NFL Sunday Ticket-YouTube TV deal: Here’s what Google will need to break even

Google better hope viewers love watching football on YouTube. Read More...

Execs at Alphabet (GOOG, GOOGL) better hope people really, really enjoy watching football on YouTube instead of — or in addition to — their broadcast networks.

Baird internet analyst Colin Sebastian estimates in a new note that Alphabet-owned YouTube TV will need to attract 2.25 million annual subscribers for Sunday NFL Ticket to reach a revenue breakeven point.

“We estimate that roughly 1.7 million would be new subscribers to YouTube TV (and pay the standard YTTV monthly fee), with about 500k up-sells to the NFL service. We also estimate that YouTube would generate about $125 million in annual streaming ad revenues from the NFL deal,” Sebastian adds.

Sebastian reiterated an outperform rating on Alphabet shares.

Earlier this month, Alphabet became the latest tech giant with almost unlimited cash to enter the pricey NFL streaming waters.

YouTube signed an exclusive streaming deal for the NFL’s Sunday Ticket package of games in the U.S. The price tag on the deal for Google is a reported $2 billion a year. The deal kicks in at the start of the 2023 NFL season.

Alphabet is a touch late to the party.

Amazon (AMZN) shelled out a whopping $11 billion in 2021 to obtain the exclusive streaming rights for Thursday Night Football over the next decade. Games began getting streaming this NFL season.

Apple’s (AAPL) new MLS Season Pass will debut on February 1, 2023, on Apple TV.

The next player eyeing the sporting arena is reportedly Netflix (NFLX). To date, the company has had success with sports franchises such as “Formula 1: Drive to Survive.”