UFC on Paramount+ and Netflix’s Big Bet on Sports Streaming

21:35Chris Stone:I mean, they're the ones with the numbers, and it sounds like it has. The quote they used was, it's delivered disproportionate excitement and sign-ups. That sounds pretty good to me. Look, they've been trying to supercharge their advertising business for some time. And since they've started investing into live sports, they've seen a pretty big bump in that revenue. And they are crediting live events, sports, as a big part of those live events, to much of that. A question for you. Do you have Netflix? And do you get served ads on Netflix? Because I don't. I'm obviously paying through the nose for it.

22:09Chris Stone:But I think I've been signed up for so long, I haven't paid attention now to what they're charging me.

22:13Nick Meacham:I think I'm in the same boat as you, which is I have Netflix. I've never requested it. So I think it just naturally just bummed me up to whatever that tier is. So I get the ads when I watch the live sports, but that's just like the nature of live sports. So I don't get it when I'm watching on-demand content.

22:29Chris Stone:Yeah, that's because I've noticed now watching Prime, I get served ads. Yep. And they're quite quick. They're like six-second ads, a bit like YouTube style in terms of their pace and turnover. But the other day I watched TV Theater, which is like the Channel 4 here in Sweden, and it was the free service. And my God, the ads breaks were so painful. I just can't go back to watching with full-blown ad breaks anymore. It just felt so wrong. Well, that's what all the big platforms want to hear, Nick.

22:59Nick Meacham:They want to hear that you'll pay the extra ad-free subscription.

23:03Chris Stone:Well, that's it, clearly. but I do remember seeing some numbers that Netflix shared a while back and I can't remember if, and I don't know if these still exist this way, but they were actually generating, once they launched the advertising product, they were actually generating more income from the people that weren't on the premium tier, but for the ones that were on the hybrid of advertising and subscription. Now, I don't know if that's still the case and maybe I misread the numbers, but I thought that's an interesting anecdote just to think if they can get that pricing model right, make it more enticing for someone to subscribe and actually make more money through advertising.

23:33Chris Stone:that's a nice little win for them. But yeah, I can't watch long-form content now with an ad break randomly inserted in the middle of some sort of scene. It just doesn't work for me. So, but look, back to Netflix, I think they've got to be, they've come out actively, they're saying that they're thrilled with the results, both from driving subscribers, but also driving up ad revenue. And that's the name of the game. And at the moment,

23:57Nick Meacham:they're still just doing events. They've not done anything with any sort of seasonality long term. But as you're reading through the tea leaves, is it difficult to imagine the idea that like the next time the NFL has their cycle coming around, which I believe they have the option to actually break their current deals. I think in like 2028 or 2029, they don't even have to see it all the way out because of what they talked about, specifically from driving subscriber numbers and then talking about the boom of the advertising. Does it feel like it's inevitable at this point that like they are going to stop doing just the christmas games the you know the small stuff and they're just going to flat out just go for it well i think about the ones that are currently

24:39Chris Stone:spending today you think about nbc and peacock as an example and they've got these different ways to maximize the value out of the rights to say the nfl or the nba as an example i feel like because they need that linear platform for quite some time to get the maximum value out of audience for non non-events-based, non-needle-moving things that those other platforms, and they're still struggling to make it work for profitability's sake. I used to think we're a while away until they really go all in on one of the premium top-tier American sports at scale.

25:12Nick Meacham:But who can write them off now?

25:15Chris Stone:Whatever they do, it seems to turn to gold. And if they can continue to build out their advertising machine, then I think them plugging in more and more longer-term deals where they can build the right sort of dynamic with an advertiser to spend on a whim if they bring in something new to the table. I'm more interested, though, to see what they do outside the U.S. now. Will they start to transfer this model and this success into other markets like Europe? Because it feels like they've got mainstream visibility and subscriber bases in a lot of the key mature Western markets. There's uncertainty and challenges in most of them around live sports in particular.

25:53Chris Stone:Yet they haven't made a real move for localized or semi-localized approaches on rights there of anything of significance. So, you know, there's the TF1 deal in France where they're going to be producing, distributing the linear TF1 broadcast in France to Netflix subscribers. And they will have probably some live sports on that. So will that turn into something for them to test out to say, hey, there is really an appetite here that we can transfer for regular season activity? i just can't i think they'll make a move at some stage and the economics are going to get more and more favorable for them to make a move at some stage but but i would say final point is that still these markets i'm referring to they don't have a lot of those events based style relationships um we're talking mainly league based stuff and that's not their raison d 'etre at the moment around like their sports approach so it would probably be something like i don't know the olympics or the grand slams or something that might be more appetizing for them to take on

