NFL Sunday Ticket Deal Still Not Done; Is Apple Asking for too Much Access? Is the NFL Asking for too Much Money?

The 2022 NFL season is in full swing, but the league has yet to announce where its out-of-market package NFL Sunday Ticket will be available beginning in the 2023 season. The rights to NFL Sunday Ticket are currently held by linear broadcaster DIRECTV since practically the package’s inception, but that contract is expiring at the end of the current season, and NFL commissioner Roger Goodell has said that he believes that its new home will be on a streaming service.

The NFL has been in discussions with various streamers for most of the year trying to finalize Sunday Ticket’s future plans. Originally the reported timetable had an announcement happening before the season kicked off, and then in the fall, but as we approach the holidays, there has been no confirmation about where football fans will be able to watch their favorite teams next year.

On Tuesday, new details were reported about why a deal has not yet been struck. According to the Athletic's Daniel Kaplan, there may be plenty of blame to go around for the lack of a new home for Sunday Ticket.

One of the parties to blame is Apple, whose streaming service Apple TV+ has been the leading candidate to land Sunday Ticket for months, despite recent stumbles. According to Kaplan’s report, Apple is running into difficulties they did not know would be in place when they entered into negotiations.

A source familiar with Apple spoke with Kaplan about the process, saying, “This negotiation has gotten silly. … Clearly, there’s a problem. I think it’s really clear Apple is learning things they didn’t know. What the conversation is, is Apple’s like, ‘OK, we can’t sell internationally. OK, that was important to us. And we can’t sell it exclusively against FOX and CBS. Well, OK. Well, that changes its value.’”

Selling exclusively against linear broadcast partners of the league makes it sound as if Apple wanted to negotiate a more comprehensive deal, like its recently announced 10-year agreement with Major League Soccer. Such a deal would presumably include in-market games too, but therein lies the issue: the NFL already licenses those games to different partners in separate, lucrative deals.

The NFL may own a large share of the blame for the failure of the negotiations to produce a deal so far, as well. The league reportedly wants as much as $3.5 billion per year for the rights to Sunday Ticket. To afford that amount, Apple would have to sign up more than 8.5 million users at $400 per season. By comparison, DIRECTV is now believed to have around 1 million paid Sunday Ticket users.

The league wanted to have negotiations wrapped up by the end of the year, but the real target date is the Super Bowl in February. After that, according to sources close to the league, a real time crunch ensues to get Sunday Ticket integrated into its new service by the start of the 2023 season.

The league’s problem at this point is that it may be running out of leverage. Although NFL games are a hugely desirable product, there may not be many streaming partners left for the league. Prime Video is already home to “Thursday Night Football,” but the company is currently laying off corporate staff and may not be open to such a large expensive on top of its already hefty NFL contract

Disney took itself out of the running due to cost very early in the negotiation process, even before its streaming losses climbed to $1.5 billion last quarter; which was part of the reason that CEO Bob Chapek was recently ousted in favor of former Disney boss Bob Iger.

Warner Bros. Discovery CEO David Zaslav is currently focused on increasing the profitability of his streaming platforms instead of chasing subscriber numbers. That, combined with comments from WBD CFO Gunnar Wiedenfels that the company was against chasing “trophy assets” make it highly unlikely the NFL ends up on HBO Max or discovery+.

Google also reportedly has entered the negotiations for the NFL package with the goal to integrate the games into YouTube and/or YouTube TV. But, with no experience broadcasting live sports on this level, it is difficult to know exactly where Alphabet’s limits are when it comes to paying for broadcast rights.

Given the fact that the companies have been negotiating for months, it’s unlikely that talks between Apple and the NFL deteriorate so far that the league is forced to look elsewhere with Sunday Ticket. Still, most in the industry expected the deal to be done by now, and each side might have to give up on something in order to finalize the agreement.