By now you’ve likely seen reports of the successful launch of Amazon Prime Video’s exclusive Thursday Night Football broadcast schedule when the Kansas City Chiefs hosted the Los Angeles Chargers on September 15. Initial Nielsen reporting of Amazon’s second game, which featured the Pittsburgh Steelers and Cleveland Browns last Thursday, were released earlier this week, once again delivering impressive numbers and causing buzz in the industry.

It’s time we recognize what Amazon’s early TNF success represents, a monumental event that will accelerate us into a new era in sports. The NFL and Amazon took a big leap when both sides agreed to bring a robust package of exclusive NFL regular season games to an ad-supported SVOD platform over the next 11 years. Industry pundits immediately questioned the move for both parties. The NFL drew criticism for distributing a large slate of games to a seemingly limited broadcaster who would place the games behind a paywall, while Amazon was questioned for investing $1B annually to bolster its position in the streaming wars with little chance to recoup that investment from ad sales alone. Even leading up to their first game, some experts scuffed at the 12MM average audience estimate publicized by Amazon, believing the actual number would land in the 6-10MM range, well below televised NFL games and TNF averages from past seasons.

But as the saying goes, “That’s why they play the games.” Following the final whistle in Kansas City, key parties across the sports and media industries waited intently to see the results of the NFL and Amazon’s latest experiment. After a delay in Nielsen reporting, initial viewership numbers for Amazon’s first game were released leading to a fury of press labeling the game as a resounding success.

Despite the success of Amazon’s first game, skeptics were still pointing to conflicting reported numbers, while suggesting that weaker matchups on Amazon’s schedule will lead to considerable fall off. Amazon’s second game was supposed to validate that theory, with two small market teams facing off in the Steelers and Browns. However, initial Nielsen numbers on the game reported this week have silenced those critics once again. The game did not measure up to Chiefs vs. Chargers, but with over 11MM average viewers we did not see the massive fall off some speculated.

However, viewership of this TNF package is only one benefit to advertisers. Merging live sports with the biggest ecommerce platform in the US has the potential to unlock purchase data and ad innovation marketers have yet to experience. The following sections explore some key performance metrics, as well as the impact a successful Prime Video TNF schedule will have on the sports industry and broader media ecosystem.

KEY METRICS THROUGH AMAZON’S FIRST TWO GAMES

*Source: Nielsen NTI, Live+SD; ListenFirst, 9/11 – 9/15/22).

TNF on Prime Video’s first game (KC vs. LAC played in week 2 of the NFL season) averaged 13.0MM P2+ and 6.6MM P18-49 viewers.

• 6.6MM P18-49 viewers is larger than all but one Thursday Night Football broadcast from last season despite 10 games airing on FOX with a NFLN simulcast.
• Per Amazon, KC vs. LAC averaged 15.3MM cumulative P2+ viewers (combining Nielsen data and Amazon’s 1P data on valid Prime and Twitch streams with ad blockers activated).

TNF on Prime Video’s second game (PIT vs. CLE played in week 3 of the NFL season) averaged 11MM P2+ and 5.6MM P18-49 viewers.

Averaging Amazon’s first two TNF games, Amazon’s TNF broadcasts are -22% on P2+ vs. last season’s FOX TNF season average, but +40% vs. NFL Network’s TNF broadcasts.

• On P18-49, Amazon’s audience is +8% vs. FOX and +74% larger than NFL Network, supporting the theory that Amazon Prime would attract younger viewers.
• The P18-49 audience is +23% larger than the 2022 Oscars on ABC (4.9MM P18-49), which ranks as the most-watched non-sports linear TV program of 2022 so far.

ADDITIONAL KEY METRICS FROM KC VS. LAC ON 9/15

• Amazon claims they attracted more new Prime subscriptions during the KC vs. LAC game than any other three-hour period in Amazon’s history. According to Nielsen, the peak of viewership was over 2 hours into the broadcast (10:35P EST) just around the start of the 4th quarter (15.3MM P2+). This supports Amazon’s new subscriber claim.
• 1.8MM unique viewers tuned into Amazon’s TNF coverage that have not tuned into another NFL game through week 2 this season. This represents 9% of the Amazon’s TNF reach and could expand if Amazon continues to add new Prime subscriptions.
• Amazon’s average time spent per viewer was 84 minutes, about 21% higher than a typical NFL broadcast suggesting the inability to change channels during commercial breaks is having an impact.
• The median age for Prime Video (46) was 7 years younger than other NFL broadcasts (53), with 30% of the TNF audience being under 35 (compared to just 21% in a normal NFL telecast). This is a key stat leagues will monitor as their TV audiences and fan bases have aged recently.
• Median Household Income was $101,900, more than $13,000 higher than a typical NFL broadcast this season, showing the typical affluence of SVOD households.
• Per Amazon, TNF on Prime had 4x more social mentions than Sunday Night Football and 11.7x more mentions than Monday Night Football, on their respective game nights. This lift is likely tied to the launch, newly signed on-air talent, and a competitive game between both teams but is worth monitoring throughout the season.

