Sports Media Rights: Current TV Deals and What's on the Horizon
Amid shrinking linear TV audiences, premium inventory is one of the only things keeping audiences from cutting the cord and live sports is the top game in town. Obviously nothing was exempt from a pandemic-induced decline over the past year, and sports was no exception as viewership declined across the board.
Despite all of that, sports content remains lucrative -- for both networks and the leagues, conferences and teams themselves. According to data from iSpot, sports (NFL games, college football and NBA) were three of the top four shows on TV by ad impressions last year, and four of the top five shows in 2021 so far (the three aforementioned sports plus college basketball). It stands to reason that as the fight for viewers grows -- on both linear and streaming TV -- sports would remain the kingmaker. And coincidentally, a lot of sports media rights are up for grabs over the next few years, with negotiations already starting in several of these cases.
So first, surveying the current landscape, which networks carry which sports?
While ESPN and FOX own the largest variety of sports media rights at the moment, they also have the most channels to house that inventory on. Along with its flagship network, ESPN can utilize ABC, ESPN2, ESPNU, ESPNEWS, ACC Network, SEC Network and the Longhorn Network. FOX, meanwhile, has FOX, Fox Sports 1 and Fox Sports 2. FOX's increased investment in sports over the last decade has come at the same time Fox Corp. divested of its other entertainment properties... which were bought up by ESPN parent company Disney.
As Disney invests more heavily into its other entertainment properties (specifically Disney+), we could see the number of big deals ESPN has scaled back in, in favor of fewer big deals at premium prices. That's not to say the "worldwide leader in sports" won't have as much sports. But you're already hearing murmurs about reduced exposure for Major League Baseball in negotiations for their next deal with ESPN (expires after this year). And realistically, ESPN's looking to move ESPN+ subscriptions -- which smaller deals with college football teams and conferences can potentially accomplish at a greater rate.
Another network that could scale back its top-tier sports coverage could be CBS. While it currently holds select SEC football games and some men's basketball games as well, that deal (valued at $55 million annually) will go away after 2023, when ESPN picks it up at a nearly 6x multiplier ($300 million per year) through 2032. Losing the SEC will mean just Sunday NFL action, March Madness and PGA Tour inventory for main CBS. Additionally, CBS Sports carries some golf and the WNBA, plus additional college football and basketball inventory from non-power conferences.
For CBS, there was desire to keep the SEC games, but when ESPN (which also owned the SEC Network already) was willing to overpay that much, it's potentially worth taking the loss there. Like Disney, ViacomCBS has also been investing heavily in streaming, with the launch of Paramount+. While entertainment is the primary way in there, a future sports play within the platform could come from a lot of the CBS Sports Network inventory (some of which is more obscure) heading over there similar to NBC's plan with Peacock. Speaking of...
NBC's potentially doing more with sports as it sunsets NBC Sports in favor of turning USA Network into its own TNT competitor, and also opts to fold plenty of sports content into streaming service Peacock -- including second-tier NHL and Premier League games, some Olympic sports content and now, the WWE Network as well. Unfortunately, though, there are hiccups to that transition.
For starters, there's still a lot of uncertainty about the rescheduled 2020 (now 2021) Olympics happening this summer, potentially voiding that lucrative content. Then there's the fact that the Premier League was "blindsided" by the move to shutter NBCSN, and its $80 million per year contract with NBC runs out in 2022. As traditional TV converts to streaming anyway, winding up with a lot of Premier League games on Peacock may not be a problem. However, it's arguably tougher to just stumble into an EPL fixture like West Ham vs. Everton on streaming than it would be on linear. Since Comcast owns NBC and the league's U.K. broadcast partner Sky, it's likely they stay with NBC... provided its current stateside broadcast setup just gets ported over to USA Network.
Where NBC's bigger concern comes is via the NHL's expiring rights deal this year. While those rights are currently worth $200 million annually, a bidding war seems likely for that inventory as both FOX and ESPN appear likely to vie for a piece. FOX hasn't aired NHL games since 1999, while ESPN hasn't since 2004, save for recent ESPN+ airings through regional networks. Losing the NHL would be a major blow to NBC's sports holdings and its idea of making USA Network a TNT equivalent (not as easy to swing with just the EPL and some golf).
