Network television's growing dependence on still-strong NFL programming could see “gigantic” increases in rights fees TV that networks pay to the league, according to MoffettNathanson Research.
MoffettNathanson estimates that a new round of multi-year contracts set to get underway could see a massive 57% rise to $8.8 billion from $5.6 billion per year for four TV networks.
Among the three broadcast NFL packages, all are projected to see a 75% increase -- CBS for Sunday AFC daytime games), NBC for “Sunday Night Football,” and Fox (Sunday NFC daytime games) as a “base case” estimate.''
For ESPN, and its “Monday Night Football” package, the estimate is for a smaller 26% increase.
MoffettNathanson also estimates a 61% increase for “Thursday Night Football,” which airs on Fox -- although the expectation is that Fox might not bid for the package in the next round of negotiations
“Given the incredibly important role that the NFL has played in efficiently retaining mass audiences and driving affiliate fees/retrans payments, we are assuming gigantic increases for the upcoming cycle of new NFL contracts,” writes Michael Nathanson, senior research analyst for MoffettNathanson Research
Last year the NFL -- for all its games on Fox, CBS, NBC, ESPN, and the NFL Network -- grew 5% in total viewership to 16.5 million, according to Nielsen data. It was up by a similar percentage in 2018 versus 2017.
MoffettNathanson says that looking at just the four major NFL networks, the average commercial minute program rating plus three days of time-shifted viewing (C3) was up 6% versus the previous year.
ESPN -- in its current multi-year deal with the league, which will end with the 2021-2022 season -- has the biggest per-year rights fee --$1.9 billion -- partly due to pulling in much higher affiliate fees versus what similar revenues broadcast networks get from retransmission deals.
Fox pays the league $1.1 billion per year for its Sunday NFC daytime package and $660 million for “Thursday Night Football.” CBS is at $1 billion for its Sunday AFC daytime package, and NBC has an average $960 million-a-year deal for “Sunday Night Football.”