Discussion surrounding the next media rights contract within the NBA is underway as the league and its partners begin considering options with two years to go on the current deal. The league currently receives nearly $24 billion in rights fees annually – and several reports have indicated that the NBA is hoping rights fees from ESPN and TNT triple in the next round of negotiations.
Disney is reportedly looking for a strategic partner to purchase a minority equity stake of ESPN, of which it currently owns 80%. The other 20% is held by Hearst Communications, and it remains unknown whether or not that company has any interest in selling part of its share. Nonetheless, Disney has been reportedly looking at potential partners within various different industries, including the technology sector.
“Overall, we’re considering potential strategic partnerships for ESPN, looking at distribution, technology, marketing, and content opportunities where we retain control of ESPN,” Iger said on the company’s third-quarter earnings call. “We’ve received notable interest from many different entities and we look forward to sharing more details at a later date when we are further along in this process.”
According to the report from The New York Times, Disney has had discussions with the NBA regarding a minority equity stake and the provisions of a potential deal. A source tells The Times that one of the benefits ESPN would hope to gain in a partnership could be the integration of its own social media with that of the NBA, along with increased in-game functionality and an expanded breadth of distribution.
Furthermore, if Diamond Sports Group is unable to emerge from Ch. 11 bankruptcy, the NBA would regain control of local media rights for 14 teams in the league. The league could then potentially consider selling those rights to a national partner, which would be a different course of action than that taken by Major League Baseball, which instituted its own local media department.
