After the National Football League celebrated its history-making 11-year contract worth more than $100 billion, attention shifted to the NBA’s deal, which runs through the 2024-25 season. Early thinking within league circles suggests the NBA will seek a $75 billion rights package, up from its current $24 billion deal, which pays $2.6 billion per year.
One person familiar with sports media deals said the NBA could get $70.2 billion over nine years, using metrics including total viewer hours, which helps networks determine the value of sports league rights. The person also said tier-one sports rights are important to streaming services.
The individual asked not to be identified due to privacy concerns.
The NBA is currently partnered with AT&T-owned WarnerMedia and Disney, the latter of which agreed to pay the NFL $2.7 billion per year until 2033. Should the NBA triple its rights and replicate its nine-year deal length, it would generate around $7 billion to $8 billion per season. That puts it just behind the NFL’s new $10 billion per year average once the new agreements begin.
The NBA also has a $1.5 billion streaming deal with Chinese-based company Tencent Holdings.
“I think everyone expects that so long as the public is demonstrating through ratings that they are watching the NBA, you can probably expect increases there as well,” said former CBS Sports president Neal Pilson. “I would think the NBA is going to look for significant increases.”
The NBA has a good reason to seek more money for its rights. The league has more global appeal than the NFL and has a younger demographic, too, as Generation Z continues to support the NBA and Gen Alpha appears to continue the trend.
Though ratings declined in 2020 primarily due to pandemic factors, the NBA has seen increases throughout its current 2020-21 season. The league is attempting to create more meaningful games with its play-in tournament, which performed well last year.
On a media call last week discussing the NFL’s new rights, ESPN President Jimmy Pitaro said the network is “very pleased” with the NBA’s partnership and “how those games have performed.”
The NBA will be highly sought-after as a top-tier sports league. Fox Sports was interested in landing pro basketball before the NBA’s last deal in 2014. But Pilson said the NBA will more than likely stay with current partners once new agreements come around.
“I think the NBA will stay with the two network packages,” Pilson said. “That gives them the promotion base, and sometimes when you end up with lots of networks, people can’t find games when they’re on. College basketball is the best example — you want to see a game, and you don’t know where it is.”
Again, it’s still early, but the second most popular league on the U.S. sports landscape knows its day is coming. And as of now, the aim is $75 billion.
Said Pitaro: “The partnership with the NBA is incredibly important to us, and we’re looking forward to getting back at the table with Adam [NBA commissioner Adam Silver] and his team when the time is right.”
The NBA declined to comment due to privacy concerns about the financials of its media deals.
Source: Business - cnbc.com
