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SBD/May 20, 2014/Media
Source: Digital Rights Issue Could Be Holding Up DirecTV's NFL Sunday Ticket Renewal
Published May 20, 2014
NFL GAINS LEVERAGE: In L.A., Flint & Puzzanghera note Sunday Ticket "may have relatively few subscribers, but it is exclusive sports content -- and providing that kind of programming will be crucial for media and telecommunications companies going forward as they navigate a constantly shifting media landscape" (L.A. TIMES, 5/20). In N.Y., Atkinson & Kosman write, "As if NFL Commissioner Roger Goodell needed another advantage over a media partner." Already owning the "hottest media rights in the US, Goodell on Monday was handed even a greater edge in talks over a new 'NFL Sunday Ticket' deal with DirecTV when it was learned that AT&T could walk away" from its $48.5B acquisition if a new deal with the NFL "couldn't be worked out." The only people "happier than Goodell and his front-office colleagues" were NFL team owners. If the "added pressure on DirecTV is enough to goose the price" of a new Sunday Ticket deal to $1.5B a year, each owner would pocket an extra $3M a year. The "walk-away clause, which requires DirecTV to ink a new deal at 'substantially' the same terms as the existing one, could be read as a warning shot from AT&T to keep the NFL in line where pricing is concerned." Bevilacqua Helfant Ventures co-Founder & CEO Chris Bevilacqua is expecting the NFL "to charge two to three times" its current $1B annual license fee (N.Y. POST, 5/20). In DC, Cindy Boren wrote Sunday Ticket "lost some of its oomph with the creation of the RedZone channel," but it is "still going to cost AT&T/DirecTV dearly." All of which will "make the NFL the big winner" (WASHINGTONPOST.com, 5/19).
FOOTBALL CRUCIAL FOR DIRECTV: CNBC's Jim Cramer said without NFL Sunday Ticket on DirecTV, "many customers would walk away" from the satellite TV provider. Cramer said, "I subscribe to DirecTV because I, like many other Americans, follow out-of-market teams and I play fantasy football. There's simply no other reason I would take this monstrosity of a network with a dish that goes down in every storm." Cramer: "Believe me, if this satellite technology were at all up to snuff then Apple, Google or Facebook would be bidding for it, not AT&T." The NFL "totally knows how this package is now make or break for AT&T. They got DirecTV over a barrel" ("Mad Money," CNBC, 5/19).