Warner Bros. executives. Discovery thought it had given the National Basketball Association a proposal that it would accept.
In April, after months of negotiations, the company made an offer to pay billions of dollars to the league for the rights to continue showing its games on TNT, as well as the Max streaming service. TNT has shown NBA games since the 1980s, and its “Inside the NBA” is considered by many to be one of the best sports studio shows ever.
But when the deadline for exclusive negotiations with Warner Bros. As Discovery nears its end, the NBA is determined to change the package of games the company will receive, according to two people familiar with the negotiations, who spoke on the condition of anonymity to discuss private deals. Warner Bros. Discovery has balked, and while the two sides continue to negotiate, the company is now at risk of losing the rights to televise the sport with which it has become closely associated. And on Friday night, the beating heart of “Inside the NBA,” Hall of Famer Charles Barkley, said he will retire from television after next season.
“The first thing people think of when they say TNT is the NBA,” said John Skipper, former president of ESPN.
Media companies, including Warner Bros. Discovery, Prepared for Tough Negotiations with Sports Rights NBA remains an extremely valuable commodity for traditional television networks, and companies increasingly see them as a way to attract more people subscribe to their streaming services.
The union made it clear that it wants a significant increase on the roughly $2.66 billion average it receives annually from Warner Bros. Discovery and ESPN are under current rights deals, which took effect in 2016. Executives at those companies know if they want to retain NBA rights they will have to Pay more for fewer games so that the NBA can create a third game bundle for sale.
Disney, the parent company of ESPN, has ended the exclusive period of negotiations with a handshake agreement to continue showing NBA games. Meanwhile, NBC and Amazon quickly jumped in and are both negotiating with the NBA about packages that include games that currently belong to Warner Bros. Discovery as well as additional assets, according to three people familiar with the negotiations. This month, the Wall Street Journal reported that the tournament had close the transaction with ESPN, NBC and Amazon will bring in about $76 billion in revenue over 11 years.
That leaves Warner Bros. Discovery had to stand aside and observe, causing a lot of tension within the company.
The public face of that rancor is Barkley, whose intelligence and candor have made him a driving force behind TNT’s critically acclaimed coverage over the past two decades.
Barkley does publicly criticized the management of Warner Bros. Discovery to handle media rights negotiations. He supported senior staff within the network, doing interviews that the network will like better than him not doing and after Friday night’s NBA Finals, announced that he planned to retire after next season, the final year of Warner Bros.’s current contract. Discovery.
“No matter what happens, next year will be my last year on television,” Barkley said. “I just want to say thank you to my NBA family. You guys have been so wonderful to me. My heart is filled with joy and gratitude. But I will hand over command at the end of next year.”
Barkley’s surprise announcement is the latest twist in a saga that began in 2022 when Discovery bought WarnerMedia — whose assets include channels like HBO, TNT and TBS — and Warner Bros. Discovery was founded.
Many, though not all, of the longtime executives who worked in the NBA for WarnerMedia have left the company since Discovery’s acquisition. That means many people with whom the NBA has long-standing relationships are gone. David Zaslav, who once ran Discovery and is now CEO and chairman of Warner Bros. Discovery, rented Luis SilberwasserCEO of Univision, to run TNT Sports.
The business relationship got off to a bad start after comments Zaslav made at an investor conference in 2022. He noted that he enjoyed the NBA and already knew Adam Silver, the league’s commissioner , for 20 years. But when it comes to business, Zaslav said: “We don’t need the NBA.”
Those comments prompted Warner Bros. Discovery is nervous when focusing on their NBA assets and when combined with Financial tightening report at the company, has raised questions in the league office about the company’s commitment to the NBA, according to people familiar with the reaction who spoke on condition of anonymity because of the sensitive nature of the situation. In a radio interview with “The Dan Patrick Show” last month, Barkley said he thought Zaslav’s comments might have upset Silver.
Warner Bros. Discovery has the contractual right to match third party offers. According to a person familiar with the company’s thinking, it will likely try to match Amazon’s offer.
But NBA lawyers are still trying to determine how the contract defines Warner Bros.’ proper rights. Discovery, according to two people familiar with the negotiations, as the company wants to show more games on TNT and Amazon will stream them on Prime. Videotapes. It’s a problem complicated by the fact that when these contracts were written in 2014, sports streaming was still in its infancy.
Losing the NBA would hurt Warner Bros. Discovery because the majority of TNT’s advertising revenue and the majority of its viewership come from NBA games. But it would save more than $2 billion annually, money it could use to buy other sports rights. In recent years, it has added rights to the National Hockey League, NASCAR, U.S. men’s and women’s soccer teams, All Elite Wrestling and the college football playoffs.
Warner Bros. Discovery is trying to maintain enough high-quality programming on its cable channels to earn big distribution fees and advertising dollars, while moving exclusive programming to streaming to build out its Max service. me.
“The streaming industry is in the midst of an evolution,” said Frank Albarella, managing director of media and telecommunications at accounting firm KPMG. “Everyone is trying to differentiate themselves. All old norms are being challenged. I really think this move to live sports could be a game changer for the industry and the industry as a whole.”
For the NBA, cable channels like TNT have lost their luster. Broadcast channels like NBC and ABC – which reach more households than cable channels – are back in vogue, and streaming has the potential to reach a larger audience worldwide than television ever had. NBC will also use its Peacock streaming platform to show NBA games.
Silver said in a press conference on June 6, before Game 1 of the NBA Finals, that streaming “allows for tremendous additional functionality in viewing the game, personalization, customization of the game , multiple feeds, multiple dialects, multiple languages, different camera angles. It really gives fans a lot of additional options that you don’t get through traditional television.”
He declined to provide an update on the negotiations at the time, but he did speak with employees of the company he said he still calls “Turner Sports.”
“I apologize that this has been a long process, because I know they are dedicated to their work,” Silver said. “I know people who work in this industry, it’s a big part of their identity and their family’s identity, and no one likes this uncertainty. I think the league office has a responsibility to take these negotiations up a notch and conclude them as quickly as possible.”
