NFL takes a long view on ‘Sunday Ticket’

By the time the Bears and Packers play on Sept. 5, fans will know whether “NFL Sunday Ticket” will still be exclusive to DirecTV starting with the 2020 season.getty images

When the NFL owners meeting in May arrived at an agenda item called “NFL Sunday Ticket,” there was a possibility of fireworks. Any movement on the future of the league’s popular out-of-market games package has the potential to change fan behavior, influence union negotiations and offer a preview of coming television deals.

But, insiders say, little of consequence was shared that day in a conference room at the Ritz-Carlton Key Biscayne. Sensitivities around the negotiations precluded sharing any serious insights, even among the tight-knit group of owners and their proxies in the room.

The NFL has until the beginning of September to decide if it will opt out of its Sunday Ticket deal with DirecTV, according to several sources. If the league has not exercised that opt-out clause by the opening night game between the Bears and Packers on Sept. 5, DirecTV will keep carrying Sunday Ticket exclusively through the end of its contract in 2022.

Essentially, the NFL has to choose whether to stick with the status quo and stay with DirecTV exclusively or court new digital players and their younger audiences — a move that risks a smaller annual payout for the package.

The league has spent more than six months gauging interest in the package. The eight-year deal with the satellite provider is worth an average of $1.5 billion per year. Despite months of talks, no deal is imminent.

So far, all of the interest has come from streaming services — Amazon, DAZN and ESPN+ — but only on a nonexclusive basis, sources say. As of now, it appears that none of the streaming services are willing to pay $1.5 billion for exclusive access, sources said.

Earlier this year, cable operators Charter, Comcast and Cox looked into whether they wanted to offer Sunday Ticket through the In Demand consortium that they own. The cable business has agitated for access to the NFL’s out-of-market package ever since it was first sold exclusively to DirecTV in 1994.

This year, though, the cable operators felt the price tag would be too steep. Cable executives consider the NFL RedZone, the league-owned whiparound channel, to be an adequate low-cost replacement for Sunday Ticket.

Several media and league executives have described talks, which started late last year, as much more prolonged than expected.

DirecTV executives have spent the past few years complaining that the $1.5 billion cost is not bringing in as many new subscribers as it once did. DirecTV executives have signaled to the NFL that they are willing to give up exclusivity to pay less, sources said.

That’s where the holdup is happening, sources said. The NFL is trying to figure out how much DirecTV is willing to pay for a non-exclusive package and whether interested streaming services could make up the difference.

On the first-quarter earnings call for DirecTV parent company AT&T, CEO Randall Stephenson predicted that Sunday Ticket would remain exclusively on DirecTV “as we go forward.” But in April of this year, AT&T dropped NFL Network and NFL RedZone from its U-verse platform — a move that suggested negotiations were not going well.

Streaming services have been open about their interest.

Disney Chairman and CEO Bob Iger told an earnings call that ESPN+ has explored a Sunday Ticket deal. Amazon has also looked into the possibility of picking up the package, as has DAZN, which already sells an NFL game package in Canada that is similar to Sunday Ticket.

“Of course we’re interested in NFL content,” said John Skipper, DAZN executive chairman. “Many major emerging networks and platforms have been built on the back of NFL content. We happen to be an emerging platform.”