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NBA can shift the balance of power in media with its next rights deal

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Jimmy Butler #22 of the Miami Heat dribbles against Jamal Murray #27 of the Denver Nuggets during the fourth quarter in Game Five of the 2023 NBA Finals at Ball Arena on June 12, 2023 in Denver, Colorado.
Justin Edmonds | Getty Images Sport | Getty Images

The National Basketball Association’s upcoming decision on which companies will acquire the TV and streaming rights for its live games could transform the entire media industry.

Based on preliminary discussions between media executives and league officials, Comcast’s NBCUniversal, Google’s YouTube TV, AmazonApple and even Netflix may challenge or join the incumbents as rights holders, according to people familiar with the matter, who asked not to be named because the discussions are private. Spokespeople at NBCUniversal, YouTube, Amazon, Apple and Netflix declined to comment.

Every media rights renewal for the NBA is an important event because it only happens about once a decade. The last rights deal was announced in 2014. The NBA’s current rights deal ends after the 2024-25 season.

All expressions of interest between media partners and the NBA have been preliminary because league officials can’t officially negotiate with interested partners until April, when the league’s exclusive negotiating window with incumbent media rights partners Disney and Warner Bros. Discovery ends.

But with the National Football League’s media rights locked up until 2033, the NBA has a unique opportunity to play media kingmaker. Live sports have continuously increased in value for decades as advertisers clamor for live events where commercials can’t be skipped. The NBA will likely get a significant increase on its new media deal. Former ESPN head John Skipper predicted earlier this year the league could get between 200% and 350% more in its new agreement.

“Our next set of media deals will help shape the future of our league and how fans consume NBA basketball for years to come,” an NBA spokesperson said.

Rise of ad-supported streaming

Netflix’s potential interest in the NBA could be industry-shaking. Co-CEO Ted Sarandos has repeatedly said Netflix hasn’t encountered a viable path to carrying live sports that would appeal to its shareholders.

“We’ve not seen a profit path to renting big sports,” he said in December.

But Sarandos has recently softened his stance from disinterest in the NBA to potential interest, according to people familiar with the matter. What that means is still unknown. It’s unlikely the NBA would hand over its largest package of streaming games to a provider that’s never had experience with live sports, said the people.

Netflix has contemplated buying sports rights before. The world’s largest streamer unsuccessfully bid for live Formula 1 racing rights last year.

Netflix’s Ted Sarandos attends the 92nd Annual Academy Awards in Hollywood, California, Feb. 09, 2020.
Jeff Kravitz | Getty Images

But the biggest change for Netflix is the company’s push to add customers to its advertising-supported tier, which launched in November. About 5 million subscribers had signed up for its ad tier, which costs $6.99 per month, Netflix announced in May.

Netflix said earlier this year it makes more money off subscribers who select the cheaper ad-supported tier than its $15.49 standard tier, which doesn’t include advertising. The average revenue per user, or ARPU, for the advertising tier would likely rise even more if Netflix added a package of NBA games, which would command premium-priced ad rates unlike anything currently on Netflix’s service.

Disney and Amazon have also adjusted their streaming offerings to account for the media industry’s recent revelation that there’s enough digital advertising demand to push ARPU just as high as or even higher than their higher-priced no-ad subscription products. Disney is increasing its ad-free pricing on Disney+ by 27% later this month while keeping the price of ad-supported Disney+ stagnant. Amazon plans to inject commercials into its previously ad-free Prime Video in 2024.

The NBA would be a particularly valuable addition to an ad-supported streaming service because its season runs from October to June, including playoffs. That’s an effective churn reducer for fans, who won’t be able to binge-watch a season of live games like they do with on-demand entertainment series.

Global reach

Netflix sells an ad-supported plan in Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, the United Kingdom and the United States.

That global reach is appealing for the NBA, which features an assortment of international stars, including Slovenian Luka Dončić of the Dallas Mavericks, Serbian Nikola Jokić of the NBA champion Denver Nuggets and French rookie Victor Wembanyama of the San Antonio Spurs.

It’s also possible the league could decide to maximize its domestic reach by striking a new deal with NBCUniversal, which has both a broadcast network and a streaming service, Peacock, that could serve as homes for live games. NBC has a nostalgic relationship with fans, dating back to the Michael Jordan-dominated days of the 1990s’ “The NBA on NBC.” CNBC first reported NBCUniversal’s interest in again airing NBA games earlier this year.

Still, Peacock has just 24 million subscribers, fewer than Disney’s ESPN+ or Warner Bros. Discovery’s Max, and is only available within the U.S.

