New NBA Media Deal: 11 years, $77B with Disney (ABC/ESPN), Comcast (NBC/Peacock), and Amazon. ESPN to license Inside the NBA

[K-Apps]

Commissioner Adam Silver provided his most definitive hint today that the NBA could have a national streaming RSN platform as soon as the 2025-26 season, admitting the topic was discussed comprehensively during this afternoon’s Board of Governors meeting and that the league will spend the next six months "intensively studying what the opportunity is."

Asked today about a harsh email last July from James Dolan — when the Knicks owner called the league’s new $77B media rights deal the potential "ruination" of the RSN model — Silver was quick to point out that, prior to that national deal, 18 of the league’s RSN had already gone defunct or entered bankruptcy. He then painted a rosier picture for the future, referencing a temporary 30-to-40% "dip" in local rights fees for 13 NBA teams due to Diamond Sports Group’s Chapter 11 but also "an interest" from streaming services that should increase rights fees shortly thereafter.

His comments lend even more credence to league-wide sentiment that either Amazon, Roku, YouTube — or some other streaming entity — will eventually take a conglomerate of between 15 and 20 teams and create a national streaming RSN somewhat similar to what the NFL does with Sunday Ticket. As of now, the league and Diamond have a court-approved single-year agreement to broadcast local games for those 13 NBA teams for this coming season, but that didn’t stop Silver from talking idealistically about the future.

"For me at least, I think we will emerge in a very good place," Silver said at his post-BOG news conference. "… I think coming out of this, when we look at the interest of streaming services to carry local games and all the additional functionality that will come to that, there will be a transition and transition for our viewers, as well, in terms of how they discover those games and how they watch them, that I think the end result will be a much better consumer experience.

"When you can personalize and customize those experiences, when you no longer have the shelf space concerns, for example -- think about not so long ago when we were doing our schedule, if Friday night is ESPN or Thursday night is TNT, obviously by definition in the old days it can only be one game, and for the most part because of the complexity of our schedule we've got to plan that game months and months in advance without knowing how well that team is going to be playing, who could be injured, if there's going to be trades or whatever else. Now without a shelf space constraint, Friday night, what's on. So [with a national streaming RSN] a lot more choice for viewers, and then as I said, a lot more ability to do new and different things."

Silver even indirectly alluded to Dolan, or at least Dolan’s discontent. Part of why the Knicks owner has sent separate contentious emails to the Board of Governors over the past two months, with passive aggressive jabs at Silver, is because he wants no part of the revenue sharing that will certainly come with the new $77B national media deal.

Every time a Knicks game is exclusively on a national network — which can only happen 12 times a season under the current ESPN/TNT media deal — Dolan loses local broadcast income, as well as local sponsorship and signage revenue. But under the new pending media rights deal, the max number a team can lose a local game broadcast to a national telecast is expected to increase to 18 times, costing Dolan more money and almost penalizing him for having a desirable team. Silver even pointed that out today.

For that reason, getting every team to a national streaming RSN may not be feasible in the near term. But, eventually, sources said the hope is that even the Knicks join the conglomerate, if it can somehow, some way be worth their while financially.

"I'll just end by saying that pound for pound, the greatest value in sports rights is in the market of that team," Silver said today. "You're here in the New York market; the Knicks are clearly a national and global brand in terms of basketball. The most intensive interest in the New York Knicks, not surprisingly, is in the New York market. So it shouldn't be that when we finish this process that rights are worth more per viewer outside of the New York region than in New York.

 

[K-Apps]

Warner Bros. Discovery filed a sweeping memorandum with the New York Supreme Court late Friday afternoon, reaffirming that the NBA negotiated its $77 billion media rights deal in "bad faith" and asking the court to deny the league’s motion to dismiss WBD’s matching rights lawsuit.

At the heart of WBD’s argument today is its claim that TBS’ matching rights are "far broader than the NBA misleadingly asserts," and that the court should refuse to throw out the lawsuit at this early stage of the proceedings.

"These multi-billion-dollar issues cannot be resolved on a motion to dismiss," the memorandum said. "Unsurprisingly, the NBA fails to cite a single case where a breach of matching rights claim was dismissed at the pleading stage. In fact, all of the relevant cases, including those the NBA relies upon, were decided on an evidentiary record. This case is no different."

According to scheduling documents, the NBA is bound to reply to today's WBD memo by Oct. 2. Sources believe that if Judge Joel Cohen sides with the plaintiffs and does not dismiss, there will be a push from both sides to negotiate a settlement. As it stands, both parties have already agreed to an expedited resolution of the matter with a tentative trial date set for early April.

However, any appeal process could conceivably drag on into the 2025-26 season, which would be problematic because the NBA’s new 11-year media rights deal with Amazon, NBCU and ESPN will have already begun.

WBD's court filing today took direct aim at the NBA's motion to dismiss earlier this month, which, in part, asserted that Turner could not match Amazon’s $1.93 billion annual bid because it was a streaming-only Prime Video package, and TNT is a cable-based linear broadcast. Turner indicated that argument was frivolous.

"Prime Video is distributed via multiple forms of non-broadcast television to consumers on televisions, tablets, computers, mobile phones and various other devices," WBD’s lawyers wrote. "TBS agreed to distribute games on both TNT and Max, which can be distributed in the same ways and to the same devices as Prime Video. The NBA insists the Amazon offer is 'internet-only.' That is both false and irrelevant.

