How the Premier League became too expensive even for Amazon ...

Armchair football fans in the UK were given cause to rejoice ahead of Christmas when the news dropped last week that Jeff Stelling and Chris Kamara were to be reunited this Boxing Day.

The old double act, best known for an on-screen friendship built through the Sky Sports’ Soccer Saturday show, will be back working together for the first time in two years as Kamara covers the Premier League game between Nottingham Forest and Tottenham Hotspur, with Stelling hosting back in the studio. Kamara’s improving health, in particular, makes it an uplifting tale for an Amazon Prime audience to kick back and enjoy.

A revisiting of one era, though, coincides with the end of another.

Amazon’s six years as a Premier League rights holder effectively comes to a close over the festive period. The streaming giant will cover all 10 games played on December 26 and 27, but after that, there will be nothing. Arsenal’s home game with Ipswich Town on Friday will be the last action they broadcast.

Next season marks a new domestic TV cycle for the Premier League and Amazon will not be a part of it. Up to 270 live games, an uptick in the number broadcast live, will be shown and all will either be on Sky Sports or TNT Sports. That four-year deal, running through to 2029, was worth a monstrous £6.7billion.

Amazon chose not to be involved. Their neat, little 20-game package was no longer available when the Premier League ran their auction last year, with the smallest available, offering 56 games a season, bought by TNT. The other four packages predictably went to Sky, the Premier League’s longest-standing ally.

The sums involved were ultimately too big for Amazon. For six years, they had paid in the region of £30million to cover two 10-game rounds each Premier League season. It would likely have cost them 10 times that amount to retain a seat at the table from 2025-26 and the decision was made to quietly withdraw from the partnership. Amazon’s footballing focus in Europe is now on the Champions League, with a cut of broadcast rights held in the UK, Germany and Italy.

A union between the Premier League and Amazon was supposed to drum up long-term competition, opening the door for more streaming platforms to inject new life into the market. Instead, it is back to the old guard of Sky and TNT, whose financial commitments still cannot be surpassed.

“If you want to challenge Sky, you must put a lot of money on the table,” says Francois Godard, senior media and telecoms analyst at Enders Analysis.

Amazon chose not to do that. Premier League football, for now, can no longer offer the value to fit their UK business model.

It was June 2018 when Amazon and the Premier League first confirmed their partnership. The stranglehold of Sky and BT Sports (since rebranded as TNT) was broken when the new kid on the block bid successfully for one of two packages that had not hit their reserve price in an initial auction four months earlier.

The 20 games spanning two rounds meant Amazon would show every team twice, once in the midweek round of early December and again in the round of fixtures that followed Christmas.

Richard Scudamore, then chief executive of the Premier League, called Amazon an “exciting new partner” for the 2019-20 season and beyond.

“Scudamore, at the time, was keen to bring a streamer on board,” says Paolo Pescatore, an analyst at PP Foresight, a research business with over 25 years of experience. “It felt like they were almost given away to attract someone like Amazon to the table, but also for Scudamore to save face. It was an extremely opportunistic move from Amazon.”

The TV industry, too, sat up and took note. The service was not free, costing about £8 a month, but many in the UK already had a subscription and many more regularly used Amazon for shopping.

The company’s intent was revealed by the package they bought. In the busiest shopping period of the year, between Black Friday and Christmas, customers were enticed to sign up for Amazon Prime with the attraction of live Premier League through their streaming platform.

And it worked. The first games shown in December 2019 had Amazon toasting two nights of record sign-ups. The broadcaster said “millions” had tuned in to their platform and by February 2023, when Manchester City won 3-1 at Arsenal, there was an audience in excess of four million.

“Amazon’s objectives are very simple and it’s all about driving the value and subscriptions around the Prime service,” says Pescatore. “Nothing more than that. Everything they do is all about Prime and getting more and more people to sign up as a Prime customer.

“The rights themselves were perfectly aligned with their own strategy, driving sales for consumers during the holiday season. That would have been great for them, but we’ve probably got to the point now where they got all the subscriptions they possibly could thanks to the Premier League. They still have to produce content all year round and that’s perhaps why they’ve shifted focus to something like the Champions League.”

