The National Football League’s Thursday night opener dropped 16% since last season and Sunday Night Football ratings hit a record low this year.
Most of those deals are set to expire at the end of the 2022 season. According to the Observer, the NFL wants to double its fees, on the argument that NFL games are a strong annual source of live viewership. The ratings decline will strengthen the broadcast networks’ negotiating hand.
Every year, the NFL rakes in about $8 billion in revenue from its deals with the broadcast networks. That’s continued despite escalating competition between streaming services and the traditional networks.
In some cases, the advertising revenue that networks bring in during NFL games works out to a fraction of the amount they pay in yearly fees to the NFL. For example, ESPN pays $1.9 billion in fees and earns $500 million in advertising revenue, the Observer found.
By contrast, CBS pays $1 billion in fees and earns $1.5 billion in advertising revenue. NBC pays $950 million in fees and earns $1.5 billion in advertising revenue. Fox pays $660 million in fees and earns $2 billion in advertising revenue.
Some have argued that the recent ratings decline is due to the anthem protests of NFL players. Others, including Fox Sports executive vice president Michael Mulvihill, claim NFL ratings are still solid.