Aug 20, 2022 - Economy

Big tech crashes big sports

Illustrated collage of a hand cursor, foam hand, turf and money elements.

Illustration: Shoshana Gordon/Axios

After years of watching traditional media dominate live sports, tech giants have decided it's time to get in the game by paying up for live sports rights.

Why it matters: The value of sports rights has been in the stratosphere and the inclusion of trillion-dollar tech giants will only lift those numbers higher.

State of play: Disney, Comcast, Paramount, and Fox will pay a combined $24.2 billion for sports rights in 2024 alone, according to data from MoffettNathanson.

  • Apple has quickly established itself as a major player for sports rights with deals for Major League Baseball and Major League Soccer that could end up totaling more than $3 billion.
  • Amazon has a sports empire of its own with regional deals for U.S. teams, including the New York Yankees through a minority stake in New York RSN YES Network, as part of a $3.47 billion deal.
  • Overseas, Amazon holds regional rights for the Premier League, France's Ligue 1 and 2, and UEFA Champions League, the latter of which it owns rights in Italy and Germany, and will own U.K. rights starting in 2024. The total value of those deals isn't known, but Amazon's U.K. UEFA deal will cost $1.8 billion a year.
  • Amazon bought the rights to NFL's "Thursday Night Football" franchise for $1 billion a year through 2023.

Yes, and: Apple and Amazon are battling for the NFL's Sunday Ticket package — a deal that is expected to include a stake in the league's media business — with Apple seen as the heavy favorite.

Yes, but: Most of the sports rights still reside with the established media giants that now have their own streaming services.

Between the lines: Traditional media companies love sports for their ability to drive huge viewership that turns into big ad dollars. Big tech has a different goal.

  • Apple and Amazon are more concerned with their ability to attract new subscribers that they can convert to higher-margin parts of their business.
  • "I'm sure [Amazon has] algorithms that show how many people who subscribe to the NFL will turn around and buy music or buy merchandise," LHB Sports CEO Lee Berke told Axios. "So that gives you a totally different perspective."

What's next: The NBA's upcoming rights renewal will be closely watched next year.

  • The NBA's current deal runs through the 2024-25 season, but it's attractive for the younger audience compared to the other sports and has a reputation for forward-thinking under Commissioner Adam Silver.
  • "When it comes to the NBA ... they're not going to ignore broadcast or cable, but there's going to be a range of content offered up in a range of platforms," Berke says.
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