Netflix invests in live sports programming with NFL, WWE, and boxing — is UFC next?

For years, Netflix co-CEO Ted Sarandos promised that the streaming service that boasts 270 million subscribers had no interest in getting involved in live sports programming.

That philosophy has changed in a major way in recent months, especially with the news that Netflix secured a deal with the NFL to bring Christmas day games to the streaming service for the next three years. The partnership launches in 2024 with a pair of games featuring the Kansas City Chiefs vs. the Pittsburgh Steelers and the Baltimore Ravens vs. the Houston Texans.

No financial details surrounding the deal were revealed, but considering Amazon paid $1 billion per year for a single game each week on Thursday nights, it’s safe to say Netflix didn’t get a bargain discount when negotiating with the NFL.

“Last year, we decided to take a big bet on live — tapping into massive fandoms across comedy, reality TV, sports, and more,” Netflix chief content officer Bela Bajaria said in a press release. “There are no live annual events, sports or otherwise, that compare with the audiences NFL football attracts. We’re so excited that the NFL’s Christmas Day games will be only on Netflix.”

The football games headed to Netflix kick off five months after the upcoming boxing match between Jake Paul and Mike Tyson, which goes down on July 20 from AT&T Stadium in Arlington, Texas. Netflix also paid $5 billion to land the WWE’s flagship show Monday Night Raw, which begins broadcasting on the streaming platform in 2025.

Despite Netflix executives pushing back against an entry into live sports programming for years, it looks like 2024 is the year that finally changed those plans. It doesn’t hurt that Netflix boasts the largest subscriber base by a wide margin with 270 million subscribers and Amazon sitting at a distant second place with 200 million subscribers — that latter figure is at least partially due to the Amazon Prime service that many customers use for free express shipping rather than streaming the latest episodes of Fallout or The Boys.

With Netflix now clearly invested in live sports programming, what’s next? Well, the easy answer is the UFC.

The UFC’s broadcast rights are exclusive to ESPN through 2025, but it’s no secret that negotiations on a new contract are expected to kick off soon. ESPN has an exclusive negotiating window starting in January where the network can lock down the UFC without allowing the organization to even field offers from other bidders, although it’s highly unlikely the two sides reach an agreement before that deadline expires.

TKO Group Holdings President Mark Shapiro has spoken glowingly about the relationship that the UFC shares with ESPN, especially after inking a deal that included pay-per-view broadcasts — one of the most lucrative parts of the entire UFC business model. ESPN remains the gold standard for sports broadcasting, but the network has taken a number of hits in recent years that has resulted in other players taking a big chunk of the market.

Beyond linear television (i.e. cable, satellite, etc.) facing a tumultuous future, ESPN’s owners at Disney have openly touted plans to seek out partners in the business, which means new owners investing in the company. Disney doesn’t want to give up a controlling interest, but an influx of cash as an investment in ESPN certainly wouldn’t hurt.

To make matters even murkier, ESPN just recently announced the launch of Venu Sports — a sports-specific streaming service launching in the fall of 2024 that brings together channels from ESPN, FOX and Warner Bros. Discovery in a joint venture. That means ESPN is partnering with networks that the company previously viewed as rivals.

CNBC estimated the service could run around $45 to $50 per month.

ESPN also faces another expensive broadcast rights negotiation with the NBA currently shopping for a new deal. The NBA is currently split across two networks with ESPN/Disney and Turner Sports (a division of Warner Bros. Discovery), but there are new bidders that could balloon a new deal to astronomical numbers.

In fact, NBCUniversal is attempting to steal away at least part of the package of games after making a whopping $2.5 billion per year offer to the NBA.

While all signs point to Disney/ESPN maintaining the partnership with the NBA, that price tag is going to hit the company right in the bottom line when that deal kicks in. That could force ESPN — or more importantly the powers-that-be at Disney — to make some hard decisions about where money should be spent on future broadcast rights deals.

The UFC has remained a valuable asset for ESPN, especially with the launch of the ESPN+ streaming service. But with ESPN+ subscribers falling for the past two quarters, and in three of the past four, it’s difficult to guess what Disney does when filling out a wish list for future partners.

Because the UFC is likely going to seek double the value from the previous package signed with ESPN — some estimates reach $3 billion or more — it opens the door for another potential suitor like Netflix to swoop in for the kill. Netflix obviously boasts far more subscribers — 270 million vs. 24.8 million for ESPN+.

Even if you add in linear television, ESPN is only available in just over 70 million households and that doesn’t come close to Netflix on a global scale.

There’s no telling if Netflix is truly interested in buying all or some of the UFC’s broadcast rights, but the fact that the streaming service is already partnered with WWE opens the door to building that relationship. Nobody saw Netflix coming when WWE announced the 10-year deal to move Monday Night Raw there in 2025, but it’s impossible not to think the UFC won’t explore that option considering they share the same owners as the professional wrestling outfit.

There’s also a great possibility that the UFC seeks a split package similar to the NBA, which means part of the company’s program stays with ESPN and another part ends up with a different partner like Netflix. That could potentially allow the UFC to keep the current pay-per-view model intact with ESPN but then provide live events and shoulder programming like specials, documentaries and more to another partner like Netflix.

In addition to Netflix, other streaming platforms like Apple TV and Amazon could get into the bidding. However, while those companies have the money to burn, they don’t have the 270 million subscribers that Netflix has.

The fact that Netflix is jumping head first into live sports programming in 2024 can only mean things are going to get more interesting when the UFC starts seeking a new deal that begins in 2026.