What Twitter's deal with the NFL means for the future of sports media rights

Published 15 April 2016 By: Dylan Kerrigan

NFL and Twitter logos on American football pitch

Twitter has agreed a deal with the National Football League (NFL) to stream 10 Thursday Night Football games. The coverage will be as broadcast by NBC and CBS and simulcast on NFL Network, securing the NFL's Tri-Cast distribution model1 of broadcast, cable and digital. The NFL looks focused on balancing traditional and new media as convergence continues to transform the viewing landscape.

It is understood that Twitter paid less than $10 million for the package, which is just a fraction of the estimated $45 million per game2 ($450 million total) that NBC and CBS have paid to broadcast the Thursday games. Twitter beat Verizon, Yahoo, Amazon and Facebook to secure the deal, despite Facebook's larger audience reach and reports that rival bids topped $15 million. There has been speculation3 that Facebook's monetisation model was underwhelming to the NFL when compared to that of Twitter, or that there was disagreement over the value of the games.  

The non-exclusive deal with Twitter appears more about driving incremental audience4 consumption than any serious attempt at replacing traditional broadcast and cable coverage. The small value of the deal also reflects that Twitter will only be getting limited advertising inventory, with the stream being NBC and CBS coverage in which the broadcasters retain the vast majority of advertising inventory. No doubt the NFL will have imposed strict conditions on Twitter to ensure that its advertising does not conflict with existing and prospective deals with NFL and broadcaster sponsors.

The social media tie-up will, however, be interesting to sports rights holders as social media grows in importance in developing "two screens" audience engagement, with viewers particularly engaged in online discussion where coverage is broadcast live.

NFL Commissioner, Roger Goodell, has boasted that Twitter is where live events unfold5 and is the right partner for the NFL as it takes the latest step in serving live NFL football to fans around the world. New entrants such as Twitter can therefore be seen as positive to sports rights holders provided deals such as this do not cannibalise the value of existing and potential broadcast and cable deals. It is interesting to see Twitter moving into sports broadcasting, which plays into the wider debate on the extent to which online media should be regulated in the same way as traditional linear broadcasting. This is particularly timely in the context of the review of the European Union's Audiovisual Media Services Directive.

While the distribution model may be evolving, this deal appears more about promoting co-existence between traditional and new media than any threat to the former's dominance. With the deal being for free-to-air games only and carrying broadcaster coverage and advertising, it appears it will promote rather than detract from traditional offerings. The relatively small proportion of the season fixtures covered by the deal also indicates it may be an experiment for both parties.

The United States is the vanguard for these initiatives and no doubt others will follow in exploring similar deals. The NFL is well placed as a premium rights holder to undertake such an experiment without risking the value of traditional deals, while niche and emerging sports may use similar tie-ups more as a way of seeking value.

Watch this space for how future NFL (and other) sports media rights deals pan out based on this experience.  


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Dylan Kerrigan

Dylan is an Associate in the TMT practice at Dentons, focusing on clients in the media, entertainment, sports and technology industries.

He primarily advises on IP, contracts and regulatory issues, and has very broad cross-border transactional and commercial experience.

Many of Dylan's clients reach a global audience and he regularly advises in relation to the UK, Europe, Middle East and Africa activities of some of the world's largest media companies.  

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