When broadcasting contracts reach the end of their cycles, the next steps will be more visible. The NFL has not only implemented the DirecTV contract, which expires at the end of the 2022 season, but also has similar completion dates with the three traditional broadcasting partners; Fox, NBC and CBS. Because these agreements are processed for billions of dollars a year, they are negotiated well in advance. It seems that these negotiations have already begun in earnest. The agreement continues a long-term agreement between the NFL and the largest satellite service provider in the United States. DirecTV has been carrying Sunday Ticket since its inception two decades ago and uses the agreement as a platform to attract new subscribers. In recent years, DirecTV has offered a free annual subscription for Sunday tickets as part of a two-year coverage contract with customers. The new agreement has been expected for some time. John Ourand and Daniel Kaplan of the Sports Business Journal reported in August that the two sides were nearing an agreement, although details are still being worked out.
The first question was whether DirecTV would continue to pay the premium for exclusive rights on Sunday Ticket – another way was to have it pay-per-view on several cable services, such as the NFL RedZone channel – but both parties eventually came to a friendly way. “This new agreement is proof of the great long-term relationship we have with the NFL and its millions of fans across the country,” DirecTV President Mike White said in a statement. “NFL Sunday Ticket has always been at the heart of DirecTV`s sports management, and we are pleased to continue our relationship with the NFL and be part of the future growth and success of the league.” As Ourand and Kaplan have noted, the new DirecTV deal will allow the NFL to raise $7 billion a year in annual revenue from licensing agreements, just with the massive deal with Verizon. (The NFL is also on a one-year contract with CBS for its $275 million Thursday Night Football package.) The NFL appears to have missed the deadline for terminating its 2014 contract with the company, worth $1.5 billion per season. All current NFL transmission contracts, with the exception of Monday Night Football, will expire in 2022. ESPN and the NFL contract expire in 2021. Four years ago, Goodell set an annual revenue target of $25 billion for 2027. The league`s current revenue is approximately $9.5 billion by CNN, most of which comes from these broadcasting contracts. Given that there is no cap on the amount of money that networks will pay for the transmission of NFL games, the goal in eight years might not seem so outlier.
The NFL has a multitude of ad offers, as Sunday Ticket is one of eight vision packages the NFL currently offers. The league has entered into a non-exclusive streaming agreement for mobile devices with Verizon and the Thursday Night Football deal mentioned above with Amazon. The NFL had already considered whether to relinquish its contract with DirecTV in order to extend its broadcast beyond the existing agreement. Amazon; ESPN, Disney`s special sport-over-the-top (OTT) service; and DAZN have been linked as possible targets for a possible Sunday digital package, but this latest update appears to mitigate these reports. In addition, according to its petition, the NFL is not only 32 competing teams, but also an “integrated joint venture” whose games and television shows cannot be produced “without agreements and joint action with any other team.” Amazon (NASDAQ:AMZN) has revised its contract with the NFL to broadcast 11 Thursday night football games in the 2020 regular seasons until 2022.