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The Miami Dolphins and the Latest York Jets face off within the National Football League’s first ever Black Friday game this week — nevertheless it’s not going to be the standard broadcast or cable offering. The game will stream exclusively on Amazon’s Prime Video.
The NFL’s decision to begin a latest Thanksgiving tradition with a streaming platform as an alternative of a broadcast or cable channel is one more indicator of trouble for linear, or traditional, TV, which has suffered from slumping ad revenue and customers cutting the cable cord.
The Black Friday matchup is an expansion of Amazon’s “Thursday Night Football” take care of the NFL, which has helped drive a 6% jump in NFL viewership since last 12 months. And with the game streaming the day after Thanksgiving, Amazon could capture a number of the holiday viewership, which broke records last 12 months.
“I do not make predictions on rankings,” Brian Rolapp, the NFL’s chief media and business officer, told CNBC’s Julia Boorstin this week. “But I believe they’ll be good.” The Black Friday game kicks off at 3 p.m. ET.
Thanksgiving Day is already a football tradition, with the Detroit Lions and Dallas Cowboys headlining matchups through the years. Fox, CBS and NBC all will broadcast games on the vacation.
The NFL and Amazon hope the Black Friday game will change into an annual tradition, executives said Tuesday at a media conference. In a push to drive Amazon e-commerce sales, the streaming broadcast will feature QR codes at the underside of the screen that may link to a few of Amazon’s Black Friday deals. Country music icon Garth Brooks will take the stage in an exclusive postgame concert.
Amazon’s 11-year “Thursday Night Football” deal and YouTube TV’s “NFL Sunday Ticket” package are only a couple of examples of live sports programming making the jump from cable to streaming. In October, Warner Bros. Discovery rolled out its Bleacher Report Sports Add-On Tier for the corporate’s flagship streaming platform Max, offering subscribers a whole lot of live sports events.
ESPN’s pivot
ESPN has long ruled sports programming on traditional TV. But that might all change when the cable stalwart brings all its programming to streaming, in a planned direct-to-consumer release.
Yet whilst the streaming trend picks up, sports programming helps keep cable and traditional TV alive, for the moment.
Earlier this 12 months, data firm Nielsen reported that traditional TV made up lower than half of overall TV usage in July. But linear popped back in August and September. The jump was largely driven by the return of faculty and skilled football, Nielsen said in a report released last month. ESPN also snagged the highest 11 telecasts for the month of September, 10 of which were football-related.
ESPN has to date weathered the storm of the TV decline, capturing a “modest increase” in ad revenue in parent company Disney’s most up-to-date quarterly report, whilst overall TV revenue for the corporate fell.
Sports programming is holding the linear television industry together, in keeping with Macquarie analyst Tim Nollen. And ESPN is a large a part of that.
But ESPN’s dominance in sports programming could pose a potentially fatal threat to linear TV. When ESPN unleashes its direct-to-consumer service, which might offer rather more than its current ESPN+ app, it might be the push sports fans are waiting for to desert the bundle altogether.
“When ESPN puts their DTC product online, depending on the pricing, it might create a critical mass of live sports outside of the bundle to speed up cord cutting,” said UBS media and telecom analyst John Hodulik. “That is what I believe individuals are waiting for.”
Disney CEO Bob Iger told CNBC’s Boorstin on Nov. 8 that Disney will launch a direct-to-consumer ESPN flagship no later than 2025, putting the sports programming world on notice.
But not everyone seems to be convinced that ESPN’s foray into streaming will do an excessive amount of damage too quickly.
“If you have a look at the economics that ESPN gets from the pay TV bundle, they can not just step away and pirouette to DTC and all the things stays the identical,” said sports media consultant and former Fox Sports executive Patrick Crakes. “There isn’t any DTC streaming product that scales like pay TV, even today, with pay TV in decline.”
The long run looks more like a reimagined pay TV bundle, Crakes said, with streaming products included in the normal economics of bundle. It’s harking back to the recent Disney-Charter agreement, through which Disney+ and ESPN+ at the moment are included in some Spectrum cable packages.
But challenges could lie ahead for media firms which have not yet made the jump to bring their programming to the streaming world.
How vulnerable is Fox?
A FOX Sports TV camera operator in the course of the week 5 NFL game between the Atlanta Falcons and the Carolina Panthers at Mercedes-Benz Stadium on October 11, 2020 in Atlanta, Georgia.
David J. Griffin | Icon Sportswire | Getty Images
The most important loser of the slowing ad market shall be Fox, Macquarie’s Nollen said. (Macquarie Group and its affiliates own a net long of 0.5% or more of the equity securities of Fox Corp.)
Other media firms, including NBCUniversal through its Peacock service, have pivoted largely to streaming ventures, where ad revenue through those platforms can partially offset the slump in linear. The issue with Fox? It doesn’t have a streaming platform beyond its free, ad-supported service Tubi.
“Fox made the choice to double down on the bundle a couple of years ago after which they’ve done surprisingly well for it,” said Nollen. “But when cord-cutting accelerates and everybody picks up streaming sports elsewhere, I just don’t understand what Fox’s plan is.”
When asked for comment, Fox referenced a quote made by Fox Corp. CFO Steve Tomsic on the Bank of America media conference in September.
“I can see a world where the ESPNs of this world do go DTC, but I’m not sure how impactful that shall be for us or the complete industry,” he said. “If there’s the emergence of some form of sports bundle that’s across different network providers, then the primary port of call goes to be Fox when it comes to people wanting to aggregate our content with their service just given how strong our sports offering is.”
Disclosure: Comcast is the parent company of NBCUniversal and CNBC.