Disney And Warner Bros' NBA Setback Vs Apple And Amazon's Courtside Victory

The National Basketball Association (NBA) is negotiating media-rights deals to fund its star players' colossal salaries ahead of its new season. As the NBA embarks on its first media discussions in ten years, significant partners like Walt Disney Co's DIS ESPN and Warner Bros. Discovery, Inc's WBD TNT—who currently shell out approximately $2.6 billion annually—are hesitant about significant spending hikes.

Both media giants are grappling with financial pressures, including the challenges of cable TV's decline and the implications of significant mergers. 

Amid these challenges, the NBA is strategizing to involve more stakeholders in its upcoming deals, which will likely commence post the 2024-2025 season, the Wall Street Journal reports.

If ESPN and TNT reduce their game purchases, it opens the door for streaming platforms to step in. Tech giants Amazon.Com Inc AMZN and Apple Inc AAPL are keen on acquiring a substantial portion of NBA games, further heightened by the possibility of bundling national TV rights with local market rights.

Last season, NBA games on TNT, ESPN, and ABC garnered an average viewership of 1.6 million. The playoffs, in particular, drew over five million viewers, consistently ranking as top-tier content for audiences below 50. 

With Diamond Sports, a significant local broadcaster, teetering on the brink of bankruptcy, the NBA might reclaim media rights in 15 markets, leading to the league broadcasting these games independently, leveraging the NBA app as a platform for individual team streaming services. 

The NBA's strategy also envisions teams streaming games and potentially broadcasting them on local channels.

The NBA is also exploring other avenues for game sales. For instance, they're launching an in-season tournament this year. 

While ESPN will broadcast the event this year, the league might segregate the match as a separate package in upcoming seasons.

Price Actions: DIS shares traded lower by 1.24% at $85.13 on the last check Tuesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.