26:54Nick Meacham:perhaps i'm not sure makes a ton of sense nick and yeah we i don't think we've seen much in europe and just to almost take things step back and i referenced at the beginning there's sort of this ongoing thing about you know the cash offer um to param or to warner brothers and paramount plus trying to fight for back and forth i know this is going to be sports adjacent because it's not just about the sports element of it but when you're thinking about the businesses as a whole particularly like netflix what do some of these moves tell you in terms of maybe what their their actual objectives are and you know sports will only be one part of that larger strategy but it just you know these are not small moves when they're talking about the the acquisition of warner brothers and everything that comes with it you know maybe just what yours what you think is i guess the end game for some of these really big mergers and acquisitions well there's a couple of

27:43Chris Stone:things we're to think about one is that netflix have actively said also their biggest competitor right now is sleep so that's one thing to consider uh then there was an interesting stat that came out of these numbers, which I think paint a bit of a story here, that a lot of positivity around revenue. Basically, they're getting more bang for their buck out of each and every consumer than they ever have, right? But actually, they only had a 2 % increase in consumption hours in the second half of last year. And you think about the growth of revenue, that means that as an aggregate and the growth of subscribers, that means on average that less people are on a per person basis are actually consuming content on the platform.

28:22Chris Stone:So for me, it looks like they do have to, looking a little bit further ahead and they can afford to do this, what moves can they make to ensure they continue to be the Netflix of entertainment, be that destination that everyone's going to press on them remote controls or on their smart TVs as a first port of call, not the second or third, which some of their other competitors have right now. And so that's why the Warner Brothers Discovery move, I think, is something they have been considering. I'm not an expert. There's lots of people who know about this type of thing. And I do know that they don't have a lot of sports actually in that deal.

28:58Chris Stone:So it is more about just the titles and the studio that Warner Brothers have. But I imagine this is a little bit of how they ensure they've got a really good long long runway of great content to keep building up consumption because they are acquiring audiences but it does feel like the consumption is floundering just a little bit nothing so it's not all roses and i i marry that up with sports you think about all the nfl matches they've had and all these other live sports events they brought they had black friday where they had sports all day long with golf and then then the nba and then the nfl and then for numbers have only got that marginal, that sort of marginal nature.

29:39Chris Stone:And think about the length of an NFL match. It's four hours long. I would have thought consumption would have been up way higher as a result of this. So I don't know. Maybe I'm reading too much into that stat, but I kind of feel like that's something that's showing that they've got a little bit of a consumption problem they need to address to make sure they continue to be the pioneers, the kingpins of the industry, basically.

30:00Nick Meacham:Yeah, well, you're not the only one with that concern. You know, friend of the pod, you know, she's been on before and she's been at several sport for events. Marion Roche, she had a LinkedIn post, which basically raised that point. And it was interesting. I was reading through some of the comments. Some people are sort of, hey, if the dollar signs are up, don't worry about it. And I think her response is a little bit more on your side, which is, you know, that the two things have to be viewed together and whether or not the engagement numbers are actually a forecasting that the money numbers might actually come down if people aren't engaging.

30:31Nick Meacham:And it was interesting to see that back and forth. So Nick, you aren't the only one that has that thought or saw that statistic and said, hold up a second here.

30:38Chris Stone:Well, it's good because Marion's very smart. And if she thinks it, then I feel validated by their speculation. But look, I think anyone running a media business these days, there's not always that linear nature between audience and revenue. Like sometimes you've got it at points where you might be growing the audience and then you've got now got the audience. Now you've got to turn that into something, right? well in netflix's case you know those those at peaks and troughs of having the content and then having the customer and then turning into revenue yeah they're not exactly linear it's therefore they might have to predict a little bit okay these are little signs we have to get in early and make sure we're mitigating that oh there's lots of speculation about why they're buying more of others just to screw over the other competition as well but i i'm not i'm not close enough to it to comment on that best defense is a good offense nick that's something the Cincinnati Bengals have taken it seriously.

31:27Nick Meacham:The last story we're going to talk about, Nick, and it's one that we've spent a bit of time, and we're going to spend time throughout 2026 talking about YouTube specifically, is here locally in the UK in the partnership that was reached with the BBC. What's really interesting here is they've entered a strategic partnership in an attempt for the platform, or I should say the public broadcaster BBC, to reach more younger and global audiences. This doesn't just include the BBC, just simply uploading more content onto YouTube. This is BBC saying they are going to make content specifically for YouTube.

32:01Nick Meacham:YouTube first programming, talking about over the next 12 months, expect up to 50 new BBC YouTube channels. They've already said that the upcoming Olympics, which we referenced at the top of the show, will have exclusive content that is designed for YouTube. There's also some interesting things around training where YouTube's basically going to work with the BBC to kind of tell them, you know, media producers and things like that, this is the best way to do this. You know, I think something like the statistics where the BBC currently has 15 million subscribers to its YouTube channel, BBC Sports has 900 ,000.

