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The NFL and DirecTV are close to a deal for Sunday Ticket

Discussion in 'DIRECTV Programming' started by avonabudget, Aug 25, 2014.

  1. avonabudget

    avonabudget Cool Member

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    The NFL and DirecTV are close to a deal for Sunday Ticket

     
  2. tonyd79

    tonyd79 Hall Of Fame

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    Another article on the deal:

    http://www.sportsbusinessdaily.com/Journal/Issues/2014/08/25/Media/DirecTV.aspx

    A couple of interesting things from that article:



    and



    So, it is mostly DirecTV or nothing for Sunday Ticket at this point.
     
  3. Laxguy

    Laxguy Honi Soit Qui Mal Y Pense.

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    Here's another excerpt from Awfulannouncing.

    Mighty nice round number, that $7B!
     
  4. fudpucker

    fudpucker Godfather

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    It's the sole reason I switched recently from Dish to Directv.
     
  5. harsh

    harsh Beware the Attack Basset

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    The $1.3-1.4B number is for just the 2015 season and reportedly may go up by 4% or more per year.

    That the article said the total was in that range is ludicrous. It could represent as much as a $5.943B deal over four years.

    The last extension (2011-2014) cost DIRECTV $1B per year.
     
  6. avonabudget

    avonabudget Cool Member

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    1 person likes this.
  7. slice1900

    slice1900 Well-Known Member

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    Given that Sunday Ticket has a lot less value than it did a few years ago, thanks to the Red Zone channel and more games not covered on it (Thursday night, two games on some Mondays) and talk of games on Wednesday and even on Saturday during college I'm surprised Directv would be willing to pay any increase at all.
     
    1 person likes this.
  8. harsh

    harsh Beware the Attack Basset

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    They're certainly between a rock and a hard place on this negotiation.
     
  9. dcowboy7

    dcowboy7 Hall Of Fame

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    The opening monday is the only monday with 2 games

    Never heard any talk of wednesday games

    Due to congressional laws the nfl cant play friday/saturday against college from around early september thru early december
     
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  10. dcowboy7

    dcowboy7 Hall Of Fame

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    To me it sounds like it starts 1.3 & then increases to 1.4 by the end of the deal:

    http://www.sportsbusinessdaily.com/Journal/Issues/2014/08/25/Media/DirecTV.aspx
     
  11. tonyd79

    tonyd79 Hall Of Fame

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    Looks like directv is getting over the top rights as well plus the deal would include ATT.

    A lot of directv's money on Sunday ticket comes from bars. They would still want the package.
     
  12. slice1900

    slice1900 Well-Known Member

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    Directv can't negotiate for AT&T at this time. At best, they could add something to the contract that states that the same price includes up to x million additional subscribers as a result of merger/acquisition, but that would leave them overpaying if that deal was shot down by the government.

    As the price goes up, some bars will drop NFLST. Some of the smaller places around here already have over the past few years as the price keeps going up by 10% a year. If they bump the contract another 30-40% as it sounds like they're doing, most of that increase will be passed to the commercial side, since half of residential customers who get it do so as a freebie, and they'd probably lose more than a few if they tried to bump the price from $299 to $399. I'm not close to dropping it, but if the price went up by another 50% I'd have to take a hard look at whether it is really worth having.
     
  13. renbutler

    renbutler Godfather

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    I hear that a lot, but a.) it's subjective and b.) easy to refute.

    Red Zone is fine for some people, but many of us have no use for it. Also, the shift to a full slate of Thursday games is a loss of less than 5% of the overall NFL schedule.

    Thanks, cowboy, for clearing up the other issues with slice's post.
     
  14. renbutler

    renbutler Godfather

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    a.) The price of Sunday Ticket dropped significantly just a couple years ago.

    b.) It's highly unlikely that "half" of Sunday Ticket subscribers get it for free.

    c.) They aren't going to increase the price by $100 in a single year or even two or three years.
     
  15. tonyd79

    tonyd79 Hall Of Fame

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    Who said they are negotiating for AT&T? A potential merger is a complication.

    If structured like previous contracts, DirecTV is paying a flat fee to the NFL and then marketing the product and reaping whatever they get in sales. Profit and loss is there issue. What I am saying is that DirecTV is probably factoring in (from their judging of the value) the potential customers from a merger that looks like it will go through during the contract period. It is still a risk. They may overpay a bit if the merger falls through but they are probably not balking at the price if they can extend it to any merged company.

    As for your pricing analysis, I will go with the DirecTV guys on their projections over yours. I think their economic modeling has held up well over the years. Hell, they dropped the price for non-commercial accounts recently. I am sure they plugged that into their model and decided it made sense. And here they are coming back for more, so that is pretty good evidence that they are not in any kind of financial trouble with Sunday Ticket.

    Of course, there are those who will say DirecTV needs ST or they lose too many customers, despite the actual numbers that show a minority of DirecTV households sub to ST. They are interested in the business customers, though. They are important to ST. And I think they know that.

    Me, I don't care what they pay for it. I just care what I pay for it. When prices are set per sub, that has a more immediate impact on my pricing. When it is a flat fee, it does not as it is dependent on how successful they are in pricing it.
     
  16. renbutler

    renbutler Godfather

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    I don't know how many ST subscribers there are, but even if only 5% subscribed, that's a lot of subscribers at risk, and losing that many would be a major blow.
     
  17. tonyd79

    tonyd79 Hall Of Fame

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    Who says they lose them? You are making a lot of assumptions. Where do they go? Sunday Ticket won't be anywhere else. DIrecTV would wind up with Red Zone like everyone else. So, they don't leave in droves. A few may leave but that would be for other reasons not just because Sunday Ticket is gone.

    Then let us do the math. If DirecTV is not spending a billion plus a year and loses 5% of its customers.

    $1 billion per year
    20 million customers

    5% of 20 million is 1 million

    Savings of $1 billion. To make up savings, each customer lost would have to spend $83 per month. A bit lower than what those customers pay but not devastating. Not a major risk.

    Rather than looking at risk, I think DirecTV is looking at gains. That is why they are talking over the top digital rights.
     
  18. dcowboy7

    dcowboy7 Hall Of Fame

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    You also have to factor in all the bars/clubs with ST that may drop directv as well & thats really where directv gets $$.

    Now they keep directv from january to august too so that would be another 8 months of $$ that would be gone.
     
  19. tonyd79

    tonyd79 Hall Of Fame

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    Again. Where are they going to go? If directv doesn't have Sunday ticket, no one will. Directv still delivers more sports bar type stuff than anyone else.
     
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