In a strategical gambit that could prove to be as brilliant as any made by football master tactician Bill Belichick, Twitter has outflanked the likes of Amazon, Facebook and Verizon for the rights to live-stream "Thursday Night Football."
According to sources familiar with the terms of the deal, Twitter has agreed to pay a little north of $10 million for the rights to stream the 10 Thursday night NFL games broadcast by CBS and NBC this fall. And while that $1 million-per-game price point is a steal compared with the $17 million Yahoo shelled out last fall for a single Bills-Jaguars game, Twitter will have a limited amount of inventory to sell in its NFL streams -- about one-third of the ad load, sources said. (Given that CBS last year aired an average load of 65 paid ads in each of its eight "Thursday Night Football" broadcasts, that works out to roughly 20 spots for Twitter to monetize, or 200 for the entire package.)
Twitter will sell its share of "TNF" ads via its Amplify program, which allows media brands to publish in-tweet video clips that include pre-roll ads. (The clips are essentially mini highlight reels that are pushed out in real time, thereby allowing users who missed the moment on TV to catch up and get in on the celebration. Think Kris Jenkins' mind-melting buzzer beater in last night's Villanova-UNC game.) In 2013, McDonald's, Verizon and Microsoft each invested millions of dollars to sponsor the NFL's Amplify videos; that early success led to the NFL extending and expanding its deal with Twitter.
While Twitter's advertising exposure is relatively limited, the opportunity to stream marquee NFL content to its 320 million active users across the globe should go a long way toward boosting the company's flagging growth. After a five-year stretch in which it added more than 10 million active users in each quarter, Twitter in Q4 2015 actually lost ground for the first time, with a net loss of around 2 million active users.
"This is about transforming the fan experience with football. People watch NFL games with Twitter today," Twitter CEO Jack Dorsey said, by way of announcing the deal. "Now they'll be able to watch right on Twitter Thursday nights."
Twitter will live-stream the 10 Thursday night games carried by the broadcast networks, but NFL Network's eight-game "TNF" roster is off limits. Because cable and satellite TV operators understandably want to protect their investment -- at $1.31 per sub per month, NFL Network is the second most expensive cable channel behind ESPN -- their carriage agreements expressly prohibit over-the-top deliveries to non-subscribers.
The NFL has been shopping around for a streaming partner since last fall, after Yahoo's historic presentation of the Bills-Jags game generally surpassed all expectations, even if more than a few blue chip sponsors stayed away. The deal comes on the heels of the league's expansion of the "TNF" TV package to include NBC alongside legacy rights holder CBS.
In addition to the live-streams, Twitter and the NFL also will team up to deliver pre-game Periscope "broadcasts" from players, and the tech firm is expected to use the games to beef up user engagement with its new Moments feature.
"There is a massive amount of NFL-related conversation happening on Twitter during our games and tapping into that audience, in addition to our viewers on broadcast and cable, will ensure 'Thursday Night Football' is seen on an unprecedented number of platforms this season," said NFL commissioner Roger Goodall. "This agreement also provides additional reach for those brands advertising with our broadcast partners."
Aptly enough, Mr. Goodell confirmed the news this morning via his Twitter account. It was the commissioner's first tweet since Sept. 5, 2014.
CBS's slate of interdivisional Thursday night games averaged 17.5 million viewers and a 10.9 household rating, up 5% from the year-ago 10.4 rating. Simulcast on NFL Net, the eight CBS games now stand as the second highest-rated primetime program of the 2015-16 broadcast season, trailing only NBC's "Sunday Night Football."