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Twitter's Reach To Sports Fans, International Presence Seen As Key In NFL Streaming Deal

The NFL went with Twitter for its "Thursday Night Football" streaming package, because the league is "intrigued by Twitter’s mobile capabilities, and Twitter is already a popular medium for sports fans," according to Ben Volin of the BOSTON GLOBE. Twitter "didn’t win the bid by offering the most money." NFL Exec VP/Media Brian Rolapp: "This is not a deal where we took the highest check; we had other things we wanted to accomplish here. We wanted to bring in a new audience, and make it complementary to television, not disruptive." He added, "Twitter, their strong mobile presence made a big difference. ... Twitter has a great international following, and it’s a platform that’s built around live events, what’s happening at that moment in time. I think that plays as much in Topeka as it does in Thailand" (BOSTON GLOBE, 4/6). NFL Exec VP/Communications Joe Lockhart said, "The attraction wasn’t just revenue, it was a reach decision" (N.Y. TIMES, 4/6). Rolapp noted the NFL is calling the 10-game "TNF" package it sold "tri-casts." Rolapp said that it is "undetermined" whether NBC and CBS "will be allowed to stream the games on their own websites." THE MMQB's Peter King writes if that happens, "it would be an unprecedented fourth way to watch" (MMQB.SI.com, 4/6).

GOOD FOR THE SHIELD: NFL CIO Michelle McKenna-Doyle yesterday on a panel at Microsoft Envision in New Orleans said that the existing relationship between the NFL and Twitter has "benefitted not only the league but also its sponsors." McKenna-Doyle said of awarding the streaming rights to Twitter: "It was really that track record that we had already established that put them in a leading position." She added, "This may reduce some friction between watching and commenting on the game, and being able to put your own spin and create your own content. We will see more fan-created content around the actual production of the game." GEEKWIRE's Taylor Soper noted "having the game stream via Twitter will allow the league to track new data about its customers." McKenna-Doyle: "We will learn a lot from this. How does this shape behavior? How does it impact our long-term digital rights business?” (GEEKWIRE.com, 4/5).

BIG GET FOR TWITTER: YAHOO FINANCE's Daniel Roberts wrote it was the "appeal of Twitter's global reach that convinced the league to turn down higher offers." Instead of "taking top dollar, the NFL prioritized international eyeballs." This deal is "mutually beneficial for both parties." The NFL "wants to get more popular abroad," and Twitter "can do that." Meanwhile, Twitter "wants to grow its business financially," something the NFL "can do" (FINANCE.YAHOO.com, 4/5). In L.A., Battaglio & Dave write the NFL likes Twitter because the platform will give league content "easily accessible exposure to cord cutters or 'cord nevers.'" Twitter has been an "audience driver for big TV events." Fans "sampling a game online may move to a bigger screen if a particularly exciting contest pulls them in." The social media platform's "worldwide reach also fits into the NFL’s long-range goal to expand internationally" (L.A. TIMES, 4/6). INC.com's Erik Sherman wrote under the header, "Twitter Pulls Off A Qualified Win With NFL Game Streaming" (INC.com, 4/5). SLATE's Will Oremus noted Twitter's "core audience dovetails neatly with the young, cord-cutting demographic that the league is targeting." Twitter also "might be less likely to cannibalize the audience the NFL was already reaching on network TV" (SLATE.com, 4/5).

BIRD SANCTUARY: In N.Y., Belson & Isaac write of "TNF" rights, "Leave it to the NFL to sell the same product three times." Twitter, which will pay around $15M to stream 10 "TNF" games this season, will show ads from NBC and CBS, but "to make money it will sell ads for the time normally reserved for local spots." SpringOwl Asset Management Managing Dir Eric Jackson said of Twitter, "If these NFL games go well, they can expand into other types of content and give users more reasons to spend more time on Twitter properties each day" (N.Y. TIMES, 4/6). USA TODAY's Molina & Guynn wrote, "Score one for Twitter." The NFL deal is a "fresh effort by the struggling social media company to increase engagement and advertising revenue as growth among users has slowed" (USATODAY.com, 4/5).

