Sports Insider: Apple and Amazon’s sports deals shake up Sky TV’s dominance in New Zealand – Trevor McKewen

The All Blacks in a huddle as they are filmed by spidercam during the 2015 Rugby World Cup semifinal against South Africa in London. Photo / Getty Images

It has taken a while but Big Tech players like Amazon, Apple, YouTube and Netflix are finally making their overdue foray into sports content. So what does it mean for Sky TV and Kiwi sports fans? And World Rugby is to elect a new boss within next 24 hours.

OPINION

For years, we waited and waited and nothing happened.

The initial predictions, some more than a decade old now, were dire for traditional broadcasters – the Big Tech streamers were coming to lay waste to your monopoly over live sports rights.

It was not a matter of “if” but “when”.

The likes of Amazon, Apple, Google, Facebook and YouTube would eventually trample linear broadcasters like the Horsemen of the Apocalypse.

It turns out “when” took a lot longer than most predicted.

And the riders among the horsemen changed too.

Facebook flirted for years with a sports play but for now, Mark Zuckerberg looks to have abandoned any sports play (Metaverse experiment notwithstanding).

But Tim Cook at Apple and Jeff Bezos at Amazon are going the other way, finally settling on and revealing their sports strategy after years of inertia, marked by the odd bold experiment.

Mark Zuckerberg looks to have abandoned any sports play. Photo / Getty Images

And Netflix has become an increasingly emboldened rider at the same time as Google appears to be slipping off the back of the pack, about to be overhauled by a flashy new entrant in TikTok.

But Google still has an oversized influence within the race via its ownership of YouTube, the company with the most intriguing strategy when it comes to sports.

In Sports Insider’s view, the leading horsemen are Amazon, Apple, YouTube, TikTok and Netflix.

In the first of a two-part Sports Insider special, we sum up the contrasting strategies of the Big Five and how they are changing the way global – and Kiwi – sports fans are viewing and consuming sport.

Today, we take a look at Apple and Amazon, while part two will focus on Netflix, YouTube and TikTok. And next week, we ask what Sky TV in New Zealand can do to withstand the challenge of the Big Tech players, and what it all means for you, the sports fan.

Amazon’s new Champions League deal signals tech giant’s arrival as a global player

Amazon’s boldest sports play yet has just got under way in the UK, where the Jeff Bezos-owned subscription behemoth is in the first of a three-year, £1.5 billion ($3.22b) contract for Uefa’s Champions League.

Amazon gets to broadcast 17 first-choice games from the wildly popular football competition per season, screening them on its Prime channel – which is free for Amazon subscribers.

The deal virtually replicates a 2019 agreement that Amazon struck with England’s Premier League (EPL), which at the time represented a significant step up in the evolution of Amazon’s sports strategy.

It was the first top-tier rights deal Amazon had done anywhere in the world and overnight elevated it into the upper ranks of sports broadcasters.

Amazon played on the EPL’s desire to attract a big tech streamer into its domestic rights auction and secured a 20-match package for just £30 million ($64.5m) a season.

Before that, and despite repeated predictions of the sleeping e-commerce giant awakening to sport’s potential, Amazon had only dabbled with modest tennis and National Football League (NFL) deals in the UK and the United States.

The EPL deal has clearly worked, given Bezos and Amazon have now rolled out the same type of agreement with the Champions League.

The Champions League contract includes two full match days in December, meaning Prime UK can show every single team during the busiest shopping season of the year.

Prime will stretch these matches across the Christmas and New Year buying cycle to continue its core online retail business of selling you everything from umbrellas to unicycles.

This is Amazon’s secret sauce in sport’s streaming wars – it can subsidise rights deals and make them even more appealing to casual fans.

Real Madrid's Arda Guler tussles with Borussia Dortmund's Marcel Sabitzer and Pascal Gross in a Champions League game. Photo / Getty Images

The logic is that live Champions League and EPL throughout the year, and not just at Christmas, will encourage sign-ups and aid retention – especially if Prime has the most attractive ties and you can see all the big-name teams.

For a fee usually costing less than $100 a year to join Amazon Prime, an annual sub not only gives you shopping bonanza access but also a truckload of streaming content, including increased live sports offerings and documentaries.

This gives Amazon a distinct advantage over pure-play content providers like Netflix and YouTube, with Apple the only other player that offers products beyond programming.

Amazon is also able to minimise what it pays for sports rights because its model often does not require exclusivity.

It will happily co-share rights with others and back its other online temptations to secure your subscription ahead of more specialist offerings.

It’s what makes Bezos and Amazon a dangerous foe for big traditional broadcast players like the BBC, ITV and Sky in the UK, Channel Nine and Fox Sports in Australia, Fox, CBS, ESPN and others in the United States and Sky here in New Zealand.

The downside is that if you are a hardened Arsenal or Liverpool fan, you will need an additional subscription with another provider to watch every game your favourite team plays ... which means more money, of course.

Amazon is backing itself so that sports fans among its subscriber base will be satisfied with a regular clutch of top games and will find its deal more economically appealing than paying £29.99 ($64.50) a month for rivals like TNT Sports.

“Millions of people already have Prime so, for them, this is a wonderful additional property that is effectively free,” Amazon said in a statement when the Champions League deal was announced.

Not that exclusive deals are entirely off Amazon’s radar.

It paid US$1b ($1.68b) a year for exclusive Thursday Night Football rights in the US and signed an agreement with the National Basketball Association (NBA) for men’s and women’s competitions worth US$1.8b annually.

