Following the debacle that was the Jake Paul vs. Mike Tyson boxing event, Netflix bounced back in a big way with a successful Christmas Day NFL doubleheader and the debut of WWE Raw on the streamer.
As such, many believe that it’s only a matter of time until Netflix increases its offerings with full-season sports rights. But while Netflix co-CEO Ted Sarandos stated that his company would be open to potentially acquiring such rights, he also acknowledged the challenges that would come with doing so.
“We are constantly trying to broaden our programming. And live events is one of those things, and sports is part of those live events,” Sarandos said during an earnings call on Tuesday. “So, when I look at this and say that’s a really fantastic thing, but it doesn’t really change the underlying economics of full-season big-league sports being extremely challenging.”
Some of those challenges are obvious, particularly in the form of production.
While WWE provides its own production for Raw on Netflix, the same can’t be said for sports leagues like the NFL. And although CBS produced the Christmas Day doubleheader for the streamer — which also featured talent from across each of the league’s other media partners — such a setup likely wouldn’t be feasible for the entirety of an NFL season.
Would the cost of adding its own in-house production for a part of the NFL package — let’s say a weekly international game — be worth it? That’s seemingly the conundrum that Netflix could find itself facing.
“If there was a path where we could actually make the economics work for both us and the league, we certainly would explore,” Sarandos said. “But right now, we believe that the live events business is where we really want to be. And sports is a very important part of that, but it is a part of that expansion.”
And then there’s the matter of what sports rights are even available.
While it’s always possible for leagues to create new packages within their existing rights deals — just as the NFL already did with Christmas Day — the only sports property whose rights are scheduled to be available in the near future is UFC, whose deal with ESPN is set to expire at the end of 2025. Considering Netflix’s preexisting relationship with the MMA giant’s TKO sister company, WWE, the streamer makes for a natural suitor for UFC’s next deal.
Asked specifically about the prospect of adding UFC to its portfolio, Sarandos declined to address such a possibility directly. But as is the case with all of Netflix’s dealings — including an upcoming rise in prices — it will ultimately be a matter of dollars and sense.
“It’s really important that those economics do work and that the big-league sports full-season economics are very hard to make work,” he said. “We want to be able to bring value to the sport like we have to date with WWE, certainly, but like we have with the NFL, too, where we were basically able to bring a big audience, a young audience, a more global audience than linear television. But that has to be reflected in the deal as well.”
