Marcio Jose Sanchez / AP
The NFL is wildly popular, makes over $10 billion year, and inspires plenty of social interaction among its fans. So you might think it would be a perfect fit for Facebook, which is bidding to stream some of the league’s games in 2016.
But in an interview with Variety this week, Facebook partnership boss Dan Rose gave little more than a shrug when confirming his company’s interest. Of Facebook’s chances of winning the rights to stream the games, Rose simply said, “We’ll see.”
The blasé answer wasn’t simply a case of underselling; it spoke of the difficulty of transposing the NFL from TV to digital. Though still in its early phases, so-called over-the-top streaming (digital rights unattached to a network broadcast partner) of NFL games is proving to be a risky venture. Just ask Yahoo, the league’s first partner in this format, which met the challenges firsthand when it tried its hand at streaming an NFL game last October.
Yahoo paid $17 million to stream one of the NFL’s 256 games in the 2015 season. But despite the novelty factor (advertisers love the new and shiny), the company was only able to attract one of the league’s top 10 sponsors, according to Advertising Age. Demand was so weak, according to the Ad Age report, that Yahoo had to cut some ad prices to “less than a tenth of what it costs to secure time in a national Sunday afternoon NFL broadcast on CBS and Fox.”
Facebook, if it wins the rights to stream some games, should have a better shot at making the stream work from a financial standpoint. The company has a solid set of data and ad tech, so it’s well-positioned to bring in the dollars. But even with this advantage, Rose told Variety that streaming the games alone is not all that appealing to Facebook. The company wants more — to go behind the scenes, for instance: “If you think about how people engage on Facebook today, it’s not really around watching three hours of video,” Rose said.
Tellingly, Apple, which introduced a new Apple TV last year and has been mulling a subscription TV service, is not bidding on the games, according to sources familiar with the company’s plans. Amazon, according to reports, is in the game.
While other companies may do a deal with NFL to increase their audience size, Facebook hasn’t shied away from measuring its popularity next to the league’s. (“We have a Super Bowl on mobile every day,” Facebook COO Sheryl Sandberg told advertisers at a conference last September.)
Then there’s the question of where the games would be played. Facebook could play the games in its new Sports Stadium product, which encourages people to post about the games they're watching. But so far, that product is buried deep within Facebook and couldn’t even keep up with play-by-play during the Super Bowl.
The other, more interesting destination would be Facebook’s Oculus VR headset and other 360-degree video viewers. If the games are streamed there, you could imagine much of America donning headsets at the start of the games and rejoining the world three hours later. While Oculus headsets are not even for sale yet, much less mass market, the experience could be a huge selling point. Facebook already supports 360-degree video, and Facebook Chief Product Officer Chris Cox alluded to the possibility of streaming live versions of that at a Friends Day event in January. While there are significant technical hurdles to streaming live 360-degree video, it’s certainly possible (YouTube is expected to add the capability this year), especially with standardized camera arrays.
Asked about this possibility, a Facebook spokesperson responded with a confirmation of Rose’s statements, noting: “That’s all we have to say at the moment.”
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