MLS strikes a 10-year, $2.5 billion-plus global contract with Apple for all MLS matches, first of its kind in America

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When it became obvious that MLS rights were set to be up for grabs for local, national, and international transmission this year, there were a lot of speculations in recent months about what could happen. The speculations have been put to rest as Apple and MLS sealed an exclusive deal during the week.

MLS strikes a 10-year, $2.5 billion-plus global contract with Apple for all MLS matches ... Some needing subscriptions while others does not

In March, The Athletic’s Sam Stejskal reported that CBS, Fox, and ESPN “had not showed much – if any – interest,” implying that the league would do something different in their next arrangement. In fact, MLS took an unusual step by securing a 10-year global partnership with Apple to broadcast all MLS matches (beginning in 2023).

MLS becomes the first major U.S. sports league to go fully-streaming (with some exceptions, which we’ll get to later), and it also represents Apple’s first deal for all of a major league’s programming, according to Sports Business Journal’s Alex Silverman and John Ourand.

Here’s more from the Major League Soccer press release:

Apple and Major League Soccer today announced that the Apple TV app will be the exclusive destination to watch every single live MLS match beginning in 2023. This partnership is a historic first for a major professional sports league and will allow fans around the world to watch all MLS, Leagues Cup, and select MLS NEXT Pro and MLS NEXT matches in one place — without any local broadcast blackouts or the need for a traditional pay-TV bundle.

From early 2023 through 2032, fans can get every live MLS match by subscribing to a new MLS streaming service, available exclusively through the Apple TV app. In addition to all of the match content, the service will provide fans a new weekly live match whip-around show so they never miss an exciting goal or save, and also game replays, highlights, analysis, and other original programming. This live and on-demand MLS content will provide in-depth, behind-the-scenes views of the players and clubs that fans love. A broad selection of MLS and Leagues Cup matches, including some of the biggest matchups, will also be available at no additional cost to Apple TV+ subscribers, with a limited number of matches available for free. As an added benefit to fans, access to the new MLS streaming service will be included as part of MLS full-season ticket packages.

There are also statements from MLS commissioner Don Garber and Apple executive Eddy Cue in the press release:

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“Apple is the perfect partner to further accelerate the growth of MLS and deepen the connection between our clubs and their fans,” said MLS Commissioner Don Garber. “Given Apple’s ability to create a best-in-class user experience and to reach fans everywhere, it’ll be incredibly easy to enjoy MLS matches anywhere, whether you’re a super fan or casual viewer.”

“For the first time in the history of sports, fans will be able to access everything from a major professional sports league in one place,” said Eddy Cue, Apple’s senior vice president of Services. “It’s a dream come true for MLS fans, soccer fans, and anyone who loves sports. No fragmentation, no frustration — just the flexibility to sign up for one convenient service that gives you everything MLS, anywhere and anytime you want to watch. We can’t wait to make it easy for even more people to fall in love with MLS and root for their favorite club.”

As a result, the distribution in this case warrants more discussion. While all of the matches will be available on the Apple TV app (which is available on many third-party smart TVs, Roku devices, and other connected TV devices in addition to Apple devices), they will be priced differently.

Viewers will need a subscription to the new MLS subscription service, which will be sold separately from a regular Apple TV+ subscription, in order to watch every match. (This is comparable to the former MLS Live out-of-market service, which was incorporated into ESPN+ in 2018, but with the added benefit of no blackouts, allowing it to be used in-market as well.) Furthermore, the actual cost of the service has yet to be announced.

MLS strikes a 10-year, $2.5 billion-plus global contract with Apple for all MLS matches ... Some needing subscriptions while others does not

However, individuals who already pay $4.99 per month for Apple TV+ will be able to watch some matches. Other games will be available in the app without requiring a paid subscription (similar to what Apple has done for their Friday night MLB package so far, their previous largest live sports deal).

