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Miami Dolphins running back Raheem Mostert, left, gets past New York Jets safety Jordan Whitehead and carries the ball into the end zone for a touchdown during the fourth quarter of an NFL football game, in East Rutherford, N.J. on Nov. 24.
Adam Hunger/The Associated Press
In the satirical TV comedy Upload, set in a near future in which people who die can upload their consciousness to a virtual world and live forever (or as long as they can afford the monthly subscription fees), corporations dominate public life to such an extent that holidays themselves have been renamed. U.S. Thanksgiving and Black Friday have become a single family-feast-and-consumerism bacchanal known as Cyber Discount Day, in which drones buzz across the landscape delivering courier boxes bearing a swooshy logo that looks eerily like the real one for Amazon.
Created by Greg Daniels, who adapted The Office for U.S. audiences, Upload is a cheeky indictment of late-stage capitalism and our own collective shrugging surrender to big tech. Which I suppose is why it streams on Amazon’s Prime Video TV service: Consider it a comedic pressure valve installed by Jeff Bezos, so that we can enjoy a collective chuckle at our shared anxiety and then safely keep on shopping.
Because if some elements of the show seem a little far-fetched, Cyber Discount Day feels like it came to fruition this week, when Amazon used an entirely new day of NFL action to create a shopapalooza that kept millions of Americans glued to their smart TVs, safely watching football and clicking on online deals instead of stampeding over strangers to get to door-crasher specials.
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Like other global tech companies, after a few years of experimentation with live sports, Amazon is now moving forcefully into the game. Last year, the company struck an 11-year deal for the U.S. rights to Thursday Night Football, paying a reported US$1-billion for 16 games annually, including one preseason match.
This year, like a patron of an exclusive restaurant who wants to feel special, it ordered something off the menu, asking the NFL to stage a game for the first time on Black Friday, featuring Miami vs. the Jets. Amazon is reportedly paying US$100-million for the U.S. rights.
It sold plenty of ads, and armed with reams of shopping, searching, and viewing data on its subscribers, it was able to serve up to three different versions of commercials to different audiences, depending on viewer profiles.
Even so, don’t bother doing the math. It doesn’t add up, at least not in any conventional sense. Ads that aired during the game sold for upward of US$500,000 for each 30-second spot, according to reports. With an estimated 50 minutes of commercials across the three-hour broadcast, that still means a loss in the range of US$75-million.
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But the company doesn’t care, because selling ads isn’t where it makes its money. Prime is a shopping-loyalty program. Amazon just wants consumers to feel more positively toward the company by virtue of having a bunch of NFL games thrown in as part of their subscription, which will make them more likely to use the platform for their shopping.
And Amazon made sure Prime customers didn’t even have to get off their couch to shop Black Friday sales by peppering the broadcast with a series of QR codes on the TV screen, enabling viewers to use their phones to access steeply discounted offers. If you weren’t watching, you missed out.
Jay Marine, the vice-president of Prime Video and global head of sports for Amazon, noted in a podcast interview this week that the company uses sports both to create “stickiness” for Prime and to bring in new subscribers to the loyalty program. That means it can lose money on sports, as long as those programs help encourage customers to stay in the Amazon ecosystem. To that end, Marine explained that Amazon doesn’t need all of the games of any given league; it just needs a selection of the important ones, enough to ensure serious fans have to sign up.
“We want to give more than we’re charging, and sports are uniquely valuable,” he told The Marchand and Ourand Sports Media Podcast. “They are must-watch, they’re non-substitutable. If you love the Premier League, you can’t watch rugby instead. … If you love the NFL, you’re going to watch the NFL.” He added that, unlike dedicated sports broadcasters, “we don’t have to fill hours, or a linear schedule, so we can really be selective.” In Europe, Prime Video streams only one UEFA Champions League match a week, all it needs to make the service a must-have for hard-core fans.
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Apple is taking a similar approach. Last year, it struck a deal with Major League Baseball for the rights to stream weekly doubleheaders in eight countries on its Apple TV+ service – national broadcasts with no frustrating regional blackouts. Like Amazon, Apple figured it only needed a small piece of the MLB action to grab the attention of potential customers. Also like Amazon, it doesn’t need to actually make money on the sports if it can bundle Apple TV+ to boost its core business: selling more iPhones.
And now the big companies are starting to move in on Canadian broadcasters’ turf.
Last week, at the annual Primetime Sports and Entertainment Conference in downtown Toronto, a trio of executives from Rogers Sportsnet, Bell Media’s TSN, and CBC were asked what they thought was the biggest development in sports media they’re preparing to confront. Right off the top, Rob Corte, the vice-president of Sportsnet and NHL Production, said, “the big global companies … the Amazons, the Googles … it’s going to be a significant challenge for us.”
Over the past two seasons, Sportsnet missed out on broadcasting some Toronto Blue Jays games – a team owned by its parent company, Rogers Communications Inc. – because Apple owned the rights. TSN, meanwhile, aired only a selection of Toronto FC games this season after Apple swooped in and bought up the rights to all MLS games. Adding insult to injury, Toronto FC is co-owned by TSN’s parent company, BCE Inc., which has a 37.5-per-cent share of Maple Leaf Sports and Entertainment.
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Can Canadian sports broadcasters – which have a pretty simple business model, buying up the rights to sports events and selling them to viewers and advertisers for a profit – compete with companies that don’t really care if they lose gobs of money on sports, as long as they can make up the difference in selling gadgets? Amazon is the world’s second-largest retailer; it has a market capitalization of US$1.5-trillion. Apple’s market cap is almost US$3-trillion. Companies like that are planets with their own gravity and atmosphere.
In his opening remarks at the conference, Corte said that competition from the “big juggernauts that are global” is “getting pretty close, and we’re trying to figure out how to deal with it, and we might not be able to actually deal with it ourselves.”
What did that mean, exactly? Was he suggesting someone – the government? a regulatory body? – might have to step in to save Canadian sports rights for Canadian broadcasters?
This week, I requested a follow-up interview with Corte, in hopes that he might elaborate. Through a spokesperson, he declined.
2023-11-25 00:31:00
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