TV Answer Man, I read your prediction that the NFL will give the next Sunday Ticket deal to two companies, DIRECTV and ESPN. But why would they do that? Doesn’t that make it less valuable to DIRECTV if another company has it? Probably a lot of people will cancel DIRECTV if they don’t need it for the Ticket, right? And why would another company want to share it with DIRECTV? — John, Marina Del Rey, California.
John, you’re right. I have predicted that the next NFL Sunday Ticket contract will be awarded to two companies, DIRECTV and Disney’s ESPN+ streaming service, starting with the 2023 season. As you know, DIRECTV has offered the Ticket as an exclusive since the launch of the football package in 1994. However, DIRECTV’s current agreement expires after the 2022 season.
Why would the NFL give the Ticket to two companies after nearly three decades of it being a DIRECTV exclusive? Let me count the ways:
1. DIRECTV will no longer pay the premium price for an exclusive.
The satellite TV service has lost several million subscribers in the last six years thanks to the rise of streaming and, arguably to a lesser extent, company (AT&T) mismanagement. And there’s no end in sight to the customer defections. Consequently, DIRECTV’s value as a company has fallen appreciably which makes it highly unlikely it would be inclined to pay a premium price for an exclusive Ticket deal. DIRECTV paid $12 billion over eight years the last time it renewed the Ticket contract. But the price for an exclusive could be double this time. There’s no way that DIRECTV’s new ownership team, which consists of AT&T and the private equity firm, TPG, could justify paying that.
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2. Streaming is on the rise and many fans prefer it to traditional TV.
Many fans, particularly younger fans, would rather watch TV via streaming rather than subscribe to a cable or satellite service which requires expensive equipment rental fees and two-year contracts. However, since the Ticket is now a DIRECTV exclusive, there is no viable streaming option for this growing audience. The NFL wants to correct this problem as soon as possible.
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3. But streaming isn’t an option for rural Americans who don’t have the Internet.
This is where DIRECTV comes back in. Studies have estimated that 20-40 million Americans don’t have access to a decent high-speed Internet service, or cable TV. Their only option for quality television is satellite TV. By allowing DIRECTV to continue offering the Ticket, the NFL can still reach the rural market plus the bar/restaurant business which generates significant revenue as well.
4. The split Ticket can lower the price tag for both companies.
While DIRECTV could lose some customers if ESPN+ also carried the Ticket, I suspect the number of defections would be smaller than some might think. The rural subscribers wouldn’t cancel and many urban/suburban customers wouldn’t either for a variety of reasons including the two-year contract, customer loyalty and overall satisfaction with service.
But DIRECTV would gain by splitting the Ticket because the league would require a smaller fee for the non-exclusive rights. Likewise, Disney’s price tag would be lower if it shared the package with DIRECTV. You might say that Disney would prefer to have the Ticket as an exclusive to boost ESPN+ subscriber numbers. But since DIRECTV’s Ticket audience would consist of a large number of rural residents, the crossover with ESPN+ audience would be less than if Disney, say, shared the package with another streaming venture.
5. DIRECTV still needs the Ticket.
Some industry analysts were predicting last year that DIRECTV would have no interest in renewing the Ticket after the 2022 season. But although the service is losing subscribers, the new management team wants to preserve its value in anticipation of a possible sale to Dish, or another company. If it doesn’t secure at least a slice of the next Ticket, DIRECTV’s value will fall even faster which could make selling the company impossible.
John, hope that makes sense. Happy viewing, and stay safe!
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Totally agree with the split ticket and your reasoning, and why DirecTV still needs to be a factor with rural areas and bars and restaurants, however, could Amazon also be in the running instead of ESPN? Amazon already has one of the best streaming platforms?
Dear “THOM” the idiot…READ this till it SINKS IN CLOWN…
1. DIRECTV will no longer pay the premium price for an exclusive.
The satellite TV service has lost several million subscribers in the last six years thanks to the rise of streaming and, arguably to a lesser extent, company (AT&T) mismanagement.
MILLIONS (as in (OVER 9 MILLION and OVER 100000 a D-A-Y with only DEATH insight.) In the VERY FEW if ANY near year future DIRECTV will BE NO MORE…AT&T will end up FIRST in Chapter 11 and ultimately chapter 7 and MISSED BY NO ONE…Sunday ticket will go to who EVER thinks it is worth it which will be a open for discussion subject to quite some time…GET IT “THOM” ( short bus rider !!)
Dave, was this in response to my post? If so, I don’t think you read it correctly. And just to clarify DirecTV is no longer owned exclusively by AT&T. https://www.theverge.com/2021/8/3/22608577/att-directv-tpg-deal-u-verse-att-tv-new-company
Dave, (he’s actually Charlie of Dish) first off i haven’t commented on this yet! Of course it’s all about the $$$$$$$$$$$, personally I’ve never bought the Sunday ticket but enjoy it when its given free…. btw Chaz … how often do you give your subs free movies, channels, or ANYTHING, you cheap skate No wonder you lose twice as many subs as direct by % You are hoping against hope to buy DTV before YOU GO UNDER GET IT???
Can you clarify the dates that these will take effect? When you say “DIRECTV’s current agreement expires after the 2022 season”, does that mean the season that ends in Feb. 2022, or the season that ends in Feb. 2023?
Feb 2023.
Do you all see the NFL streaming singular team season passes. For example, I am an Atlanta Falcons fan and I just want watch all my teams games, I don’t care about the other games. The NBA currently offers similar to this for $17/month for just the Hawks games.
I will get it if it streams … and ik about 65 people that would too…
DirecTV does now offer a streaming only option. No DirecTV satellite account is required, however, you do need to be determined ineligible for satellite service (whatever that means.) I switched to it for a condo in Washington, DC, even though many neighbors have a DirecTV dish on their balconies. The streaming service also works with the mobile app for streaming on the go.
I agree with this article for the most part. In my opinion, and I am aware this is moreso wishful thinking than what might or will likely happen, the NFL needs to embrace the cord cutters and do something unheard of in the streaming market. The NFL could be the first league to sell games and services without region locking or blacking out games that are considered local. I say this because rural areas are very complicated tv markets. Many rural areas throughout the US are in counties that are referred to as orphan counties and this leaves many NFL fans stuck in a TV market that’s opposite of the popular team in the area. For example where I live, northwest Wisconsin, is stuck in the Minnesota TV market despite the majority of the resident’s are Packers fans and are stuck with not being able to watch Packers games when the Vikings play at the same time or when the NFL does weird viewing regulations where maybe the AFC plays two games and the NFC is only one game to be aired. However with the streaming services now, they will blackout both the Packers and Vikings games based off the zip code or IP address. Sure there are VPN services to fix this but that’s a little annoying and requires more money and energy to get it done. So if the Sunday Ticket could be sold to the fans through streaming services and allowed a fan to buy the games for a team, despite if the team is local or not, then that would possibly generate more revenue and be way more pleasing to the customers. And we all know basic economics, and basic business practices dictate that happy customers are good for the overall business.