Advertisers will be charged $2.8 million by Amazon for packages which will include spots running for half a minute during the NFL games which will be streamed on Thursday nights to customers of Amazon Prime. This was according to sources who spoke to Reuters. Players in the broadcasting and advertising industries will watch the development closely as the largest online retailer in the world delves into streaming of live sports events.
Earlier in the year Amazon acquired streaming rights from the National Football League for $50 million. The license will see the online retailer streaming 10 games on Thursday nights. It is not an exclusive license though as the games will also air on NBC and CBS. Each of the networks will broadcast five games each. On Amazon, only subscribers of the Prime service will be able to watch the NFL games. An annual Prime subscription costs $99 and comes with free video and fast shipping.
Before Amazon acquired the NFL licenses, Twitter had been streaming the games last season for a price for $10 million. On U.S. television the National Football League games regularly receive the highest number of viewers.
Besides using the NFL games to lure more customers to shop on Amazon, the streaming of the games will also be a revenue source for the online retail giant through the sale of ads. It is, however, still too early to tell whether revenue from advertising will offset what Amazon spent on acquiring the streaming license.
For each NFL game that Amazon streams the opportunity exists to sell half-a-minute spots totaling ten. The spots will appear on Amazon’s live-stream while the local airs will air on network television.
“We are offering a range of options at various price points, depending on advertiser objectives,” Kristin Marian, a representative for Amazon, said in an email.
Though Amazon did not disclose the exact pricing, it seems to be less than what Twitter was charging. In the case of the microblogging firm’s rates, advertisers were being charged between $2 million and $8 million for a variety of ad packages. According to sources in the industry, Amazon’s rates are, however, higher than what CBS and NBC charge for ads that air nationally as their prices range between $550,00 and $590,000.
One problem for advertisers is determining exactly how many people will watch the streamed games. Though analysts estimate Prime subscrib