Formula 1 is inking a new TV rights deal in the United States, and due to the sport’s sudden popularity, the demand for broadcast rights is at its peak. Four bidders are in contention for a contract that Liberty Media expects to increase twenty-fold.
According to business InsiderESPN is facing NBCUniversal, Amazon and Netflix to take over Formula 1 coverage in 2023. ESPN itself has offered US$70 million (it currently pays US$5 million), but Liberty Media is now asking for US$100 million a year.
There is motivation to invest in Formula 1 from all four companies. ESPN and Netflix deserve credit for the series’ high popularity. ESPN isn’t paying you much and using the Sky Sports feed in the UK does save you some money, but the race is free, with minimal ads during practice and qualifying. This has generated a lot of goodwill from US F1 fans, and with plans to keep broadcasts commercial-free, most fans want to keep things as they are.
Netflix doesn’t have live sports, but he had a big influence on Formula 1 with the Drive to Survive series. While the show has dramatically upset some of the more hardcore drivers and fans, the intrigue and conflict served as an introduction for many new fans to actually watch the race. While Netflix management talked about bidding for F1 rights last year, the company is undergoing minor changes due to plunging share prices and declining subscriber counts. Since, in addition to buying the sports rights from Apple and Amazon, it makes sense that they have a close relationship with sports to begin their foray into live sports.
But ESPN is in pole position to retain the rights. Unless Amazon and Netflix really ‘bust the bank’ and offer crazy cash, they’re fighting an uphill battle because of F1TV. Liberty Media retained the OTT rights to its streaming service, so if another streaming service shows the race, it would defeat the purpose of F1TV Pro, which costs $80 per year in the US.
$100 million to buy broadcast rights may sound like a lot of money, but the major North American sports leagues cost about 20 times that, and none is exclusive to both the NBA and the NFL.