Apple

Apple is in talks to sponsor the Super Bowl halftime show

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

The NFL is seeking as much as $2.5 billion for NFL Sunday Ticket rights, about $1 billion more than it collects from its current provider, DirecTV. As the parties wrangle over such a hefty rights fee, Apple has agreed to be the primary sponsor of the Super Bowl halftime show, the league and the company announced late Thursday. They did not disclose terms of the deal.

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

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

Apple rarely sponsors events it does not control. She hasn’t given her brand to a major event since 2016, when she sponsored the Met Gala in an effort to increase adoption of her Apple Watch in the fashion world.

The stalemate in the much larger deal between Apple and the NFL has hampered the league’s efforts to become a leader in live sports broadcasting. As consumers abandon traditional television packages, Roger Goodell, the NFL commissioner, has prioritized expanding the league’s reach beyond traditional broadcasters to digital media like Netflix and HBO Max, where younger viewers are tuning in.

Last year, the league cut a series of traditional broadcast deals with CBS, ESPN, Fox and NBC for its most popular games, but retained two packages for technology companies it considered the sports programmers of tomorrow. It inked an 11-year, $13 billion deal with Amazon to stream games Thursday night and announced it will sell its Sunday ticket to the streaming service.

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

One of the biggest issues was the NFL’s $2.5 billion asking price. The $1 billion increase from the current deal would be hard to earn from a traditional media company, but it was especially difficult to capture from Apple, which has deep pockets and an interest in branching out into sports, but also an unwavering commitment to profitability that leads her to press suppliers.

The NFL has signaled its frustration with Apple by reaching out to representatives of other media companies to encourage them to make a bid, according to two people familiar with the matter. But some of those companies are wary of becoming a tool the NFL could use to prompt a larger offer from Apple.

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

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

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

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

The idea of ​​Apple sponsoring the Super Bowl halftime show came up during the talks as a way to deepen business ties. The NFL needed a replacement for Pepsi and admitted that Apple had used its marketing budget to win rights to live sports. The company offered Major League Baseball $55 million in rights fees for two weekly Friday baseball games and an additional $30 million in advertising, according to two people familiar with the agreement. Forbes previously reported the terms of the deal.

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

Jay-Z and Roc Nation are expected to continue to take the lead in selecting artists and performers for the event, but Apple will be able to gauge 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.

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

Ken Belson and Kevin Draper contributed reporting.