How the NFL Can Leverage FAST to Win the Future of Streaming

While watching week 1 of the National Football League season kickoff I couldn’t help but think about what the NFL’s FAST strategy should be.

Nerdy, I know. Focus on your fantasy team! Way cooler.

The NFL has always embraced the strategy of maximizing distribution to avoid having all of its eggs in one basket. Fans can currently tune into the NFL across 15 different broadcasters ranging from major networks such as CBS to streaming platforms like Amazon Prime Video.

The NFL is the most profitable professional sports league in the United States. The league dominates TV viewing. In 2022, it accounted for 82 out of 100 top broadcasts.

NFL Revenue by Broadcast

The NFL’s domestic media rights, which are the most valuable in sports, are locked in until 2033. The broadcast deals combined are worth more than $120 billion from 2023 to 2033. Here are the deals broken out by each broadcast partner.

Current FAST Strategy

The NFL currently has one FAST channel called aptly the NFL Channel. The NFL Channel was launched in 2019 which marked the 100th year of the league. It’s currently live across the following FAST services: LG, Peacock, Pluto TV, Roku, Tubi, Vizio, and Xumo. The NFL Channel is marketed as “the NFL's 24/7, always on, channel offering NFL content. We feature Live Game Day Coverage, NFL Game Replays, Original Shows, Emmy-Award winning series and more, available FREE!” Sounds pretty great, right? Except there’s one tiny thing missing. Actual live games. That’s because the NFL makes too much money from selling its broadcast rights for live games to networks and big tech.

The NFL channel is mainly used as an upsell product for the league’s SVOD app NFL+, which offers live local and primetime regular and postseason games. NFL+ is the NFL dipping its toes into the streaming wars with its own SVOD service. It’s not a major SVOD contender because it has one major limitation. Live games are only available on phones and tablets. You have to tune into the major networks or big tech platforms such as YouTube TV in order to watch on the big screen.

We had the same limitations when I was a product manager at Yahoo where our parent company Verizon paid $2.25 billion for a five-year streaming deal to carry live local games on mobile apps. Although we saw impressive engagement on the Yahoo Sports app and high CPMs for the ad inventory, Verizon/Yahoo lost a lot of money on that deal.

Unlike Yahoo at the time they made the deal for these rights, the NFL has the luxury of playing from a position of strength. They need to do some serious experimentation over the next decade to figure out the optimal strategy while the TV landscape shifts from linear and cable to streaming. To maintain its dominance, the league must continue spreading its rights to air games across broadcasters, so they don’t become too reliant on one platform for eyeballs.

Big Tech is particularly good at commoditizing content and gobbling up revenues for itself. If the NFL wants to continue to succeed, it’s going to need to be as competitive as the product on the field when it comes to negotiations with the likes of Amazon, Google, etc.

Future FAST Strategy

In the coming years, The NFL should launch a channel dedicated to Fantasy Football and betting. Sports betting generated $7.5 billion in revenue during 2022 which marked a 73% increase from a year earlier. Gamblers wagered a combined $93.2 billion on sporting events throughout the year, so this is a huge potential revenue source for the league.

They should also launch a local channel for each team. These 32 channels would not clash with their local affiliate and regional sports network (RSN) deals since they would initially exclude live games. But the team channels would build a strong viewership by just airing the latest news on all things Cleveland Browns for instance. As a native Clevelander, I would certainly tune in more than I would like to admit.

This content strategy would lay the groundwork for the ultimate move — the NFL should push for carriage fees directly from vMVPDs, FAST aggregators, and SmartTV OEMs in the future instead of relying on middlemen such as ESPN to negotiate them. The NFL makes $1.2 Billion in cable carriage fees today from the NFL Network alone and billions more from the network middlemen. This money is set to dwindle over the next decade as cord-cutting continues.

I don’t think the NFL remains as dominant as it’s today going all-in on its NFL+ SVOD service. Rather, as more eyeballs move to streaming, the NFL needs to incrementally move more of its premium content to FAST and AVOD Services. My bet is that when the NFL’s broadcast deals are up in 10 years, FAST services such as The Roku Channel and Samsung TV Plus will be king due to their ability to make the service the default on Smart TVs. These default services will be in a battle to differentiate and therefore willing to pay carriage fees for premium content. That’s when the NFL negotiates billions in carriage fees for the rights to stream its live games. The recent deal the NFL did with Roku to offer the “NFL Zone” offers a glimpse into this future. The NFL Zone offers “viewers an easy way to find where to watch NFL live games” within the Roku Channel.

When the time comes, the NFL will be able to take advantage of this increased FAST distribution and use the leverage they have with live games to recreate the “golden goose” of carriage fees in streaming. What’s old is new again.

Great Content on Sports + Streaming

• If you want to go even deeper into the current state of the NFL business The Hollywood Reporter did an amazing breakdown.

• NFL streaming by the numbers from State of the Screens is chock-full of interesting data.

• Finally, Ben Thompson on the implications of the latest Disney-Charter agreement and the “Great Rebundling.”

Go Browns!

 🤙 Moffie