Warner to NBA: No, Sorry, We're Not Breaking Up
Alex Weprin
As had been expected:
Warner Bros. Discovery is making a play to keep NBA rights, telling the league that it will match Amazon‘s bid for a package of games.
The company said in a statement Monday afternoon that it intends to match Amazon’s bid, which is for about $1.8 billion per year, or more than $20 billion over the course of the deal. WBD did not mention Amazon by name, but a source says that it is targeting the package from the tech giant.
Expected, but sort of weird. First and foremost, as everyone knows, WBD is trying to cut costs to get its debt under control. That's clearly why they couldn't come to terms with the NBA during their exclusive bargaining window. And not coming to terms with WBD helped the NBA, which subsequently got a higher offer from Comcast/NBC. For fewer games, no less. Which is how they were able to create the Amazon package as well, thus bringing in even more revenue for the league. Now WBD has decided they'd like that package. This is just awkward:
“In an effort to continue our long-standing partnership, during both exclusive and non-exclusive negotiation periods, we acted in good faith to present strong bids that were fair to both parties,” TNT Sports said in a statement. “Regrettably, the league notified us of its intention to accept other offers for the games in our current rights package, leaving us to proceed under the matching rights provision, which is an integral part of our current agreement and the rights we have paid for under it.
“We have reviewed the offers and matched one of them,” the statement continued. “Our matching paperwork was submitted to the league today. We look forward to the NBA executing our new contract.”
In other words, sorry, you can't break up with us.
Legally, no one seems clear who has what rights here. Welcome to the wonderful world of streaming chaos mixed with declining cable. Amazon's rights are for Prime Video, of course, since they don't own any traditional TV channels. WBD would undoubtedly put at least some of those games on Max, their own streaming service, but they would also want to continue to leverage TNT, which is what underpins what is arguably their most important linear asset: Inside the NBA.
Adding to this awkward chaos is the fact that the game of musical chairs which has been being played amongst the streaming services (too many players for too few chairs) is slowing down. With Skydance taking on Paramount, everyone who is not Netflix and Disney is going to have to partner up soon. WBD is simply a less attractive partner without the NBA – certainly in, say, a sports streaming partnership. Again, awkward.
What happens next is unclear, but the two most plausible outcomes, per multiple sources, are either some kind of settlement or a lawsuit from WBD.
A settlement could see the two parties agree to some sort of deal — either a small fourth rights package for TNT Sports or some cash payment or other offer from the league to WBD. Or if the league rejects the match outright, a potential suit from WBD would let a judge determine what qualifies as a “match” in rights.
I'm going to sue you to get you to love me again is probably not the best strategy.
One more thing: Also not the best strategy? Releasing your statement in an almost completely illegible typeface. I know the NBA has a storied history of such moves, but come on...
Update July 25, 2024: The NBA has responded to WBD with a 'thanks, but no thanks':
M.G. Siegler