Apple's Soccer TV isn't Guaranteed for Advertisers

There is no doubt that Apple Inc., will launch its new streaming service for Major League Soccer this week, throwing a lot of the traditional practices of television advertising out of the window

‍

According to people familiar with the company's sales efforts, the Cupertino, California-based technology giant hasn't been looking for buyers of individual commercials during the games, instead asking marketers to buy a season-long series of spots that will run from games to games during the season.

‍

Apple's $68 billion US TV ad market debuts in February with the launch of MLS Season Pass, which marks the company's first major foray into this market. In a deal worth at least $250 million a year, last year the company reached a 10-year deal to stream the men's professional soccer league, which was previously streamed on ESPN, Fox and Univision. MLS Season Pass for Apple TV is available for $15 a month, or $99 for the entire season, and can be purchased through the app. 

‍

Apple has been expanding its sports ambitions over the last few years. Streaming Major League Baseball games on Friday nights was something the company offered last year, but MLB sold the ads to those games to the company. The company has assembled its own sales team to handle sponsorships of Major League Soccer, headed by Todd Teresi, Apple's vice president of advertising platforms, and has spent weeks meeting with advertisers about sponsorship opportunities. 

‍

Apple did not respond to a request for comment. As part of its coverage of the MLS this year, Fox Corp. is also airing some games from the league. 

‍

There hasn't been a lot of TV interest in Major League Soccer lately. Last year, it averaged 343,000 viewers per game during the regular season on ABC and ESPN. Streaming services have been attracting new subscribers to their services as a result of live sports, especially soccer. 

‍

There are three sponsorship packages available from Apple for the Major League Soccer. "Gold" is the most expensive package, and it costs approximately $4 million per season, which includes the playoffs and integrations, such as sponsoring a "Player of the Match," according to people familiar with the matter. A more affordable package, known as "Silver" or "Bronze," is available for about $3 million a year and about $1.5 million a year, respectively.

‍

Media buyers have been informed by the company that it is permissible to advertise for the company in categories like credit cards, alcohol, and car rentals, one of the persons said. Amazon.com Inc., for example, was not accepting commercials from beer companies during Thursday Night Football this past season, as it was not allowed to advertise on its platform. It is not unusual for tech giants to be selective about who can advertise on their platforms. 

‍

Moreover, Amazon has hired Nielsen, the company that has been measuring television audiences for decades, in order to count the number of people watching NFL games on PrimeVideo, a move that is aimed at making advertisers more comfortable with Amazon's services.

‍

The role that Apple plays in the advertising industry has been controversial for quite some time. Several social media companies have pointed out that Apple's privacy changes two years ago made it harder for them to advertise to iPhone users instead of Facebook's owner, Meta Platforms Inc. Apple has said that these changes have nothing to do with its own foray into selling ads. 

‍

It is estimated that Apple's advertising unit generates about $4 billion in revenue annually, and the company is looking to increase that amount to $10 billion or more by the end of next year. In addition, Google is planning to start making search advertisements available in more apps, such as its maps service, as early as this year. 

‍

According to Dave Morgan, chief executive officer of Simulmedia, a company that helps marketers place ads more precisely, the company has the ability to become an even bigger ad giant one day given its reach of hundreds of millions of Apple devices worldwide.

‍

“This is a game that comes out of the gate with absolutely extraordinary distribution,” he said. 

‍

In order for Apple to succeed, Morgan believes it will need to grow its subscriber base, demonstrate it can build effective ad technology, and acquire more live sports rights in order to succeed. Last year, the company was in negotiations with Google, the owner of YouTube, to stream NFL Sunday Ticket, which provides viewers access to games that are not broadcast in their local TV markets. Alphabet Inc. won the rights to broadcast those games.

‍

“There can't be just the MLS,” Morgan said. “They'll have to follow up with other things.”