YouTube’s NFL Sunday Ticket deal is a brilliant move for its subscription future

The “pick me! pick me!” bidding war for NFL Sunday Ticket has finally come to an end, and YouTube won big. The company announced a “multi-year” deal that will see it carry Sunday Ticket both standalone (as a YouTube Primetime Channel) and through YouTube TV. It’s a massive score for YouTube, which successfully fended off Big Tech rivals like Apple to land the deal, and a pivotal moment as live sports continue their transition away from traditional cable — DirecTV is the soon-to-be-former Sunday Ticket rights holder — in favor of major streaming platforms.

In one fell swoop, Google has solidified YouTube as a vital destination for NFL fans. And it has resoundingly committed to a long-term future for YouTube TV, which has over 5 million customers. The company isn’t revealing what it paid for this deal on the record, but according to The Wall Street Journal, it works out to roughly $2 billion per year — and the contract is for seven years.

DirecTV might not lose out on the package altogether; the NFL still needs a way to put Sunday Ticket on millions of sports bar and restaurant TVs, and as Amazon recently learned, the satellite provider still dominates that realm. But without AT&T’s coffers to pull from, DirecTV was in a vulnerable position to miss out on the main deal; it was already losing money on the existing Sunday Ticket contract.

For the NFL, the YouTube partnership is about expanding reach and giving Sunday Ticket a presence on an enormous global platform that’s synonymous with the internet as a whole. “It is a site where a lot of ‘Gen Z’ goes to get content,” NFL commissioner Roger Goodell told the Journal. Sure, and everyone else, too, Roger. The league has now divvied up rights among Big Tech, with Amazon locking down Thursday Night Football and YouTube winning the Sunday Ticket competition.

YouTube is aggressively circling back to the bundle

Football fans will be able to pay for Sunday Ticket as a standalone subscription, but that scenario isn’t what YouTube ultimately wants. Rather, it’s all about pulling consumers into some kind of bundle. Your first option for getting the package is buying it as an add-on to YouTube TV, which costs $64.99 all by itself. The company’s TV service has been praised for its user interface, streaming quality, and unlimited DVR functionality, but customers have also bemoaned the pricey monthly subscription, which has steadily risen in recent years.

You can get Sunday Ticket by itself, but that’s not what YouTube wants

Option two is buying Sunday Ticket through YouTube’s Primetime Channels, where you can also find subscriptions for Paramount Plus, Showtime, Starz, and other entertainment services. From Amazon and Roku all the way to Verizon, everyone wants to be the hub for most of your subscriptions — even if they don’t all have everything (i.e., HBO) — and YouTube’s effort is no different. If anything, it was late to this concept, but Sunday Ticket is a huge get to make up for that.

If you’re Google, YouTube TV is obviously the preferable route from a revenue perspective, and it’s likely that YouTube will offer a discount for pairing Sunday Ticket with live TV to sweeten the pot. CNBC’s Alex Sherman says that other NFL contracts prevent YouTube from “dramatically” undercutting what DirecTV has typically charged for Sunday Ticket, but I have to imagine there’s some wiggle room. I’d expect that the package will be most expensive when purchased through Primetime Channels since that comes with the least commitment from viewers. YouTube hasn’t revealed any pricing plans as of yet. There are no long-term contracts in either of these scenarios, but YouTube’s goal is to hook people into paying for more than just Sunday Ticket and create enough friction that they’ll stick around.

Want in-market games? That’s how they get you with YouTube TV

Sunday Ticket only lets you watch out-of-market NFL games. If you want to watch your local team, you’ll need to do so through whatever network is airing that game. But YouTube TV will be able to seamlessly send you to the right place, whether it’s Sunday Ticket or any channel that might be broadcasting a game on YouTube TV that weekend.

It’s not going to make the monthly $65 any easier to swallow for people with zero interest in sportsball — and I doubt YouTube TV is done with price hikes — but if you’re an NFL superfan, YouTube TV might start looking very appealing. And like I said, the service itself is excellent if you’re willing to pay for it. I’m looking forward to seeing what the Sunday Ticket interface is like.

At least Apple Music is sponsoring the Super Bowl halftime show, I guess?

After months of speculation that Apple and the NFL were thiiiiiis close to partnering on Sunday Ticket, it just didn’t pan out. With the ink now dry on the YouTube deal, more details are emerging as to why Apple and the league couldn’t get there. Last week, it was reported that Apple had wanted to include Sunday Ticket as part of Apple TV Plus at no extra cost. This seems incredibly naive and overly optimistic even by Apple standards; the NFL was never going to demote Sunday Ticket to “included for free” status. I’m curious as to what the full story is there.

The more significant impasse might have been related to Apple’s upcoming long-rumored mixed reality headset. According to The Athletic, Apple was trying to convince the NFL to let it “distribute Sunday Ticket on as yet non-existent platforms.” But the league wouldn’t budge on granting this “known and unknown rights” clause.

Once talks with Apple fizzled, YouTube didn’t miss an opportunity to snag Sunday Ticket and make it a cornerstone of the company’s subscription (and bundle) ambitions for years to come. Apple will just have to settle for soccer and baseball for the time being.

Originally appeared on: TheSpuzz