability of Monday Night Football-- which averaged nearly 11 million weekly viewers last year-- without the need to subscribe to ESPN thanks to the mobile streaming deal represents a chink in the armor of ESPN's value proposition. 

At Telogical, we’re always studying the competitive landscape. If you have a topic you’d like to discuss with us, please reach out. We look forward to working with you.

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