TNT Played Hardball With The NBA (And It Might End Up Costing Them Billions)
Warner Bros. Discovery CEO David Zaslav looked tough when he said TNT didn't need the NBA. Now, Zaslav is left scrambling to avoid a multi-billion-dollar drop in carriage fees.
The ongoing NBA media rights negotiation has been the talk of the town. Friends, family, industry contacts. Everyone wants to know what is happening, and my wife is even mourning the death of TNT’s Inside The NBA, her favorite studio show.
This confusion (and the resulting early obituary for Shaq, Kenny, Ernie, and Charles) mainly stems from media outlets making a simple topic unnecessarily complex.
I mean, I get it. Media rights are important. They determine the audience and, therefore, the profitability of a league. Fans are interested and invested in the outcome, and we should expect every media pundit to juice it for all its worth.
The writing is on the wall, though. The NBA had an exclusive negotiating window with its current TV partners, Disney and Warner Bros. Discovery (WBD). Disney left that window with a handshake agreement, doubling its current payment from $1.4 billion annually to $2.8 billion despite receiving less inventory than it previously had.
WBD CEO David Zaslav, on the other hand, decided to risk it. Zaslav reportedly topped out at $2.1 billion annually — a sizable increase from the network’s current $1.2 billion annual payment but below the NBA’s $2.3 billion asking price.
The thought process was simple. Zaslav didn’t think anyone would buy the NBA’s “B” package for $2.3 billion annually. And if someone came out of left field to do what he thought was financially reckless, WBD could always use its contractual right to match that agreement, keeping the NBA as a cornerstone within its sports portfolio.
“We don’t have to have the NBA,” Zaslav famously said early on in his tenure as CEO.