(cache)NFL-ESPN deal: What it means for RedZone, equity stake, networks - The Washington Post

The NFL and ESPN reached their long-awaited agreement that gives the Disney-owned sports network access to league media properties, including NFL Network and RedZone, while the NFL takes a 10 percent equity stake in ESPN.

The two sides announced the deal Tuesday night, calling the agreement “nonbinding.” The transactions included in the deal are “subject to the parties’ negotiation of definitive agreements, various approvals including by the NFL team owners, and customary closing conditions,” the NFL and ESPN said. The Walt Disney Company is scheduled to announce its quarterly earnings Wednesday.

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(The Washington Post)

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“Today’s announcement paves the way for the world’s leading sports media brand and America’s most popular sport to deliver an even more compelling experience for NFL fans, in a way that only ESPN and Disney can,” Bob Iger, Disney’s chief executive officer, said in a statement. “Commissioner [Roger] Goodell and the NFL have built outstanding media assets, and these transactions will add to consumer choice, provide viewers with even greater convenience and quality, and expand the breadth and value proposition of Disney’s streaming ecosystem.”

People familiar with the deliberations said last week that the deal was being finalized. It still faces regulatory approvals. That process is expected to take months, meaning little is likely to change during the 2025 NFL season, which begins next month.

How does the deal work?

ESPN would own and operate NFL Network and, along with its traditional paid-television distribution, would integrate it into the direct-to-consumer streaming service it is launching. ESPN’s platforms would license an additional three games per season to be carried on NFL Network, according to the announcement. Some games would be shifted from ESPN to NFL Network, which would continue to carry seven games per season.

The deal would give ESPN “broad rights to the RedZone brand,” the league and network said. ESPN would distribute the NFL RedZone Channel, which allows viewers to watch key plays from Sunday afternoon games, to pay TV operators. People with knowledge of the discussions had called RedZone a key component of the deal. The NFL would retain ownership of RedZone and keep the rights to distribute it digitally.

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The NFL would take a 10 percent equity stake in ESPN as part of the deal. The league would retain NFL Films, NFL+, its podcast network and the league’s and individual teams’ websites. NFL Fantasy Football would merge with ESPN Fantasy Football.

NFL owners previously were alerted that the league might schedule a special owners meeting in August, apparently related to the pending deal with ESPN.

What does the deal mean for ESPN?

ESPN already holds the broadcast rights to the NFL’s “Monday Night Football” package. Disney pays the NFL about $2.7 billion per year for that package. ESPN and Disney-owned ABC have the rights to carry two Super Bowls, the first to conclude the 2026 season.

The deal would provide content and value for ESPN’s direct-to-consumer streaming service. ESPN announced in May that the service would launch this fall and cost subscribers $29.99 per month.

The network said in May that the service will provide viewers with access to all seven of ESPN’s domestic linear networks, in addition to ESPN on ABC and several other streaming options. At launch, it will offer 47,000 live events annually and on-demand replays, studio shows and original programming.

“This is an exciting day for sports fans,” ESPN Chairman Jimmy Pitaro said in a statement Tuesday. “By combining these NFL media assets with ESPN’s reach and innovation, we’re creating a premier destination for football fans. Together, ESPN and the NFL are redefining how fans engage with the game — anytime, anywhere. This deal helps fuel ESPN’s digital future, laying the foundation for an even more robust offering as we prepare to launch our new direct-to-consumer service.”

ESPN will have to decide to what extent it might bolster NFL Network programming following cutbacks to certain shows under the league’s ownership. It also will have to consider how to address any redundancies between NFL Network staff and ESPN’s current employees.

“As a result of this sale, NFL programming will be available on more platforms than ever before, including ESPN’s upcoming direct-to-consumer (‘DTC’) service, while remaining on cable, satellite and leading streaming providers. ESPN’s DTC offering will deliver an array of NFL content to subscribers,” the NFL and ESPN said in their announcement.

ESPN and other networks that pay billions of dollars in rights fees to carry NFL games always have faced conflict-of-interest questions about the objectivity of their news coverage of the league and teams. Those questions were particularly intense about NFL Network’s coverage of the league when it was owned by the NFL and the owners. Those issues could intensify for ESPN, with the NFL’s pending ownership stake in the network.

What does the deal mean for the NFL?

The league and owners would be getting out of the business of running their own network. They had been negotiating for several years to sell NFL Network, but people with knowledge of the deliberations said Goodell was intent on doing a deal only if it was the right one and only if it made sense for the league.

“Since its launch in 2003, NFL Network has provided millions of fans unprecedented access to the sport they love,” Goodell said in a statement Tuesday. “Whether it was debuting Thursday Night Football, televising the Combine, or telling incredible football stories through original shows and breaking news, NFL Network has delivered. The Network’s sale to ESPN will build on this remarkable legacy, providing more NFL football for more fans in new and innovative ways.”

The NFL announced a set of broadcasting and streaming deals in March 2021 worth more than $110 billion in rights fees over 11 years. The league could reopen those deals around the end of the decade. Once the Monday night package comes up for another round of bidding, some in the industry wonder whether ESPN will have a built-in advantage.