UK, US take different paths to fix falling sports audience

The premiere league and NFL both saw television audiences decline last season. Sky is moving decisively to address the problem in the UK, while operators and the league in the US do nothing much at all.

TV sports audiences are falling

Sky saw another big drop in viewers for Premier League games last season. Audiences declined 10% season-over-season and 31% from the peak in the 2011-2012 season. Viewers in the US also declined. NBC carried 2016-2017 Premiere League games across several channels and saw the average audience fall 18% from last season. One of the groups most affected by declining football ratings is the millennials. NFL ratings have been declining in 18-34-year-olds for some time. Peak game viewing occurred in 2011, with 4.3M watching per game. This season’s games are receiving a millennial audience of just 3M.

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Falling audiences are particularly galling because NFL and Premier League license fees continue to climb to astronomic levels. Sky paid ￡4.2 billion (￡11M a game) to the league in its latest deal, 83% more than the previous contract. In 2016, CBS and NBC agreed to pay a combined $450M a year for the next two years to air Thursday night games. That is $45M per game. At the same time, Amazon paid $50M to the NFL to air those same games to Amazon Prime members. That is 5 times what Twitter paid for the same rights last year.

Sky moves decisively to address the issue

Sky recognizes a big part of the problem with watching Premier League is price. The company offers two ways for consumers to get access to the games. The traditional satellite route is through Sky Sports channels 1, 2, 3, 4, and 5. The cheapest Sky sports package costs ￡49.50 a month ($63.40,) a steep price if your primary interest is soccer.

The other way is via Sky’s online service, Now TV. Users can buy daily access to the channels for ￡7, or a month pass for ￡34 ($44.)

Younger viewers, where soccer TV viewing has declined most steeply, simply aren’t used to paying that much for their entertainment. Netflix, a favored service on both sides of the Atlantic, costs just ￡8 per month. Another barrier is forcing them to pay for access to all the sports when they just want access to one of them.

Sky is doing two things to address these problems. The first is to change the way it presents the premium sports to consumers. The company is abandoning the numbered channels and creating sports-themed channels. Expect to see a Sky Football, Golf, and Cricket channel launch soon.

Sky is also dramatically lowering the cost barrier if a viewer’s primary interest is just one or two sports. The lowest price sports package will be ￡18 a month. The cost of subscribing to all the sports-themed channels will remain relatively high. No word how Sky plans to price daily and monthly access via Now TV.

NFL continues to dither, though concern mounts

Robert Kraft, Owner, New England Patriots

Robert Kraft, the owner of the New England Patriots, realizes there is a problem with young audiences abandoning football. Speaking at the Cannes Lions International Festival of Creativity, Mr. Kraft said:

“The thing we have to be careful of is millennials. They don’t watch TV, they don’t have TVs or subscribe to cable. So, we have to bring that audience in. Partly it’s done through fantasy games and linking to that. Over-the-top is a great opportunity.”

Roger Goodell, NFL

Unfortunately, neither the league nor rightsholders seem ready to act as decisively as Sky in the UK. Roger Goodell, NFL Head, says the league is working to reduce the number of ad breaks and, what he calls double-ups. However, the number of ads aired in total will not change. And games still can’t be viewed on a smartphone through vMVPD or broadcaster apps. Verizon Wireless owns those exclusive rights.

MVPD efforts align mostly around TV Everywhere apps. And to use those, of course, requires a hefty pay TV subscription. A fee many millennials seem disinclined to pay.

The Twitter experiment last year with Thursday night games was a start in the right direction. That approach should start to broaden the appeal of games and help win back the millennials. However, placing those games behind another paywall, this time Amazon’s, seems like a retrograde step.

All in all, the NFL and pay TV seems to be hoping the audience will come back without them having to do much of anything different. In today’s climate for entertainment, that seems highly unlikely.

Why it matters

Audiences for Premier League and NFL are declining in the UK and US.

Sky in the UK has moved decisively to make access to Premier League games cheaper and more granular.

Operators and the NFL are making small changes to access that seemed to make very little difference overall.