NFL drew massive audiences on Netflix Christmas Day
We had that Kansas City Game on where I was Christmas. Apparently it was viewed by massive audience on Netflix. I'm sure this means Here comes Netflix in the sports streaming space. It will be interesting to see if they migrate to college sports. They'll start with Professional ones for sure.
Link:
Netflix
35 Replies
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lawhokie
1y
Sorry LeBron, but basketball is dying a slow ratings death, and revenues will soon follow. 90% of viewers will watch the NFL over the NBA. I believe in a decade that basketball will be the #4 American sport, at best.
(In response to this post by HOO86)
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13HOKIE
1y
then I am all in. I want to see ESPN homeless living in a cardboard box in the worst neighborhood in Connecticut!
(In response to this post by HOO86)
1y
It was on Netflix.
(In response to this post by HOO86)
1y
4pm, 8pm kickoff?
Will also be interested in the ratings for NFL v college playoff games on 12-21.
(In response to this post by HOO86)
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2hhoop3
1y
relative to what? The streaming sphere? OTA networks? Do we know what Netflix paid for the games? Just trying to understand the value proposition for both the NFL and netflix.
(In response to this post by HOO86)
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Vippie1
1y
But the cost of not having the NFL is higher. Classic lost leader.
(In response to this post by 2hhoop3)
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2hhoop3
1y
bids billions on a contract to be a loss leader and believe you are wrong.
(In response to this post by Vippie1)
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lawhokie
1y
And NFC and AFC deals are about a billion each. Dropping 1 percent of annual income into a business unit that allows you to promote every aspect of adjacent business units, with max expected losses being a small percentage of that 1 percent, sort of fits the paradigm of a loss leader.
I’m not saying anybody is losing on NFL deals, but I am saying that a hundred billion dollar company would absolutely bid a billion on the NFL as a loss leader.
** Edited by lawhokie at 1/1/2025, 9:32:50 AM
(In response to this post by 2hhoop3)
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Vippie1
1y
could be losing some. The ability to promote your other programming is worth whatever the delta is. The ability to be a lead in like cbs for Sunday night programming is worth a lot. Etc . There are a lot of intangible benefits to broadcasting the NFL.
Yes I believe on a standalone basis they likely lose money.
(In response to this post by 2hhoop3)
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2hhoop3
1y
your belief. You are also correct that the NFL is a strong lead in to other programming but, that does not mean they lose money on the contract. Like I said, NOBODY commits billions to a contract that is a loss leader in any industry I am aware of. The intangibles you speak of are nothing more than value derived indirectly from that contract.
(In response to this post by Vippie1)
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lawhokie
1y
Disney takes in a billion dollars like, every three days. If Disney had to take a reasonable loss to keep a toe in the NFL water, I think they would have to. Same goes for every major network. Maybe not during a major recession - who knows?
Every year, something like 80% of the most heavily viewed TV events are NFL games. How many times in your career have you heard “we can’t afford not to.” That’s the answer to whether a network should sign an NFL deal.
** Edited by lawhokie at 1/1/2025, 9:45:56 AM
(In response to this post by 2hhoop3)
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Vippie1
1y
because indirect value, which i totally agree with and mentioned, doesn't go on a P&L.
(In response to this post by 2hhoop3)
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2hhoop3
1y
on your part. That indirect value most certain hits the P&L in the advertising rates they get for other programs. As far as what might be my thing, as a CPA with over 40 years public and private experience I will be happy to discuss P&Ls or other aspects as you would like. What might be your thing?
(In response to this post by Vippie1)
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Vippie1
1y
Yeah so I know certain "benefits" of those contracts aren't reflected on an income statement. So they very well can be accretive to the enterprise but still show a loss. And by the way nothing I am saying is unique..
why is so hard to agree that the network may pay a dollar and only get 98 cents back in revenues directly attributable to the broadcast but still overall effectively but not technically profit? And yes I do believe the networks are more than willing to take a strategic loss on the NFL to prevent their competitors from having the presigue.
So let's move on. I'm not an idiot in this arena, and I'm measured in what I say.
(In response to this post by 2hhoop3)
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lawhokie
1y
This seems like a back of the envelope look at the issue.
Link:
Not a loss leader
(In response to this post by Vippie1)
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lawhokie
1y
Link:
Streaming losses
(In response to this post by lawhokie)
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2hhoop3
1y
are not reflected on the income statement, be specific, either directly or indirectly? As an M&A guy you should understand the value of a contract or deal is comprised of direct and indirect benefits that are reflected in the financial statements. You might want to reread your posts in this thread and reassess how measured you actually were.
