How important is Amazon's NFL deal for Amazo... http://www.foxnews.com/tech/2017/09/28/how-...

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AMAZON September 28th

How important is Amazon's NFL deal for Amazon

and the future of the league?
By Chris Ciaccia, Fox News

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Sep 24, 2017; Foxborough, MA, USA; Houston Texans defensive back Marcus Gilchrist (21) hits the arm of New England Patriots
quarterback Tom Brady (12) in the second half at Gillette Stadium. Mandatory Credit: David Butler II-USA TODAY Sports - 10304422
(USA Today Sports)

Amazon is set to begin hosting the rst of its 10 Thursday Night Football games with
tonight's match-up between the Green Bay Packers and the Chicago Bears. As
consumers continue to be faced with a deluge of content options and cord-cutting
becomes more popular, it remains to be seen whether consumers will fork out an extra
$99 per year for something they can already get for free.

Amazon is betting heavily (to the tune of a reported $50 million for the streaming
rights) that customers will want to watch the game on Amazon's Video service. Last
year, Twitter paid a reported $10 million for the games, which demonstrates that
Amazon is willing to pay up for the chance to acquire new Prime subscribers.

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"In order to enhance its value proposition in a highly competitive [over-the-top] market,
Amazon needs appealing, differentiated content," Tom Richardson, a sports industry
veteran who teaches digital media in Columbia Universitys Sports Management
masters program, wrote in a recent LinkedIn article.

AMAZON UNVEILS NEW PRODUCTS, INCLUDING NEW ECHO SPEAKER, FIRE TV

Amazon has been building up its content offerings for Prime Video, which competes
with the likes of Netix, Hulu, HBO Now, as well as other traditional media. In addition to
the Thursday games, which Richardson added are a "pretty safe bet," it has a number of
its own shows, including "Man in the High Castle," "The Tick" and "Transparent," which
has received critical acclaim in the form of both Emmy nominations and wins.

The streaming service is also reportedly looking to add its own version of HBO's mega-
hit show, "Game of Thrones," according to media reports.

Though Amazon may not see a ood of new subscribers for Amazon Prime because of
the streaming rights, it's clearly part of expanding the benets of the service.

"This is virgin territory for Amazon, which has never had major sports rights before, and
of course its for a single game a week for only some of the weeks of one season, so its
a pretty limited offering," Jackdaw Research chief analyst Jan Dawson told Fox News.

Dawson added, "Ive no doubt Amazon will see some new signups as a result of
offering the Thursday night games, but I cant see it moving the overall needle much
relative to its existing strong growth in Prime subscribers."

Richardson agreed, saying that it probably will not be a determing factor in adding new
Prime subscribers, but it will likely "at the very least, enhance the perceived value of
Prime membership."

Amazon has never publicly disclosed how many Prime users it has, but third-party
research from Consumer Intelligence Research Partners puts Amazon Prime
membership at around 80 million people in the U.S. alone.

In addition to the games available to U.S. Prime members, they will also be available to
Prime Video members internationally in more than 200 countries.

AMAZON 'REVIEWING' WEBSITE AFTER SUGGESTING BOMB-MAKING MATERIALS TO

CUSTOMERS

What's at stake

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In announcing the deal this past April, the NFL said Amazon would stream 10 Thursday
Night Football games, which are also broadcast by NBC and CBS, giving the league a
"tri-cast" model of reaching viewers: broadcast via NBC and CBS, cable via the NFL
Network and digital.

"We are continually looking for ways to deliver our games to fans wherever they watch,
whether on television or on digital platforms and we are thrilled to bring Thursday Night
Football to Amazon," Brian Rolapp, Chief Media and Business Ocer for the NFL said at
the time of the announcement. "As has been the case with all our streaming initiatives,
we look forward to continuing to innovate with our partners as we learn the best ways
to serve our fans both this season and into the future."

It's important that Amazon, with its millions of Prime subscribers, helps show ratings
growth for Thursday Night Football and the league in general.

Viewers and experts have often bemoaned the quality of the Thursday night games,
with reasons like short weeks and players not fully recovered from the previous games
oft mentioned. According to football website, ProFootball Talk, the NFL Network has
seen two consecutive weeks of ratings growth over the 2016 season, including last
week's thrilling shoot-out between the Los Angeles Rams and the San Francisco 49ers,
which had 7.4 million viewers.

Twitter has said in the past it averaged around 3.5 million unique viewers per game, a
fraction of what games on broadcast TV get. Twitter also let anyone (including those
without a Twitter account) watch the games, so the pressure is on Amazon to deliver
strong engagement and viewing gures.

Amazon, for its part, is looking to add new features to keep users engaged.