32:33Nick Meacham:But then Barb, the agency over here that, you know, monitors digital content said that It's 52 people are on YouTube in the UK, which is, I think, just over 60 million populations. Almost the whole population of the UK is on YouTube. So they want to get on it. So, Nick, we know we've talked about the BBC does have a bit of a unique commercial proposition, given the way the TV licensing works here. But just what you're already pretty positive about YouTube. what i guess you know scale of one to ten how much does this pique your interest that the bbc is taking such a it seems like a significant step to invest in this new platform i don't want to say new platform the bbc is just so much older than youtube you know got to give it a little bit of

33:18Chris Stone:credit yeah just a little bit but no i get your point it's a new platform to them in terms of really leaning into it i thought was most interesting about the announcement that they were going to create new and dedicated content for the platform i don't think it's entirely really surprising that they want to create something that's more attuned to YouTube consumers and streamers and perhaps younger audiences, given the nature of the platform. But initially, I thought, well, BBC could just tomorrow start distributing UK relevant content on the platform and they'll be hitting new audiences. I mean, look, it comes back to BBC, with BBC, it comes back to what is their goal and their objective of an organization?

33:56Chris Stone:Because it is unique. It isn't like other platforms. My understanding of it is they are funded by the taxpayer through the TV licensing model primarily and to basically their raison d 'etre, again, I think I've used that more than once on this podcast already, but is to service and serve the UK audiences with great content, credible source, et cetera, and serve their audiences, serve their people that are paying them, even though it's compulsory, with the content they want to get served. Now, by ignoring YouTube, and YouTube is now the most, as you pointed out, the most consumed platform in the UK, I feel like by not being there, that they are doing their taxpayer a disservice.

34:43Chris Stone:They're not being where they are. In the same way that they need to have a website on the internet, I think you kind of have to think about YouTube in this vein as like, they've got to be there. If YouTube's the new TV, which some people say, then you have to be where people are consuming, not expect people to leave where they are where they typically are day-to-day to go find you on a different place and location now i have seen some pushback and negativity around i have too yeah and i just felt like um there's more of an existential question around big tech social media that is probably fueling that negativity but in my view until something happens otherwise around around that, they should be absolutely all in on serving their content through those channels to ensure they're maximizing the value that they're due to be serving to UK audiences.

35:32Chris Stone:So I think it's not only a no-brainer, I can't really understand the negativity or pushback other than people do like to be contrarian and the risk is otherwise no one's going to be consuming their stuff as decline is happening so rapidly on cross-linear.

35:46Nick Meacham:Yeah, the pushback I saw did have to do with the big tech angle, but it came more to, and this is probably where we talk about sometimes it's difficult to separate politics from sports and everything else, is that YouTube is an American based company. I think the argument was that this is a UK paid by taxpayers. How does that ultimately feel if some of that money is then ultimately going to the US was essentially, I think, the pushback I saw, which I mean, I get, but I think to your point as well, like if it is justifiable in the service that it's providing to the local taxpayer. You know, that's just the cost of doing business, I suppose.

36:22Chris Stone:We're looking at it another way is that they obviously get a revenue share. I'm not doing a big, I don't want to do a big sell on YouTube, but I get the logic to some extent. The revenue they generate on YouTube will be shared. You know, YouTube take a cut, right, of everything they generate. Thinking about it the other way around is that by BBC leaning into their platforms, sorry, having 50 plus channels available on YouTube, is they'll now be able to generate revenue from global audiences in a way they've never been able to do before. Now, the economics around YouTube are not strong from a programmatic advertising perspective, but they're just opening up.

36:57Chris Stone:So one of the biggest and best producers of content, definitely in the UK, if not the world, is now going to be available globally. They're going to be able to generate a whole bunch of income that they wouldn't be able to do otherwise. And I think that's not an insignificant part, which should offset some of the fact that they're giving money to a US-based business. So I think it's not only it's a no-brainer, I think they have to be super committed to this as an approach. And I am intrigued to see what and how different their new content, this exclusive content they are creating, and also how much of their existing legacy stuff for Linear and their traditional streaming channels is going to be used also on those platforms.

37:37Chris Stone:But 50 different channels is a lot. So I'm intrigued to see what all those different ones look like and feel like once they're up and running.

37:46Nick Meacham:It'll just be interesting to see what it looks like from a user experience because, you know, I've got BBC iPlayer, so I'm familiar with what that platform looks like. I've also spent plenty of time on YouTube. You know, is it going to be some sort of hybrid? Are they going to build something bespoke or is it simply going to be just your standard YouTube channels? Like I would be curious to know how ingrained that partnership will be in terms of just the outlay of things. How will it look? You know, what would feel like its own BBC channel? or is it going to just kind of be existing? So it will be interesting to see like even those layers of the user experience, how that'll differentiate from what exists with BBC's existing digital platforms and then what YouTube already has on its platform.

