On Monday, the NBA struck a nine-year, $24 billion television deal. ESPN and Turner Sports will pay the NBA about $2.6 billion a year, starting with the 2016-17 NBA season — a 180 percent increase over the last deal.
To discuss that agreement and what it might mean for the league, its viewers and its players, Deadpsin's Kevin Draper joined Bill Littlefield.
BL: Why was the NBA able to leverage that amount of money?
[sidebar title="The Future Of Sports On TV" width="630" align="right"] Changes to cable could majorly impact sports leagues, networks and fans. [/sidebar]
KD: Well, this deal came up at a really good time for the NBA. Over the last couple years, as TV viewership has declined, one steady thing has been live sports, and so cable companies and networks are paying through the roof to get these live sports' rights to be able to sell it to advertisers. And the NBA was the last one to come up. There's no big sports deals to be signed for the next five, six, seven years. The NFL signed, MLB signed, NHL -- and so the NBA's came up at a good time, and they got paid for it.
BL: The NBA only negotiated with Turner and ESPN, with whom the league had exclusive negotiating rights. What advantage did that give the NBA...or, for that that matter, what advantage did it give ESPN and Turner sports?
KD: For the NBA side, I think the advantage it gave them is it got them more money. Turner and ESPN wanted to prevent the bidding for this deal to become an open competition where, particularly Fox Sports but also NBC or CBS could get in, or even providers like Netflix, Google or YouTube trying to somehow get involved. So the NBA got more money by not putting it out to open market, and Turner and ESPN prevented their competitors from having a real shot at it.
BL: What does the new deal mean for fans who want to watch NBA games? And what does it mean for cable subscribers who maybe don't care to watch?
Your cable bill is going to go up a dollar or two a month solely because of this deal.Kevin Draper, Deadspin
KD: For fans nothing really is going to change. There's a couple tweaks here and there — who shows what games and how many they're going to show. But basically you'll continue to watch the NBA the same way you have for the last decade.
Cable subscribers, at some point they'll feel the hit in this, in that what's going to happen is ESPN and Turner are going to charge the companies that provide you cable more money to carry their channels. I don't think the cable operators are going to be altruistic and eat that cost. They're going to pass it on to you somehow. So your cable bill is going to go up a dollar or two a month solely because of this deal.
Players are "encouraged" per new CBA to take less to win or risk being called selfish+ungrateful while nbatv deal goes UP by a BILLION #biz
— Kobe Bryant (@kobebryant) October 7, 2014
BL: Some of the NBA's biggest stars including LeBron James, Kevin Durant and Kobe Bryant have already weighed in on this deal and publicly said the players deserve a bigger piece of this soon-to-be-bigger pie. Do they have a point?
[sidebar title="Meet Michele Roberts" width="630" align="right"] Back in August we spoke to Michele Roberts after she was named executive director of the NBA Players Association. [/sidebar]
KD: Yeah, I really think they do. And the last lockout in 2011, the NBA managed to put forth the claim that a lot of teams were losing money, and that, in response to this, the players needed to give up some of their money to keep the league solvent, to keep everybody going. And so now when we have teams — you know, they're going to earn tens of millions of dollars more a year just because of this deal; the players are saying, "Hey, now it's your turn to give us some of this money."
BL: NBPA Executive Director Michele Roberts has said that the minute she got her job she began preparing to opt out of the current labor deal at the end of 2016. Is there any chance they can avoid another lockout?
KD: There's a chance, but I wouldn't be particularly optimistic that that's going to happen. We've got a lot of the big stars weighing in and saying that they want more money, and we've also had an owner like Mark Cuban saying, "Hey, well if the players want to get more money then we want to get rid of guaranteed contracts, so when we cut somebody we don't have to continue paying them." So it looks like this new money isn't going to get spread out equally to everybody and making everybody happy, but rather it's causing everybody to fight even more fiercely for this bigger pie.
This segment aired on October 11, 2014.