Chart of the Week #38: The NFL's Media Rights Preeminence
Last week, we presented our 2024 Annual Media Update to league and team executives and owners. Arctos Operating Advisor and former head of Fox’s RSNs, Jeff Krolik, and Director and head of Arctos Insights, Zach Baran , reviewed our outlook for the national and local media markets and explored key themes: Cable vs. Streaming, the RSN Death Spiral, the 'NFL-ization' of media rights, and the implications for premium sports rights.
But to truly understand today’s media rights landscape is to understand the relative size of the National Football League (NFL) .
In 2024, we estimate that the NFL will earn ~$0.40 (!) of every premium sports media rights dollar earned in the U.S.
The above chart represents the vast majority of NFL and non-NFL premium sports content costs in the U.S. We collected data on major sports league investments by broadcaster, amortized the existing deals, and made very simple, often conservative assumptions about their renewals in the forecast period.
Once the new National Basketball Association (NBA) media rights deal comes online in 2025-26, we estimate that the NFL will still receive ~$0.37 of each premium sports media dollar earned in the U.S. That number could be even higher, should the NFL choose to opt-out of its media deals prior to the 2029 season. We believe they will exercise this option and the League should see a significant reevaluation of their rights – again.
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In some ways this shouldn’t come as a surprise. The NFL is the most watched content in America and Americans loves their football. 69% of Americans view the NFL as ‘essential’ content when selecting a live TV service. 94 of the top 100 telecasts in the U.S. in 2023 were NFL-related telecasts, and even a streaming-exclusive playoff game attracted 23+ million viewers and accounted for 30% of U.S. web traffic. In fact, according to our estimates, the NFL comprised 80%+ of live viewer hours (i.e., avg. viewers per event x hours per event x number of events) of regular season, nationally televised Big 4 North American sports games in 2023.
When we talk about the value of the NFL, we believe there are four pillars that have been foundational for its continued growth:
Football, and the NFL in particular, itself is not magically more compelling than other sports. We believe what the League has done is really simple (though extremely difficult to execute): where they have a team, they matter to that community, often (though not always) even when that team is bad. We believe that is incredibly powerful and continues to drive national media value.
CEO at Overtime
1 个月From an objective game design perspective it is actually a more compelling sport. The game can be won or lost in the first minute or the last minute. The start and stop nature is perfect for analysis and replays. The variety of plays and highlights is greater than any other sport. Except maybe soccer. And it’s the most like an actual Battle with two sides facing off against each other. The idea of two armies protecting territory and going head to head is primal. And all you need is a ball. That’s why football and soccer just from a game design perspective are the most popular. NFL execs and NBA execs and others have done a masterful job of creating narratives and rights and packages. But independent of any league it’s important to analyze the actual sport itself. The nfl has also done a fantastic job of continual rule tweaks.
Financial Analyst & Broader Consultant to G7
1 个月As was said in the movie Concussion, "The NFL owns a day of the week. The same day the church used to own. Now it's theirs". Pretty incredible what that translates to media money-wise
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Growing soccer in the U.S. and next generation of sports leaders | Adweek Executive Mentee | Sports Professor
2 个月The 'NFL-ization' of media rights. Two standout data points. 1) In 2024, we estimate that the NFL will earn ~$0.40 (!) of every premium sports media rights dollar earned in the U.S. 2) In fact, according to our estimates, the NFL comprised 80%+ of live viewer hours (i.e., avg. viewers per event x hours per event x number of events) of regular season, nationally televised Big 4 North American sports games in 2023. ?? Bigger takeaway: continued pressure on not only other tier 1 properties, but non tier 1 properties to diversify revenue streams given lion’s share of $$$ going to more smaller concentration of leagues. ?? Arctos in great position with their league approval for PE investment into the National Football League (NFL).
MBA Candidate at Harvard Business School | Netflix, NFL
2 个月Great analysis - as trite as calling the NFL the king of media rights may sound, it’s sometimes hard to appreciate just how valuable it is. Thanks for the post! One analysis I’ve always thought would be interesting - if you visualized the NFL’s ‘earned’ share of carriage fees vs. other sports or even categories of content (e.g., News, Scripted TV, etc) based on gross viewership vs. associated costs. That could tease out some interesting conversations about the tradeoffs for legacy media companies between investing in top sports vs. non-sports content.