SBD/August 22, 2013/Media

Sources Say Google-NFL Deal Unlikely, As League May Only Look For Leverage In Talks

Goodell led a contingent of NFL officials who met with Google execs this week
Google’s possible purchase of the NFL Sunday Ticket package “is unlikely to happen,” according to sources cited by Claire Atkinson of the N.Y. POST. One source said, “They’re trying to gin up potential bidders; the cable guys have already circled (Sunday Ticket) the last two times. They’ve gotten to the place where it’s not worth it to buy it exclusively.” ESPN President John Skipper yesterday said that leagues “wouldn’t put major events online only.” He said leagues "all love to float the idea because there will be more competition for rights.” The Google-NFL meeting “may have focused on global streaming rights, which would offer the NFL another way to squeeze out more revenue.” Sources said that the NFL has “held back from selling international streaming rights,” valued at around $100M (N.Y. POST, 8/22). In L.A., Joe Flint writes, “An over the top offering of Sunday Ticket could greatly increase the potential audience far beyond DirecTV and Google certainly has deep enough pockets to make the NFL think very seriously about such a bold offer.” However, there are “other things to consider including how CBS and Fox would feel about a Google package.” The concern of the broadcast networks "would primarily be that if enough people were watching football games online that were not available in their town, it could hurt the ratings for their local stations." Even though the ratings for a game watched on Sunday Ticket "count toward CBS and Fox's national rating, a Los Angeles resident watching a game in the Washington market doesn't do their local stations any good." This is the reason the NFL has "resisted the urge to offer Sunday Ticket to cable operators such as Time Warner Cable and Comcast who would be very eager to get the package away from DirecTV." The risk is that it "would ultimately harm CBS and Fox and make them less eager to spend so much on football" (L.A. TIMES, 8/22).

LEAKING TO GAIN LEVERAGE? The WALL STREET JOURNAL's Miriam Gottfried writes there is "no indication that Google is anywhere near a deal to offer the package," but the news "raises the possibility of a powerful partnership that could be the magic bullet for Google in its goal of luring traditional TV viewers, and associated advertising dollars, to the Internet." Live sporting events are "among the primary reasons U.S. consumers pay for TV," and bringing them online as a separate subscription "would allow many more people to stop paying for traditional TV." It also would "let the NFL broaden its viewer base by selling to those people who don't pay for TV." It is "possible the NFL may have leaked news of the meeting to gain leverage in negotiations with DirecTV" (WALL STREET JOURNAL, 8/22).

READY FOR THE BIG TIME?
Mavericks Owner Mark Cuban "thinks the Web, and Google, are capable of delivering NFL games to your TV." Cuban in an e-mail wrote, "Sunday Ticket is a great starting and testing point for Google -- the NBA League Pass would be as well -- simply because the number of out of market simultaneous viewers falls far below what Google can handle at HD quality." Cuban: "They can do Sunday Ticket. But they have to anticipate the fallout, and negative brand impact, from fans who really, really want the best quality picture on their big screen TVs. While Google can handle the technical side of delivery, they’ll have the QOS issues I mentioned above. So DirecTV will blow away the picture quality and continuity of picture and service that Google can offer at this point. And every football fan will thank them if they keep the rights" (ALLTHINGSD.com, 8/21).
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