In a television deal notable more for its financial heft than anything else, the NBA has agreed to keep the status quo going for an additional nine years.
The NBA has officially announced a new nine year television deal with ESPN and Turner Sports that will begin in the 2016-17 season and last through 2024-25. The parties did not disclose financial terms, but the deal is reported to be worth $2.6 or $2.7 billion per year — up nearly 200% from the current level of $930 million.
According to Sports Business Daily, ESPN will pay $1.4 billion and Turner Sports $1.2 billion.
The new deal will feature 22 additional regular season windows (ten on ESPN, twelve on TNT), but that is about the only major change on the television side. Beyond TV, ESPN is said to be negotiating the launch of a new NBA streaming service that would allow fans to watch games online with or without a cable subscription.
By the end of the deal, ESPN and ABC will have held NBA rights for 23 consecutive seasons and Turner Sports 41. CBS had NBA rights for 17 years and NBC’s tenure lasted just twelve. Fox Sports, which publicly expressed interest in bidding for rights this year, has never had a national NBA contract.
The NBA stacks up quite well versus the other major sports. Major League Baseball’s new television deal with ESPN, Turner and Fox Sports is worth $1.5 billion per year and the NHL’s deal with NBC Sports and Canada’s Rogers is worth $633 million. The NFL, of course, is well ahead of the pack with $5.0 billion per year in rights fees from its TV partners (not including additional revenue from sources such as DirecTV, which drives the NFL’s haul up to $7 billion).
The massive increase in TV money is a direct result of the NBA’s recent resurgence. The current contract was signed in 2007, with the league coming off the lowest rated NBA Finals ever. The $930 million annual rights fee marked ‘only’ a 22% increase over the previous deal ($765M).
In the seven years since that contract was signed, regular season and playoff ratings improved dramatically. The NBA Finals averaged a double-digit rating each year from 2010 to 2013, topping the World Series in five of the last six years. The conference finals set records in 2011 (on TNT) and 2012 (on ESPN). ABC’s coverage of the shortened 2012 regular season was the most-watched on any network since the shortened 1999 regular season.
The players were principally responsible for that seven-year resurgence. Kevin Garnett‘s 2007 arrival in Boston rekindled the Celtics/Lakers rivalry, which started the league on its path back to relevance. Then, LeBron James‘ 2010 decision to sign with the Miami Heat kicked off four years of an unhinged media and fan backlash that sent ratings soaring.
The new TV deal comes nearly three years after NBA owners successfully engineered a massive redistribution of wealth that reduced the players’ share of basketball-related income to 50 percent. That was predicated on claims that the league was in dire financial health with most of the teams losing money. The players or owners can opt out of the current collective bargaining agreement in 2017, and another lockout is widely expected.
(Mon. news from ESPN, Turner Sports, Sports Business Daily)
