Ron Chenoy/USA TODAY NETWORK
NEW YORK — The NBA is formalizing written contracts with Disney, NBC and Amazon this week, with sources calling it the final stage of media rights negotiations that may inevitably lead incumbent Warner Bros. Discovery to take legal action.
Industry sources believe ESPN will ultimately pay $2.8B annually — though other industry sources insist it is still an earlier reported $2.6B — for the league’s “A” package, which includes the NBA Finals, a conference final, weekly primetime games, the WNBA and likely shared international rights. NBC’s proposed “B” package is believed to be worth between $2.5B and $2.6B annually and would probably include a “Basketball Night in America” or “Sunday Night Basketball” following the NFL season, a total of two primetime windows a week, conference semifinals and a conference final. Amazon’s deal is believed to be worth between $1.8B and $2B and would likely include the Emirates In-Season Tournament, the SoFi Play-In Tournament, first-round playoff games, the WNBA and international rights.
The final tweaks — which sources said have been fluid and changing almost every other day — are expected to be finalized in the coming days or week, at which time sources said all three networks will go to their respective leadership groups to have their contracts approved. At that point, sources said the league will take NBC’s contract to WBD to see if WBD CEO David Zaslav is able to match it in “total value.”
Considering WBD is $40B in debt and does not have the over-the-air infrastructure of NBC, sources believe WBD would need to pay more than $2.6B to match the deal and that NBC’s overall bid could be structured in a way (for example, multiple weekly over-the-air games) that makes it virtually impossible for WBD to equal. Sources said Zaslav would then essentially have three choices: pass on the NBA, drastically overpay for the “B” package or take the NBA to court over the definition of a match.
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In that event, sources said the league will contend a match is not dollar-for-dollar and that, specifically, a match would need to include the same ad revenue, broadcast windows, etc. — something WBD apparently disagrees with. Sources said the NBA is prepping its lawyers for a possible inquisition or lawsuit.
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 purportedly doubled or came close to doubling 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.
