NBA Commissioner Says League Needs to ‘Reimagine’ Regional Sports Network Relationships
The NBA playoffs are underway, and that means that if your team is still playing, you’re likely watching ESPN, TNT, or another national network for your playoff basketball needs. Regional sports networks (RSNs) like those from Bally Sports do the heavy broadcasting lifting during the regular season, however, and more than half the league are covered by such channels.
NBA commissioner Adam Silver thinks that relationship needs to be looked at, however. Speaking with Sports Business Journal’s John Ourand at the CAA World Congress of Sports, Silver talked about the decline of cable as a whole, and how the league may not be in business with RSNs for much longer.
“There’s no doubt that…we need to reimagine these relationships,” Silver said. There’s the specific issue in terms of [Diamond Sports Group] with the debt they had and correcting that issue. Then in terms of the fundamentals of the business, everyone sees what’s happening in the television market. You’ve had a dramatic decline in the number of television homes.”
Silver was certainly correct to cite Diamond Sports as an example of the struggles RSNs are currently undergoing. DSG has a debt load of $8 billion, and is currently attempting to restructure that debt in bankruptcy court. Silver’s league has been willing to work with Diamond while it determines its restructuring plans, but Silver clearly sees the RSN model is not one that will work permanently. However, it’s important for both the league and companies like Diamond to keep their relationship going in the short term.
“There’s still 75 million homes receiving cable/satellite programming in the United States,” Silver told Ourand. “But [the decline of cable] has a particular impact on a sport like ours that has a very young viewership. Our young fans are not watching traditional television. It’s why Diamond was so focused on distributing those games digitally. As they’re trying to reimagine their business, part of it is to have a digital package to go alongside the linear package. Those 75 million homes are still going to be important for the mid-term future.”
That explains why the NBA renewed its deal with Diamond Sports for another season, despite the company’s ills. Diamond holds the rights to 16 NBA teams, which it broadcasts as well as streams on its direct-to-consumer (DTC) service Bally Sports+. There’s a good chance the extension with Diamond was to help the league more closely align its negotiation windows; its national broadcast rights deals expire following the 2024-25 season, and now its agreement with Diamond will conclude at the same time.
If DSG is still in existence by then, it will have plenty of competition for NBA rights. The league reportedly wants to sell a streaming-only package of games to some entity or other, and companies like Apple, Amazon and many others have all been mentioned as possible partners.
The NBA has certainly shown less combativeness and more willingness to work with the RSN model in the short term than MLB has. But league executives from every sport see the same thing: as pay TV continues its precipitate decline in use, thought must be given to how to distribute games to an audience who is using other methods to consume media.
Bally Sports+
Bally Sports+ is a direct-to-consumer streaming service that offers live games for those who want access to your local Bally Sports RSN without subscribing to a cable or satellite package.