Sports Rights Continue To Soar, Making Untenable Economics For Broadcast And Cable Networks

Media Sports Rights Continue To Soar, Making Untenable Economics For Broadcast And Cable Networks Derek Baine Contributor Opinions expressed by Forbes Contributors are their own. I am Media Forecasting Experts Managing Director, 30 years experience. New! Follow this author to stay notified about their latest stories.

Got it! Aug 19, 2022, 02:44pm EDT | New! Click on the conversation bubble to join the conversation Got it! Share to Facebook Share to Twitter Share to Linkedin Photo by Friedemann Vogel – Pool/Getty Images. Getty Images The cost of sports rights continue to soar in the double and even triple digits, making it unlikely that linear broadcast and cable networks focused on sports will be able to survive in this new streaming world. In a bidding war with Amazon.

com, Paramount PARA was able to sign a new six-year deal with the Union of European Football Associations, or UEFA EFA (it already held the rights for two more years and will now have them through the 2029-2030 season), for a whopping $1. 5 billion (2. 5x what they sold for last time).

It’s likely that many of the English language games will appear on Paramount+, with some showing on their linear channels along with an advertisement pitching the value of Paramount+. This is critically important for new streaming company launches as they battle it out with Amazon Prime Video, Disney+, Hulu, Netflix NFLX and many others. The Spanish-language rights have not yet been sold.

It is difficult for most cable and broadcast networks to bid against streamers for expensive sports packages, as they are posting flat to down advertising revenue while distribution fees are also suffering for cable networks as more people move from traditional cable and satellite services to streaming, a trend called cord cutting. The most notable exception to this would be ESPN, which is expected to move more and more of its games to its ESPN+ service over time, while increasing the price. But even ESPN has its limits on what it will pay for rights fees.

They reportedly rejected an offer of a seven year contract for a package of Big Ten games that were less desirable than the games they currently hold and were priced at $380 million. Recommended For You 1 How To Become A Translator More stories like this Fewer stories like this 2 CNN’s John Berman: Arizona ‘Sham Audit’ Proves Donald Trump ‘Even Bigger Loser Than The First Time’ More stories like this Fewer stories like this 3 ‘Cut Him Off, Cut Him Off Now!’ Newsmax Anchor Ends Interview When Guest Criticizes Donald Trump More stories like this Fewer stories like this The Big Ten eventually sold its media rights to CBS, Fox and NBC for roughly $7 biullion over seven years starting July 1, 2023. Broadcast networks will split the games, with Fox getting the most championships in 2023, 2025 and 2027, CBS airing them in 2024 and 2028 and NBC in 2026.

Going forward, companies like NBC Universal may opt to bid on big sports rights deals as it can amortize the cost of its cable and broadcast networks, and now Peacock. However, over time we are likely to see more games popping up on Amazon Prime Video, which has a cash war chest which is just unrivaled by many of the traditional linear network owners. Photo by James Black/Icon Sportswire via Getty Images.

Icon Sportswire via Getty Images Derek Baine Editorial Standards Print Reprints & Permissions.