Adam Silver Addresses ‘Broken’ RSN Model, Gives NBA Expansion Update

NBA commissioner Adam Silver conducted a press conference in New York after a meeting with the league’s board of governors. Some of the important topics Silver addressed:

RSN Woes

Ahead of the board meeting, Knicks owner James Dolan delivered his second letter in the last two months to the NBA expressing several concerns about the league’s business decisions, including how the $77 billion media-rights deal it signed in July would lead to the downfall of regional sports networks.

Silver said that the national media deal, because of its scale and the addition of a third partner, will cannibalize inventory from the RSNs, but he said the old model wasn’t working, either, pointing out how 18 of the league’s regional partners were either defunct or in bankruptcy. For this season, Silver revealed the league’s struggling regional partners are receiving “significantly lower fees.”

He acknowledged that the RSN model is “broken” and that the league will spend the next six months “extensively studying” the issue. He also predicted that streaming services will play a bigger role in the future of local viewership.

“I think coming out of it, what you’ll see is that just in the same way these new media deals we entered into demonstrated the enormous interest in the NBA and WNBA on a national and global basis, there’s no reason that shouldn’t translate on a local basis,” Silver said.

Pumping the Brakes on Expansion

There was deliberately little talk about league expansion in this meeting, as Silver said the league is “not quite ready” to have the conversation. He said there is interest in expansion, and the league plans to discuss it with the board this season.

“Over time, organizations should grow, but it gets a little complicated in terms of selling equity in the league and what that means for the existing television relationships,” Silver said. “What we’ve told interested parties is, ‘Thank you for your interest. We’ll get back to you.’”

Silver stressed that the league has yet to make a decision on the markets, or even whether to expand at all. There have been numerous reports that the league is looking to add two expansion teams, most likely in Las Vegas and Seattle.

Growing Across the Pond

Last month, the Associated Press reported the NBA was looking at increasing its footprint in Europe. The NBA has already established leagues in Africa and Asia, but Silver believes Europe is an untapped market.

“There’s agreement that where we are in terms of the level of interest in basketball is not commensurate with commercial activities,” Silver said. 

He confirmed they are considering options like a tournament or league in Europe, but there are no specifics as of now.

Hands Off on Timberwolves Dispute

There is an arbitration hearing in November between Timberwolves principal owner Glen Taylor and minority owners Alex Rodriguez and Marc Lore—but Silver said the league will have no say in the matter.

“Depending on the outcome, only then would the league continue a vetting process for ownership,” Silver said.