TECH GIANTS HESITANT TO PAY OUT LUCRATIVE LONG-TERM DEALS TO LEAGUES; SPORTS BROADCASTING MODEL MAY GO FROM RIGHTS DEALS TO REVENUE-SHARE MODEL

Exclusive television network broadcast rights deals have been the growing source of income for pro sports leagues for the last several decades. TV networks have tripped over themselves to pay out lucrative, long-term contracts to sports leagues, in order to lock up valuable content it can resell to advertisers. League execs have long assumed that tech giants like Amazon (AMZN), Facebook (FB) and YouTube (GOOGL) would be eager to bid on future contracts in an effort to stream content. While that may still be the case, it likely won’t be in the same form of the existing TV contracts and as a result, a decline in revenues may be coming. Mark Zuckerberg has indicated that FB could be interested in streaming select pro sports, but the long-term goal would not be to pay for content, but to engage in a revenue-share model.

Technology Titans Won’t Splurge to Save Sports

Howie Long-Short: Sports leagues will follow the money. It could be a while before tech firms can outbid traditional media for top sports rights, other than carving out digital rights.

Fan Marino: If Zuckerberg can get off paying Bieber on a rev-share model, he can certainly convince pro sports leagues, with few viable alternative options, to sign off.

Author: John Wall Street

At the intersection of sports & finance.

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