NBC Sports has retained the excusive rights to broadcast English Premier League matches through 2022, outbidding Fox and former Al Jazeera subsidiary BeIN Sports in what amounts to a six-year extension of its current deal.
Sources said that bidding on the rights to the EPL was limited to a single round, in which ESPN did not participate.
While financial terms were not disclosed, the new pact is said to be worth significantly more than the three-year, $250 million deal NBC struck with Europe's most popular soccer league back in October 2012. Given that Sky Sports and BT Sport in February agreed to a 71% price increase to £5.14 billion, or $7.84 billion, for a joint three-year U.K. rights deal, NBC's new obligations are almost certain to be north of $1 billion.
Ten-figure deals are nothing new to NBC, which in 2011 committed $2 billion for a decade-long pact with the increasingly niche franchise that is the NHL. (Case in point: Despite the presence of the New York Rangers and Los Angeles Kings, representatives of the country's top two DMAs, the 2014 Stanley Cup Final averaged just 4.7 million viewers and a 2.8 household rating. That same spring, the NBA Finals showdown between the San Antonio Spurs and Miami Heat averaged 15.6 million viewers and a 9.3 household rating.)
On the other side of the ratings continuum, the Peacock last year ponied up a whopping $7.65 billion for the rights to broadcast the Olympics through 2032. As far as calculated risks go, this looks like a winner; after years of taking a loss on the Olympics, NBC broke even on the 2012 London Games and made a tidy profit on the 2014 Winter Games in Sochi.
The new NBC-EPL deal includes all U.S. Spanish-language rights and live streaming. NBC Sports will make the 380 EPL matches available via the flagship broadcast network, Telemundo and the cable channels NBCSN, USA Network and NBC Universo.
The EPL sent out invitation to tender letters in early July. Sources said that while ESPN was interested in pursuing a shared package with another network, the league did not allow for co-bidding. Moreover, nearly one-third of the EPL's Saturday-heavy schedule overlaps the college football season, making an exclusive association with ESPN all but untenable.
NBC Sports chairman Mark Lazarus this afternoon said that the bids were placed on Thursday, which made for an "anxious" couple of days. Mr. Lazarus said his team worked through the weekend -- as it so happened, the opening weekend of the 2015-16 EPL campaign -- in order to secure the deal.
With the EPL rights locked in for the near term, the pickings are slim for TV outlets looking to bulk up on top-tier sports content. But for the rights to the Big Ten conference, which are currently held by ESPN and Fox and are set to expire in 2017, there are no premium packages up for grabs. The NFL and Major League Baseball's respective TV deals are nailed down through 2021, Turner and ESPN last fall renewed their NBA rights through 2025, and NBC's $1 billion NHL deal isn't set to expire until the end of the 2020-21 season. Meanwhile, the ratings driver of the most recent vintage, ESPN's College Football Playoff package, is staying put through 2026.
In an era in which viewers increasingly break free of the hoary appointment TV model, sports content is particularly crucial. Not only are sports the last frontier for live viewership (which in turn helps keep commercial avoidance at bay), but the engagement metrics for live sports events versus scripted and reality fare are off the charts.
If there is any downside to NBC's doubling down on the EPL, it's that soccer by its very nature is more difficult to monetize than other top-tier sports. But for pre- and post-game sponsorship opportunities and three halftime pods, soccer is all but impervious to traditional advertising. Even baseball broadcasts, which are limited to two minutes of commercial time between the halves of each inning, provide a more sumptuous environment for marketers looking to shill beer, cars and movies.
Which isn't to say that advertising dollars can't in some way defray the expense of broadcasting soccer. ESPN over the course of the 64-match 2014 FIFA World Cup generated some $529 million in ad revenue, and while direct ad-rate comparisons are perhaps specious, NBC has 316 more broadcasts to sell than Bristol did during its coverage of the quadrennial event.
EPL matches last season averaged 479,000 viewers on NBC and NBCSN, up 9% versus the 438,000 who tuned in the previous year. This past weekend, the 2015-16 EPL season got off to a record start, as the first four Saturday matches averaged a 2.0 overnight household rating, up 43% from last August's 1.4.