Amazon enjoyed a good run and one that was arguably reliant on the Covid-19 pandemic for coming this far. The original three-year arrangement, struck for 2019-20 through to 2021-22, was rolled over without a tender due to the financial uncertainty that had descended. Three seasons became six at a price that Amazon were only too willing to pay.

“For the money Amazon spent, they will have been very happy,” says Godard. “If the same thing had been available, I’m sure they would’ve been interested again, but that package was not there.

“They came into the Premier League with a retailer’s mentality, wanting people there on the platform right at the time they would shop most, and then moved towards a broadcasters’ mentality, where you need to people to come back to your service.

“For that, weekly sport is ideal. Amazon were so happy with the Champions League in Italy and Germany that they switched to the UK. I never saw this as a vote against the Premier League, but it is so expensive.”

If the Premier League felt they needed Amazon in 2018, it was not the case last year. Six packages became five and, over a four-year domestic cycle, collectively they were sold off for roughly £1.68billion a season.

That was only a small increase, roughly four per cent, but a notable one given the struggles of other major European leagues and their domestic rights packages. It works out as each Premier League game shown in the UK costs just over £6million. Too much, in short, for Amazon.

“It’s not that Amazon don’t have the appetite for live sport,” says Pescatore. “Look at what they’ve done in the U.S. with the NFL (winning exclusive rights for Thursday Night Football in 2021 for a reported $1billion a year) and the amounts of money being spent.

“They’re clearly willing to invest if they see value, but for a market like the UK, to make a serious dent as a rights holder and challenge Sky, you’ve got to spend £1billion. There’s a huge disconnect with what Amazon paid for this current set of games to what they would need to pay as a minimum for the next cycle. It didn’t make financial sense for them.”

For all that the Premier League has wedded itself to traditional domestic broadcasters for the next four years, the wider rights market continues to see newcomers and disrupters making themselves known.

DAZN, the streaming platform, secured exclusive rights to show all 63 matches at next summer’s FIFA Club World Cup, while Netflix last week made another step into the live sports arena when buying the U.S. rights for the Women’s World Cup in 2027 and 2031. Apple TV planted its own flag in 2022, securing a 10-year rights package for the MLS worth $2.5billion.

Live sport carries increasing appeal to the streaming platforms, but the risk remains.

Could Amazon ever convince itself that a £1billion investment in the Premier League’s domestic rights would be justified by a subsequent spike in Prime subscribers? The same question will have been asked by other platforms and, for now, there is caution.

“We will see at the next auction if there are other streamers that may come in,” says Godard. “We’ve seen YouTube have NFL rights in the U.S, Apple has the rights in MLS, Netflix is broadcasting NFL for the first time over Christmas.

“I would not bet against Netflix buying sports rights in the next few years, but they must get their model right in the U.S. before trying anything in Europe.

“It is a very different market. Advertising in Europe is far less than in the U.S. We have some figures and it’s something like 25 per cent of a sports broadcast in the U.S. is advertising, but in Europ,e it’s eight per cent.”

The Premier League can be content in knowing its own broadcast models are thriving. Without Amazon, they landed what they called the biggest sports rights sale in UK history last year and keep guaranteeing more with incremental deals struck in territories all around the world. Growth shows little sign of slowing as a global product, but the cycle that follows 2028-29 will present new opportunities.

“Despite Amazon stepping back, Sky and TNT are both well-placed to deal with the streaming revolution,” says Pescatore. “They’ve made big investments to allow people to watch over a number of devices.

“Will the Premier League ever do it in-house? The big question will be distribution and, specifically when you look at the UK, we are going towards everything being delivered over IP (internet protocol). I’m calling it the big TV switch-off when DTT (digital terrestrial television) will effectively be switched off in the 2030s, most likely 2034, where everything has to be delivered over IP.

“We’re going to see this Prem-flix type of service at some point. It could be that the Premier League decides to do it and sell the access for that through broadcast partners. The direction of travel is clear, but how we get there still isn’t.”

Amazon, after this week at least, will be watching from the sidelines.

(Top photo: Everton manager Sean Dyche on Amazon earlier this month; by Alex Livesey via Getty Images)