Warner Bros. Discovery On Monday it said it had notified the National Basketball Association of its intention to use its matching rights for a series of games exclusively for another company. Warner Bros. Discovery Channel targets NBC and Amazon Prime Video, according to people familiar with the matter.
“In order to continue our long-term partnership, during both exclusive and non-exclusive negotiations, we made in good faith a strong offer that was fair to both parties. Unfortunately, the Alliance has informed us that it intends to accept additional offers from Warner Bros. Discovery.” A statement said: “We made an offer for the games in our current rights package that enables us to operate under matching rights terms, which is an integral part of our current agreement and the rights we pay under that agreement. “
“We have reviewed these offers and matched one of them. This will allow fans to continue to enjoy our unrivaled coverage of the best live game production in the industry as well as our signature studio shows and talent, while building on We have many more years to build on our proven 40-year commitment,” the company said. “Our pairing documents were submitted to the league today. We look forward to the NBA enforcing our new contract.”
Warner Bros. Discovery acquired the matching rights as part of its previous deal with the league, which expires at the end of next season. These rights allow the company to match payments for any game played on TNT during the current deal.
The question facing the NBA and Warner Bros. Discovery Channel is whether the rights will extend to full streaming packages, as Amazon has laid out. Warner Bros. Discovery also owns the streaming service Max, which can be used to stream games.
Still, Amazon Prime Video has more than twice as many global customers — more than 200 million, compared to Max's roughly 100 million customers — which could make the service a more attractive platform for alliances. Streaming rights are global, according to people familiar with the deal.
Amazon's status as an independent company has also become more solid, with a market capitalization of nearly $2 trillion. Warner Bros. Discovery's market value has fallen to about $20 billion, and CEO David Zaslav has repeatedly discussed his interest in more products merger or partnership, putting the company's future into question. That's an additional potential headache for the league, which wants stability from its broadcast partners. The alliance also disney and Comcast NBCUniversal is offering two additional game packages. Disney and Comcast each have market capitalizations in excess of $150 billion.
It's still unclear what will happen if the NBA denies Warner Bros. Discovery the right to match Amazon's package. Warner Bros. Discovery Channel may sue NBA. It's also possible the league could reach a settlement with the company. It's unclear whether the NBA will ask Amazon to pay more for its packages.
One unlikely possibility is a fourth set of games, according to people familiar with the matter. The NBA considered a fourth option over the past two months, but those talks fell through because deals were already in place with Disney, Comcast and Amazon, and those partners didn't want to give up inventory, people familiar with the matter said. . All three partners plan to pay more for fewer games than the league currently receives from Disney or Warner Bros. Discovery's current deals.
According to previous reports by CNBC, Disney will pay about $2.6 billion per year for its package, and NBCUniversal will pay about $2.5 billion per year. Amazon's deals are worth $1.8 billion annually. People familiar with the matter revealed that Warner Bros. Discovery Channel targeted this series of games as its companion rights due to its relatively low price.
The NBA also doesn't want to roll out too many packages because it's sensitive to consumer confusion and limits the number of services fans need to subscribe to, people familiar with the matter said. While Amazon plans to offer free NBA games to its Prime subscribers, Max's sports strategy includes additional content $9.99 per month In addition to the basic Max membership, access to live matches is also available.
Revealed: Comcast-owned NBCUniversal is the parent company of CNBC.