That's just a sampling of what could be up for grabs, however. The graph below shows the annual value of top-tier properties. Then, we'll break down the crucial years -- most of which are between 2021 and 2025 -- where all of these deals are up.
That's clearly a lot of money and premium inventory. And a lot more may about to be in play. Going year by year, a quick breakdown on what's due for a new contract and who could be involved.
2021
ESPN's portion ($700 million annually) of MLB deal expires
NHL exclusivity with NBC expires
As already mentioned, ESPN's going to be downgrading the MLB deal, though still seems likely to be involved. The amount they're saving on baseball could get tossed right into part of a deal for NHL rights. It seems unlikely NBC is going to pay what hockey rights could cost in full, with two additional suitors ready to jump in. You likely wind up with two of the three, plus the NHL Network, so more hockey on national TV than we've seen since the cancelled 2004-05 season saw the league's stature greatly reduced.
2022
All NFL media rights deals expire
MLS deals expire
Premier League deal expires
Morning Brew had a great breakdown of NFL rights recently, and the consensus seems to be that not much will change aside from the value of the games (could be close to double). With Sunday Night Football becoming the league's weekly showcase, NBC seems likely to keep that. FOX and CBS will re-up their Sunday afternoon deals at higher rates. ESPN may involve ABC more in a new Monday night contract. The questions will come around Thursday Night Football -- currently held by FOX and Amazon -- and NFL Sunday Ticket.
Thursday night's not attractive for anyone, but they're not getting rid of it. Amazon seems to like where they're situated as a secondary rights holder, and greater Twitch integration there could be the key to making it something more unique. It can't really take off as a property without being an Amazon exclusive, however. Amazon would have to pay more than its current $65 million per year rate to accomplish that.
For Sunday Ticket, DirecTV could keep it, but the NFL could stand to make a lot more if it weren't exclusive to that service (similar to the setup of NBA League Pass, NHL Center Ice, etc.). Some combination of DirecTV/Amazon/Apple could land it. Apple, in particular, needs it given its paltry programming draws in comparison to its streaming competitors.
On the MLS front, the league needs to make more from its various TV deals and the $90 million or so per year isn't enough to prop up the rapidly expanding league (which is using expansion fees as a way to help get past many teams losing money). ESPN seems unlikely to invest more heavily, but FOX certainly could between its linear channels and potentially utilizing Tubi as its streaming arm. The question is whether any network wants to do that. NBC probably wouldn't be a player here unless the Premier League goes elsewhere.
Speaking of... the Premier League seems most likely to get a similar deal to its last one with NBC, provided it has the right guarantees around games on main NBC plus USA Network. What will be most interesting to watch is whether or not the U.S.'s own soccer league can get a better deal for English-language broadcasts ($15 million of its current $90 million comes from Univision) than the imported EPL.
2023
SEC deal with CBS expires (already picked up by ESPN)
Nothing to see here. By housing everything SEC on ESPN networks now, ESPN gains an even stronger foothold in college football season than it already had. And the SEC makes boatloads more money.
2024
NASCAR deals expire
NCAA (non-CFP or March Madness) exclusivity with ESPN expires
College Football Playoff exclusivity with ESPN expires
Big Ten deals expire
Pac-12 deal expires
This is where the ground can shift for both networks and leagues.
NASCAR may not "seem" like a big property the way it was trending toward in the early aughts, but it's still worth the sixth-most annually of any U.S. sports property. Provided Peacock and USA Network actually become bigger homes for sports by this point (something that NASCAR would be a good-sized part of), that could give NBC a desire to re-up. With FOX likely having to fork over even more for Big Ten rights (we'll get there), plus other interesting college properties up for bid, NASCAR rights probably aren't first in line for them. CBS seems unlikely to get involved given its golf commitments. WarnerMedia could be a player if it wants summer content beyond baseball.
Split between ESPN and FOX for $440 million per year, Big Ten rights are already incredibly high as it is, but FOX seems like the preferred partner in recent years and has a stake in the Big Ten Network. Assuming the Big Ten Network isn't dropped from basic packages (could definitely happen), the conference will be in an advantageous position to ask FOX and/or ESPN for another high number. Another option: CBS grabs afternoon rights to the Big Ten (and some basketball inventory) to replace the SEC deal. OR NBC could jump in if Notre Dame opts to put football under the ESPN umbrella with the rest of its sports (see below).