Victor Wembanyama, now a rookie with the San Antonio Spurs, in action with his French team, Metropolitans 92, on April 8, 2023, in Levallois-Perret, France.
Aurelien Meunier | Getty Images

Broadening reach is important to league officials, who are intrigued by Google’s YouTube TV as a potential streaming partner, according to people familiar with the matter. YouTube TV struck a deal to be the NFL’s exclusive “Sunday Ticket” provider earlier this year. NBA executives have been impressed with the production quality and user experience, said the people.

While YouTube TV, a subscription bundle of linear channels a la traditional pay TV, is only available in the U.S., the league already has an existing global partnership with YouTube that includes providing highlights, game recaps, full-length games and produced segments. YouTube has more than 2.7 billion global monthly active users and can market the sport to a younger audience than Amazon or Apple can do with their subscription services. The average age of an NBA viewer is 49, and 26% of viewers are under 35, according to Nielsen.

Between Amazon and Apple, league officials are currently more comfortable with choosing Amazon as a potential streaming partner, according to people familiar with the matter. Amazon has proven to the NBA it is serious about making a large investment in live sports, including its $1 billion per year contract to carry “Thursday Night Football.” While Apple has deals to carry Major League Soccer and “Friday Night Baseball” for Major League Baseball, the NBA isn’t convinced Apple will prioritize marketing the league’s games in the same way other streaming services might. Apple TV+ has never disclosed how many subscribers it has.

Apple will have a chance to make its pitch directly to the league if and when the NBA begins discussions with other partners after its exclusive window with incumbents expires. It’s possible Apple or Netflix could get a smaller package of games from the NBA as a test run for a future larger partnership. Still, that would run counter to the league’s preference to limit the number of packages it wishes to dole out.

Carving up the pie

The NBA will have to balance demand against restricting supply to maximize the price for rights. The league probably wants to have just two or three media partners to serve broadcast, cable and streaming eyeballs, according to people familiar with the matter.

Spreading packages between too many media partners will potentially confuse and annoy consumers, who will need to sign up for multiple services and then find where games are streaming on a given day. Currently, an NBA game could appear on Disney’s ESPN or ABC, Warner Bros. Discovery’s TNT, NBA TV, NBA League Pass or a regional sports network. Add new streaming services to the mix, and consumers could easily become overwhelmed with options.

Likewise, if the NBA doesn’t reach a new deal with either ESPN or TNT and goes in another direction, it may accelerate the deterioration of the cable bundle — as live sports is one of the last pillars keeping it alive.

The league hopes to mitigate some of this complexity by marketing its NBA app and NBA.com as digital “front doors” to discover content, according to people familiar with the matter. The league hopes to get fans in the habit of first opening the app or NBA.com before being directly ported to a streaming service that’s broadcasting the game or potentially staying and watching games in-app, depending on partnership arrangements. This is a similar concept to what ESPN has considered, as CNBC reported earlier this year.

Disclosure: Comcast-owned NBCUniversal is the parent company of CNBC.

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What to stream this weekend: ‘Civil War,’ Snow Patrol, ‘How to Die Alone,’ ‘Tulsa King’ and ‘Uglies’

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Hallmark launching a streaming service with two new original series, and Bill Skarsgård out for revenge in “Boy Kills World” are some of the new television, films, music and games headed to a device near you.

Also among the streaming offerings worth your time as selected by The Associated Press’ entertainment journalists: Alex Garland’s “Civil War” starring Kirsten Dunst, Natasha Rothwell’s heartfelt comedy for Hulu called “How to Die Alone” and Sylvester Stallone’s second season of “Tulsa King” debuts.

NEW MOVIES TO STREAM SEPT. 9-15

Alex Garland’s “Civil War” is finally making its debut on MAX on Friday. The film stars Kirsten Dunst as a veteran photojournalist covering a violent war that’s divided America; She reluctantly allows an aspiring photographer, played by Cailee Spaeny, to tag along as she, an editor (Stephen McKinley Henderson) and a reporter (Wagner Moura) make the dangerous journey to Washington, D.C., to interview the president (Nick Offerman), a blustery, rising despot who has given himself a third term, taken to attacking his citizens and shut himself off from the press. In my review, I called it a bellowing and haunting experience; Smart and thought-provoking with great performances. It’s well worth a watch.

— Joey King stars in Netflix’s adaptation of Scott Westerfeld’s “Uglies,” about a future society in which everyone is required to have beautifying cosmetic surgery at age 16. Streaming on Friday, McG directed the film, in which King’s character inadvertently finds herself in the midst of an uprising against the status quo. “Outer Banks” star Chase Stokes plays King’s best friend.

