Currently, negotiations are ongoing within the NBA for media deals worth over $76 billion. If Warner Bros. Discovery were to lose the NBA, it could face a significant loss in ad revenue, estimated at around $270 million per year, and a 45% decline in affiliate fees for its TNT subsidiary according to Citigroup analyst Jason Bazinet. However, despite the potential impact on Warner Bros. Discovery, its new joint streaming venture with Disney and Fox, Venu Sports, may be less affected as it could leverage other sports programming to offset any losses from losing the NBA rights.
Three insiders familiar with the venture indicated that the outcome of NBA negotiations would not hinder the planned launch of Venu Sports in the fall, pending regulatory approval and final agreements with all parties involved. The joint venture aims to bring together top-tier sports content from both Warner Bros. Discovery and Disney and Fox in one place. It will allow customers to access exclusive programming from their favorite teams and athletes across multiple platforms including TV channels, streaming services and social media channels.
While NBA negotiations are ongoing, Warner Bros. Discovery is preparing for all possible outcomes by exploring other revenue streams for its TNT subsidiary such as advertising sales and affiliate fees from other sports leagues or events. Additionally, they are also looking at expanding their content library beyond just basketball to include other genres like movies, TV shows and music which can help offset any losses from losing the NBA rights.
In conclusion, while NBA negotiations may have an impact on Warner Bros. Discovery’s ability to maintain its current deal with the league, it is not likely to significantly hinder their plans for Venu Sports or overall business strategy moving forward. They are prepared for all possible outcomes by exploring new revenue streams and expanding their content library beyond just basketball.
