ESPN, TNT Can Match Any Deal Made Between NBA and Third Broadcaster; Will They Block NBC, Amazon From Rights Deal?
The NBA is seeking as much as $75 billion+ in its next TV deal, and its two current media partners could have deep-pocketed competition.
The NBA is on the hunt for a raise. The league is now free to sell its national broadcasting rights to any linear channel or streaming service it chooses, as it emerged from its exclusive negotiation window with current partners ESPN and TNT on Monday without having reached deals with either channel. Analysts still expect ESPN and TNT to remain NBA partners as part of the deal; in fact, the league may not have a choice in the matter. A new report from Sports Business Journal indicates that both Disney and Warner Bros. Discovery have the right to match any deal put in front of the NBA by a competing company like Amazon or NBCUniversal, which could keep the Association’s national broadcasts exclusively with ESPN and TNT throughout the length of their next agreement.
Key Details
- The NBA wants to double, or even triple the total value of its last broadcasting contract.
- Disney and Warner Bros. Discovery both have lots of financial demands, and competitors like Amazon can pony up large sums for NBA rights.
- It appears highly unlikely that ESPN and TNT will pay what the NBA wants in its next broadcast contract all on their own.
The NBA’s current broadcast contracts with national partners expire after the 2024-25 season. In the regular season that just concluded, ESPN and ABC combined to offer 100 nationally broadcast NBA games, while TNT kicked in another 65.
The league’s last deal with ESPN and TNT netted it $24 billion over the course of nine seasons, including the still-to-come 2024-25 campaign. Various reports have indicated that the NBA wants to double, or even triple the value of that contract this time around, but last fall a report emerged that ESPN and TNT both wanted to reduce the number of games per season they offered in their next agreements with the league.
Who Can Outbid ESPN and TNT for the NBA?
The report stating that Disney and WBD both wanted to trim their NBA packages could have just been a negotiating ploy to lower the asking price for those rights, just as WBD head David Zaslav’s insistence that his company “doesn't have to have the NBA” in 2022 likely was. But both Disney and WBD are grappling with big shifts in revenue as cord-cutters eat into the cable and satellite market, where both companies have traditionally pulled in big hauls from retransmission fees.
As Disney and WBD try to turn streaming platforms like Disney+ and Max into big-time revenue generators, they have to be strategic with the way that they spend their cash. A huge increase in NBA rights fees may not be what either company wants at the moment, particularly when some of its competitors have large cash reserves to fall back on. Disney has yet to turn a streaming profit, and WBD netted a modest $103 million from its streaming segment in 2023, a figure that includes revenues generated by the linear HBO channel.
Amazon is the biggest threat to Disney and TNT keeping all NBA rights for themselves going forward. In The Streamable’s expert opinion, we predict that Prime Video will land a package of NBA games in the deal, and its deep pockets could help it register a bid that Disney and WBD simply feel uncomfortable matching. Amazon pulled in nearly $600 billion in revenue last year, netting a profit of over $30 billion, and Prime Video executives have promised to be “aggressive” in pursuit of desired sports rights.
The NBA wants to split its rights up as much as possible for its next deal, in part to stimulate interested parties to make higher bids for the packages they want. That could lead to as many as two new game bundles in addition to those heading to ESPN and TNT; the league’s new In-Season Tournament has been floated as a possible TV or streaming product, and companies like NBCUniversal, Apple and even Netflix have been discussed as potential landing spots.
In our view, we believe that all of these points add up to the conclusion that Disney and WBD are unlikely to try to outbid everyone else and keep the NBA’s rights all to themselves. Trying to do so would undoubtedly cost both companies billions of extra dollars per year while each is trying to navigate steep declines in linear revenue and bring their streamers up to proftability. Companies like Apple, Amazon, and Netflix can afford to pay hefty sums for NBA rights, and Disney and WBD would be better served not trying to match their bids with the financial demands both companies face.
Amazon Prime Video
Amazon Prime Video is a subscription video streaming service that includes on-demand access to 10,000+ movies, TV shows, and Prime Originals like “The Lord of the Rings: The Rings of Power,” “Jack Ryan,” “The Marvelous Mrs. Maisel,” “The Boys,” and more. Subscribers can also add third-party services like Max, Showtime, STARZ, and dozens more with Amazon Prime Video Channels. Prime Video also offers exclusive live access to NFL Thursday Night Football.