— Bill Skarsgård is out for revenge against the woman (Famke Janssen) who killed his family in “Boy Kills World,” coming to Hulu on Friday. Moritz Mohr directed the ultra-violent film, of which Variety critic Owen Gleiberman wrote: “It’s a depraved vision, yet I got caught up in its kick-ass revenge-horror pizzazz, its disreputable commitment to what it was doing.”

AP Film Writer Lindsey Bahr

NEW MUSIC TO STREAM SEPT. 9-15

— The year was 2006. Snow Patrol, the Northern Irish-Scottish alternative rock band, released an album, “Eyes Open,” producing the biggest hit of their career: “Chasing Cars.” A lot has happened in the time since — three, soon to be four quality full-length albums, to be exact. On Friday, the band will release “The Forest Is the Path,” their first new album in seven years. Anthemic pop-rock is the name of the game across songs of love and loss, like “All,”“The Beginning” and “This Is the Sound Of Your Voice.”

— For fans of raucous guitar music, Jordan Peele’s 2022 sci-fi thriller, “NOPE,” provided a surprising, if tiny, thrill. One of the leads, Emerald “Em” Haywood portrayed by Keke Palmer, rocks a Jesus Lizard shirt. (Also featured through the film: Rage Against the Machine, Wipers, Mr Bungle, Butthole Surfers and Earth band shirts.) The Austin noise rock band are a less than obvious pick, having been signed to the legendary Touch and Go Records and having stopped releasing new albums in 1998. That changes on Friday the 13th, when “Rack” arrives. And for those curious: The Jesus Lizard’s intensity never went away.

AP Music Writer Maria Sherman

NEW SHOWS TO STREAM SEPT. 9-15

— Hallmark launched a streaming service called Hallmark+ on Tuesday with two new original series, the scripted drama “The Chicken Sisters” and unscripted series “Celebrations with Lacey Chabert.” If you’re a Hallmark holiday movies fan, you know Chabert. She’s starred in more than 30 of their films and many are holiday themed. Off camera, Chabert has a passion for throwing parties and entertaining. In “Celebrations,” deserving people are surprised with a bash in their honor — planned with Chabert’s help. “The Chicken Sisters” stars Schuyler Fisk, Wendie Malick and Lea Thompson in a show about employees at rival chicken restaurants in a small town. The eight-episode series is based on a novel of the same name.

Natasha Rothwell of “Insecure” and “The White Lotus” fame created and stars in a new heartfelt comedy for Hulu called “How to Die Alone.” She plays Mel, a broke, go-along-to-get-along, single, airport employee who, after a near-death experience, makes the conscious decision to take risks and pursue her dreams. Rothwell has been working on the series for the past eight years and described it to The AP as “the most vulnerable piece of art I’ve ever put into the world.” Like Mel, Rothwell had to learn to bet on herself to make the show she wanted to make. “In the Venn diagram of me and Mel, there’s significant overlap,” said Rothwell. It premieres Friday on Hulu.

— Shailene Woodley, DeWanda Wise and Betty Gilpin star in a new drama for Starz called “Three Women,” about entrepreneur Sloane, homemaker Lina and student Maggie who are each stepping into their power and making life-changing decisions. They’re interviewed by a writer named Gia (Woodley.) The series is based on a 2019 best-selling book of the same name by Lisa Taddeo. “Three Women” premieres Friday on Starz.

— Sylvester Stallone’s second season of “Tulsa King” debuts Sunday on Paramount+. Stallone plays Dwight Manfredi, a mafia boss who was recently released from prison after serving 25 years. He’s sent to Tulsa to set up a new crime syndicate. The series is created by Taylor Sheridan of “Yellowstone” fame.

Alicia Rancilio

NEW VIDEO GAMES TO PLAY

— One thing about the title of Focus Entertainment’s Warhammer 40,000: Space Marine 2 — you know exactly what you’re in for. You are Demetrian Titus, a genetically enhanced brute sent into battle against the Tyranids, an insectoid species with an insatiable craving for human flesh. You have a rocket-powered suit of armor and an arsenal of ridiculous weapons like the “Chainsword,” the “Thunderhammer” and the “Melta Rifle,” so what could go wrong? Besides the squishy single-player mode, there are cooperative missions and six-vs.-six free-for-alls. You can suit up now on PlayStation 5, Xbox X/S or PC.

— Likewise, Wild Bastards isn’t exactly the kind of title that’s going to attract fans of, say, Animal Crossing. It’s another sci-fi shooter, but the protagonists are a gang of 13 varmints — aliens and androids included — who are on the run from the law. Each outlaw has a distinctive set of weapons and special powers: Sarge, for example, is a robot with horse genes, while Billy the Squid is … well, you get the idea. Australian studio Blue Manchu developed the 2019 cult hit Void Bastards, and this Wild-West-in-space spinoff has the same snarky humor and vibrant, neon-drenched cartoon look. Saddle up on PlayStation 5, Xbox X/S, Nintendo Switch or PC.

