The highly anticipated media rights for National Basketball Association (NBA) live games are up for grabs.
What Happened: For years, Warner Bros. Discovery WBD and The Walt Disney Company DIS have had the media rights for NBA content for their TNT and ESPN units respectively.
After failing to come to a new deal under an exclusive negotiation window, Warner Bros. Discovery could now be on the outside looking in with rival Comcast Corporation CMCSA ready to swoop in with a huge offer.
NBCUniversal, which is owned by Comcast, is reportedly nearing a deal to pay $2.5 billion annually for the rights to a package of NBA games each year.
TNT currently pays around $1.2 billion annually under the current NBA deal that expires at the end of the 2024-2025 season.
TNT can try and match rival offers as the current league partner.
The bid from NBCUniversal includes regular season and playoff games that would air on NBC and the Peacock streaming platform. The media company has also discussed having two prime-time games a week on its NBC channel. Warner Bros. Discovery does not own a broadcast network, which could give NBC a leg up.
Disney is expected to pay $2.6 billion annually for a renewal of its current deal with the league, which marks a sharp increase from the $1.5 billion it currently pays annually.
Under the new NBA deal, TV partners would air fewer games than in the past. This is due to the league working out a new package for a streaming partner.
Amazon.com Inc AMZN is believed to be in the final stages of negotiating a streaming rights deal with the league for its Prime Video platform.
Related Link: Disney’s ESPN, College Football Playoff Reach New Agreement: What’s Going On?
Why It's Important: Sports rights remain a key asset for live television broadcast and cable networks as many consumers have cut the cord and turned to streaming platforms. Many sports rights also end up on streaming platforms, which can provide incentives for consumers to subscribe to platforms.
Without the NBA, TNT could lose part of its luster to cable companies and struggle to command a premium estimated at around $3 per month for each cable customer, according to the Wall Street Journal.
It would still have the NHL, Nascar and the NCAA Men's Basketball Tournament.
Warner is also working on a sports streaming joint venture with Disney and Fox Corporation FOXFOXA. Without the NBA rights, Warner may have less to contribute to the venture and risk being squeezed out or owning a smaller stake in the venture.
Amazon's interest in NBA rights has been a hot topic since October. The e-commerce company landed NFL rights and has the "Thursday Night Football" broadcast that has been strong for ratings and helped boost Amazon Prime membership.
The streaming platform pitched having an exclusive night of NBA games on Amazon Prime similar to "Thursday Night Football" previously.
Comcast has been a key player in the sports rights markets and currently has rights to content that includes the Olympic Games, PGA Tour, Nascar, English Premier League, National Football League, Big Ten Football, Notre Dame Football, Triple Crown Horse Racing and more.
NBC previously had rights to NBA rights from 1954 to 1962 and from 1990 to 2002.
CMCSA Price Action: Comcast shares are down 2% to $38.11 on Tuesday versus a 52-week trading range of $36.43 to $47.45.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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