Matthew Keys | Media & Tech Insider

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So you can see it from both the league's perspective, as well as from our perspective. Matthew, thank you so much for joining us for the first time. Let's start with something easy, shall we?

You write for a living. What are a few overarching words, umbrella words maybe, that you would use to describe the industry right now, whether we're talking about sports or whether we're talking about any other genre as we see this migration to streaming in 2023? In a few words, I would say, you know, there's a lot of options, right?

So you have tons of options, tons of variety. The sports production on television is top notch. This is some of the best time to watch sports on TV, but also very expensive.

Agreed. And I think more and more sports fans are figuring out that leagues are going for the streaming services because that's where they can tap into this brand new revenue stream. The latest for football fans is Peacock, putting not just one regular season game, but a playoff game on a streaming service. What's your reaction to Amazon Prime and YouTube TV, and now Peacock being part of the NFL season, the broadcast season? Two things to that, which number one, we're still in really an experimental phase with this shift from traditional television broadcast cable and satellite over to streaming. The fact of the matter is the overwhelming amount of sports on television in the top four sports domestically, which is football, basketball, baseball, and hockey are still on broadcasting cable television, because that is where most of the money is being made for these media companies. But these media companies, they see the writing on the wall. They know that consumers are moving towards streaming. The amount of customers that are paying for cable and satellite today are fewer than they were a year ago, two years ago, three years ago, and that's a trend that's continuing. So they know that people are moving over towards streaming.

They're not quite ready to go all in yet. So what you have is number two, a very fractured sports broadcast landscape, where you have the majority of, let's say football, for example, you've got the majority of football games still on broadcasting cable television. Monday Night Football is still on ESPN, right? But you now have Thursday night games, exclusive to Amazon, which are traditionally the lowest rated games out of the week. So that's not a huge shift for the NFL. It's not a big risk to put those games on Amazon. But then you also have Comcast coming out and saying, let's put an NFC wild card game on Peacock, right?

But just the one, and let's just see how this works. They're not ready to jump in the pool because they're worried the water is going to be cold, but they know eventually they're going to have to get in and swim. So they're starting to dip their toes in. What do you make of YouTube TV grabbing NFL Sunday ticket? That's a big deal.

It's a huge deal. I am a YouTube TV subscriber, so I am all in on them getting Sunday ticket. I have pre-ordered my Sunday ticket with Red Zone and I am ready for this upcoming football season.

They know, right? The professional sports leagues know that streaming is going to be the platform where people consume the most professional sports eventually. And what they've seen is as people are leaving satellite television, because it was exclusive to satellite television for over a decade, well, suddenly you don't have that core audience there anymore. And Sunday ticket is not a big driver for satellite television. So where are those audiences moving to? Well, they're moving to streaming.

And who's willing to pay the most amount of money? Well, Google said, we'll throw $2 billion at that problem and we'll put it on YouTube TV for 350 bucks a season. But we'll also let people subscribe to Sunday ticket without YouTube TV. You can get Sunday ticket without a YouTube TV subscription. It's in the YouTube app through prime time channels, which is a new feature that they have.

And it's a hundred bucks more, right? So they know that that is where things are moving towards. And Google has built a track record of being very successful with YouTube as a streaming product. YouTube TV is now the most dominant streaming cable replacement in America. So they're very well positioned to capitalize on the streaming shift and also to be a really good partner for the NFL, not only in generating money for them, but also in reaching new audiences, right? Because younger audiences, they tend to gravitate more towards streaming than they do cable and satellite. So it's a win-win proposition for both of them.

Is it a win or a loss? Is it a win for consumers? Well, now all of a sudden you have to subscribe to prime video to watch Thursday football. You have to subscribe to YouTube TV if you want to also get the Sunday ticket at the best deal, right?

And also red zone. You have to be able to get access to your local CBS, Sandor, Fox station to watch your team and ESPN to watch your local team on Monday nights. And that cost really adds up. So we're looking at it costing more than what a traditional cable or satellite subscription would have cost five years ago, just to stay on top of that one sport. Just during these NBA conference finals, we've had issues with some of the quality and some of the buffering with YouTube TV. And I know it's not the only app where it happens. Is that a concern when more and more sports are moving to streaming services?

