Sources have indicated that the exclusive rights that telecommunication giant Verizon Communications Inc. (NYSE:VZ) enjoys with regards to streaming live NFL games on smartphones will come to an end. The National Football League inked a four-year deal with Verizon worth $1 billion which is ending at the conclusion of the current season.
While broadcasters such as Walt Disney Co (NYSE:DIS) ESPN pay for rights to various games, they are not allowed to stream them on smartphones as only Verizon enjoys that. Sources say that the thinking within the league body is to allow competing platforms to stream the games. This means that while Verizon could retain the sponsorship rights as well as be able to stream the games, it will not be able to do so exclusively since the streaming rights will be offered to other telecommunication firms as well.
Global streaming rights
A report in The Wall Street Journal earlier in the year indicated that Verizon Communications had paid approximately $21 million to obtain exclusive global streaming rights for a game that was being played between Jacksonville Jaguars and Baltimore Ravens on September 24. This was at a 40% premium in comparison with what the National Football League was paid by Yahoo for streaming rights two years ago in the league’s first attempt to make a matchup available online primarily. The match between Buffalo Bills and Jaguars was played in London and Yahoo paid $15 million. The number of viewers who watched the game was only 2.36 million.
Ad revenue
Verizon used the match to lure more users to its platform as well as to boost advertising revenue on its various online properties including go90, a mobile video service. Earlier in the year the sale of Yahoo to Verizon was closed.
The deal by Verizon to obtain the rights to the game came a month following Amazon.com, Inc. (NASDAQ:AMZN)’s acquisition of streaming rights for ten NFL games on Thursday nights at a price of $50 million. Last season Twitter Inc (NYSE:TWTR) had paid $10 million for the same rights.
In Tuesday’s trading session the stock of Verizon Communications Inc edged down by 0.14% to close the day at $48.94 per share.
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