According to SBJ’s Silverman and Ourand, negotiations for some matches to be shown on linear TV as well as through the Apple TV app are still in the works (including with ESPN and Fox). The revenue data in that SBJ article are also interesting:

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MLS execs said that Apple is not paying a straight rights fee for the package of rights. Rather, Apple is paying a minimum guarantee that sources say is worth $250M per year starting in ‘23. MLS will start to bring in more revenue as Apple sell subscriptions for a newly launched MLS subscription offering. “What’s different here is traditionally media companies pay rights fees, and you sell ads,” said MLS Commissioner Don Garber. “This is a partnership. And that partnership’s core is a subscription business that we’re going to build together, and we’re going to get a guarantee against the revenues that will be achieved on the subscription business. Then, we go over those guarantees, we’ll have the opportunity to make more money, which is really unique in sports media.”

That is unquestionably a one-of-a-kind deal. ESPN’s guarantee of $295 million over 20 years to the University of Texas for the (soon-to-be-defunct) Longhorn Network insured that the Longhorns would receive their money regardless of how well the Longhorn Network performed for ESPN (note: not that well). However, that was supposedly a guarantee rather than a profit-sharing arrangement (which, in the end, didn’t matter because LHN lost money). This one has a guaranteed floor as well as upside potential if a large number of subscriptions are sold.

As a result, it has some interest for MLS. Even the $250 million yearly floor guarantee is much beyond the estimated $90 million they were earning from ESPN, Fox, and Univision for national rights in the United States, and it’s also well above the $150 million to $200 million many predicted in March.

Yes, this means less access to linear TV, but that’s part of the reason the figures are so good: streaming providers frequently have to pay a premium to obtain previously-linear rights. The inclusion of local and worldwide rights, which were not included in the ESPN/Fox/Univision bundles, is another major reason for the higher numbers, but MLS wasn’t doing all that well with those either.

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They now have a single media partner for everything, and it’s a media partner with a large worldwide reach who might be able to help them get a bigger deal elsewhere.

And there’s a case to be made that MLS is better suited to all-streaming than many other leagues. Its audience has been described as being younger than that of many sports (for example, in a 2017 story, Sports Business Journal estimated the average age of MLS fans to be 40, the youngest of any North American league).

This indicates that the MLS audience is more accustomed with streaming and has connected TVs, rather than having traditional cable or satellite bundles. (And the group of people who do not have access to a multichannel television provider, whether cable, satellite, or virtual, could benefit the most from this.) Most sports have made a half-hearted foray into streaming, urging fans to keep their MVPD subscriptions while also purchasing over-the-top services.

MLS strikes a 10-year, $2.5 billion-plus global contract with Apple for all MLS matches ... Some needing subscriptions while others does not

An MVPD will no longer be required for those who just care about MLS in the context of (live sports.) It’s also worth noting that Major League Soccer has dabbled in streaming before, with local arrangements with YouTube TV and fuboTV, so they and their fans are familiar with the process.

There’s also some logic to why Apple would benefit from this. For starters, this grants people global and local rights in addition to the traditional national ones. The capacity to attract both local and national fans for the same broadcasts, as well as the opportunity to display these matches around the world, may assist improve MLS national TV ratings.

They’ll also create several language broadcasts, with English and Spanish feeds available for all MLS teams based in the United States, and English and French feeds available for all MLS teams based in Canada.

However, fans who appreciated local RSN/streaming coverage of their MLS team may be disappointed. According to The Oregonian’s Ryan Clarke, MLS president and deputy commissioner Gary Stevenson has stated that this is coming to an end.

However, Stevenson stated that teams can build their own pre- and post-game content if they choose, as well as local radio broadcasts and the ability to use audio from local radio in the Apple app):

As Soccer America’s Paul Kennedy pointed out, this coincides with MLS’s shift to more consistent matchdays on Wednesdays and Saturdays:

We’ll have to wait and see how this partnership between MLS and Apple turns out. But it will undoubtedly be a significant change.

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