(In response to this post by Vippie1)
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Vippie1
1y
Maybe you are a public cpa. But the last thing I care about is gaap. There are multiple articles out there....just google.. .about the streaming services losing big on their nfl contracts but still doing entering into them. Of course cbs nbc and fox aren't going to tell you if they are. As I explained ad naseum at this point there are multiple defensive able reasons why networks overpay for the nfl.
I won't reply so if getting the last word makes you feel you "won" knock yourself out. I've spent enought pointless time already. Cheers.
(In response to this post by 2hhoop3)
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lawhokie
1y
But I have yet to find an article that says that NBC, CBS, ABC/DIS actually lose money. That would be an interesting read if you could post a link. WSJ link is fine. I’ve seen the stuff on streaming losses but that is what I guess everybody expected at this stage.
(In response to this post by Vippie1)
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Stech
1y
Sell products or services that make more than they spend (profitable products and services), sell products and services that don’t make a profit, but lead the customer to a profitable product or service.
The Streamers since they don’t have the scale yet could be losing money, but either with more scale or with this leading to expanded subscribers and an in with advertisers it could be profitable down the road.
The networks on the other hand, could already have the scale and thus the eyeballs to get high paying advertisers, and be profitable. However, since they lack the scale of a Netflix for Streamers, are probably very nervous about losing share/scale. So they may be profitable now, but will they be if a powerful Streamer like Netflix and Amazon start dwindling the Networks share?
The answer to this question as you both I am sure know, will have a huge impact on top tier college football. In other words, will the Streamers buy the Networks or will the Networks buy the Streamers? I have my opinion, but I would like to hear from both of you.
(In response to this post by Vippie1)
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lawhokie
1y
And if he does, will Bezos immediately regret it? Why buy a broadcast network and FCC and DOJ headaches when you can buy content and stream it?
The far more important question is which school will sell its soul to Amazon or Netflix. If Amazon came to VT with a mega sponsorship deal and we were forced to change our name to the Fighting Bezonians or whatever I would shave my head, don a cowboy hat, and sign up as the new mascot. In a time when everyone else seems to be thinking ten years out, VT needs a vision for 2050.
(In response to this post by Stech)
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Stech
1y
Go Zons Go!! 🤣🤣
Man, seriously, you have some of the best and most creative posts!! 👏
(In response to this post by lawhokie)
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2hhoop3
1y
you ever got started you just weren't able to recognize it. I thought eventually the light bulb would come on for you but, I guess not. Your OP said, "But the cost of not having the NFL is higher" by definition means the contract brings value(i.e. makes money) to the enterprise.
(In response to this post by Vippie1)
1y
that includes their Thursday games. The contract was for two years.
(In response to this post by 2hhoop3)
1y
wasn't for Thursday games.
(In response to this post by mancunian)
1y
it was well worth it!
Link:
NFL Netflix and Chill
(In response to this post by Big12 guy)
1y
The Thursday night game is closer to the 17 million. These on Christmas day were substantially higher.
(In response to this post by 2hhoop3)
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TVLander
1y
Year's Super Bowl apparently had 113M viewers. So I would guess that Netflix pulling 1/4 of the viewership for the Super Bowl on Christmas Day, with people that have to pay to see it, seems like a pretty big win for them.
(In response to this post by 2hhoop3)
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Stech
1y
but I assume they had Ads.
(In response to this post by TVLander)
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Stech
1y
(In response to this post by HOO86)
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daveinop
1y
They know what they are doing
(In response to this post by HOO86)
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TVLander
1y
have a limited time to get their streaming services fully out there. Netflix has a 17 year head start on them in streaming infrastructure and lessons learned, and if they get their coverage and talent right, it'll be a LOT easier for many people to justify that higher netflix monthly fee instead of paying for that plus an ESPN fee and a FoxSports fee. If they're not careful, ESPN and FS will find themselves up against Netflix, Apple, and Amazon before they're ready. Is it harder to create a streaming service and get it into the minds of people and convince them to pay for it, or is it harder to already *be* an existing streaming service and create a sports coverage department?
I wonder if this is like a BlackBerry vs iPhone/Android turnaround coming down the road.
(In response to this post by daveinop)
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Stech
1y
lately and this is probably why it’s happening. One of those Streamers you mentioned or all of them could potentially swoop in and change everything. I would not be surprised behind the scenes this is already happening, and Sankey/Saban/ESPN are trying to counter it with their we can do this without them. However, like you mentioned, it’s not easy to start from scratch when the competitors already have so many established customers in Streaming.
Interesting post TVLander!
** Edited by Stech at 12/28/2024, 2:10:39 PM
(In response to this post by TVLander)