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NFL signs new broadcast deals worth more than $100B

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Yahoo Sports NFL Reporter Charles Robinson joins Yahoo Finance Live to break down the NFL’s new 11-year media rights deal.

Video Transcript

[MUSIC PLAYING]

BRIAN CHEUNG: Well, we got a fun fact now. If you want to buy the rights to broadcast NFL games over 11 years, it's going to cost you about $110 billion. That's according to Yahoo Sports. That's a total of the package of deals with Amazon, ESPN, ABC, NBC, CBS, and Fox. And Amazon specifically getting be very interesting Thursday Night Football package that's going to start in 2023.

To help us break this down, we have Yahoo Sports' Charles Robinson. So Charles, very interesting to see Amazon in the mix here. I know the Thursday Night Football game has been bouncing around a lot over the past few years. What's the significance of that, and then broadly of the $110 billion package at large?

CHARLES ROBINSON: Well, Amazon's the bully on the block. I mean, that's the name that NFL owners are excited about, I think, in negotiation of this deal. When you spoke to people about where the numbers could come in and what they were excited about, Amazon came up quite prominently over the last several months.

And I think the league is looking at the Thursday night package as a bit of a test drive for Amazon. You look at Roger Goodell. In 2010, he tells the NFL owners, hey, we want to get to $25 billion in revenue by 2027. But what Roger Goodell didn't know about 2021 was that Amazon would be a $1.5 trillion company that was getting into rights and media.

And so for the NFL to partner with Amazon is significant. The Thursday night package could lead to something more lucrative. Remember, this deal does not include the NFL's cornerstone, really, a fairly large franchise, the Sunday ticket deal, which now lies with DirecTV. But ESPN is pursuing that. I think there's some thought that maybe Amazon could get involved. That's another lucrative aspect of this that has not been ironed out.

But as you said, 110 million-- excuse, $110 billion over 11 years with a seven-year opt-out before the 2030 NFL season. A gargantuan deal for the NFL. Should have a significant impact on the salary cap starting in 2023.

JENNIFER ROGERS: That's what I want to ask you about is what's the knock-on effect of this on advertisers? Will we be seeing those rates go up, on what payers are paid, on ticket prices? Somebody pays all this money.

CHARLES ROBINSON: Sure. I mean, look, all of this is expected to trickle down to everyone. I mean, this deal, in effect, although it's hard to really quantify exactly what the last TV deal was because there was some overlap, and it wasn't just one massive package in one complex set of years. But this is more than double what the rights deal was last time that the NFL went to the table with a number of different providers. And again, the difference here is that Amazon has now entered this group, whereas they were not part of the first deal or the last deal when the NFL went around the block. But when you talk about where does this money come from, well, yeah, it's going to come from advertisers. It's going to come from pretty much anyone who wants to get network time with any of these providers now.

And I think what's interesting is that seven-year opt-out clause, you talk to people in the league, you say, well, why is there a seven-year opt-out clause? Why not just take the whole 11-year shot? It's because the NFL is sitting here going, hey, we're cutting all kinds of deals now. We don't know what digital rights are going to look like. We don't know if there's going to be someone else, another Amazon-esque company that's going to come to the table by 2030.

And oh, by the way, we have all this ancillary gambling revenue that we think could actually drive ratings even higher. It's in our best interest to give ourselves an opportunity with all of these companies, all of these corporations to potentially opt out prior to the 2030 season if we see ratings fly even higher.

BRIAN CHEUNG: And Charles, on the point of ratings though, I know it's difficult to draw a counterfactual. But 15.4 million viewers is my understanding for 2020 regular season games. I think that's a pretty substantial decline from the previous regular season. So is this price tag actually lower than it otherwise would have been if there weren't a pandemic and people were maybe more tuned in to NFL games as they were last year?

CHARLES ROBINSON: It's arguable. It's hard to really look back and figure out what the number could have been had there not been the ratings impact this year. I think when you talk to people about how the networks approached this deal, they looked at the ratings decline as a blip, largely because the NFL had a lot of games playing out of slots this year. Because of how the season was staggered with the NBA, it was going against NBA games in weird times.

Really, the pandemic wreaked havoc with the NFL's scheduling more than it ever had before in history. And I think one game you could look at as being a significant flag that everybody looked at was the Thursday night game between the Baltimore Ravens and the Pittsburgh Steelers gets moved to the following week and ends up getting played on, like, a Wednesday afternoon. That had never happened before. And it massively hammered the numbers that would have been gotten by NBC in that particular deal.

So I think that networks looked at it as a blip. And they see, moving forward, the NFL is probably the most ironclad, bulletproof thing that they have going.

JENNIFER ROGERS: Charles Robinson, Yahoo Sports reporter covering this absolutely massive deal for the NFL. Thanks so much. Great to see you.