Verizon pays more for less with loss of exclusivity in $2.25B NFL deal

Verizon will offer the national games to mobile viewers, “regardless of mobile network.”

As had been widely speculated, Verizon's new $2.25 billion content rights deal with the NFL does not extend the exclusive mobile rights Verizon first secured back in 2010 for NFL games. Instead, Verizon will offer the national games to mobile viewers, “regardless of mobile network.” It’s unclear if Verizon plans to offer its own wireless customers data-free streaming for the NFL content.

"With this agreement, Verizon is giving up exclusivity to be the only mobile operator to offer NFL streaming rights," noted Wells Fargo analyst Jennifer M. Fritzsche, summing up what she feels is the bottom line to the deal in a note to investors this morning. 

As had been expected, Verizon reached an agreement with the National Football League for future digital distribution of NFL games and related content, such as game highlights and clips, as well as jointly developed original content. The multiyear deal, which will kick off in January 2018, includes streaming of national preseason, regular season, playoff games, and the Super Bowl.

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Verizon will be streaming Sunday Night, Monday Night and Thursday Night football games and the ancillary content across its digital and mobile properties, which now span Yahoo and Yahoo Sports, AOL properties and Verizon’s mobile-first online video platform, Go90. Verizon has claimed its digital properties reach over 200 million viewers monthly, and that its digital platform Oath leads in terms of millennial reach. “NFL content will reach a massive digital audience,” the company said. Yahoo will also become an official sponsor of the NFL.

For Verizon, the expanded deal offers an opportunity to attract more viewers to the telco’s burgeoning digital and mobile advertising business. The NFL deal will give Verizon a chance to stream NFL games, and consequently advertising that runs against those games, on connected TVs, which is currently one of the fastest growing digital ad sectors.

And while the lack of exclusive mobile rights is a loss for Verizon, it’s a decided win for the NFL. The league, which has been plagued by ratings erosion over the past two seasons, has begun pushing for more expansive digital-based distribution deals in lieu of exclusivity, in the hopes of reaching audiences that are now eschewing linear TV.

NFL Commissioner Roger Goodell touted the new deal with Verizon, claiming it will let more NFL fans watch the games. “Starting with the upcoming playoffs and for seasons to come, live NFL action directly on your mobile device—regardless of carrier—will give millions of fans additional ways to follow their favorite sport,” he said.   

The $2.25 billion price tag is a healthy upsell from the $1 billion Verizon paid as part of its current NFL licensing agreement. Despite the NFL’s ratings declines, the league has been able to command more money for its programming season after season. Digital outlets like Amazon, Google and Facebook and their respective interest in streaming NFL games are helping to drive up the price of the sports content, while TV networks and service providers are desperate for any content that can amass large live audiences.