June 2, 2021
Exclusive access to “NFL Thursday Night Football” may cost Amazon billions, but the e-commerce behemoth’s 11-year carriage agreement will boost U.S. Prime membership, according to Parks Associates.
The Dallas-based research firm June 2 disclosed new consumer data that suggests 47% of U.S. broadband households currently subscribe to Prime Video. That percentage could move past 50% following the landmark content rights deal, which kicks in 2022 and is reportedly worth $1 billion annually to the NFL.
Parks says the pact will help increase Prime’s subscription uptake among regular NFL viewers through exclusive rights to stream Thursday night football games.
The arrangement will boost advertising dollars, data captured, and exposure to sports fans for Amazon’s streaming service. The NFL deal preceded Amazon’s merger with film studio MGM for $8.45 billion, announced May 26. That acquisition will likewise help Amazon boost subscriptions to its Prime e-commerce and Prime Video services with the addition of MGM’s IP, which includes the “James Bond” and “Robocop” movie franchises.
Parks Associates estimates that 77.3 million U.S. households are Prime members, and that roughly 71% watch Prime Video, totaling nearly 55 million households in Q1 2021.
“By offering live games, streaming services give the significant market of NFL fans a reason to subscribe,” Parks research director Steve Nason said in a statement. “As OTT becomes an integral part of its strategy, the NFL is working to secure viewers, and profits, for the next decade, and the Amazon partnership represents an outstanding and unprecedented opportunity to set the stage for success.”
Parks’ data from 10,000 U.S. broadband households finds 55% of pay-TV households consider live sports important in their decision to keep their service. Additionally, more than two-thirds of online pay-TV subs and 43% of traditional pay-TV subs who canceled their service during COVID-19 were likely to re-subscribe following the return of live sports.
Other media conglomerates have also expanded their live NFL coverage to incorporate both traditional TV and OTT. Disney will air one international game on ESPN+ and add one exclusive national game yearly, beginning in 2022. Additionally, NBCUniversal will air Sunday Night Football on its linear NBC channel and stream select games on its OTT service Peacock.
“Traditional video is dwindling and a diversified distribution strategy is the only logical method of growing NFL viewership,” Nason said. “While traditional players won’t see reductions to their coverage content, the lack of exclusivity over one of their biggest remaining assets will be detrimental to adding new viewers.”