With each new deal, YouTube’s role in sports media is becoming ever more firmly established—from the $2 billion it’s paying each year for Sunday Ticket to C.E.O. Neal Mohan’s recent decision to spend a pretty penny on this week’s Friday night game between the Chiefs and the Chargers. (Although financials weren’t disclosed, Peacock paid $105 million for the same game.) The company’s maneuver to poach Justin Connolly from Disney, despite some minor legal love taps on both sides, also suggests that it views sports as a core ingredient in its attempt to create a TV-oriented service. And, of course, YouTube has unique levers at its disposal, like tapping creators iShowSpeed and Roberto Morales to provide alternate simulcasts of the Chiefs-Chargers game to their combined 50 million subscribers.

But YouTube’s ultimate sports ambitions remain a giant question mark. Outside of the 10-figure NFL deal, Mohan has been reluctant to bid on the NBA, and YouTube has demonstrated indifference about the MLB. (YouTube doesn’t really have the same incentives as competitors, since the business has essentially gotten its milk for free without making any livestock purchases.) And yet, YouTube’s growing ubiquity, three-dimensional understanding of its data, and endless coffers have put fear in the hearts of the rest of the industry. Unlike everyone else, it doesn’t need live rights… and yet it still clearly covets them.

I recently sat down with William Mao, a senior vice president of global media rights at Octagon, the marketing consultancy, and a former YouTube employee who worked on the league partnership side back when that meant trying to get leagues to start even using YouTube. We got into what YouTube really wants out of these deals, the potential for smaller leagues to use YouTube as their own streaming service for fans, and more. Below is a condensed version of that conversation.

YouTube’s incentives for buying rights isn’t as clear as a company like ESPN. Take what’s happening with the Bundesliga, whose games will air on YouTube for free on Fridays, without YouTube having to go big with any kind of bid. Do you think YouTube will bid on more leagues?

When I was at YouTube, we were talking to the leagues simply about leveraging our platform more. They’ve come a long way. I always think about YouTube from the viewpoint of the necessity and the alternatives. Does YouTube need a certain set of rights in the same way a cable sports network does? And how could the sports partnership benefit the broader business—in YouTube’s case, and Google/Alphabet more broadly? YouTube has had a focus on the “lean-back” experience, even when I was with the company. The fact that YouTube already commands the largest share of TV consumption in the U.S. also suggests the platform may not need to increase its bidding on live sports to be successful in getting users to watch on TVs.

YouTube is pushing a “Watch With” feature during this NFL game, which involves creators bringing these big, mainstream events to their smaller audiences. Do you expect we’ll see more of those moments on the platform?

YouTube is focused on getting people into the app to engage with their programming—and that means creators. YouTube, the platform, could go strike a deal with the league, as we’ve seen with the NFL. Looking at the Bundesliga example, the leagues may think there’s a creator, or someone who’s backing a network of creators, who may want to acquire a set of rights that they can then put their own flavor on. There are groups out there, like the Creators Sports Network, that are doing exactly what you’re talking about. Sports leagues want to target these younger fans, and get ahead of their future fans. So it could be a platform doing the deal directly, or it could be creators and major networks on those platforms striking those deals to deliver and deploy across the YouTube platform.

Is there a world where YouTube is the exclusive home to the Super Bowl, even in the U.S.?

This question about YouTube going for big events has been kicked around for years. During my time at YouTube, a decade ago, we were asking questions about whether we could have the Super Bowl in international markets, because those rights were obviously locked up in the linear market in the U.S. Richard Deitsch of The Athletic asked me whether the World Series would no longer be on linear television [one day] and move to something like YouTube, and I think we might be cresting closer to that, simply based on the increasing number of marquee events making their way to platforms in the digital space. It’s more of an economic question.

For YouTube or the leagues?

No one would argue that YouTube isn’t super accessible to everyone in the market. No one would express concerns around the foundational technology or product. It’s about the expected audience for the leagues, which will ask themselves: What am I currently getting compensated for these rights? How will this impact the spend around advertising and sponsorships? How do the new revenue economics compare to how I’m currently distributing and delivering them?

Sports leagues want to target these younger fans and ensure they’re where their future fans are going to be. And maybe there’s a sponsor or brand that wants to get behind this whole idea, and can brand the whole exercise. That’s how the commercial model works, and that’s the revenue-generating part of the deal that underpins what would traditionally be considered a rights fee. That’s how the whole new equation could evolve.

Thanks, Julia. See you all on Thursday.
John