Verizon to sacrifice NFL mobile rights, initiating bidding war

Whenever a new OTT streaming service offering live NFL matches launches in the US, we must always point out that it is limited to certain screens due to Verizon holding exclusive rights for streaming live NFL games on mobile devices. A bidding war for these rights could soon erupt, as new negotiations between the NFL and Verizon would extend streaming rights to PCs and tablets, as well as mobiles, but at the cost to Verizon of losing its mobile exclusivity.

These exclusive rights have kept the influence of AT&T and Dish Network on smartphone NFL streaming at bay, but these two are now likely to pour cash into picking up NFL mobile streaming rights, although there is no guarantee of these being exclusive to either, while Amazon will almost certainly show its hand in the bidding, perhaps chasing them up for outside the US.

Verizon and the NFL are nearing a new deal, according to Bloomberg sources close to the matter, stating that the agreement will include Thursday night matches, “among others”. Verizon has been the exclusive home of NFL matches on screens under seven-inches since 2012, but the increasing sizes of smartphones and prevalence of streaming sticks and dongles for TV sets has pushed Verizon into a change of strategy. Bloomberg notes that Verizon will still have some mobile rights, but the details of the agreement will not become clear until the official announcement. Part of the reason for this re-negotiation may well be due to the lack of clear success by Verizon for any of its TV mobile bundles.

It’s worth remembering how new the NFL itself is to delivering content over the internet, with connected TV sets only receiving the Super Bowl for the first time in February last year. That game attracted 4 million unique viewers, compared to the previous year’s streamed Super Bowl which racked up 1.3 million viewers on NBC. Since then, interest in streaming NFL matches has gone through the roof, with Twitter paying $10 million for Thursday night games last year, a deal which Amazon then dwarfed by paying $50 million for non-exclusive rights to show 10 live Thursday night NFL matches earlier this year, outbidding Facebook and YouTube.

Interestingly, there is no mention of connected TVs in the original Bloomberg report, but other outlets have cited these as part of Verizon’s new NFL deal. The NFL app comes pre-installed on most Verizon smartphones, a tiny fraction of which have screen sizes over 7-inches, so its existing rights deal covers the majority of the smartphone market and was designed to keep the streaming rights for tablets separate.

Google has been interested in NFL rights for years and with the recent launch of YouTube TV, NFL content would be an invaluable addition to its offering. Perhaps there is scope for one of the big US operators to partner with Google on NFL rights and add games to YouTube TV as a premium. That type of deal would certainly shake things up, although Google would likely insist on keeping the bulk of advertising revenues given its extensive online reach, which may make striking an agreement difficult.

AT&T’s DirecTV Now currently holds rights to show out-of-market matches on Sunday on devices including mobiles, while Verizon holds the Sunday night rights, as well as in a team’s home market on Sunday during the day, plus Thursday and Monday night matches. CBS and NBC also hold Thursday night NFL rights and will show five games each on TV and streaming formats.

One thing for certain from whatever comes of the NFL rights agreement is that Verizon’s newly formed Oath digital advertising arm will be at the heart of its NFL streaming operations, formed by the consolidation of AOL and Yahoo – aiming to fire the advertising potential of its mega mobile subscriber base into life.