by Sirius Satellite Radio Signs NFL Deal
Tuesday December 16, 9:45 am ET
NEW YORK (Reuters) - Sirius Satellite Radio (NasdaqNM:SIRI - News)
said on Tuesday it signed a $220 million deal with the National
Football League to broadcast professional football games beginning in
2004.
Over the course of the seven-year deal, the NFL will receive $188
million in cash and $32 million in Sirius stock, with the ability to
earn warrants to buy an additional 50 million shares.
Sirius gets national broadcast rights to all regular season NFL games,
as well as select preseason and playoff contests. It also becomes the
official satellite radio provider of the NFL.
"I would call this a transformative event," said Sirius CEO Joseph
Clayton. "There's no question we're the leader in sports compared to
terrestrial radio or our (satellite) competitor."
The deal is not exclusive, but Clayton said it contains a provision
that would make it "very expensive" for Sirius competitor XM Satellite
Radio (NasdaqNM:XMSR - News) to gain the same kind of rights to NFL
games.
As part of the agreement, Sirius will create an additional sports
channel, "The NFL Radio Network," an around-the-clock stream of NFL
games, features and analysis.
The deal adds football to Sirius' sports roster, which also includes
the National Basketball Association and the National Hockey League.
Clayton said the deal is back-loaded to allow Sirius to pay more as
subscriber numbers grow. Sirius agreed to pay the NFL $10 million in
the first two years, $85 million in years three through five, and $93
million in the final two years of the deal.
Sirius is the second-largest satellite radio provider in the U.S. with
200,000 subscribers. Its leading competitor, XM Satellite Radio, has
more than 1 million subscribers.