Report: Facebook is ready to invest billions in sports streaming rights

Dive Brief:

Facebook is reportedly looking to hire an executive whose main responsibility will be to negotiate sports streaming deals, according to Recode. The person is said to have a budget of a "few billion dollars" to spend to secure those rights.
Analysts suggest that that amount of money wouldn't stretch very far in the traditional TV world, but could be used to acquire multiple online-only streaming licenses, per Recode. Facebook recently bid $600 million to stream cricket matches in India over the next five years, but lost the deal to Star's $2.6 billion offer for a combined TV and digital package.
The social media giant, along with YouTube and Twitter, lost out to Amazon for streaming rights to the National Football League's (NFL) Thursday Night Football earlier this year after the e-commerce giant won with a $50 million bid along with a reported additional $30 million in marketing and advertisement for the league. Facebook was reportedly an early bidder for the deal in 2016, but pulled out of the process before the league made the final decision to give streaming rights to Twitter for $10 million.

Dive Insight:

If the report is correct and Facebook soon hires a person dedicated to nailing streaming deals, the social network could become a much more aggressive player in a potential new wave of growth for digital sports viewing.

Though Facebook lost the cricket-streaming deal, the bid itself — along with the hiring of an executive dedicated to landing streaming deals — suggests that the social platform is willing to spend major money to reel in sports fans. This executive would build upon Facebook's current efforts in sports-related content, including deals with the NFL for post-game highlights, Major League Baseball to stream 20 Friday games last season, Major League Soccer last March and Univision Communications' Univision Deportes to stream games.

With its shift toward sports, Facebook appears to view live sporting events as key catalysts to driving user growth and eventually digital ad revenues, especially as more marketers shift their ad dollars from TV to digital media. Live sports could position the social media giant to better connect with younger fans and combine viewing, gaming and real-time commentary on a streamlined platform to boost engagement beyond the traditional linear experience.

Professional sports has been seen as one of the last bastions of live TV viewing but this is changing as more consumers continue to cut the cord on traditional TV and digital alternatives like Facebook and Netflix increasingly becoming top-of-mind. The recent competition between big-name digital platforms for NFL streaming rights, including Facebook, Verizon and YouTube, points to how fans of major sports leagues are coveted by broadcasters and advertisers because they're generally considered loyal viewers.