ESPN To Pay NFL Record Fee Close To $2 Billion Per Year For “MNF” Extension
Sports Business Daily is reporting that ESPN and the NFL have agreed to broad terms on a new media rights deal that will be worth nearly $2 billion per year. According to SBD staff writer John Ourand, ESPN “will pay the league a record fee, between $1.8 billion and $1.9 billion a year.”
NFL Players Association executive director DeMaurice Smith said: “The NFL should be congratulated for another billion dollar network contract. It does make one question how they can announce both a single TV deal worth $2B for MNF and ‘negative cash flow’ in the same week. Fans and Players continue to be confused about their claims of a financial hardship as justification for a lockout. All I can say is, welcome to the wonderful world of CBA negotiations in the NFL. Open the books and let’s get a deal done.”
Despite the contention from NFL owners that the current business model doesn’t work for them, the potential ESPN deal is just another sign that the league is enjoying an overwhelming amount of success. In fact, the NFL continues to generate record revenues and it remains a television juggernaut, having dominated the TV ratings this season like never before.
“The potential deal comes as the NFL enters its CBA negotiations and sets up consistent and profitable revenue streams for the league,” Ourand writes. “It comes after the league last year extended current partners NBC, CBS and Fox through 2013.”
ESPN’s current annual payout to the league is roughly $1.1 billion, higher than the annual rights fees paid by Fox ($720 million), CBS ($620 million) and NBC ($603 million). DirecTV pays about $1 billion a year for exclusive access to Sunday Ticket.
The NFL-ESPN contract extension still has not been finalized, but the deal length is reported to be “for nine or 10 years, which would take it up to 2022-23.”
In addition, Ourand reports that the league and ESPN have not agreed on a deal for mobile rights.
“Last year, Verizon signed a four-year, $720 million sponsorship deal that includes the exclusive mobile rights to stream ‘Sunday Night Football’ and NFL Network games, as well as the NFL RedZone channel. The NFL sees significant value in these types of rights and is guarding them jealously.”
For the complete SBD article, click here.
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