Warner Bros. Discovery and NBA settle legal battle over TV rights
Warner Bros. Discovery will remain on the court with the NBA in a new settlement that gives the media company the chance to keep professional basketball in its overall lineup even as it cedes U.S. rights to traditional TV games to rivals.
The media company and the basketball league have come up with a new pact that will see Warner Bros. Discovery the right to show NBA content on its Bleacher Report and House of Highlights stores and to distribute games abroad in places like Northern Europe and parts of Latin America. with the exception of Brazil and Mexico, according to a person familiar with the matter. The new pact, which will last for 11 years, ends a Warner lawsuit against the NBA that began after the league opted to cut Warner from the structure of its next TV deal, which it struck with Disney’s ESPN and Amazon. and NBCUniversal.
The NBA did not immediately respond to a request for comment and Warner Bros. Discovery declined to make executives available for comment. The Wall Street Journal previously reported on the new agreement.
Warner Bros. Discovery will make its flagship studio show “Inside the NBA” available to Disney’s ESPN at key points during the NBA season in a separate deal, according to two people familiar with the matter. Under the terms of that pact, Warner Bros. Discovery some rights to show Big 12 football and men’s basketball, one of these people said. Warner Bros. Discovery will continue to produce the popular “Inside the NBA,” led by Charles Barkley and Shaquille O’Neal, and is also considering ways to develop it into an edition that looks at a broader range of sports.
ESPN declined to make executives available for comment.
Without the new deal, both the NBA and Warner faced unwanted scrutiny and a months-long legal battle. NBA executives were optimistic that they would have prevailed, but they could have been in court well into the following season. Warner, meanwhile, is said to have suffered for targeting a former partner at a time when media companies are even more dependent on sports leagues. Live sports games are one of the few content genres that can attract large, simultaneous audiences to video, something major advertisers still crave.
The deal marks something of a turn for Warner Bros. Discovery, which is dealing with a decline in its cable business that will be accelerated by the loss of NBA TV games next season when the league’s new TV tie-up takes effect. Warner announced a massive $9.1 billion writedown on its TV assets in August, citing business headwinds and the expected loss of its lucrative deal with the NBA to show games on its cable networks.
Warner had maintained that its current deal with the NBA gave the company the ability to offer a new package of the games it currently shows, and the company, before filing the lawsuit, had expressed hope for a fourth package games. games. Such a concept was considered unlikely because all of the NBA’s national broadcasts were listed in deals with the other three companies.
Warner’s new deal with the NBA will also allow it to continue operating NBA TV, the league’s cable network and the NBA’s digital channels, as it has done for years. The NBA has partnered with Warner and its predecessors for more than three decades, with Warner cable networks showing NBA games beginning in 1989.
The company has reason to fight to stay in the good graces of the NBA. The loss of NBA games will shrink the business of TNT, the main cable company. Cable and satellite distributors would no doubt see the absence of these games as a reason to call for a reduction in distribution fees, even as Warner has signed a series of new rights deals with properties like the French Open and NASCAR, and signed an agreement to show two CFP games assigned to ESPN.
NBA games have generated a large portion of Warner’s past revenue. According to Nielsen data, all of TNT’s top broadcasts in 2023 were NBA broadcasts, and NBA games appear to have generated the majority of ad sales for the cable network in the second quarter of last year.
Executives believe the new pact, which includes international games and digital highlights, could generate as much as $100 million in profits over the first five years of the deal, according to one of the people familiar with the situation.