38:23Chris Stone:Well, a couple, yeah, absolutely. A couple other things just to flag or to mention is that for those that aren't familiar and outside of the UK, so the BBC isn't able to serve advertisements to UK audiences. So on those platforms, it will be ad-free on YouTube. So the revenue creation will happen from outside of the UK from an advertising standpoint. I think that's just worth mentioning. And look, I've seen YouTube's top figures all shouting about it through every social channel possible because this is the biggest validation, I suppose, for YouTube to say, everyone come to us, work with us. We're the place where you need to be.

39:04Chris Stone:Channel 4 has already leant into this quite heavily. They've probably been very much one of the pioneers in broadcasters leaning into YouTube and broadcasting content on the platform, making it available there. So I think YouTube will be shouting about the fact that BBC has joined them to this level for quite some time and be pushing this in everyone's faces. And the other final bit I was curious to see if it was going to be connected with, which I haven't heard any mention of it, is remember they launched that primetime channels concept? I've heard nothing about that since. so I don't know if that's been a bit of a flop for them for whatever reason because it sounded great on paper but maybe they're just going to look into creating their own channels like you said and just build a network of them that they can use to target different audience segments I guess.

39:52Nick Meacham:So I'm sure you two will be hoping the answer to this question is yes Nick but do you see this as the first of several steps that'll look similar like this to the other public broadcasters taking this similar approach. You know, I guess that's the next question is, you know, what's next? Do other people follow this? Because I don't think the BBC will be the only people having an existential crisis about where audiences are. And to your point, do we want to fight the effort to make them come to us or do we just go to where they're already at?

40:25Chris Stone:It's a great question. And I think it's almost inevitable that we will see others follow. Again, YouTube's probably worked really hard to get a deal done with BBC so they make this commitment, whether it's the education, whether it's the commercials, etc., because they'll use it as a case study to then sell into each and every market they exist in. I posted something on this the other day. It was off the back of Steve's story around Match of the Day numbers. I don't know if you saw that, but basically Match of the Day, it's the BBC's premier highlights show that's been running for generations.

40:57Chris Stone:Decades. decades yeah that and that they've had that on their linear channels historically um and they've also got it on iplayer and the bbc's website app etc the numbers um numbers on linear have dropped by more than 10 in just 12 months right so that's dropped by 770 000 viewers um and the website is now it's gone by about 20 odd percent i think to 1.5 1.69 million depending on which statistic you're using. So my point there is the numbers have gone down by about 770 ,000 on their own digital channels. It's gone up by probably about 300 ,000. So that's an incredible rate of decline. Positive that the digital numbers are going up, but at 770 ,000 dip, that means they need to find those audiences from elsewhere.

41:50Chris Stone:And that's why YouTube is clearly, given what we said about the barbed numbers is that's where they are so that's why they have to lean into that and i'd expect them to put more of their sports content on the platform like match of the day is inevitable it would end up on youtube in the future maybe they can't do it at the moment though because of the

42:05Nick Meacham:existing rights agreement would be my guess yeah we'll see but again another really interesting story um something for us to follow through 2026 and yeah we we said it'd be a big year we said it'd be an exciting year you know nick what we were i was a little pessimistic at the start of the year You heard the first podcast, but you know, some rosier things coming up. Maybe, maybe, maybe, you know, I just had to get through it a little bit. Maybe I was just going through some stuff. Maybe I didn't get enough sleep with the newborn Nick, but you know, it's a little bit more positive to that.

42:29Chris Stone:Well, there's, there's lots, there's always lots of things going on at the moment. I remember having a bit of a lull about one or two years ago. I'm like, Oh, is this, there's not much going on. It's like pretty, pretty basic sort of storylines. And now there's all sorts of little nuances happening in the industry, which makes a lot more fun to talk about. So I'm all, I'm all here for it.

42:46Nick Meacham:Awesome. Well, Nick, it was a pleasure as always to get to chat with you. And then I will say, you know, we're going to do a double pod drop next week. So if you're listening, this will be another one coming out in just a couple of days. Basically, our most ever watched guest will be back, Mr. Dan Rayburn. So I don't think that's, you know, spoilers or anything like that, Nick. But yeah, double pod next week or this upcoming week as you're listening to this.

43:07Chris Stone:Absolutely. We'll be doing a preview to the Super Bowl. And also we're going to be meeting in person for our next Stream Time event. I'll be heading to London for that, which we're hosting at TikTok's offices. and we'll have DAZN, TikTok and a few others on stage there talking about how to monetize social. So lots to talk about. We'll share some of that either. For sure. Some of that content and some highlights from that with you all following that event.

43:33Nick Meacham:And thank you, everybody. We'll catch you next episode.