Fox pays $2.2 billion a year for NFL rights. Netflix will reportedly pay around $500 million for its recently expanded slate of games. Fox gets a lot more games – 30 or more to Netflix’s 5 – so you might assume that Netflix’s deal is relatively insignificant compared to Fox. But the low absolute cost of Netflix’s arrangement has huge strategic benefits that are potentially perilous to Fox and the other legacy TV networks.

The NFL is allowing Netflix to order à la carte, so to speak. Netflix is able to cherry-pick premium games (e.g., Thanksgiving Eve, Christmas Day, last day of the regular season), and only buy a handful of them. Fox and the TV networks get traditional full-season packages at a much higher total cost. This is a huge change to how major sports leagues traditionally sold their rights that is not being fully appreciated by the market.

Traditionally, if a broadcaster wanted to air a league’s marquee games/dates, the broadcaster had to step up to an extremely expensive full-season package. Even five years ago, it would have been a non-starter to sell premium games like Christmas Day or Thanksgiving to a broadcast partner not paying “full freight”. But that’s rapidly changing. The leagues are desperate to have the tech companies as buyers of live games, which is allowing the streamers to cut deals for some of the league’s best events at total annual rights fees that are a fraction of those paid by the traditional TV companies.

Said another way, the leagues like the NFL are beginning to allow streamers to extract much or most of the benefits of being an NFL partner without the huge total financial commitment that could eat into the rest of the streamers’ content/business. That’s a big advantage that’s quietly punishing the legacy TV companies’ non-sports business.

The menu

Annual NFL rights / NFL as % of total content budget:

• Fox — $2.2B / ~22%

• Paramount/CBS — $2.1B / ~14%

• Disney (ABC/ESPN) — $2.7B / ~12%

• NBC — $2.0B / ~8%

• Amazon TNF — $1.0B / ~4.5%

• Netflix — $500M / ~2.8%

What each tier is actually buying

The legacy prix fixe package is the full season: 30+ game windows, weekly (or more) full-season studio production, year-round NFL operations infrastructure, playoff rotation including a Super Bowl every four years. The Titans–Cardinals 1pm slot in Week 11 comes with the package whether you want it or not.

The streamer à la carte package is marquee inventory, scaled to fit alongside the rest of the company’s content commitments. Amazon has exclusive Thursday nights and matchups that have gotten better every year — a single premium weekly proposition. Netflix has Christmas Day, which they’ve turned into a brand campaign as much as a sports broadcast. Both get to choose limited premium inventory for maximum eventizing potential. Neither absorbs the huge total cost of a traditional full Sunday (or Monday night) plus playoffs package.

Increasingly streamers buy some cream off the top. Legacy networks pay for the cream and everything underneath it.

The flexibility advantage

Netflix at $500M for the NFL is less than 3% of their ~$20B annual content budget. That leaves the lion’s share for entertainment, films, anime, games, international originals — the actual core subscription drivers of their business. They get the NFL halo, sub retention throughout football season, major advertiser tentpoles for the ad-tier sell, the “Netflix is in sports now” brand positioning. And ~$18B+ left to keep widening the entertainment moat.

Fox at $2.2B is 22% of an estimated $10B content budget. That leaves ~$8B for everything else Fox does — news, scripted, Tubi, non-NFL sports, digital. The NFL spend is fixed, escalating, and load-bearing on Fox’s entire carriage and advertising proposition. And the share of Fox’s money going to the NFL may increase dramatically given that the NFL is reportedly looking to renegotiate Fox’s fees.

This same logic applies to Amazon. Its exclusive Thursday package serves as a major retention tool for Prime Video, and Amazon/Prime Video is able to market and position itself as an NFL partner right alongside the legacy TV companies. But at a total price point and share of its content budget that’s half that of the traditional broadcasters.

Compounding exacerbates the issue. Each year, the absolute gap in non-NFL content spending widens. The NFL isn’t just an inventory cost for Fox — it’s an opportunity cost preventing them from competing across the rest of the content market.

Netflix gets the brand and business benefits of being an NFL partner for ~25% of Fox’s absolute commitment. Amazon gets it for 50%.

The asymmetric risk

Three forces compound against the legacy partners.

Concentration. Fox at 22% of total content spend on one league is the most aggressive single-property concentration in major US media.

A rising price floor. Expanding the buyer set raises every bid in the room. With Amazon and Netflix now in the market, the NFL has every incentive to push all partners — legacy and streaming alike — toward higher prices at the next renewal cycle. The legacy networks will have to absorb those raises with no room to grow into the spend. The streamers can absorb the same increases at the margin without breaking their P&L.

Linear erosion. The NFL deals were underwritten on a carriage and linear ad model that’s structurally weakening. Carriage fees are constrained by distributor margins, which are constrained by cord-cutting. The funding base is shrinking while the commitment rises.

Higher NFL spend, on smaller content budgets, funded by a shrinking carriage stack, with no capacity left to invest in the rest of the business — that’s a one-way ratchet for legacy TV nets.

The close

The NFL’s tiered pricing looks like an expansion of partners. It’s actually a slow squeeze on the legacy networks, who are buying volume at absolute price points that don’t leave room to compete anywhere else. The streamers are signing much smaller commitments, with the bulk of their content budgets free to win the rest of the entertainment market.

In any market with rising input costs and shifting distribution, the partner with optionality wins. The NFL’s best deal isn’t going to the network paying the most.