IS THERE MONEY TO BE MADE? Twitter CFO Anthony Noto said the deal is a "way to communicate the value of Twitter to new users." CNBC's Julia Boorstin said Twitter's hope is that the deal "will help grow its user base beyond the roughly 300 million people who currently log in to the service, which is a number the company has been struggling to grow, which of course has been weighing on the company' stock" ("Squawk On The Street," CNBC, 4/5). Investor Jason Calacanis said of the deal for Twitter, "If they make back half of that money with the Periscope streams backstage and some other ancillary ad revenue, it's well worth it." But Calacanis noted the deal "is not going to be some huge silver bullet that solves all of Twitter's problems. But what it does speak to is the fact that the community on Twitter is extremely, extremely valuable to content owners" ("Squawk Alley," CNBC, 4/5). Elevation Partners co-Founder Roger McNamee said, "It's a small piece of business on both sides. There’s not a lot risk and there’s potentially a huge upside for both sides.” McNamee added it is "not actually necessary for Twitter to make a profit on this specific transaction. What they really need to do if they're not going to make a profit is ... generate a lot of attention and begin to pivot the business of the company away from just the news feed towards these event-based, streaming-based models that have much higher engagement, and therefore, much greater value to advertisers" ("Fast Money," CNBC, 4/5).

BRING ON THE MAD MEN: AD AGE's Anthony Crupi wrote the "price point is a steal" for Twitter compared to the $17M Yahoo paid for just one game -- Bills-Jaguars from London -- last year. Twitter will "sell its share of 'TNF' ads via its amplify program." Given that CBS last year "aired an average load of 65 paid ads" in each of its eight "TNF" broadcasts, "that works out to roughly 20 spots for Twitter to monetize, or 200 for the entire package" (ADAGE.com, 4/5). ADWEEK's Christopher Heine cited a source as saying that Twitter will "sell the ads on a cost-per-thousand (CPM) basis at what would represent a premium cost to marketers accustomed to Twitter pricing." The source added that ads will "sometimes be sold on a country-by-country basis." Heine noted Bank of America has "been a steady advertiser via the preroll-based Twitter Amplify program," and BofA Senior VP & Enterprise Media Exec Lou Paskalis "plans to buy." He said, "The NFL got it right. Twitter gives us a real path to connect around relevant cultural moments in a way that other advertisements do not." Heine noted that "if the NFL experience proves successful, folks should probably expect similar deals" with the likes of MLB, the NBA, NHL and the NCAA in "years to come" (ADWEEK.com, 4/5).

BENEFITS DEPARTMENT: Desser Sports Media President Ed Desser said of the deal, "There are all sorts of things you can do on a platform like Twitter that you can't do with traditional television, at least not in the same way. So this is about testing a new paradigm and seeing what you can do" (CHRON.com, 4/5). Pivotal Research Senior Analyst Brian Wieser said that the move was "positive for Twitter as it may add some incremental users in the short term and, more importantly, will serve as a promotional platform for Twitter’s overall product and platform to what could be a significant number of non-users." Wieser added that the "direct financial impact of the arrangement in terms of revenues and expenses will not likely be overly significant" (FINANCIAL TIMES, 4/6). The WALL STREET JOURNAL's Miriam Gottfried writes the price Twitter paid "seems a worthwhile bet for the struggling social-media platform." The "challenge for the company, which has been hesitant to make big changes to its platform, will be monetizing that demand" (WALL STREET JOURNAL, 4/6).

NOT BUYING IT
: WIRED's Brian Barrett wrote the fact that the games air on CBS and NBC "raises the question of who exactly these streams are for." Frost & Sullivan Principal Analyst Dan Rayburn said, "Where am I going to be that I don’t have access to CBS or NBC?" Barrett noted time zone differences also "may limit the appeal." Rayburn said that "if you’re that big a fan abroad, you probably have an NFL streaming package anyway" (WIRED.com, 4/5). The Washington Post's Kevin Blackistone said, "What I want to see is somebody showing me an NFL game via Meerkat or via Periscope. Something really cool like that. Give the fans the ability to do that kind of thing. I don't want the NFL controlling my Twitter feed to watch a football game" ("Around The Horn," ESPN, 4/5). Wedbush Securities Research Analyst Michael Pachter: "Not many people watch TNF, fewer will watch via Twitter. Breakeven at best, and other than the media attention, not really all that meaningful" (USATODAY.com, 4/5). TIME's Victor Luckerson wrote under the header, "Tech Companies Keep Failing To Figure Out Sports" (TIME.com, 4/5).

CAN'T PLEASE EVERYONE: Twitter Canada and Rogers Media confirmed that Canadians viewers "will be blocked from watching" the "TNF" games on Twitter. Rogers Media Senior Dir of Communications Andrea Goldstein said that her company is "currently negotiating with the NFL for live streaming rights for its new web- and mobile-based service Sportsnet Now." Twitter Canada Communications Lead Cam Gordon said that Canadian users "will be blocked based on location and IP address" (FINANCIALPOST.com, 4/5). Rogers President of Sportsnet & NHL Properties Scott Moore: "“I’m told by the NFL that they will not be doing it in Canada. It’s in respect to our rights agreement" (THEGLOBEANDMAIL.com, 4/5).

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