Warner Bros. Discovery Sues NBA Over Media Rights Deal

Business07/26/2024Mr. SmithMr. Smith
NBA
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Warner Bros. Discovery (WBD) has filed a lawsuit against the NBA after the league declined the company's matching offer for one of the packages in its upcoming 11-year media rights deal. The lawsuit was filed in New York state court in Manhattan, with WBD seeking a judgment that it matched Amazon Prime Video's offer and an order to delay the new media rights deal set to begin with the 2025-26 season.

Details of the Dispute

The NBA recently signed deals with Disney, NBCUniversal, and Amazon Prime Video after rejecting Warner Bros. Discovery’s $1.8 billion per year offer. These deals will bring the league approximately $76 billion over 11 years. TNT Sports, a subsidiary of WBD, stated, “Given the NBA’s unjustified rejection of our matching of a third-party offer, we have taken legal action to enforce our rights.” The company believes it is in the best interest of fans who want to continue enjoying NBA content on platforms like TNT and Max.

NBA spokesman Mike Bass responded, saying, “Warner Bros. Discovery’s claims are without merit and our lawyers will address them.”

WBD's Claims and the Legal Context

In the lawsuit, WBD asserts that “TBS properly matched the Amazon Offer by agreeing to telecast the games on both TNT and Max.” According to WBD, the Amazon offer includes cable rights, which encompasses both cable and internet distribution via Non-Broadcast Television. WBD claims it has the contractual right to “match a third party offer that provides for the exercise of NBA games via any form of combined audio and video distribution.”

This legal battle marks another chapter in the long-standing and increasingly strained relationship between the NBA and Turner Sports, a relationship that spans nearly 40 years. Turner has held an NBA package since 1984, with games airing on TNT since the network's launch in 1988. TNT’s “Inside the NBA” show has been a staple, winning numerous Sports Emmy Awards.

Impact on Fans and Future Implications

The tension escalated when WBD CEO David Zaslav remarked during a 2022 RBC Investor Conference that Turner and WBD “don’t have to have the NBA.” Negotiations between Warner Bros. Discovery and the NBA did not yield a new deal during the exclusive period, which expired in April. Despite this, Zaslav and TNT Sports Chairman/CEO Luis Silberwasser expressed their intent to match one of the deals.

Following the NBA Board of Governors’ approval of the rights deals on July 17, WBD received the contracts the next day and informed the league on Monday of its intention to match Amazon Prime Video's offer. However, the NBA announced on Wednesday that it did not consider WBD's offer a true match.

In their announcement, the NBA emphasized their goal to “maximize the reach and accessibility of our games for our fans.” They highlighted that their new arrangement with Amazon complements the broadcast, cable, and streaming packages of Disney and NBCUniversal, enhancing the fan experience through substantial promotional resources.

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