Amazon Continues To Advance Down The Field As It Showcases Value Of Immersion

Summary:

• Amazon’s success in streaming live sports, particularly with the NFL’s “Thursday Night Football,” has set a profitable model for rivals to follow.
• Apple and Netflix have adjusted their strategies as a result, including Apple securing Major League Soccer and Super Bowl halftime rights, and Netflix acquiring WWE’s ‘Monday Night RAW.’
• Overall, streaming platforms must figure out where best to spend their money and how to pivot when rights get overly expensive or some other factor emerges.
• The high cost of sports rights necessitates strategic investments, with Amazon’s approach serving as a comprehensive model for long-term success.
• Amazon’s in-game integrations of e-commerce, analytics, and innovative broadcast feeds creates an immersive sports viewing experience which sets a new overall standard.

When it comes to businesses like Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL) and Netflix (NASDAQ:NFLX), you expect innovation to be a part of their long-term goals. None of the companies have ever been content to just rely on their past success ??? they all want to grow. What???s become interesting is watching how one company???s win forces the hand of the others to adjust.

In the tech world, this goes beyond a simple tit-for-tat style match and more of ???game respects game??? race to be better. This has become especially prominent in the streaming world as companies have seen new areas come to the forefront ??? case in point, streaming live sports.

What makes Amazon???s approach especially interesting here is that they not only showed Apple and Netflix this content was profitable, but they have effectively built out a roadmap for how they are changing the traditional TV paradigm, whether fans want that or not.

First as always, some background.

Yes, it is weird to say that anyone is showing any of these big companies how to challenge the norm. Netflix already revolutionized TV once and Apple has evolved just about any space its ever been in. Yet sports was an area that presented a challenge.

Netflix had long sworn they were not interested in streaming sporting events and Apple wasn???t at the point where it was a viable option in their product???s life-cycle until recently.

Amazon was one of the first to effectively showcase the model.

While Netflix had effectively doubled-down on its opinion that sports were a non-starter for them, Apple clearly wanted in, but it wasn???t the right moment. Then came Thursday Night Football, which, after years of bouncing around linear was looking for a long-term home and Amazon stepped up with a massive ten-year commitment.

For the NFL, which has made it clear they want as many partners as possible, this was intriguing. However, for a larger part of the fandom, this was also irritating. It was expensive enough to watch your favorite team, and now you would also need a Prime subscription to watch one of the week???s three higher profile prime time games. And that???s before the league doubled-down by creating a special Black Friday premium product for Prime, which took more games off the linear table.

Here???s the thing about fans though ??? they???ll complain loudly but activate slowly.

Yes, some did not make the leap to streaming, but the majority did and the TNF experiment, now in its third season, has been a success. This year???s opening game between division rivals the Buffalo Bills and Miami Dolphins drew an average of nearly 15 million viewers and ranks as the third-most watched game since Prime took over rights.

Year-to-year the numbers slipped just 1% and that is even with the game being a blowout and effectively over mid-way through the third quarter. The game reached a peak of just over 18 million and beat last season???s average viewership by 26%.

That???s the thing about sports and especially the NFL, neither the league nor Amazon really needed to see a large subset of numbers to know they had made a good deal. Fans are going to tune in and stay engaged in the action. However, you always like to know ???how much,??? and given the pair DID have numbers and it did show a strong return – not only did it justify the partnership, but it was grounds to add an exclusive play-off game to the arrangement.

And while that has again rattled fans, the NFL doesn???t seem to be overly worried. Football has a dedicated following and while they may complain about the cost and the added layers to watch, they aren???t going anywhere.

Apple, Netflix and the other leagues have seen that and adjusted accordingly.

Apple went all-in with Major League Soccer and when it realized arcane contracts would prevent it from doing the same with the NFL, it pivoted to securing rights for the Super Bowl halftime show. That proved to be a cheaper and, in some ways, a more impactful investment. In addition, it made a deal with Major League Baseball for a Friday night package that included a twin-bill of marquee games each week.

Even the ???no sports ever??? mantra of Netflix fell to the wayside when the NFL made its Christmas games a premium product and the streamer saw an opportunity. After all, games are rarely played on a Wednesday night, but tis??? the season, so why not make a spectacle out of it?

Although NFL aside, Netflix was already set to make a live-sports splash when it shockingly acquired the rights to WWE???s flagship Monday Night RAW series earlier this year. As a result, the Monday night wrestling staple will be moving off linear for the first time ever this January.

But that???s not all, as Netflix, while ???new??? to the live sports game, isn???t new to sports. The company has been in the documentary space for a while and lately turned its attention to chronicling sports with series Quarterback, Receiver and the upcoming Starting Five as examples.

The elevation in sports docs likely also came after the success of Prime Video???s Kelce ??? which chronicles the career of NFL star Travis Kelce (along with his brother Jason). The feature became the most watched documentary on Prime and sent a message that this type of content was something subscribers across the board wanted.

The trick here, though, is that sports rights are expensive and long-term, so companies must think long and hard about which ones they want to pursue and how much they are willing to spend. For example, Apple smartly realized the NFL deal wasn???t worth it, just as Netflix realized WWE was a huge global opportunity they couldn???t pass up.

Ultimately, you can trace back a lot of Apple and Netflix???s sports strategy to Amazon, and while some could say that is a coincidence, when you look at the time-lines they line up nicely. But in either case, Amazon???s entrance to sports ??? which will continue in 2026 with its new basketball deal ??? has become an important model to follow.

This is more than just programming and content to them.

It???s a full company immersion.

Amazon, which makes its real money in e-commerce and retail, can easily introduce ways to buy the various jerseys, hat, apparel, etc. through its platform while watching. The company has even worked its highly profitable AWS division into the mix by leveraging their use of statistics and analytics into the broadcasts to show its full potential to prospective partners.

And then there are alternate ???feeds??? that provide endless opportunities, especially when they don???t require a network to have multiple linear channels to simulcast them. The ???Manning-Cast??? on ESPN is a great example ??? but part of the reason it works is because you have multiple ESPN networks to accommodate the extra content. Amazon can duplicate that (if it wanted) in an unlimited way and not be held back by space. So far, we???ve seen feeds with an all-female broadcast team, a foreign language broadcast team and a stat-enhanced broadcast among others.

Every year they tend to add more and more features that try to help make the game more than a traditional experience via a new medium. It???s a new way of catering to sports fans and while some may be a little adverse to those changes, by and large you have to admit Amazon has scored a touchdown.

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