CUPERTINO, Calif. (AP) — After taking the first step into sports streaming last year, Apple is now dipping into itself.
The tech giant kicked off its 10-year partnership with Major League Soccer on Wednesday with the launch of the Season Pass on Apple TV+.
“This is very important to us. It’s one of the key things we’re going to do this year and the next 10 years. We’re now part of a family,” Apple AAPL said.
CEO Tim Cook said this during a presentation to MLS players, owners and media at Apple Park last month.
Apple’s launch comes after a transformative year for sports and streaming services. Prime Video further embraced NFL streaming last year, partnering with Apple TV and Peacock to stream “Thursday Night Football” and Major League Baseball games. In addition, the NFL has reached a deal with Google’s YouTube TV to launch a “Sunday Ticket” package next season.
Tech companies and broadcasters see the value of live sports programming. According to a recent report by Parks Associates, revenue from sports streaming subscription packages is expected to grow 73% to $22.6 billion by 2027, after generating $13.1 billion last year.
In the era of cord-cutting, tech companies, advertisers and sports leagues are finding that younger viewers are moving to streaming and watching longer.
According to Amazon tracking data, 22% of “Thursday Night Football” viewers on Prime Video were in the coveted 18-34 age demographic, compared to 14% of viewers watching NFL games on linear networks.
The average viewing time for “Thursday Night” games was 85 minutes – nine minutes longer than non-prime games.
Apple joining MLS makes sense for both parties. Various studies have shown that soccer fans are more likely to watch sports on streaming devices or recorded TV.
“This is a contract that defines where things have been headed for some time and will push it forward,” said Daniel Kirchner, founder and CEO of Greenfly, a digital media distribution platform that works with 30 leagues.
MLS receives at least $250 million per season from Apple. The league averaged $90 million per season under its previous eight-year deal with Fox, ESPN and Univision.
Apple has experimented with sports streaming before, but this is its first significant involvement in the league. MLB aired two games on Apple TV+ on Friday nights last year, including a game in which St. Louis’ Albert Pujols became the fourth player in baseball history to hit 700 home runs.
This deal could indicate where sports streaming and the league’s media rights are headed.
Apple and MLS are teaming up for a direct-to-consumer product that allows fans to watch every game without local congestion or restrictions and reaches beyond North America. Fans can watch the game in London, Paris and on the Apple TV app.
“We look at sports and believe there’s never been a better time to be a sports fan, and there’s never been a worse time to be a sports fan,” said Eddie Cue, Apple’s senior vice president of services. “With this partnership, we have the opportunity to make the experience even better for fans and help grow the sport and the league in the US and beyond.”
As European soccer leagues do business, MLS is organizing all of its matches. But other leagues, such as the Premier League and Germany’s Bundesliga, sell their rights to broadcasters in their respective countries. In this case, only one outlet – Apple – has global rights.
Games will be on Fox in the United States, TSN and RDS in Canada, and TelevisaUnivision on the Apple TV+ app.
“I think the long-term value of their rights is with streaming partners or technology partners, as opposed to the traditional leagues that need billions of dollars in payments from traditional networks,” said John Cohen, senior vice president of Frequency, which provides software for ad-supported streaming channels. “
While Apple TV+ had success last year as the first streaming service to receive an Oscar for best picture with “CODA,” and “Ted Lasso” won back-to-back Emmys for best comedy, it’s not turning into an entertainment company or studio. . It remains a diversified company.
“Sports drives a lot of engagement in terms of media. I think it shows that they have a very different strategy when it comes to growing their subscription and video services,” Cohen said.
MLS and Apple’s progress will be closely watched by other leagues. While the NFL, NHL and baseball have finalized rights deals over the past two years, the NBA is expected to have some streaming component when it begins negotiations over its media rights this year.
Koo and Cook recognize that there will be growing pains in the first year, especially as MLS gets up to speed with its own production company. However, everyone is focused on the potential of the project and the way forward.
“People are going to say we’re the smartest guys in the class or we were two years too early,” MLS commissioner Don Garber said. “The possibilities are endless, but it’s a job with many trials.”