The National Football League, the U.S.’s most-watched sport, will generate about 60 percent more revenue through 2022 from nine-year contract extensions with CBS Corp. (CBS), News Corp. (NWSA)’s Fox unit and Comcast Corp. (CMCSA)’s NBC.
Rights fees for all three networks will increase by about 6 percent or 7 percent a year, according to three people with knowledge of the talks who were granted anonymity because they weren’t authorized to disclose the terms. The NFL currently receives about $4 billion a year in television rights fees from companies including Walt Disney Co. (DIS)’s ESPN and DirecTV. (DTV)
“It’s an exceptional deal under any economic circumstances, let alone the current climate,” Marc Ganis, president of Chicago-based industry consultant Sportscorp Ltd., said in an interview yesterday at an NFL owners meeting in Irving, Texas. “It demonstrates the extraordinary power of the NFL and it doesn’t even look like it’s peaked yet.”
The Super Bowl championship game between the Pittsburgh Steelers and the Green Bay Packers in February was the most- watched program in U.S. television history.
“From the beginning of September through the second week in February, it’s dominant television programming,” Sean McManus, president of CBS Sports, said in a telephone interview. “The ratings are consistently remarkable and once you get into the postseason, they get even better.”
ESPN said Sept. 8 it extended its agreement with the NFL for eight years, giving the Disney unit “Monday Night Football” through the 2021 season. The deal was valued at $1.9 billion a year, or about 73 percent more than the Bristol, Connecticut-based network has been paying, the New York Times reported.
NFL Commissioner Roger Goodell -- who along with the three broadcast networks declined to reveal financial terms -- said the 32-team league’s new decade-long labor agreement signed after a four-month offseason lockout helped it to negotiate the longest television deals in league history.
“That kind of stability gave us the ability to get these contract extensions,” Goodell told reporters yesterday. “The players deserve great credit.”
Under the terms of the new collective bargaining agreement, the players’ share of broadcast revenue climbs to about 55 percent from around 50-51 percent under the prior deal, Ganis said. The NFL has annual revenue in excess of $9 billion.
“Whether they did that intentionally or not, the players have been very smart,” Ganis said. “The TV deal is phenomenal for them.”
CBS will continue to broadcast American Football Conference games, with Fox airing the National Football Conference and NBC showing a Sunday night prime-time matchup. Each network will show three Super Bowls during the span of the contract extensions, which McManus said was important to CBS.
“It’s a product you want to watch live,” McManus said. “When they began to talk about eight years or longer, we said that, within reason, the longer the deal the better for CBS, because the value is only going to increase in future years.”
The agreements continue the sport’s flexible-scheduling system to allow games between playoff contenders to be shown late in the season, while the league-owned NFL Network will be able to expand its existing slate of eight Thursday night games. The league’s broadcast committee will decide whether the NFL Network retains exclusive rights to Thursday night games, Goodell said.
NBC will continue showing the league’s opening Thursday night game and will add a night game during the U.S. Thanksgiving holiday.
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