Why Netflix Must Soon Decide if Paying More for Less Sports Is a Winning Strategy

Netflix is in a quagmire of sorts with its live sports strategy. As much as I hate the notion of paying an added fee to watch the product I’ve always enjoyed on cable, I understand the shift in consumer behavior.

But Netflix is in a precarious position with its sports strategy, and I’m not convinced it can truly tame the beast it has purchased.

Netflix carried its first non-Christmas Day NFL broadcast Thursday. The viewership figures were not pleasant. An average of 18.5 million viewers in the United States tuned in for the NFL’s debut in Australia. Despite heavy promotion and marketing, the kickoff of the NFL on Netflix hit a new domestic viewership low.

So, is Netflix’s live sports approach working?

To start, let’s not kid ourselves. Any broadcast network would love to have 18.5 million viewers watching a four-hour telecast. But Netflix operates in a different hemisphere than your traditional network.

That distinction matters.

Paying More For Less

Earlier this year, Netflix and the NFL extended their agreement through the 2029-30 season. That essentially gives Netflix the same term as every other NFL network partner, outside of ESPN, whose agreement expires a season later. Reporting places Netflix’s cost for five games this season at around $500 million.

That means Netflix is paying roughly $100 million per game.

For comparison, FOX Sports and CBS Sports each pay about $2 billion for their NFL packages. NBC Sports pays roughly $2 billion for its package, while Prime Video pays $1 billion for Thursday Night Football.

Those networks and Prime Video get significantly more bang for their buck. Their per-game costs are far lower because they receive substantially more inventory. That’s why it’s more important for Netflix to hit home runs with their real estate instead of legging out doubles.

Habits are hard to break. They’re even harder to create. However, this is Year 3 for Netflix and the NFL. This isn’t Year 1, when establishing a habit could be the primary goal. Is the platform seeing growth? That depends on what you consider growth.

Netflix U.S. Viewership — Sports Events (NFL Regular Season)

Netflix U.S. Viewership — Sports Events (MLB 2026)

Looking at the U.S. average viewership for Netflix’s NFL events, Thursday’s game was the lowest. If Netflix can’t grow its audience with the NFL, what can it grow with? The same concern exists with Netflix’s MLB strategy.

This year has been a difficult one for the platform’s performance with Major League Baseball. The Field of Dreams Game delivered its lowest audience ever, while the Home Run Derby produced its lowest viewership since 2003. That followed a surprising 2.97 million average viewers for MLB Opening Night.

The simple point is this: Not everyone has Netflix, despite what your kids may tell you.

Developing Habit

Sports fans have habits that have developed over generations. The NFL is expected to be on FOX Sports, CBS Sports, NBC Sports and ESPN/ABC. Why? Because it’s a week-to-week sport, and those networks have established that expectation with viewers.

Netflix has an expectation with its subscribers, too. But that expectation isn’t sports. It also may never become sports. That’s where the quagmire lies.

Netflix pays more but delivers less.

It’s difficult to create a sports viewing habit when your platform only provides five of 285 games during the NFL regular season. How can any platform realistically expect sports subscriptions to follow when it owns such a small piece of the football schedule?

The same can be said about Netflix’s MLB strategy.

The company reportedly paid $60 million for three MLB events this season. That’s roughly 25% of what NBC Sports paid for its MLB package this year, yet NBC Sports carried more than 60 games. This is where the conversation needs to move beyond ratings.

Netflix doesn’t necessarily need to produce the largest audience. It needs to produce enough audience, engagement and business value to justify what it is spending. That is a much different measurement. Netflix doesn’t need to abandon live sports. It needs to decide what it wants live sports to accomplish.

If the strategy is to use marquee events to create appointment viewing, attract new subscribers and establish Netflix as a legitimate destination for sports, the early returns should be concerning. Paying a premium for a fraction of the inventory only works if that fraction delivers an outsized return. Otherwise, Netflix is simply paying more to reach fewer people with less product.

That may be sustainable for a company with Netflix’s resources. But it isn’t necessarily sustainable as a strategy.

What’s The Win?

The NFL and MLB provide Netflix with some of the most recognizable sports properties in the world. If those events can’t consistently move the needle, Netflix has to question what will. Sports rights are only valuable when the audience, engagement and business results justify the investment.

And that’s the question Netflix eventually has to answer.

Is the value of being associated with the NFL and MLB enough to justify paying a premium for a limited amount of inventory? Can those marquee events actually drive new subscriptions, retain existing customers and change the way consumers view Netflix?

If the answer is yes, Netflix can afford to absorb a few disappointing nights along the way.

If the answer is no, the company has a much bigger problem than a low rating.

The good news? Netflix has time to figure this out. What it doesn’t have is an unlimited amount of time to convince itself the strategy is working. At some point, paying more for far less has to be more than a bold move. It has to be a winning one. If the early signs are any indication, Netflix should start rethinking that strategy sooner rather than later.

Barrett Media produces daily content on the music, news, and sports media industries. Sign up for our newsletters to stay updated and get the latest information right in your inbox.