Warner Bros. Discovery Now Reportedly Aiming to Secure Amazon’s NBA Package
WBD CEO David Zaslav considers NBC’s bid of $2.5 billion an overpay for NBA rights, and could go after the newly-created “C” package of NBA rights.
The saga of the NBA’s latest round of contract negotiations has had more twists and turns than a seven-game playoff series. As talks have progressed, signs have increasingly pointed to a scenario in which Warner Bros. Discovery — which currently owns the NBA’s “B” broadcasting package — loses its status as an NBA partner, as NBC has bid as much as $2.6 billion per season to snag that package for itself. The league has also created a new “C” package of broadcast rights, and a new report from CNBC reveals that WBD may try to secure this package for itself instead of trying to use its matching rights to wrestle the “B” package away from NBC.
Key Details:
- WBD has the contractual right to match any deal made between the NBA and a third-party broadcaster.
- Amazon is set to pay between $1.8 billion and $2 billion per season in its agreed-upon deal framework with the NBA.
- That figure is in line with what WBD CEO David Zaslav thought he would have to pay for NBA rights in the current round of negotiations.
In its last deal with the NBA, WBD agreed to pay $1.2 billion per season to carry 65 regular-season games and half of the league’s playoff rights — outside the NBA Finals, which have been an ESPN exclusive. The league carved out a third package of rights for its current round of negotiations, in order to get its partners bidding against each other and jack up the price.
As things stand now, Amazon’s streamer Prime Video has agreed to the framework of a deal that would see it acquire the third NBA package. The details could still change, but as of now, the “C” package will have regular season games, the league’s new In-Season Tournament, a conference finals series every other season, and the yearly series of play-in games that determine which teams will be the last to make it into the NBA postseason. Amazon is expected to pay between $1.8 billion and $2 billion per season for the package when its offer is formalized.
CNBC reports that WBD could be more interested in matching this offer than NBC’s bid. The company has the right to match any offer from a third-party broadcaster to the NBA, and a deal for the “C” package could allow it to keep the NBA while staying aligned to CEO David Zaslav’s original vision of how much he wanted to pay for the Association.
Why Has WBD Given Up on its Old Package of NBA Rights?
The report from CNBC points to the conclusion that WBD has simply let go of the hope of keeping the NBA’s “B” package past the 2024-25 season. It states that Zaslav has been telling associates that he thinks that $2.5 billion per year for what NBC will reportedly end up getting is an overpay, which reinforces reporting that he entered into this year’s exclusive negotiating window with the NBA intending to max out his bid at around $1.8 to $2.1 billion per season. Those figures are right in line with the reported per-season price that Amazon has agreed to pay for the “C” package, which is why WBD may be strongly considering trying to match that offer instead of continuing to chase the “B” package.
Money isn’t the only problem in the equation in WBD’s quest to win back the “B” package. NBC can offer NBA games on an over-the-air broadcast network, with more weekly primetime slots available and a larger reach than TNT. The NBA’s lawyers have been pouring over its contract with TNT, and many analysts believe that the league is prepared to argue in court that a dollar-for-dollar match of NBC’s offer by WBD wouldn’t constitute a fully equitable matching deal, because it can’t match NBC’s reach.
Amazon emerged as a highly logical partner for the league quite early in the process, as the NBA made no secret of its desire to increase its streaming presence in its next broadcast contract. WBD can now offer that option, as it streams all live sports available on TNT, TBS, and truTV in the Bleacher Report Sports Add-On, which launched in October. One possible wrinkle for WBD, if it wants to match try and match Amazon’s offer, is that it plans to make the B/R add-on a paid feature eventually, and the tiered availability of sports on the service may be a turn-off to the NBA, particularly since Prime Video offers all of its sports to all subscribers at no extra cost. However, the forthcoming launch of Venu Sports, which is a sports streaming joint venture that will carry all of ESPN, Fox, and WBD’s sports programming could help bridge the gap.
WBD agreed to a deal to sublicense some College Football Playoff games from ESPN, so it’s clearly not sitting on its hands while NBA negotiations unfold. The company may have been priced out of its old NBA package, but the newly-created “C” package of rights could allow it to retain the Association without having to resort to what its executives think of as an overpay for the league’s rights.
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