Really, a lot hinges on what happens with the College Football Playoff. While the current arrangement is lucrative for the sport, one-sided games and a lack of parity (20 of the 28 spots since 2015 have gone to Clemson, Alabama, Ohio State and Oklahoma), is helping fuel a steady ratings decline, along with questions about the current four-team format and ESPN's stewardship of that event as it pertains to year-round coverage of the sport.
It's unlikely that the Playoff leaves ESPN, but a return to it would likely require alterations to the event. An expansion to six or eight teams would mean more games, more intrigue and (obviously) more money forked over. ESPN doesn't want to lose something it helped create -- especially this soon -- so it'll make changes. A bigger playoff could be worth twice as much as the current $470 million.
A bigger price tag could mean it's easier for ESPN to either get outbid for the Big Ten rights or the Pac-12's. We've noted where competition comes from on the Big Ten front. For the Pac-12, a tech player like Amazon or Apple is more likely to offer more cash. Recent Pac-12 results have seen the conference retreat from national attention in both football and men's basketball, and the league's messed up its TV rights so badly that the league finally pushed out commissioner Larry Scott.
A heavy streaming deal doesn't necessarily solve all of the Pac-12's exposure issues. But a larger deal would at least give the league and its members (which include college athletic heavyweights like USC and Oregon, among others) more resources to play with and upgrade their on-field talent -- thus making the teams a more valuable asset on TV.
2025
NBA/WNBA deals expire
Notre Dame exclusivity with NBC expires
Big 12 deals expire
Big East deals expire
The NBA's been so tied to ESPN and WarnerMedia/Turner at this point that it's hard to see that changing, especially with the latter's involvement with NBATV as well. One would think that the NBA figures out the expansion question before this point and adding two more teams should only bolster the value of these rights. The NBA is far and away the second most popular pro league in the U.S., only trailing the NFL. The most recent deal (worth $2.6 billion annually) finally seemed to reward the league accordingly, and that will continue, especially as long as it keeps its lead in digital fan engagement relative to peers.
To-date, WNBA media rights have been tied heavily to the NBA's. But after a breakthrough season last year and growing momentum for the women's game on TV, there could be a major shift by 2025 that sees this inventory's value go way up (and perhaps independently of the men's league).
We mentioned Notre Dame a little in the 2024 section, but it's worth expanding upon here. The Fighting Irish football program played in a conference for the first time in 2020, temporarily joining the ACC (where it houses all other sports but hockey) and making the College Football Playoff in the process. Notre Dame isn't looking to bail on its long-time independence. But should it decide to join the ACC full-time, it would leave the NBC deal behind for a more lucrative one within the league's ESPN contract -- one whose value would increase with the Irish's full membership.
Given that it's basketball-specific, don't expect a major uptick for Big East rights -- especially if FOX has been laying out more money for Big Ten and/or Pac-12 games. The main draw for the Big East is Villanova, at the moment, after the Wildcats won two of the last four national titles (2016, 2018) and their continued presence near the top of the sport should lift all boats in the league. In an ideal world for the Big East, it's not buried on FS1 so much. But no other network beyond ESPN (its long-time partner before 2013) could really offer better exposure.
The Big 12 is the bigger college property up for grabs, and it would seem likely that FOX and ESPN split that once again. Worth mentioning that if CBS doesn't jump in on the Big Ten rights at all, though, they could also be a player here, trying to bank on the strength of national brand Texas and Oklahoma, in particular. TBD what that would do to the ESPN-owned Longhorn Network, however.
Further out:
2026: World Cup deals expire
2028: MLB deals expire
2030: PGA deals expire
2032: NCAA Tournament, Olympics, new SEC deals expire
2036: ACC deal expires
As noted above, networks have some challenging times ahead and while expensive, these sports rights deals are the fastest way to remain relevant. Since all parties involved are aware of that at this point, it likely means most hold onto what they have, even if at a higher price. There's always the opportunity that a tech giant jumps in, though, and shakes things up. As streaming becomes a more pronounced part of networks' strategies as well, that also makes a power play by Amazon, Apple or Google all the more likely -- since the cost of that change on the consumer side only stands to decline in the coming years.