Amazon’s deep pockets and ability to subsidise its sports rights deals make it one of the most formidable of the international streamers.

With US$575b in revenues just last year, the Bezos company is also significantly placed to step up the race pace.

Apple wants to rule your sporting world – and its app is at the heart of it

Apple’s strategy is very similar to Amazon’s – lure you into their walled garden and then keep you there.

But its means of achieving that goal is markedly different to its e-commerce rival.

Like its major competitor, Apple has sent mixed messages to the sporting world for close to a decade.

And also like other big tech players, that all changed this year.

But what sets Apple apart is its unique strategy, which is based on a bold new app, securing internationally appealing live sports rights and a potentially game-changing spectator play with its Vision Pro product.

Apple is backing football’s global appeal as its breakthrough product. It spent US$2.5b to secure the exclusive live rights for 10 years to American Major League Soccer, including incentivising the world’s best player, Lionel Messi, in a unique deal that brought him to Miami.

Contracts with Spain’s La Liga, England’s Premier League and Germany’s Bundesliga followed while Apple further expanded its American portfolio this year with deals with the NBA and the NHL (North America’s National Hockey League).

Importantly, all of these rights have been integrated into Apple’s new sports app, which also has a heavy emphasis on delivering stats and other data to viewers.

“We developed Apple Sports to give sports fans what they want – an app that provides incredibly fast access to scores and statistics,” a company spokesman said at the launch.

Apple’s Tim Cook has made it clear the iconic company wants a big role in professional sports. Its experimentation with the NBA on its Apple Vision Pro product also shows it wants to be a world leader in innovation.

Cook is backing Apple Sports to become a hub for fans within the Apple ecosystem, including the potential to use Vision Pro, launched last year, as a breakthrough viewing companion by sending personalised stats and information during a game.

The ability to introduce virtual and augmented reality into live sports coverage could become Apple’s advantage and is likely to also create new interesting immersive and gaming-focused business models that will appeal to rights holders.

Vision Pro is already seeing a significant uptick in applications from sports leagues including the PGA Tour, NBA and Major League Baseball (MLB).

“Viewers will feel every heart-pounding moment in 8K 3D with a 180-degree field of view and spatial audio that transports them to each match,” according to Apple.

Like Amazon, Apple is well placed to corral sports fans, whether it’s by promoting its Apple Sports offering above other products on its app store or offering deals with its music store, merchandising, memorabilia and ticketing arms.

“It can become the future home of all live sports by becoming a “one-stop-shop”, one analyst observed.

Alongside Amazon, Apple is a dangerous and cashed-up horseman with a total revenue of US$383.3b in 2023.

The global tech giant is also aided by its size and reach, with many rights holders willing to do cheaper deals in return for the Apple footprint.

In recent times, Apple has also followed Netflix into the sports documentary genre, where costs and management of the content is cheaper than live rights but also garner plenty of eyeballs.

Next week: What Netflix, YouTube and TikTok are up to – and can Sky NZ stop the onslaught?

World Rugby chief to be decided tomorrow

The most significant rugby meeting of this week will not happen on the playing pitch this weekend, despite another full round of Northern Hemisphere v Southern Hemisphere test matches.

Over the next 24 hours, national unions from around the globe will gather in a Dublin hotel to hammer out who leads World Rugby into the future as its chair, in the wake of Sir Bill Beaumont’s retirement.

There’s a lot at stake. And, interestingly, the normal divide around voting preferences between the Northern and Southern Hemispheres is not apparent.

For example, England is backing New Zealand’s open support for Australian candidate Brett Robinson, who remains the favourite.

Brett Robinson. Photo / Three Plus

There is support for France’s former test star Abdelatif Benazzi and also for Italy’s Andrea Rinaldo. The winner needs 27 votes and should Rinaldo be eliminated in the first round of voting, Benazzi could gain enough last-minute backers to upset Robinson.

Whoever wins the race has a massive challenge in front of them ... New Zealand’s upset of Ireland may have been compelling for All Blacks viewers but for the neutral observer, it was yet another dour and dispiriting watch.

The English Guardian put it well in summing up what awaits the victor: “Unions playing a muted version of the away anthem over the public address before firing up their own anthem singer to do the home anthem maximum justice. Allowing one team to do a full-on ceremonial haka while simultaneously barring the opposition from putting so much as a toenail over the halfway line. Permitting six fresh forward substitutes to rumble on simultaneously while still marketing rugby as a game for all shapes and sizes. The winner of Thursday’s vote will inherit a bulging in-tray.”

Team of the Week

Razor’s All Blacks – After gutsy wins over England and Ireland, what was looking like a shaky first season for Scott Robertson can finish triumphantly with a victory over France in Paris this weekend, followed by success over Italy in the final test of the year.

Joseph-Aukuso Suaalii and Isaah Yeo – The man-of-the-match award for Sua’ali’i on his Wallabies debut in the upset win over England was a tad over-the-top but the kid is an undoubted talent. As for Yeo, a State of Origin win with New South Wales, a fourth premiership with Penrith and now captaining Australia to a Pacific Championships title. Has any league player ever had a better season?

Steve Alker – A bumper payday on the PGA Champions Tour for the Kiwi veteran with a $2.5 million-plus haul at the final event of the year, the Charles Schwab Cup Championship, pocketing US$528,000 ($888,000) prizemoney and a US$1m ($1.68 million) bonus for the season title.