- The Washington Times - Thursday, June 28, 2007

The NBA yesterday announced an eight-year extension of its television contracts with ESPN and TNT that includes rights to broadcast games and other content on a variety of digital platforms.

The deal, which begins with the 2008-09 season, extends the relationship between the three parties through 2016 and increases the number of times the networks can show the league’s top teams.

For the NBA, the deal is seen as a validation of its product, which in recent years has seen relatively low television ratings and declining viewership in the playoffs. For the networks, the new contract provides guaranteed programming for emerging platforms, such as the Internet and mobile phones, and platforms yet to be developed.

“I am extremely happy because I consider this to be a wonderful vote of confidence,” NBA commissioner David Stern said. “We have continued to believe that in order to encourage and support our partners they are looking for longer, supportive investments in content.”

Financial terms were not disclosed, but the Associated Press reported the deal to be worth $930 million a year, about a 21 percent increase over the existing contract.

Under the deal, ABC will show at least 15 games a season, beginning Christmas Day and continuing on Sunday afternoons. ESPN and ESPN2 will show up to 75 games, mostly on Wednesday and Friday nights, and ESPN will televise the NBA Draft and NBA Draft lottery. TNT, meanwhile, will show 52 regular-season games plus the NBA All-Star Game and weekend festivities. ESPN and TNT will alternate the Western and Eastern conference finals each year. ABC will have the exclusive rights to the NBA Finals.

The new contract also provides for ESPN’s international division. NBA games and related studio shows can now be aired in Latin America, the Middle East, Africa and Oceania. ESPNdeportes, the company’s Spanish-language station, also has the rights to air live simulcasts of all ESPN games. In all, the new broadcast deal provides for rights on 17 different ESPN platforms.

The contract’s provisions regarding emerging digital platforms are unique to a deal of this size. ESPN and TNT have the right to broadcast games and other content on any platform, including services like ESPN360 and ESPN Mobile TV. Those rights also apply to platforms not yet developed or even conceived. ESPN officials said they expect the company to develop between five and 10 new platforms by the time the new contract expires.

“This is probably the first rights deal where it looks as if there’s a fair amount of room, flexibility and salability,” said David Carter, principal of the Sports Business Group. “Without that flexibility and the ability to revisit these issues, an eight-year deal would make no sense.”

ESPN president George Bodenheimer said the network had few reservations about renewing its deal with the NBA despite flat ratings for the regular season and record-low ratings for the NBA Finals this season.

“We are in it for the long term with the NBA,” he said. “Sports are cyclical. … They are an historically strong performer.”

The eight-year term is impressive, according to Chad Lewis, associate director of Fitch Ratings.

“It’s a testament to their sports product despite their ups and downs,” he said.



Click to Read More

Click to Hide