Disney’s ABC/ESPN, NBCUniversal’s NBC Sports, and Amazon Prime Video appear to be the winners in the NBA’s $76 billion sweepstakes—which means Warner Bros. Discovery’s TNT Sports gets kicked to the curb after 40 loyal years with the league.
There are multiple reasons why Wednesday’s outcome shook out as it did, but one key factor was the starkly different negotiating strategies of the NBA’s two incumbent media partners: ESPN and TNT.
ESPN chairman Jimmy Pitaro (above) took the approach that maintaining rights to the NBA was existential. Starting several years ago, he and No. 2 Burke Magnus aggressively courted the NBA with an “always be closing” approach. On the other hand, WBD chief executive David Zaslav dissed his league partner at a Wall Street conference in 2022 by declaring: “We don’t have to have the NBA.”
Big mistake.
Commissioners like the NBA’s Adam Silver don’t want to hear their media partners questioning their value or crying poverty come contract time. Instead, they want to be courted, flattered, told their rights are their partners’ only business priority. Once Zaslav committed that public faux pas, outsiders like Prime and NBC smelled blood, then moved in for the kill.
During an ESPN media call, I asked Pitaro and Rosalyn Durant, executive vice president of programming and acquisitions, about their aggressive negotiating strategy. Maintaining ESPN’s 12-year pole position as the NBA’s lead media partner, along with exclusive rights to the NBA Finals, was “critical,” Pitaro said. But so was trying to finalize an extension during incumbent ESPN’s exclusive negotiating period from early March to April.
Even if the deal wasn’t 100% finalized inside that window, it was all but done. Importantly, Pitaro said he had the “complete support” of Disney chairman Bob Iger to make a deal as soon as possible.
“We had very good momentum from the outset. As soon as that window opened, we were all hands on deck. Roz and her team were in a conference room daily, and unfortunately nightly, all hours of the evenings during the negotiating window,” Pitaro said. “It was a top priority for us, and for our business, to get this done, and get it done quickly, assuming again we could acquire the items that were most important to us.”
Meanwhile, WBD let its own window to secure an extension slip away, providing a strategic opening for Prime and NBC. You can’t completely blame WBD. I’ve heard the slippery NBA negotiating team, led by Bill Koenig, moved the goalposts on WBD several times during negotiations. Maybe WBD figured TNT’s four decades of loyal service would give it a leg up. It didn’t.
To its credit, WBD saw Prime coming from a mile away. The streamer already had a deal with the NBA in Brazil, and had telegraphed it wanted U.S. rights. What WBD didn’t anticipate was NBC’s $2.5 billion offer. Sources tell Front Office Sports the offer stunned WBD (which doesn’t own a broadcast network), and left them scrambling to match Prime’s offer of $1.8 billion a year.
Despite his jokes, TNT’s Charles Barkley is nobody’s fool in matters of business. Sir Charles knew TNT was in trouble when the NBA’s rights became available to the highest bidders. It was the first time in his 24 years that TNT did not re-sign the NBA during its exclusive negotiating window, Barkley noted during a May interview with ESPN Chicago.
“Am I concerned? One hundred percent. Because as much as we have been partners with the NBA for 40 years, you would think if it was close in a bidding war, we would get the benefit of the doubt, but clearly that’s not happening,” he lamented. During another interview with Dan Patrick, an angry Barkley lambasted his bosses as “clowns” and “fools” who “screwed” up the negotiations. Ultimately, Zaslav’s claim that he didn’t need the NBA only “pissed” Silver off, warned Barkley.
This week, I also did a one-one-one interview with Jay Marine, global head of sports for Amazon Prime Video. Similar to ESPN, Amazon aggressively romanced the NBA, with the allure of its $2 trillion stock market valuation and demonstrated ability to draw younger viewers for the NFL’s Thursday Night Football.
Amazon “made no secret” it wanted a deal with the NBA, said Marine. It kept pedal-to-the-metal until they got one. “What they’ve really done to grow the NBA into a worldwide game is absolutely fantastic. It’s a young, diverse, highly engaged audience. So there’s a lot to like,” Marine told FOS.
Hindsight is 20/20. But WBD’s reactive approach would never have happened under TNT’s savvy former CEO David Levy. The former Turner Sports boss, who left in 2019, would have sat on Silver’s lap, or staked out his office in midtown Manhattan, until a deal was reached. But WBD’s new management tried to coolly play poker with the NBA. In the end, it misread its own hand.
Another mistake: Zaslav inexplicably failed to utilize what could have been his greatest PR weapon: Barkley, Shaquille O’Neal, Kenny Smith, and Ernie Johnson. WBD should have had its Emmy-winning cast of TNT’s iconic Inside the NBA out in public, singing the praises of TNT and its huge contributions to the league’s popularity. Instead, management left Barkley in the dark.
Despite being TNT’s biggest star, Barkley said he’d briefly met Zaslav only twice. This week, WBD’s TNT, Bleacher Report, and House of Highlights smartly launched a social media campaign designed to pluck at the nostalgic heartstrings of fans and keep the NBA on TNT. But it was too little too late. Before the grassroots effort really got going, the NBA publicly announced NBC and Prime were in, and TNT was out, after next season. That was that.
What happens now? After the NBA rejected its matching offer to Prime’s bid, TNT is threatening a lawsuit. Unless the threat of a lengthy and expensive lawsuit squeezes a face-saving fourth package, or monetary settlement, out of the NBA, TNT’s last hope might lie in the courtroom.
Until then, WBD will have to live with second-guessing whether it should have been more proactive. And that Zaslav’s too-cool-for-school negotiating approach with the NBA backfired. As Alec Baldwin’s motivational speaker from hell tells the hapless salesmen in Glengarry Glen Ross, nothing matters except getting the client to sign on the line that is dotted. First place is a Cadillac Eldorado, second prize is a set of steak knives. Third prize is you’re fired.
Michael McCarthy’s “Tuned In” column is at your fingertips every week with the latest insights and ongoings around sports media. If he hears it, you will, too.
This September, the column will come to life as a one-day event bringing together industry experts to discuss media trends and the future of fan viewership. The event will take place in New York on Sept. 10 at Times Center (242 W. 41st St.).