"It is false because the Amazon offer on its face provides transmittal by satellite too," the memo continued. "It is irrelevant because transmittal via the Internet to a television is a form of 'television distribution' under §C.4 of the MRE [Matching Rights Exhibit]. In any event, the NBA’s arguments raise a number of fact issues that cannot be resolved at this stage. How do video feeds by Amazon and TBS ultimately make their way from an NBA arena to the end consumer? How and on what device does the consumer watch that transmission? Does Amazon itself market Prime Video as ‘television’? What aspects of those processes are relevant under the governing contractual provisions? None of this can be decided on a motion to dismiss."

In its motion to toss out the case, the NBA had also told the court that WBD had failed to match a proposed rolling $3.2 billion escrow account in Amazon’s bid because Turner had attempted to replicate it through letters of credit from a group of banks -- not the same thing. In its response today, WBD insinuated that by asking Turner to come up with $3.2 billion in a brief five-day matching period, the NBA "never intended to allow TBS to match the Amazon offer," violating a "'well-established' principle 'that [rightsholders] and potential buyers may not structure [offers] in bad faith for the purpose of defeating the exercise of rights of first refusal.'"

The NBA had also argued previously that WBD had failed to match a provision in Amazon’s bid requiring them to promote NBA games during NFL Thursday night broadcasts. For instance, the league had asserted WBD could have simply purchased commercials promoting the NBA during those NFL games -- even though it did not own NFL broadcast rights.

But WBD’s response today was to reiterate that the NBA’s tactic was “in bad faith to circumvent TBS’s matching rights," and the NBA "intentionally included Amazon-specific terms in the Amazon offer, and other purposely onerous or immaterial conditions." An example provided in the WBD response noted the Amazon offer "required that NBA games be shown on a platform that also shows NFL games -- even though the NBA knows plaintiffs do not have NFL rights."

However, industry experts believe Amazon -- not the NBA -- proposed including the "Thursday Night Football" promo requirement in its NBA bid for the sole purpose of precluding WBD from matching. Experts said it is a common practice for entities to insert "poison pills" into bids that contain matching rights, and that Amazon did not nothing untoward.

 

[FAH1223]

 

[Saysumthinfunnymike]

"Provider must show 3 NFL games, WNBA and a 'Lord of the Rings' series"

 

[HandyWithTheSteel]

Silver ho’d these dudes.

This is some Stern type shyt. TNT really thought they were gonna play hardball.

 

[TM101]

Once LeBron, Steph and KD leave the league wont have the stars to keep viewership needed to increase ad revenue. A league of 7-feet, three point spamming Europeans is perfect for Amazon that wants a loss leader to drive subscriptions to their main product. We will look back and say TNT was fortunate that the NBA didn't want to renew with them.

 

[KFBF]

Once LeBron, Steph and KD leave the league wont have the stars to keep viewership needed to increase ad revenue. A league of 7-feet, three point spamming Europeans is perfect for Amazon that wants a loss leader to drive subscriptions to their main product. We will look back and say TNT was fortunate that the NBA didn't want to renew with them.

Think it's more likely TNT doesn't exist in the way it does now than we say losing the NBA was good for them.

 

[Jplaya2023]

"Provider must show 3 NFL games, WNBA and a 'Lord of the Rings' series"

Why in the world would showing an nfl game be a requirement for the NBA

 

[Saysumthinfunnymike]

Why in the world would showing an nfl game be a requirement for the NBA

Because they wanted to stream on Amazon and no place else.

Also, I wouldn't say losing the NBA is "good" for WBD at all. It's not good, they will lose millions in ad revenue but the game WBD is playing now that it's clear they likely won't have the NBA is trying to secure their carriage fee with Comcast and the like. Comcast will say "why should we pay x if you don't have the NBA..." and WBD's rebuttal will likely be to threaten to pull all of their networks from Comcast which would severely damage Comcast's cable package. But then Comcast could say "we don't care.." if they are planning on moving away from cable sometime soon.

It'll be interesting to see how that all plays out

 

[HandyWithTheSteel]

Once LeBron, Steph and KD leave the league wont have the stars to keep viewership needed to increase ad revenue. A league of 7-feet, three point spamming Europeans is perfect for Amazon that wants a loss leader to drive subscriptions to their main product. We will look back and say TNT was fortunate that the NBA didn't want to renew with them.

TNT might not exist in 10 years. Have you seen those WBD stock numbers?

 

[Regular_P]

Drop Doris altogether.

 

[GoldenGlove]

 

[Saysumthinfunnymike]

TNT might not exist in 10 years. Have you seen those WBD stock numbers?

Cable won't exist in ten years. Have you seen how many subs these companies are losing YOY? WBD is just the first domino to fall. Nobody knows how to correct it.

 

[Rekkapryde]

"Provider must show 3 NFL games, WNBA and a 'Lord of the Rings' series"

NBA fukked up if that's the case. That is 100% bad faith. The fact they also removed the matching provision going forward is another item I'd use against the NBA if I'm WBD

 

[Rekkapryde]

TNT might not exist in 10 years. Have you seen those WBD stock numbers?

Disney is almost 50 billion in debt too. Didn't stop the the NBA from quickly agreeing to ESPN deal.