The NBA’s rights negotiations appear to be reaching a final outcome — or, at least, an initial finalization before potentially going to court. According to Tom Friend of Sports Business Journal, the league is nearing written agreements with ESPN, NBC, and Amazon as has been expected.
Friend included details on what each network will get, but the most interesting nugget was on why the league is headed to NBC and not coming back to TNT and Warner Bros. Discovery — pending potential litigation. According to Friend, ESPN locked down the “A” rights by doubling their offer in the exclusive negotiation window, but WBD wasn’t willing to do the same for their “B” rights package.
It is also becoming clearer how WBD reached this perilous point in negotiations. During Disney’s and WBD’s exclusive negotiating window from mid-March to April 22, industry sources said Disney was firm about not letting the “A” package go on the open market. So it doubled its old rights fee of $1.4B annually to $2.8B.
But those same sources said Zaslav — whose company paid $1.2B for NBA media rights a decade ago — believed he would only have to pay between $1.8B and $2.1B to retain the “B” package this time around and refused to double to $2.4B. That is why the bidding ventured into the marketplace and why NBC leaped in. If WBD does, in fact, lose the NBA, 2024-25 will be its final season under the current deal.
Now, NBC is reportedly paying $2.6 billion for those rights and the NBA is asking $2.8 billion from WBD to match for a variety of reasons (and could end up leading to a court battle). Given what the deal ended up being, it certainly sounds from this reporting that WBD undervalued the rights deal they had and the NBA called their bluff and were able to take it to NBC and get even more. There is still a chance WBD ends up with a piece of the pie, but to do so they’ll have to pay more than they would’ve a few months ago. If not, playing hardball will cost them the NBA and cost us Inside the NBA.