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The NFL: King of North American Sports

The National Football League is the king of North American sports. They have the must watch event of the year, the Super Bowl, and attracts the highest TV rating among the four major North American sports leagues. Fortunate to have already finished their season before the pandemic hit, the NFL didn’t cancel a single game or event; the only adjustment necessary was modifying the draft to a virtual format, leaving them relatively unscathed by the initial wave of COVID-19.

The NFL draft is a three-day event. During the 2020 draft, each day drew more viewers compared to its 2019 counterpart. On day one, its best performing day, the 2020 draft averaged 15.6M views - a 37% increase from 2019. While the increase in viewership makes logical sense with the pandemic confining most people to their homes, it also speaks to the power of the NFL and the value of their brand in North America.

COVID-19 Impact

As the 2020-21 NFL season started, there was little uncertainty - they had strict COVID protocols and a select few stadiums that were accepting fans. As the season progressed, more stadiums began to open at a reduced capacity. You may be thinking that this would immediately strengthen team revenues, think again. The NFL is not dependent on the gate revenue - it generates most of its profit from TV deals and sponsorships. Despite the meticulous planning to ensure a relative lack of interruption from the pandemic, the 2020-21 NFL season did still suffer a decline in viewership. According to Pro Football Network, the NFL averaged 15.4M viewers on regular season game days, which reflects a 7% decline from the 2019 regular season.

A simple breakdown of some of the most elite sports broadcasters in 2020 is as follows; Monday night football saw a decline of 3%, CBS Sunday was down 4%, Fox Sunday was down 6%, Thursday night football was down 6% and NBC Sunday Night football was down a whopping 16%. Even the 2021 Super Bowl was impacted, drawing only 91.6M viewers. For comparison, the 2020 Super Bowl drew 101.32M viewers. A fascinating side point: the cost of a 30 second Super Bowl commercial has continued to increase, reaching 5.5M in 2021 (up from 5.2M in 2019). Logically thinking, one would assume the decline in viewers would impact the NFL’s next TV deal.

A TV Broadcasting Touchdown

The NFL knows their place in the industry and was not short of TV Networks knocking on their door bidding on broadcast rights at the end of the 2020-21 season. The new deal, which begins in 2023 and runs until 2033, is the largest in professional sports history. The 11-year deal is worth a total of $113 billion USD including some of the industry’s biggest players and is as follows:

Amazon, being the newbie of the sports broadcasting world, has signed on as the exclusive broadcaster of Thursday Night football. It has been reported that Amazon is paying $1 billion per season, which is equivalent to an average of $58.8 million per game. This is yet another step Amazon is taking in their effort to grow their streaming service, Amazon Prime Video. It has been long rumored that Jeff Bezos, former CEO of Amazon, has been trying to purchase an NFL franchise over the past few seasons. These rumors reached their height back in July 2020, when Washington Football Team owner Dan Snyder refused to change the name of the team and was under intense pressure from corporate sponsors to either sell the team or follow through with the requested name change. Since then, Dan Snyder has bought out minority stakes in the team, assuming full ownership of the team.

CBS will remain a main broadcaster for the NFL, as they’ve retained their Sunday slot and the AFC games on Sunday afternoon. They also secured the broadcasting rights to the Super Bowl in 2023, 2027, and 2031. CBS’ portion of the deal is valued at $2.1 billion per season, representing a total value of $23.1 billion over the 11 years.

ESPN, owned by Disney, locked up the broadcasting rights to Monday Night football for the duration of the deal. Upon signing, ESPN, and its partner ABC, will remain as the exclusive broadcasters of Monday Night Football. The new deal also secured the broadcasting rights to the Super Bowl in 2026 and 2030. ESPN’s portion of the deal is valued at $2.7 billion per season, with the total value of the deal reaching $29.7 billion over the 11 years.

Fox will remain a main broadcaster for the NFL, keeping their Sunday slot and the NFC games on Sunday afternoon. They secured broadcasting rights to the Super Bowl in 2025, 2029 and 2033 and have also expanded their digital rights. The value of

Fox’s portion of the deal is $2.2 billion per season, bringing the total value of the deal to $24.2 billion over the 11 years.

NBC has retained the exclusive rights to Sunday Night Football and has gained the rights to show select games on their streaming service, Peacock. As a part of the deal, NBC also secured rights to the Super Bowl in 2025, 2029, 2033. NBC’s portion of the deal is valued at $2 billion per season, reaching a total of $22 billion over the 11-year deal.

The new NFL broadcasting deal signifies just how dominant the league is across North America. The NFL, along with its broadcasting partners, forecast significant growth within the game, not only through this new deal, but also through the expansion to digital streaming services. Streaming NFL games online, outside of traditional cable is the future of the NFL and this deal is the next step towards that reality.

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