Disruption is all around us!

Congratulations to Richard Thaler of the University of Chicago for winning the 2017 Nobel Memorial Prize in Economics.  Thaler is being recognized for his important work in Behavioral Economics, which arguably has upended mainstream economics (and its assumptions), as much as Amazon and Netflix have disrupted brick-and-mortar retail and traditional Pay-TV, respectively.

https://www.nytimes.com/2017/10/09/business/nobel-economics-richard-thaler.html

Is it time for some football?

For the right to stream the broadcast feed of eleven NFL games to its Prime Video Service subscribers this fall, Amazon paid the League $50 million or $4.55 million per game.  For the Thursday night game (9/28) between the Chicago Bears and Green Bay Packers, the streaming service averaged 372K viewers, or .6% of Prime members and approximately 2.5% of the 15M+ in total who viewed the game on CBS, the NFL Network, and other digital platforms.  If you divide the game’s programming cost by the number of viewers, it comes to approximately $12.  

So, what is the per viewer cost threshold that Amazon would have to get to that would support the continuation of paying for and streaming live sporting events? Will this be a short-term (failed) experiment or a long-term winner for the firm?  I’d never bet against Amazon, but I’m not sure about this one.