Amazon (AMZN) is jumping feet first into sports broadcasting after the NFL announced a 10-year deal in which Amazon will have exclusive rights to broadcast Thursday Night Football starting with the 2023 season. Amazon will reportedly pay $1 billion per season for those rights.
Analysts at JPMorgan maintained their overweight rating on Amazon with the firm, noting that the Thursday Night Football spend comprises more than 13% of Prime Video's annual $7.5 billion spend.
"As such, TNF represents a significant investment by Prime Video. But we think this is money well spent, and believe it provides Amazon with multiple benefits," analyst Doug Anmuth said.
Those benefits include the potential to drive new Prime subs while deepening the engagement of existing ones. The firm estimates that Amazon Prime has more than 180 million subscribers, including 75 million in the U.S.
Anmuth also sees an opportunity to market Prime Video original and exclusive content to a larger audience that doesn't normally get to see Amazon content.
The firm notes that Amazon's first exclusive NFL game on Dec. 26 drew 11.2 million total viewers, and delivered the highest digital average-minute audience ever for a regular season NFL game.
In addition to the Amazon deal, the NFL also on Thursday disclosed new deals with Disney's (DIS) ESPN, Fox Corp. (FOXA) , Comcast's (CMCSA) NBC and ViacomCBS (VIACA) totaling about $90 billion over the next 11 years. The Street recently looked at where Amazon stood in its negotiations with the NFL in an interview with Dan Cohen of sports marketing and consulting firm Octagon.
Last year, Amazon reached an agreement to stream an NFL wild-card playoff game.
Shares of Amazon were rising 0.8% to $3,053.50 in morning trading on Friday.