Lou Kesten

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Trump could cash out his DJT stock within weeks. Here’s what happens if he sells

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Former President Donald Trump is on the brink of a significant financial decision that could have far-reaching implications for both his personal wealth and the future of his fledgling social media company, Trump Media & Technology Group (TMTG). As the lockup period on his shares in TMTG, which owns Truth Social, nears its end, Trump could soon be free to sell his substantial stake in the company. However, the potential payday, which makes up a large portion of his net worth, comes with considerable risks for Trump and his supporters.

Trump’s stake in TMTG comprises nearly 59% of the company, amounting to 114,750,000 shares. As of now, this holding is valued at approximately $2.6 billion. These shares are currently under a lockup agreement, a common feature of initial public offerings (IPOs), designed to prevent company insiders from immediately selling their shares and potentially destabilizing the stock. The lockup, which began after TMTG’s merger with a special purpose acquisition company (SPAC), is set to expire on September 25, though it could end earlier if certain conditions are met.

Should Trump decide to sell his shares after the lockup expires, the market could respond in unpredictable ways. The sale of a substantial number of shares by a major stakeholder like Trump could flood the market, potentially driving down the stock price. Daniel Bradley, a finance professor at the University of South Florida, suggests that the market might react negatively to such a large sale, particularly if there aren’t enough buyers to absorb the supply. This could lead to a sharp decline in the stock’s value, impacting both Trump’s personal wealth and the company’s market standing.

Moreover, Trump’s involvement in Truth Social has been a key driver of investor interest. The platform, marketed as a free speech alternative to mainstream social media, has attracted a loyal user base largely due to Trump’s presence. If Trump were to sell his stake, it might signal a lack of confidence in the company, potentially shaking investor confidence and further depressing the stock price.

Trump’s decision is also influenced by his ongoing legal battles, which have already cost him over $100 million in legal fees. Selling his shares could provide a significant financial boost, helping him cover these mounting expenses. However, this move could also have political ramifications, especially as he continues his bid for the Republican nomination in the 2024 presidential race.

Trump Media’s success is closely tied to Trump’s political fortunes. The company’s stock has shown volatility in response to developments in the presidential race, with Trump’s chances of winning having a direct impact on the stock’s value. If Trump sells his stake, it could be interpreted as a lack of confidence in his own political future, potentially undermining both his campaign and the company’s prospects.

Truth Social, the flagship product of TMTG, has faced challenges in generating traffic and advertising revenue, especially compared to established social media giants like X (formerly Twitter) and Facebook. Despite this, the company’s valuation has remained high, fueled by investor speculation on Trump’s political future. If Trump remains in the race and manages to secure the presidency, the value of his shares could increase. Conversely, any missteps on the campaign trail could have the opposite effect, further destabilizing the stock.

As the lockup period comes to an end, Trump faces a critical decision that could shape the future of both his personal finances and Truth Social. Whether he chooses to hold onto his shares or cash out, the outcome will likely have significant consequences for the company, its investors, and Trump’s political aspirations.

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Arizona man accused of social media threats to Trump is arrested

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Cochise County, AZ — Law enforcement officials in Arizona have apprehended Ronald Lee Syvrud, a 66-year-old resident of Cochise County, after a manhunt was launched following alleged death threats he made against former President Donald Trump. The threats reportedly surfaced in social media posts over the past two weeks, as Trump visited the US-Mexico border in Cochise County on Thursday.

Syvrud, who hails from Benson, Arizona, located about 50 miles southeast of Tucson, was captured by the Cochise County Sheriff’s Office on Thursday afternoon. The Sheriff’s Office confirmed his arrest, stating, “This subject has been taken into custody without incident.”

In addition to the alleged threats against Trump, Syvrud is wanted for multiple offences, including failure to register as a sex offender. He also faces several warrants in both Wisconsin and Arizona, including charges for driving under the influence and a felony hit-and-run.

The timing of the arrest coincided with Trump’s visit to Cochise County, where he toured the US-Mexico border. During his visit, Trump addressed the ongoing border issues and criticized his political rival, Democratic presidential nominee Kamala Harris, for what he described as lax immigration policies. When asked by reporters about the ongoing manhunt for Syvrud, Trump responded, “No, I have not heard that, but I am not that surprised and the reason is because I want to do things that are very bad for the bad guys.”

This incident marks the latest in a series of threats against political figures during the current election cycle. Just earlier this month, a 66-year-old Virginia man was arrested on suspicion of making death threats against Vice President Kamala Harris and other public officials.

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