Executives at CBS and NBC felt they scored when they landed a schedule of Thursday night primetime NFL games for next season, but analysts at Barclays aren’t so sure.
In a report titled Thursday Night Football: Fumble or Touchdown, Barclays figures CBS lost money on Thursday Night Football last year looking at ad sales versus rights fees. With rights fees per game going up, but the number of games going down, Barclays figured CBS will come out “slightly ahead” under the new deal.
For NBC, part of Comcast, adding Thursday Night Football "is likely to put some pressure on margins, although some of it could be offset by the Olympics, which may do better than breakeven based on the trend line over the last couple of cycles," Barclay said.
More worrisome is the NFL's plan not only to simulcast the games on the NFL Network and on Verizon's mobile network but to find an OTT provider to stream the games. While the stream will be carrying the broadcaster's national advertising, consumers will still have another alternative when it comes to deciding how to watch those games.
"We believe the League is experimenting more with cross platform habit formation and actually getting paid for it by the broadcasters. In our opinion, similar to the emergence of OTT platforms like Netflix as a competitive threat to the legacy ecosystem, the availability of live sports, especially football, breaks down the last protected bastion for Internet delivered content," Barclays said.
Barclays said it understood why networks would jump at the chance to broadcast NFL games at a time when ratings for non-sports programming is challenged. But it said “the tradeoffs being made to get these rights raise the question of how long this trend can be sustained.”
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