Google Wins Over Apple with NFL Deal for YouTube TV, but Will This Lead to Future Growth
It's over, and YouTube came out on top in the bidding war for NFL Sunday Ticket. Sunday Ticket will be carried by the firm both independently (as a YouTube Primetime Channel) and via YouTube TV, according to a "multi-year" agreement that was revealed.
It's a huge win for YouTube, which managed to defeat Big Tech rivals like Apple to get the agreement, and a crucial turning point as live sports continue to migrate away from conventional cable — DirecTV is the soon-to-be-former Sunday Ticket rights holder — in favor of big streaming platforms.
What Business Benefits Do Google & YouTube Get out of this?
Google has swiftly established YouTube as a key resource for NFL fans. Additionally, it has resolutely committed to YouTube TV's long-term survival. YouTube TV has more than 5 million subscribers. The Wall Street Journal reports that the sum was undisclosed by the corporation but that it works out to about $2 billion annually over the course of the seven-year contract.
The NFL's collaboration with YouTube aims to increase its audience and provide Sunday Ticket a presence on a huge international platform that is representative of the internet as a whole. NFL Commissioner Roger Goodell told the Journal, "It is a site where a lot of 'Gen Z' goes to obtain material." Yes, Roger, and everyone else as well. The league has now divided up the rights among Big Tech, with YouTube taking home the Sunday Ticket and Amazon securing Thursday Night Football.
Sunday Ticket can be purchased separately by football fans, but YouTube doesn't want that to happen. Instead, the focus is on enticing customers into a package. The cheapest way to obtain the bundle is as an add-on to YouTube TV, which is $64.99 on its own. Customers have complained about the expensive monthly fee, which has been continuously rising in recent years, as well as the company's TV service's user interface, streaming quality, and limitless DVR feature.
From a revenue standpoint, YouTube TV is the better option for Google, and it's probable that YouTube will provide a discount for combining Sunday Ticket with live TV to make the deal more enticing. As of now, YouTube hasn't disclosed any pricing information. Although none of these possibilities involves a long-term contract, YouTube wants to get users to pay for more than simply Sunday Ticket and provide enough friction to keep them around.
What and Why Did Apple Lose on the NFL Deal?
Sunday Ticket partnership between Apple and the NFL was said to be extremely close for months, but it never materialized. According to information published recently, Apple planned to incorporate Sunday Ticket as a free add-on to Apple TV Plus. Even by Apple standards, this seems much too idealistic and naïve; the NFL was never going to reduce Sunday Ticket's standing to "included for free.".
The bigger deadlock may have been connected to Apple's impending, long-rumored mixed reality headgear. The Athletic said that Apple was pleading with the NFL to allow it to "distribute Sunday Ticket on as of yet non-existent platforms." The league, however, was adamant on approving this "known and unknown rights" clause.
When negotiations with Apple broke down, YouTube seized the chance to acquire Sunday Ticket and turn it into the centerpiece of the company's subscription (and package) plans for years to come. Apple will have to make do with baseball and soccer for the time being.
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