It is in two ways. It's a concern for people like you and me who like to follow sports and much of your listening audience also, right? Because if you're throwing money at YouTube TV, right, it's $73 a month. You expect that to work without any flaws, especially when YouTube TV is sponsoring the NBA finals and the NBA, you know, conference finals. So that was kind of an embarrassment for them. Are they the only ones that have suffered this issue?

The answer is no. And that leads me into point two, which is businesses that are offering those games live to their patrons, think bars, restaurants, hotels, the infrastructure to provide those games, the internet infrastructure often isn't the most reliable in restaurants. And also you have to make those games available on multiple screens. So if you're a business, you're going, well, we're not quite ready to make the transition over to streaming. So what you've had is one of these major satellite companies come in and say, we'll provide those games specifically for businesses, anything from Apple TV's baseball games to the NFL Sunday ticket deal that was just announced today.

So if you're a business, you're still relying on satellite for a few more years. Well, all of that streaming stuff is figured out. There is a lot of information, which is why we're really excited to welcome Matthew Keys to the show for the first time. He is an award-winning journalist who covers media and tech as you can hear, and the business side of what we just take for granted sometimes with games on TV or now streaming.

His website is thedesk.net. We're just so excited to pick his brain. It's After Hours with Amy Lawrence here on CBS Sports Radio. If a sports fan wants to access all of the various platforms, including cable, where games are broadcast, what kind of money are we talking about, Matthew?

So let's just take this upcoming football season as an example. Best product you can get if you want to watch football is YouTube TV, because they have access to all of your local ABC, NBC, CBS, and Fox affiliates and stations across the country, right? So you know you're going to be able to get those games. NFL Sunday ticket, they have that to $350 a pop or $390 if you want red zone. Then you also have to add Amazon Prime Video on there for Thursday night and Peacock for that NSC wildcard game.

And you know, maybe you want to watch the after show Sunday night. So I did the math right before we jumped on the phone. And the average cost per month to follow football with all of that taken into account this upcoming season, 150 bucks a month.

Wow. It goes up to $160 a month. If you add red zone through YouTube TV, that's just to follow that one sport, not counting the other one. So you can imagine if you have multiple sports teams that you like to follow across different pro sports, just how expensive that's going to get for the average household. And frankly, it's making some people kind of wish for the days of cable and satellite again, because suddenly, you know that that bill seems pretty high. And by the way, that's not counting, adding Netflix, adding Disney Plus, adding Hulu, we know households like to, you know, add multiple streaming services for general entertainment.

That's just sports. So yeah, at least for the next couple of years, it's going to be expensive. I think hardcore sports fans are willing to pay for it. You've got a couple of different streaming businesses that are really counting on that.

And look, I'll pay for it. Like I bought, like I said, at the beginning of the interview, I bought NFL Sunday tickets through YouTube TV, and I'm looking forward to seeing how that pans out for the season. But even I've started to have a few reservations of like, you know, is this really a good use of that money? Could I, you know, maybe save a couple of dollars if I was willing to sacrifice not watching a game one day a week? Or would it be more cost effective to just go down to my neighborhood sports bar and watch the game there?

And I think you might actually see people starting to do that more and more. So it remains to be seen what the breaking point is, as far as sports fees go, and how much people are willing to pay per month that quite hasn't been figured out yet. But $150 a month is pretty expensive, I would say for them for most people. And as you point out, that's just for sports. We're not even talking about a household that maybe has other streaming services.

Matthew, how concerned are these outlets about password sharing? We hear a lot about some of the services trying to crack down on that, but also about piracy, and about people finding backdoors or finding ways to access the service without paying for it. Sports is one of those things that people have a real sentimental attachment to. And if they can't afford to watch the game, they will find a way to watch it.

