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Amazon wrestles ATP tennis from Sky

News, 02 August 2017
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LONDON: Amazon Prime Video will broadcast practically all top-level men’s tennis in the UK, except for the four grand slam events, as the ecommerce giant outbid the ATP’s current home, Sky Sports, in a deal thought to be worth up to £10 million a year.

The Guardian reported that tennis fans will need to purchase an Amazon Prime subscription from 2018 in order to keep up with ATP tennis. The paper suggested that the incumbent was not willing to match its previous fee, thought to be around £8m a year.

Outside of the US, this is Amazon’s first major live sports deal. The move is ominous for traditional broadcasters, as the competition becomes enlivened by digital players for whom money is not a problem.

In April, Amazon won the rights to broadcast the 10 of the NFL’s Thursday-night American football games with NBC and CBS, for $50 million, after fighting off competition from YouTube, Facebook, and Twitter – all of whom are moving into live broadcasting.

The NFL rights have bolstered Amazon’s growing ad-space opportunity. According to a Reuters report last month, the company will offer advertising packages costing up to $2.8m.

Amazon’s pockets proved deeper than that of the competition, allowing the company to add to the roster of live programming that it now offers in the US, UK, and Germany. In terms of sports, Amazon also offers live audio-streaming of the German Bundesliga, through its music service.

For Sky, the development reflects the pressure put on the broadcaster by increases in sporting rights. A recent one-off increase in its English Premier fee of £629m contributed to a 14% drop in profits for Sky UK and Ireland.

Jeremy Darroch, CEO, Sky Plc, confirmed this last week when he told reporters that the company had “walked away” from the auctions for some sports, adding that there was better value to be added elsewhere in the business.

Broadcasters Sky and BT Sport will next year fight out the renewal of their £5.14 billion deal to show the Premier league.

The Drum noted that while Sky has moved to create individual channels for each of its featured sports, the recent loss of broadcast rights to the US Open to Eurosport means that tennis has been relegated to its two mixed sport channels. In a recent analysis of quarterly earnings calls by Bloomberg, executives mentioned Amazon more than any other factor as a threat to other businesses.

Data sourced from The Guardian, Reuters, The Drum, Bloomberg; additional content by WARC staff

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