YouTube sports strategy targets more live rights -- but not necessarily events
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YouTube is stalking the sports landscape for live rights.
YouTube would like as many games as it can get its hands on – while also giving users as "clean" of an experience as possible, according to people familiar with the matter.
YouTube has been coy with its sports strategy, acquiring the rights to one NFL game last year for its free, ad-supported platform and buying "NFL Sunday Ticket" rights until the end of the 2029-30 season. Beyond those two moves, YouTube has largely been quiet.
Still, YouTube is an interested buyer in live sports for almost all of the major U.S. sports leagues if it can get bespoke rights that present an easy consumer message, such as all local games or all games in a tournament, said the people, who asked not to be named because the company's plans are private.
YouTube's strategy is distinct from Netflix's — an interesting contrast between the two largest streaming services in the world by users. While Netflix wants individual games or tournaments that it can turn into mini-events, YouTube is more likely to buy games in bulk if there's a clear consumer proposition underlying the rights. In other words, YouTube isn't interested in a swath of games if there's no obvious connection to them.
Sports Business Journal reported earlier this year that YouTube is in advanced talks to be the NBA's new regional sports network solution, buying the rights for 20 to 25 teams for a price tag of potentially more than $1 billion. YouTube is interested in the FIFA Men's World Cup rights, as CNBC first reported in July.
YouTube is still wrestling with the feasibility of this idea if it can't get all of the teams, said the people. YouTube ideally wants both in-market and out-of-market games, the people said. It's also unclear if the NBA is comfortable selling complete rights to one platform.
A big part of YouTube's sports objective relates to building up its premium service. A few weeks ago, YouTube Premium struck a deal to ingest Peacock content within the service for no extra cost.
YouTube Premium, which eliminates YouTube ads and costs $15.99 per month, doesn't necessarily want to strike a bunch of other similar deals and turn the service into an aggregator of other companies' streaming services. But what may interest YouTube executives is buying a chunk of live sports and putting it behind the paywall. In other words, making people pay for YouTube Premium to get access to the games.
YouTube could then use "free" YouTube as its front-of-the-paywall marketing tool to get people to pay the monthly subscription fee for YouTube Premium. For example, it could put a small number of games on ad-supported YouTube to effectively advertise for signing up for the full package in Premium. It also can use its millions of sports-related content creator videos to push live games on Premium.
YouTube hired Justin Connolly away from Disney last year to be its global head of media and sports. Connolly was one of Disney's highest paid executives, having spent 25 years at the company and rising through the ranks to become the company's president of platform distribution, including ESPN and Disney+.
