ESPN Gains Leverage for Future NFL Rights Negotiations

ESPN 200x200

ESPN (DIS) President Jimmy Pitaro values the cable network’s relationship with the NFL, having made it a priority to meet with league execs within his first few days on the job; but, unlike John Skipper, who was bound by provisions within cable and satellite carriage agreements to carry NFL games (or have their rate cut), Pitaro is free to operate in the best interest of the network. Between 2010-2015, ESPN worked to remove a provision from its affiliate deals, giving the network the leverage it desperately lacked during the last round of negotiations (when it agreed to pay $1.9 billion/season for the league’s least valuable rights package). While Pitaro views the network’s relationship with the league as a “top priority”, recent announcements by the NFL to re-assign ESPN’s playoff game to Fox (FOXA) and to give FOXA the rights to carry a competing NFL draft show, have placed the relationship in jeopardy beyond the ’21 season.

Howie Long-Short: ESPN will have more leverage with the league in the next round of negotiations, but there is also going to have more competition (at least if it seeks streaming rights) with Facebook, Amazon, YouTube etc. all looking to acquire live sports content. The good news for ESPN is that the NFL is going to seek “duel revenue streams” in the next round of broadcast negotiations, awarding television rights to the linear players and streaming rights to FAANG. The league is still a firm believer in traditional broadcast television, meaning ESPN/ABC will only need to outbid CBS, FOX, NBC to retain NFL rights.

Fan Marino: The NFL’s legal tampering period began on Monday and several high-profile unrestricted free-agents having already committed to signing contacts with new teams. Kirk Cousins (Vikings: 3 Years, $84 million), Allen Robinson (Bears: 3 Years, $42 million) and Malcolm Butler (Titans: 5 Years, $60 million) were among the those to sign lucrative deals with new franchises. Andrew Norwell (Jaguars: 5 Years, $66.5 million), Sammy Watkins (Chiefs: 3 Years, $48 million) and Case Keenum (Broncos: 3 Years, $36 million) are also all now off the board. NFL free agents can finalize contracts at 4p EST today, the official start of the 2018 league year.

Interested in Sports? Sports Business? Sports Finance? Sign-up for our free daily email newsletter list, here!

Author: John Wall Street

At the intersection of sports & finance.

Leave a Reply