IMPACT TO THE SPORTS INDUSTRY

Assuming TNF sustains positive momentum and Amazon continues to add subscriptions, here’s what to expect from key players across the sports industry:

LEAGUES AND GOVERNING BODIES

Amazon’s success is a proof of concept that leagues can successfully broadcast high-profile games exclusively on SVODs while drawing both mass and unique audiences. This adds viable broadcast partners to the mix of rights holders, likely increasing the price set for broadcast rights and the number of partners each league will secure. In the end, more distribution deals equate to more revenue so expect them to follow the NFL’s lead and give significant games/schedules exclusively to SVOD partners, at least the ad-supported platforms. Over the next four years broadcast rights up for negotiation include the NFL’s Sunday Ticket package, the NBA, several big college packages including the Big 12, Pac 12, Notre Dame, and the expanded College Football Playoff.

BROADCAST NETWORKS

Adding more viable partners to the mix of sports distribution rights inversely affects the traditional broadcast networks, but in varying capacities. As viewers continue to shift to VOD platforms to watch scripted entertainment, the value of live sports to support their linear networks and cable subscriptions increases exponentially, leading to broadcast rights growing over 63% since 2013 to +$20B annually. However, most networks have launched and invested heavily in their own SVOD platforms to compete long term. Expect traditional networks to continue to secure live sports rights despite the rising cost, and for them to prioritize the ability to distribute games on their SVODs within those deals. We already see examples of this across the marketplace (i.e. NBCU shifting Premier League games from cable networks to Peacock), but they could also explore simulcasts to navigate existing contracts where linear telecasts are required.

STREAMERS

A successful first season for Amazon will be interpreted differently for the non-network owned streaming platforms. Like all broadcast partners, they will not recoup the cost of rights through ad sales alone. If Amazon’s increase in subscriptions over the NFL season continues to rise, this adds incentive for Big Tech and other independent streaming platforms to secure future rights. Apple has already secured exclusive rights with MLB and MLS. We expect streaming services to secure more exclusive rights in major sports and for higher profile games/schedules.

IMPACT TO ADVERTISERS

Exclusive broadcast rights on streaming services will undoubtedly have ripple effects across advertisers’ media, sponsorship, and creative activation. Here’s what brands can expect in coming years:

CONTINUED FRAGMENTATION

Since the explosion of cable in the late 90s, advertisers have been increasingly challenged to reach and impact mass audiences. In a future where live sports (the last bastion of mass appointment viewing) splinters further, advertisers must evolve their media mix and follow the eyeballs as they migrate to new content and platforms. Leagues have also fragmented themselves well beyond the walls of live games, distributing their content across social, digital, gaming, and more. These two factors will continue to erode the traditional TV average rating, which is quickly becoming an antiquated metric to measure the reach and value of sports. More people in the US consider themselves sports fans than ever before, but brands need to evolve their strategies and activation to fully capitalize on the scale of sports.

TRICKLE DOWN INFLATION

As the number of broadcast rights partners increases and the price per rights deal inflates, that cost will undoubtedly put more pressure on the rights holders to charge higher rates to advertisers. Couple this with continued ratings and supply decreases in linear TV, and the price for live sports media is sure to rise. This will also cause the media commitments for official league partners to rise, increasing the costs of sponsorships. It will be critical for advertisers to lean into agencies who can leverage sports investments at scale and negotiate future-forward media and sponsorship deals that protect against a quickly evolving landscape.

ADVANCED TARGETING WITHIN LIVE SPORTS

When the news broke of Amazon winning the NFL’s exclusive TNF package, the media industry quickly questioned whether advanced targeting and innovative ecommerce features would be available in live games. With a treasure trove of first party data and advanced targeting capabilities, Amazon was expected to offer more robust DAI (dynamic ad insertion) in live sports broadcasts, something the sports industry has yet to adopt widely. We expect these capabilities to be available in future seasons once Amazon tests the use of their ad technology and consumer data within live broadcasts (and decides how to best monetize this inventory). As additional streaming services acquire sports rights, the benefits of advanced targeting could soon merge with the benefits of mass live viewership of sports.

CONCLUSION

The early success of Amazon’s exclusive TNF broadcasts are likely to continue as Amazon continues to add new Prime Video subscribers. Will there be fluctuation in viewership as matchups and markets change throughout the season? Absolutely. Amazon and other streamers have an advantage that traditional networks do not. They can continue to add households and distribution to fuel their audience growth, while networks are managing household losses via cord cutting. The price for an Amazon Prime membership is high, but the power of the NFL and live sports is clearly strong enough to convert new customers.

As streaming services secure rights and schedules splinter across new networks, platforms, and devices, brands will face continued fragmentation. Audience fragmentation should not necessarily be viewed negatively because it is the unavoidable result of leagues adapting to new consumption trends, especially among younger fans. With a well-developed and data-informed strategy, brands can engage consumers in new and more impactful ways across multiple touchpoints, while continuing to benefit from the scale of sports.

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