Not So Fast On the Streaming

Amazon's CEO is "confident" that the streamer will one day get a Super Bowl.  Netflix reportedly is "in the mix" for Sunday Night Football when the NFL renegotiates its media rights package.  Both might want to pump the brakes on those ambitions.  Because Congress and the FCC are both looking into the NFL and potentially putting the league's antitrust exemption at risk.  And it's all because of the abundace of games that are exclusively available behind streaming paywalls.

In the NFL's never-ending pursuit of more money, they keep finding new broadcast windows and creating packages of games to sell to the highest bidder.  The newest is a five-game package that went back to the league as a part of the deal when ESPN absorbed NFL Network.  The package was rumored to be going to both Amazon and Netflix along the way.  Now it looks like it'll end up on YouTube, where the stream will be free.  That's not a coincidence.

Last season, the NFL had games on 10 different broadcasters.  In addition to the four broadcast networks, there were games on ESPN and NFL Network, as well as Thursday Night Football on Amazon Prime and exclusive games on Netflix, Peacock and YouTube.  There was also supposed to be a Monday night game exclusively on ESPN+, but that ended up being shifted to regular ESPN.  Yes, all games are required to be made available on over-the-air television in the home markets of the two participating teams.  But, for a fan of a team who lives outside their local market, they need to navigate this endless maze of broadcast options and pay for a subscription to all of the different streaming services just to watch their team play.

Needless to say, the streaming wars are beyond frustrating for sports fans.  Because, while the thought process was that streaming would make it easier to watch games and make them more accessible, the opposite has actually been true.  It isn't easier.  In fact, it's harder than ever.  First, you need to find who's broadcasting the game.  Then, you need to see if you already have a subscription.  And, if you don't, you need to sign up for one.  Just to watch a football game.

Then there's the cost, which is the real driving factor here.  It's never been more expensive to watch sports.  In order to watch every game, you need to have a cable subscription (which you pay for), as well as a subscription to each individual streaming service (which, again, you have to pay for).  And, those streamers need to pay for those rights fees somehow.  So, they pass them on to their subscribers.  Which makes watching football more expensive by the year.

For each of the last three seasons, a wild card game has been aired exclusively on a streamer.  Peacock had the Chiefs-Dolphins game in January 2024, while the last two have been on Prime as a part of their Thursday Night Football package.  In January, Prime had the Packers-Bears game, which was considered the marquee matchup of Wild Card Weekend.  Yet it was the least accessible of the six games.  Unless you lived in Chicago, Green Bay or Milwaukee, the only way to watch it was on Amazon Prime.  That was the last straw for Senator Tammy Baldwin.

Sen. Baldwin has introduced a bill called the "For the Fans Act."  She's as frustrated as her constituents about the abundance of streaming services and the cost associated with them, so she's doing something about it.  The For the Fans Act would require all nationally-televised games to be made available for free, either on broadcast TV or a streaming service.  It would also remove local blackouts when games are only available on another streamer.  Most importantly, it would bring the cost down for people who just want to watch their team.

The FCC, meanwhile, is reexamining the NFL's antitrust exemption entirely because of the ever-increasing number of games available only behind streaming paywalls.  The NFL needs its antitrust exemption to operate as the multibillion-dollar business it has become (although, an argument could be made that the league's teams are business partners rather than competitors, so they need the antitrust exemption as much as the league itself does).  However, that exemption is now under threat, as the NFL asks its existing rightsholders to pay more for less game inventory.

Live sports are a valuable commodity for both traditional TV networks and streaming platforms.  Sports are the only "event TV" remaining where there's a guaranteed, built-in live audience.  That's why rights fees continue going up.  But, at the same time, networks having to pay more for rights fees means they have to come up with that money somewhere.  For the streamers, it means raising subscription prices and passing those on to the consumer.  But CBS, NBC and FOX don't have that option.  Which is why they, or more specifically, their affiliates, will be hurt the most.  And why there's pressure on the FCC to do something.

Network affiliates rely on those live sports broadcasts to fund the local news and their other programming.  The more CBS, FOX and NBC are required to pay in rights fees, the more they may have to charge in affiliate fees, which could be devastating to affiliates in certain markets that may not be able to afford it.  That, in turn, could lead to reductions in staff, local programming, etc., just to make up the difference.  Or, worse yet, they might have to drop their network affiliation altogether. 

They're the biggest beneficiaries of the NFL's antitrust exemption.  And they have the most to lose.  Which is why this is such an important issue.  Because some of those network affiliates need those NFL games on their station simply to stay in business.

A key part of the NFL's counterargument is that 87 percent of its games are still available for free on broadcast television.  And the league is required to make every game, regardless of the broadcaster, available free over-the-air in the home markets of the participating teams, so that number is 100 percent.  However, the 87 percent used to also be 100 percent.  And that number will keep going down as the league continues to make games streaming-exclusives.  Which require you to pay a subscription fee in order to watch.  Which is why the government has taken such an interest.

While the NFL garners the most headlines because it's the most popular sport and the only one where every game is nationally televised, this is far bigger than just the NFL.  The other pro leagues are sure paying attention.  And, while no one expects the NFL to lose it antitrust exemption entirely, whatever happens will directly impact each of them.  Especially since, like the NFL, they're all splintering off their media rights and involving multiple streamers, much to the frustration of fans.  So, whatever's decided regarding the NFL could very well apply to other sports, as well.

Putting more and more games on streaming platforms isn't necessarily all it's cracked up to be, either.  Ask MLS.  Their exclusive deal with Apple turned out to be such a disaster that they've pretty much given up and made MLS games free for anyone who's already an Apple TV subscriber.  If MLS had it to do all over again, it's doubtful they'd still go all-in on streaming.

So, no matter what happens with the NFL's media rights renegotiations, don't expect Sunday Night Football to go anywhere.  It's too valuable a commodity for both the league and NBC.  In fact, the NFL needs NBC more than NBC needs the NFL.  If it were to move to Amazon or Netflix, it would no longer be the highest-rated program on TV.  Not even close.  And, while NBC would love to maintain its relationship with the NFL, with their year-round Sunday night sports strategy, they could easily expand their Sunday Night Baseball and Sunday Night Basketball packages to a full season, with a NASCAR race or other event to fill any gaps.

This is about the NFL's antitrust exemption, yes.  But it's about so much more.  It's about the proliferation of live sports on streaming and how fed up viewers are with it.  And now, the government is finally pushing back.  Which means the viewers, instead of the leagues and streaming services, may soon finally be the ones to benefit.