It might be something like going down your local sports bar, as I mentioned earlier. But yeah, there are nefarious ways, backdoor ways that you can watch pretty much whatever sport you want to watch online. And if you're a broadcaster that's spending, you know, $2 billion a year on NFL football rights, again, that's just that one sport. And you are producing a high quality telecast each and every week with hundreds of people behind the scenes that the average American doesn't get to see on TV, you're really concerned about the idea that someone somewhere could just upload that game in real time for free. And then suddenly that huge investment that you've made in sports rights, you don't get to see back. And then the people who are paying for that sport, right, legitimately paying for that sport, wind up having to pay more over the long term. That's just how the economics of that works. Now, having said that, you have had some broadcasters band together, right, they're all crazy rivals of each other.

And they're all very competitive. But on this one issue, they actually are banding together and saying, let's form a task force to go take these websites down to go grab these converter boxes and these digital boxes that are popping up online, giving people easy access to sports. Let's try to rein that in. And while that doesn't sound particularly great for media companies that are bringing in billions of dollars in revenue, it kind of sounds like they're being a little greedy here. The end result actually will wind up being that the sports programming long term, the cost of that will go down. So that $150 a month that I mentioned earlier, just to follow football, right? That cost might actually come down if more people were willing to pay for it, because suddenly you have the volume of people legitimately paying for sports. And that volume will bring the cost of the programming down just a little bit. Not that I'm advocating that people go out there and find the websites, right?

But they are out there. And I've got friends that that's how they watch sports. That's how they follow sports because they really can't afford to pay $150 a month just to follow football, or a similar crazy amount just to follow their favorite team. And like I said, sports is a real sentimental attachment for a lot of people. It brings back memories of when they were kids watching sports with their parents. It gives them a sense of local pride to see their team do really well.

I'm in Sacramento, right? Our team's had a great year this year. We haven't always been able to say that about our team. But to follow the team, I had to pay for YouTube TV because the telecasts right here are on NBC Sports. Was it worth it? Absolutely. For me, it was absolutely worth it. But I could also afford it.

There's a lot of people who couldn't. So I feel for them. I do think that as the issue of piracy is tackled a little bit more, I do think more people are willing to flip the bill for a legitimate subscription.

And I do think that that will ultimately result in those costs coming down just a little bit. Great information from Matthew Keyes, who is with us from Sacramento. As he mentioned, it's After Hours with Amy Lawrence on CBS Sports Radio. Before I let you go, there's this one trend that really came to light more with Major League Baseball season starting, but it's becoming more prolific around the country in that regional sports networks are no longer viable, or are finding out that the model isn't viable.

What does this tell you, Matthew? You know, the business of regional sports was tied into cable and satellite. And as more people are leaving cable and satellite, that business foundation is starting to crumble. So I think what you're going to see are two things happen.

And we've already started to see one of them, and I'm making a grand prediction on the other. The first is you're going to see more professional sports rights move over to broadcast television. That means free access over the air. And what we're seeing with a lot of these rights is that in addition to the broadcast component, they're also building subscription streaming services.

So you'll have the choice. If you live in an area where you can get your local station, you'll be able to watch the game. If you don't, you can subscribe to a streaming service for a few bucks a month and watch it legitimately. But I think the second thing that we're going to see is I really think that the cable television detriment and the shift over to expensive streaming services is going to be a real boon for sports radio, because radio has most of the professional sports rights, right? You can get it in your local area on free AM and FM radio. If you want to follow out of market sports, you pay for satellite radio. It's a lot cheaper than paying for some of these TV services. And look, at the end of the day, if you can follow your favorite sport on radio and you hear a key moment that you want to actually see for yourself, you just go on social media a few minutes later and someone's down to post the highlights.

A lot of times the teams post the highlights themselves. The downside to really expensive sports on television is that you are going to see more people move over to radio and listen to the games live on free broadcast radio and on satellite. Man, there's so much here that we could talk about. So promise me that as you continue to follow the trends and write about it on your website, thedesk.net, that we can have you back on the show and we can kind of chart this, especially as we get closer to football season, because that is where people really tend to get passionate is about their NFL and their college football.

I am happy to chat with you anytime, Amy. It's been a pleasure. So you can find Matthew on Twitter at Matthew Keys Live, K-E-Y-S.

He's an award-winning journalist and you can hear this is his wheelhouse with the media, the tech, the business side, and of course that affects us as sports fans too. Man, I loved this. We can't wait to have you on again, Matthew. Thank you so much.

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