Apple sponsors the Super Bowl Halftime Show

Talks between the National Football League and Apple over a package of football games on Sunday have dragged on as the league and the tech giant have fallen out over pricing, but another deal has been added: sponsorship of the Super Bowl halftime show.

The NFL has requested up to $2.5 billion for rights to NFL Sunday Ticket, about $1 billion more than what it’s taking in from its current provider, DirecTV. While the sides are at odds over such a hefty rights fee, Apple has agreed to be the main sponsor of the Super Bowl halftime show, the league and company announced late Thursday night. They did not disclose the terms of the deal.

Apple Music will replace Pepsi as a sponsor in a deal the NFL bought for about $50 million, three people familiar with the negotiations said.

Becoming the main sponsor of the Super Bowl halftime show is a departure for Apple. The company prides itself on marketing its brand differently than consumer goods companies like Coca-Cola, Budweiser and McDonald’s, which have long sponsored sporting and cultural events.

Apple rarely sponsors events that it doesn’t control. It hasn’t lent its brand to a high-profile event since 2016, when it sponsored the Met Gala to increase fashion’s acceptance of its Apple Watch.

The standoff in the much larger deal between Apple and the NFL is hampering the league’s efforts to become a leader in live sports broadcasting. As consumers abandon traditional television packages, NFL commissioner Roger Goodell has made it a priority to expand the league’s reach beyond traditional broadcasters to digital media like Netflix and HBO Max, which younger viewers are turning their attention to.

Over the past year, the league has canceled a number of traditional broadcast deals with CBS, ESPN, Fox and NBC for its best-known games, but it has reserved two packages for tech companies it sees as the sports programmers of tomorrow. It has struck an 11-year, $13 billion deal with Amazon to stream games on Thursday nights and has said it will sell its Sunday ticket to a streaming service.

Although the NFL has discussed Sunday Ticket with Google, Amazon and ESPN, the most extensive negotiations have been with Apple. Executives from both the league and the tech giant have told business partners they expect a deal to be struck, according to people familiar with the negotiations. However, the talks were complicated by the NFL’s decision to sell multiple assets at once, including Sunday Ticket, the halftime show and NFL Media properties such as NFL Network and the RedZone channel.

One of the biggest problems was the NFL’s asking price of $2.5 billion. The $1 billion raise from the current deal would be tough to win from a traditional media company, but has been particularly tough to win from Apple, which has deep pockets and an interest in getting into esports, but also an unyielding commitment to Profitability leading to suppliers squeezing.

The NFL has signaled its frustration with Apple by reaching out to representatives from other media companies to encourage them to make a bid, according to two public relations people. However, some of these companies have been wary of becoming a tool for the NFL to evoke a larger offering from Apple.

“While the foundation and cornerstones of the deal are in place, the devil is always in the details, especially in a deal with complex elements that extend beyond historic Sunday card rights,” said William Mao, media rights advisor at Octagon. a sports and entertainment agency.

Apple has pursued Sunday Ticket as part of a broader strategy to increase subscriptions to its Apple TV+ streaming service by capitalizing on the popularity of live sports. Despite billions of dollars pouring into critically acclaimed series like “The Morning Show” and “Ted Lasso” each year, Apple’s three-year-old service only has about 16 million subscribers in the United States, fewer than half the subscribers that Disney+ has has accumulated around the same time since launch, according to Antenna, a media research firm.

Apple executives have told Hollywood executives that buying Sunday Ticket would increase viewership for its shows. The NFL remains one of television’s biggest draws, with its games accounting for three-quarters of the top 100 most-watched programs last year, according to Sports Business Journal.

In recent months, Apple’s chief executive Tim Cook and Apple’s head of services Eddy Cue have met with New England Patriots owner Robert Kraft and Dallas Cowboys owner Jerry Jones, who both support the league are leading negotiations, said people familiar with the negotiations.

During the talks, the idea bubbled up that Apple would sponsor the Super Bowl halftime show to deepen business ties. Needing a replacement for Pepsi, the NFL realized Apple had tapped into its marketing budget to win rights to live sports. The company offered Major League Baseball $55 million in rights fees for two weekly baseball games on Friday and an additional $30 million in advertising, according to two people familiar with the agreement. Forbes previously reported on the terms of the deal.

Discussions between the NFL and Apple during the Super Bowl halftime threatened to delay the league’s release of this season’s cast members, some of those people said. The NFL and Jay-Z’s entertainment company, Roc Nation, which produces the show, announced the artists in September last year, giving the league ample time to build anticipation. Organizers are eager to build on last year’s event, the Super Bowl’s first hip-hop performance, a celebration of rap making history by winning three Emmy Awards.

Jay-Z and Roc Nation are expected to continue taking the lead in selecting artists and cast members for the event, but Apple will be able to influence the direction of the show, according to a person familiar with the deal.

A spokeswoman for Roc Nation did not respond to requests for comment.

The tech company and hip-hop pioneer make odd bedfellows. In 2015, Jay-Z bought a streaming music service, Tidal, and made its catalog of songs exclusive to the service, withholding albums like “The Blueprint” from Apple Music. Two years later, he released much of his catalog for Apple and eventually exited the streaming music business, selling Tidal to Square in 2021 for nearly $300 million.

Ken Belson and Kevin Draper contributed reporting.

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