The National Football League (NFL) is in "advanced talks" to award Google's YouTube with exclusive rights to NFL Sunday Ticket, The Wall Street Journal reported. The Sunday Ticket is the premium subscription package for out-of-market football games that have long been the domain of DirecTV.

In a deal that could be cemented as early as today, Google/YouTube is poised to pay $2.5 billion per year for those rights, plus "additional payments based on the number of YouTube subscribers" that Google can add, according to The New York Times. DirecTV has been paying about $1.5 billion per year for those rights – rights that reportedly also gained interest from Apple and Amazon.

Figure 1: (Source PSL Images/Alamy Stock Photo)

The distribution discussion

In addition to its primary, largely ad-supported streaming platform, YouTube also operates YouTube TV, an Internet-delivered, multichannel pay-TV service that starts at $64.95 per month. In June, YouTube TV had over 5 million subscription and trial accounts.

The WSJ said the discussed deal would have the Sunday Ticket package available on YouTube TV and Primetime Channels starting next season. Launched last month, YouTube Primetime Channels is a platform that lets viewers sign up directly for more than 30 streaming services, including Showtime, Paramount+ and AMC+.

Sports shifting to streaming

If YouTube pulls off the NFL Sunday Ticket deal, it will further loosen the ties between live sports and traditional pay TV. In recent years, various sports rights have been granted or extended to major direct-to-consumer (DTC) subscription streaming services, including NBCUniversal's Peacock, Apple TV+, Amazon Prime Video and Paramount+.

The distribution of NFL Sunday Ticket has been exclusive to DirecTV's satellite TV service, save for instances where consumers who can't get DirecTV are allowed to stream the package. DirecTV offered its subscribers the NFL Sunday Ticket package for the 2022 season for $293.94. The NFL Sunday Ticket will be sold via YouTube as a premium service at a cost similar to what DirecTV charges today, reports the Sports Business Journal.

NFL Sunday Ticket reportedly has about 1.5 million subscribers through DirecTV, a service spun-out of AT&T in 2021. But a deal with YouTube stands to broaden access to the service and, with it, the potential to attract a bigger subscriber base. On the other side of it, current NFL Sunday Ticket subscribers in rural areas lacking access to decent broadband could lose access to the package.

DirecTV no longer shares subscriber numbers, but Leichtman Research Group estimated that the company lost 400,000 subs in Q3 2022, a figure that includes the DirecTV satellite TV, DirecTV Stream and former AT&T U-verse TV services.

The entire pay-TV sector, including both traditional and Internet-delivered options, lost 655,000 subs in Q3 2022, widened from a year-ago loss of -617,000, according to MoffettNathanson estimates.

Related posts:

— Jeff Baumgartner, Senior Editor, Light Reading