I thought separate meetings I had last week with the top video executives at Comcast (Nasdaq: CMCSA) and Verizon (NYSE: VZ) would help answer questions about their strategy with new technology platforms like X1 and LTE multicast.
Comcast's Matt Strauss delivered some useful answers (you can read some of those in today's feature about Comcast's push to use the Olympics to to sell X1 to subscribers nationwide, and show other distributors why they may want to license X1 for their systems).
But my interview with Verizon's Shawn Strickland and its demo of its LTE multicast technology left me with many more questions. The biggest: Could Verizon buy rights to the "NFL Sunday Ticket" package to anchor the launch of a national, virtual pay-TV service delivered through a wireless broadband network to mobile devices and IP-connected TVs?
Outbidding DirecTV (Nasdaq: DTV), whose rights to the NFL package expire at the end of the 2014 season, would be a huge gamble for Verizon. It's one thing to shell out a reported $200 million to buy Intel's OnCue virtual cable platform. It would be much riskier to acquire exclusive Sunday Ticket rights, which cost DirecTV about $1 billion per year. But there are plenty of reasons why a Sunday Ticket deal would make sense, and indications that the NFL and Verizon have much more in the works.
Verizon already has strong ties to the NFL. Last June, it announced that it signed a contract with the league that gives it exclusive rights to offer Verizon Wireless customers who subscribe to its $5 monthly NFL Mobile package every regular season NFL game produced by CBS and Fox, along with the playoffs, the Super Bowl and the NFL Red Zone channel.
And last Thursday, two days after Verizon opened its LTE multicast demonstration in New York--which showed multiple video feeds from NFL Network running on smartphones, tablets and computer monitors--the NFL said that it was partnering with Verizon on the launch of over-the-top network NFL Now this summer. The league said it will announce the details later this year of an NFL Now Plus service, which will offer premium video content to subscribers willing to pay monthly fees. Could that premium NFL Now service be a mobile version of NFL Sunday Ticket?
DirecTV executives said last year that the company would be willing to share rights to Sunday Ticket. Could the league sign a new contract with DirecTV that gives it rights to deliver Sunday Ticket on TV, while giving Verizon exclusive rights to deliver every game on Sunday to subscribers using mobile devices?
It's also worth considering the possibility that Comcast and other cable MSOs could bid for rights to deliver Sunday Ticket on any screen. Liberty Media (Nasdaq: LMCA) chairman John Malone said last October that cable operators should form joint ventures focused on delivering multiplatform content to subscribers, citing Comcast's Xfinity TV and Hulu as two possibilities. "The history of the business is replete with the industry solving its balkanization and scale problems through joint effort," Malone said.
Could those joint efforts include a cable bid for Sunday Ticket? Comcast hasn't said that it is looking to buy rights to Sunday Ticket. But the MSO is looking to license its X1 platform to other cable operators. It will use the Olympics, which begin tonight, to show the industry how X1 could shatter viewing records for content delivered to both TVs and mobile devices.
You can read our piece about Comcast using the Olympics to showcase X1 here. And for more on Verizon and the NFL, check out our story on the NFL Now announcement, and Verizon's LTE multicast demo.--Steve