Apple Inc. will launch its new streaming service for Major League Soccer this week with a lot of the traditional practices of TV advertising kicked to the sidelines.
(Bloomberg) — Apple Inc. will launch its new streaming service for Major League Soccer this week with a lot of the traditional practices of TV advertising kicked to the sidelines.
The Cupertino, California-based technology giant hasn’t been looking for buyers of individual ads during the games, asking marketers instead to buy a season-long series of spots that will run during the games, according to people familiar with the company’s sales efforts.
Apple hasn’t been guaranteeing advertisers they’ll reach a certain number of viewers, a standard practice in TV. It’s also not accepting ads from sports-betting companies, at least initially, according to two of the people.
MLS Season Pass, which debuts Feb. 1, marks Apple’s first major push into the $68 billion US TV ad market. The company reached a 10-year deal last year to stream the men’s professional soccer league, which aired previously on ESPN, Fox and Univision, in a deal worth at least $250 million annually. Fans can buy MLS Season Pass for $15 a month, or $99 per season, through the Apple TV app.
Apple’s sports ambitions have been growing. Last year, the company streamed Major League Baseball on Friday nights, but MLB sold the ads to those games. For MLS, Apple assembled its own sales team, led by Todd Teresi, the company’s vice president of advertising platforms, and has spent weeks meeting with ad buyers about sponsorships.
Apple didn’t respond to requests for comment. Fox Corp. is also airing some MLS games this year.
MLS has not been a particularly big draw on television. Its regular season audience on ABC and ESPN averaged 343,000 viewers per game last year. But live sports, especially soccer, have been attracting new subscribers to streaming services.
Apple has been selling three MLS sponsorship packages. The most expensive, called “Gold,” costs about $4 million per season and includes the playoffs and integrations, like sponsoring a “Player of the Match,” the people said. Less expensive packages, called “Silver” and “Bronze,” cost about $3 million and $1.5 million per season.
The company has told media buyers that it would allow ads from categories such as credit cards, alcohol and car rentals, one person said. It’s not unusual for a tech giant to be selective about who can advertise on its platform. Amazon.com Inc., for example, wasn’t accepting commercials from beer companies during Thursday Night Football this past season.
Amazon also hired Nielsen, the measurement firm that has calculated TV audiences for decades, to count the viewers watching NFL games on Prime Video, a move aimed at making advertisers comfortable.
Apple’s role in the advertising industry has been controversial. Its privacy changes two years ago hurt social-media companies like Facebook’s owner, Meta Platforms Inc., by making it harder to target iPhone users. Apple has said its own foray into selling ads is unrelated to those changes.
Apple’s advertising unit generates about $4 billion in revenue annually, and the company is looking to increase that to $10 billion or more, Bloomberg News has reported. That includes putting search advertisements in more apps, such as its maps service, as early as this year.
With hundreds of millions of people owning Apple devices globally, the company has the reach to become an even bigger ad giant some day, said Dave Morgan, chief executive officer of Simulmedia, which helps marketers place ads more precisely.
“It comes out of the gate with absolutely extraordinary distribution,” he said.
But Apple will need to grow its subscriber base, prove it can build effective ad technology and acquire more live sports rights, according to Morgan. The company was in talks last year to stream NFL Sunday Ticket, which gives viewers access to games not airing in their local TV markets. Alphabet Inc., owner of YouTube, won those rights.
“It can’t just be MLS,” Morgan said. “They’ll have to follow up with other things.”
–With assistance from Mark Gurman.
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