In an email to Fox News, the company said it would offer alternate language audio of
the games (including Spanish, Brazilian Portuguese, and U.K. English streams, one of
which will have well-known soccer announcer Tommy Smyth), its own kickoff show,
NFL trivia from Alexa and custom-themed Amazon boxes.

AMAZON'S LACK OF INCOME TAXES PAID HAS BECOME AN 'UNCOMFORTABLE

QUESTION'

NFL's future at stake

The league is also mired in controversy as President Donald Trump stirred the
proverbial pot last Friday, saying at a rally in Alabama that players who do not stand for
the National Anthem should be red. "Wouldn't you love to see one of these NFL
owners, when somebody disrespects our ag, to say 'get that son of a b**** off the eld

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right now - he's red,'" Trump said.

Trump has continued to make similar remarks on Twitter, including this one referencing
the ratings for the league.

Ratings for NFL football are way down except before game starts, when people tune in
to see whether or not our country will be disrespected!

Donald J. Trump (@realDonaldTrump) September 26, 2017

Though the NFL has multi-year, multi-billion dollar deals locked up with cable
companies such as CBS, Disney and 21st Century Fox (the parent company of this
website), the league is continuing to push towards streaming.

New England Patriots owner Robert Kraft, one of the most inuential owners in the
league, said the future for the NFL is over-the-top, a term used to reference non-
traditional content such as Netix and Amazon Prime.

This year were with Amazon and for us the future is OTT, Kraft said during an
interview at the Cannes Lions festival in France in June, as reported by Fox Business.
Well be very interested to see how Amazon goes as its behind the paywall. The thing
we have to be careful of is millennials. They dont watch TV, they dont have TVs or
subscribe to cable. So we have to bring that audience in. Partly its done through
fantasy games and linking to that. Over-the-top is a great opportunity.

According to Bloomberg, the tech giant paid $50 million for the games, with the
potential for an additional $30 million in marketing and promotion. By contrast, Twitter,
which had the streaming rights to Thursday Night Football in 2016, paid approximately
$10 million.

Part of the marketing and promotion is ironically showing up on Twitter, where the
hashtag #TNFonPrimeVideo is being promoted by Amazon Video.

TRUMP ATTACKS AMAZON, SAYS IT'S DOING 'GREAT DAMAGE' TO RETAILERS

Benet to Amazon

While it's likely to help show an increase in interest in Amazon's Prime subscription
service, it could also help the company's burgeoning advertising business.

Per the agreement with the NFL, Amazon can sell a "limited number of advertisements"
during the broadcasts, in addition to the ones aired from CBS and NBC. Fox Business
reported that the company could charge as much as $2.8 million per 30 second spot.

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According to media reports, Barclays estimated Amazon generated around $1.4 billion
in advertising revenue in 2016, a gure that pales in comparison to those of both
Google and Facebook.

While the deal is an experiment for now (Amazon already airs some NFL-related
programming, including "All or Nothing"), it could be a precursor for viewing rights to
come in the future.

A majority of the NFL's rights deals expire in either 2021 or 2022, so companies like
Amazon could potentially bid on them when they come up for renewal. If the
experiment goes well, analysts could see Kraft's words, that over-the-top is the future,
come to fruition.

"As the additional rights come up for renewal, the digital players will denitely be big
bidders against the traditional TV companies, and well have to see to what extent the
NFL chooses to parcel out streaming and TV rights separately or encourages single
bids including both components," Dawson said.

Follow Chris Ciaccia on Twitter @Chris_Ciaccia

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Conversation (18)

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dr3yec Leader

#nboycott
Reply Share 2 Likes

AnotherMidClass Leader

Bud Lightcurrently serves as the ocial beerof the NFL. So the company set
up a hotline for fans to call and give their thoughts about the protests and
Anheuser-Buschs sponsorship of the NFL. The number for the hotline is:
1-800-342-5283.
Reply Share 5 Likes

JumpinJoeDemsGottaGo521 Leader Another Mid Class

Thank you for your email, we always appreciate feedback from our
consumers and take your concerns seriously.

At Anheuser-Busch we have a long heritage of supporting the

institutions and values that have made America so strong. That
includes our armed forces and the national anthem as well as diversity,
equality and freedom of speech.We proudly employ over 1,100 military
veterans and we work every day to create an inclusive environment for
all of our employees.

Anheuser-Busch has many long-term sports partnerships, including our

NFL sponsorship, and while we may not agree on everything, we still
believe in the power of sport to bring people together and overcome
their differences.

We understand your concerns and will convey them to the NFL.

See more

Reply Share

whiskeypapa1 Leader

Bad timing, Amazon

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