Under their new, eight-year multiplatform agreement with the National Basketball Association, ESPN/ABC Sports and TNT have expanded their digital games.
The new contracts together are worth $7.4 billion, including fees from the league-owned NBA TV. While they essentially replicate ESPN's and TNT's current TV schedules, the deals afford a new-media assist: Both networks can stream live games from their air and migrate other NBA-oriented content to an array of platforms.
Covering the 2008-09 through 2015-16 NBA seasons, the pact calls for ESPN to televise up to 75 regular-season and 29 playoff games, while ABC will broadcast up to 15 postseason games, including the NBA Finals. TNT will continue to offer exclusive Thursday-night doubleheader telecasts, the circuit's All-Star Game and up to 52 playoff tilts per season.
Averaging some $925 million per year, the new rights deals, which came after ESPN and TNT both sustained double-digit ratings erosion for the recently completed playoffs, represent a 21% advance over the current six-year, $4.6 billion contract that yields some $766 million on average. That contract expires after the upcoming season.
None of the parties would specifically address the price, but NBA Commissioner David Stern, during a June 27 conference call announcing the deal, stated that the value of the broadcast rights continue to exceed those in the digital realm. However, he noted that the contract's length would help the league's partners to monetize their investments in these technologies as fans consume the sport in new ways.
For the total sports network, the deal allows ESPN to present games and other content across 17 platforms, including ESPN.com, ESPN360, ESPN Mobile TV and ESPN International, which significantly increases its pro hoops presence.
Relative to Turner Broadcasting System, the games aired by TNT can be simulcast to wireless and broadband properties and delivered to video-on-demand platforms shortly after their original telecasts.
Hailed by Turner and ESPN executives as model for sports and programming rights in the digital era, the pact also assures the networks' NBA transport on platforms that have yet to be developed.
But Stern hasn't ceded all the action: the NBA retains digital rights to more than 1,000 games per season.
Executives at TNT and ESPN insisted that the deals will produce plenty of green.
“The overall financial picture is where we need this to be,” ESPN executive vice president of content John Skipper said. “We're quite confident that [the NBA deal] will have great value for all of our properties.”
To that end, he explained that sold-out ads accompanying online video starts — 3.2 million over the course of the recently completed NBA season — carry CPMs (cost per thousand homes) that are “consistent” with those for ESPN's TV CPMs. Skipper said ESPN, which has launched seven new platforms since its current NBA deal tipped off, could add another five to 10 over the life of the new contract.
Turner Sports president David Levy said the company wouldn't have engaged in a deal of this magnitude “unless it would be profitable across all platforms.” He noted that the media landscape of today will look vastly different in “2011, 12, 13 and 14,” with digital assets becoming even more important to advertisers, branding efforts and consumers.