Two of the best-performing women’s sports properties — the WNBA and the NCAA Division I women’s basketball tournament — are now drawing audiences that would command much higher rights fees if either property were sold standalone on an open market. Neither one has been sold that way. There’s a few reasons for this.

The gap, in round numbers

WNBA national telecasts now average over 1M viewers. That’s roughly half the NBA’s 1.8M regular-season average. The new WNBA rights deal pays about $280M/year; the NBA’s pays about $7B. Half the regular-season audience, 4% of the money.

The 2026 NCAA women’s tournament averaged 1.3M viewers per game against the men’s 11M. The women’s tournament is valued at about $65M/year inside a broader ESPN package. The men’s tournament pulls roughly $1.1B. About 12% of the audience, about 6% of the money — and the women’s championship game alone drew 10M viewers to the men’s 18M.

If either property were being sold cleanly, on its own, with multiple buyers competing on an audited audience number, you’d expect both would price much higher. They aren’t being sold that way for at least three reasons.

One: carriage doesn’t reprice fast

ESPN and other broadcasters fund sports rights spending in large part through the network carriage fees they charge Comcast, YouTube TV, and other distributors. That rate doesn’t get rebuilt from scratch — it gets renegotiated against the prior cycle plus an escalator. The 2026 WNBA deal is anchored to what the league was worth way pre Caitlin Clark, i.e., years back when it averaged 200K viewers. And the WNBA and Women’s March Madness are just a couple sports properties inside much bigger programming lineups on NBC, CBS, ESPN, etc. Drastically re-rating one league inside a much larger bundle isn’t something networks or distributors do often (if ever).

Two: distributors are short on money

Even if ESPN or another broadcaster wanted to argue for a higher WNBA value, Comcast, Charter, YouTube TV and the like have trouble with the math. Most TV distributors are losing subs every quarter. There’s little-to-no headroom to fund new rights inflation for emerging sports leagues. The NFL, NBA, MLB, and college football already absorb whatever capacity exists.

Three: both properties were sold inside bigger deals

The WNBA was negotiated alongside the NBA’s $76B megadeal. The NBA captured its 150%+ raise on its own product and accepted a WNBA number that worked as a throw-in. The $280M wasn’t an arms-length valuation. It was the residual.

The NCAA case is also stark. ESPN paid $115M/year for 40 NCAA championships as a single package. The women’s basketball tournament — about $65M of that — is effectively subsidizing the broadcast of 39 lower-audience properties: softball, gymnastics, wrestling, and the rest. The NCAA accepted a discount on its most valuable women’s property in exchange for ESPN’s willingness to produce the rest of the inventory. Standalone estimates for the women’s tournament have been in the $80–110M range for years.

A long-term bet to watch

CNBC’s 2026 valuations put the average WNBA franchise at $460M. Golden State crossed $1B in year two, three years after paying a $50M expansion fee. Those investors aren’t underwriting the 2026 rights deal. They’re underwriting the 2036 deal, and betting that one or more of the constraints above will give way before WNBA media rights go back out to market.

The WNBA deal does include a three-year adjustment provision that lets the league and its partners revisit the value in 2028 — and the NWSL used a similar mechanism last fall to expand its deal mid-cycle after 72% YoY ESPN viewership growth. So the renegotiation path isn’t entirely theoretical. But absent that kind of trigger, the W and its players are sitting on a media deal that’s much larger than its immediate predecessor but that still captures only a small fraction of the value implied by current TV ratings. Same for Women’s March Madness. Inertia is a mother…

NBC called it a “triumph.” ESPN called it their most-watched season in seven years. The NBA called it record-setting — the most-watched regular season in 24 years. Then the broadcasters reported earnings.

NBC’s Peacock lost an additional $200M+ on an Adjusted EBITDA basis relative to Q2 2025 — notable given that Wall Street has been laser-focused on streaming profitability, and because NBC cited Peacock as a central rationale for buying NBA rights in the first place. ESPN’s revenue increased just 2% versus Q2 2025, while costs were up 3% and operating income fell 5%.

Across X, their websites, and press releases, the ratings praise was circulated widely by the league, its broadcasters, and sports business writers. For many analysts, the numbers were a thumb on the scale for the argument that “the NBA is back.” Accepting the historical comparisons at face value, a financial windfall seemed like a reasonable expectation. The earnings told a different story.

The key culprit weighing down both companies is the cost of the new NBA rights — and those costs are here to stay. The 11-year packages that began this season carry annual escalators of 5%-10%, meaning the expense grows and compounds whether ratings go up or down. For ESPN, an even bigger hit may come in Q3, when they air and absorb the cost of the bulk of playoff games.

The NBA and broadcaster PR teams will remain fixed on annual ratings fluctuations — which are real, inevitable, and tied to team matchups, series lengths, and measurement methodology. But ratings fluctuations typically don’t move broadcaster financials much. Massive, locked-in, escalating rights fees do. If ratings swing 10%-30% randomly over the next five years while costs outpace revenue by 2%-3% every year, the posts on X will still be celebratory. The earnings won’t be.

The Next Move: Watch Q3 earnings closely for ESPN — that’s when the playoff tab comes due. Same for NBC (part of Comcast) — which has said it wants Peacock to approach profitability soon. More broadly, this is the dynamic that makes the next round of rights negotiations (NFL, MLB, college) worth paying close attention to: the broadcasters who just committed to the NBA now have less flexibility and more pressure to prove the model still works. That changes their leverage at every future table.