Streaming services are negotiating fiercely for exclusive rights to livestream major sports events, and are expected to spend more than $6 billion on such rights in 2023, according to Deloitte Global's TMT Predictions.
But no one said that the road to profitability on these huge investments would be short, or free of curves and potholes.
Amazon, which last August paid $1 billion for 10-year rights to stream 15 regular season and one pre-season “Thursday Night Football” games on Prime Video — the NFL’s first exclusive national broadcast package with a digital streaming service — is now offering advertisers refunds or alternate ad inventory after audiences for the just-completed season fell about 25% of Amazon’s preseason estimates, according to a Business Insider advertising source.
The exception to Prime Video’s “TNF” exclusive is that the games continue to be broadcast on linear channels in the home markets of the two teams playing.
Nielsen data show that, although viewership exceeded 10 million six times during the deal’s inaugural season, and peak viewership over 15 games averaged 11.3 million, the overall season average (including OTA and OOH viewing) was 9.58 million. That’s about 41% fewer than the 2021 season, when the games were divided among Prime Video, the NFL Network, Fox and local broadcast stations. (Amazon’s own first-party viewership figures show an average of 11.3 million per game for the season.)
Amazon initially put an $80 CPM on “TNF” ads — about twice the going rate for game inventory on broadcast TV, later reducing it to a still-high $60, according to BI.
The elevated rates were based in part on stats showing that Prime Video-streamed games had been attracting significantly more of the desirable but tough-to-reach 18- to 34-year-old demo than broadcast games.
While advertisers aren’t likely to give Prime Video a total pass on missing its overall audience promise, its delivery of that young audience in the inaugural exclusive season may go far in persuading them to continue supporting the programming while it works to gain full footing.
In fact, “TNF” ended the first Prime Video-exclusive season with a median viewer age of 47 — seven years younger than the average median age of viewers watching the NFL on linear TV, and the youngest median age of any NFL broadcast package since 2013, according to Nielsen data.
For the full season, it recorded an 18% increase in that P18-34 viewer segment versus the games’ previous season, shown across Prime, Fox and the NFL Network. Average per-game viewership across the season for the demo was 2.11 million, up 11% from the 1.9 million average recorded in the 2021 season.
The season also finished up by 18% vs 2021 among men 18 to 34, the largest year-over-year gain in the demo for an NFL package since 2014.
In addition, minutes watched per game averaged 85 — up 12% versus the nine-minute average for linear NFL telecast viewers (one-minute qualifier, P2+).
Amazon has not commented on the makegoods report. Unsurprisingly, Amazon executives stressed the viewer demographics and high engagement — driven in part by enhancements including showing a host of real-time statistics on-screen, using its X-Ray technology — and its commitment to continuing to improve the experience and audience size.
“Amazon has earned a strong reputation for making big bets, and given the unprecedented scale of this challenge and the hallowed place that NFL coverage holds among millions of fans, the launch of Thursday Night Football ranks high among our most ambitious enterprises,” stated Jay Marine, vice president, Prime Video and global head of sports. “We are only at the beginning of a long-term mission, but are ecstatic with the results and achievements of this first season, bringing millions of new viewers to Prime Video every week.”
“We are incredibly proud of our inaugural exclusive season of TNF, and gratified by the positive response from sports fans, especially hard-to-reach younger fans,” added Marie Donoghue, vice president of global sports video, Amazon. “Along with a top-notch game broadcast, fans are increasingly looking for fresh voices, optionality, and personalization, all of which we delivered, and will continue to build upon in the coming seasons.”
Author’s note: Following publication, Amazon sent another statement reiterating several points in the article (including its first-party viewership claim), emphasizing that the company is “very pleased with the viewership and customer feedback for the first season” of TNF, and adding: “We worked closely with our advertising partners throughout the season to deliver on our commitments, and we look forward to creating even more opportunities and innovations next season.”
Interesting report, Karlene. I see that , once again, Amazon's own "first party" data almost exactly confirmed Nielsen's "audience estimates"---a finding that Nielsen's detractors might bear in mind. As for the numbers I wonder how Amazon determines how many persons "viewed" an average commercial minute of its games. As far as I know, all it knows is that a device was presenting program and ad content on its screen. Finally, regarding the point about 18-34 "viewership", I doubt that any advertiser targeting this elusive segment would even consider the NFL games which are mainly viewed by males aged 35+---not at those ultra high CPMs at any rate.