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In 2017, Facebook started to create its own video streaming platform, complete with original content paid for, presumably, by the billions in advertising dollars it has been pulling in from its users. However, there’s only so far you can go with 30-minute TV shows that look a lot like what you’d find on a really bad cable TV network, so it’s perhaps no surprise that Facebook has been rumored to be looking for some way to enter the market for live streaming sports.
What would a Facebook live streaming deal look like?
In fact, the latest rumor making the rounds is that Facebook has “a few billion dollars” to pay for streaming rights to professional sports. The company already bid (unsuccessfully) $600 million to live stream cricket matches in India, but that could just be the tip of the iceberg. The real action is in U.S. professional sports, such as the NFL or NBA. Consider, for example, that DIRECTV is paying $1.5 billion a year to the NFL for its exclusive “Sunday Ticket” package. And ESPN pays upwards of $2.5 billion per year for the right to televise NBA games.
So imagine a scenario in which Facebook plunks down a similar amount of cash to live stream your favorite professional sports teams. Instead of turning on your TV to watch “Monday Night Football” on ESPN, you’d simply tune in to Facebook. And instead of watching the Sunday night “game of the week” for baseball, you’d watch the game on your Facebook app. And, indeed, Facebook has already experimented with live-streaming of out-of-market games for MLB baseball.
The business case for live streaming sports
So what’s in it for Facebook? Two words: advertising dollars. If Facebook is going to spend billions of dollars for the right to stream content, they’re not doing it as a public service for loyal Facebook users who cut the cord with cable. Nope, they’re doing it for the same reason that the big TV networks bid on these lucrative broadcasting deals – so that they can sell advertising against it.
The best part of live streaming sports, of course, is that you don’t have to waste time and money coming up with “original content.” You don’t have to pay content creators (i.e. actors, directors, producers) lots of money to create shows that might – or might not – do well. Just think of how many TV shows “bomb” after just a few episodes and are never renewed. Or about how much low-quality content is on TV most nights. With professional sports, you don’t have that problem. In the case of baseball, for example, you have a nine-month season with guaranteed programming every night of the week. The same is true for hockey and basketball.
Looking ahead in 2018
In 2018, it’s almost a certainty that Facebook will find some way to enter the live streaming sports market in a big, splashy way. Consider that Amazon is paying the NFL $50 million right now to live stream Thursday Night Football games, after Twitter paid $10 million in the previous year for the same rights. Don’t you think that Facebook is secretly envious of those deals? Even starting small – such as live streaming a single game a week – would be a great way for Facebook to test the market and see what other types of revenue opportunities develop from that.