AT&T and the NFL have missed deadlines to opt out of their current deal for DirecTV NFL Sunday Ticket and will keep the live games package exclusively on the satellite TV carrier through the 2020-21 pro football season, The Athletic reports (behind the site's paywall).
AT&T and the National Football League are widely known to be at an impasse to extend their eight-year, $12 billion deal for Sunday Ticket, which was signed in 2014. Each had the option of opting out of that deal before it expired. But the sports news site said both parties missed the deadline to press the eject button.
For now, both the football league and the wireless giant have agreed to continue talking under a “gentleman’s agreement.”
The Athletic report conflicts with an earlier Sports Business Journal story suggesting that both sides had until the end of the 2019-20 season to opt out of the contract.
With the NFL recouping $1.5 billion a year, an unnamed source The Athletic identified as being affiliated with National Football League team ownership described the league as being in no hurry to opt out of the current arrangement.
“The NFL is going to be in a good position,” the league source told The Athletic. “I mean, I don’t mean that to sound obnoxious. But I mean, they’re gonna pay us a lot of money, or there are others with different business models lined up to pay us different money for different versions of it. . . . I think the NFL will be fine. I think AT&T is paralyzed.”
Certainly, the pricey NFL Sunday Ticket contract is coming up at an inopportune time for AT&T, which appears to be de-prioritizing the satellite TV company it paid $67.1 billion for just four years ago.
As MCN noted earlier this week, AT&T is no longer using the DirecTV brand for its emerging streaming ventures. And the one asset it did use the brand for, virtual pay TV service DirecTV Now, appears poised for marginalization.
With DirecTV losing more than 1 million linear satellite TV customers in 2018, speculation has begun to swirl that AT&T might sell the asset to Dish Network, which is watching its own satellite TV service decline at a similar rate.
The satellite TV carriers tried to merge back in 2002, but were rebuffed by regulators. This time around, the conventional wisdom among equity analysts is that the platforms are too obsolete, and face too much OTT competition, to say no to.
In any event, as AT&T weighs the mathematics of a satellite TV platform that appears no longer useful to it, a rash decision to ditch one of its crown jewels, Sunday Ticket, does not appear in the offing.
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