The Multibillion-Dollar Fight for the NBA

The NBA playoffs tipped off in 16 major cities last month before taking an unexpected detour to Galveston, Texas.

As Charles Barkley saw it, the New Orleans Pelicans were so dismal in their first-round series against the Oklahoma City Thunder that they didn’t deserve an off-season vacation in Cancun. “We’re gonna send them to Galveston, where that dirty-ass water be washin’ up on the shore,” Barkley said on Inside the NBA, the long-running TNT studio show. One of his cohosts, fellow Hall of Famer Shaquille O’Neal, was in stitches. And for Barkley, that’s like a coach giving him the green light to keep shooting. “Come on, man,” he continued. “They didn’t even try, man. We’re not giving them no plane ticket to the beach.”

Barkley’s riff quickly took on a life of its own, going viral on social media and setting off a playful feud between a Gulf getaway destination and an NBA legend. Tina Knowles, the mother of Beyoncé and a Galveston native, got in on the fun, warning Barkley that locals “don’t play about Galveston.” In recent weeks, billboards have popped up around the city responding in kind to Barkley’s ribbing (“Hey Charles, our water is cleaner than your golf swing”).

Behold the power of Inside the NBA, one of the most consistently entertaining programs on television for two decades running. The unequivocal GOAT of studio shows (really, one of the only good studio shows), it is part basketball commentary, part comedy roast, alchemized into TV magic by the singular talent of Barkley and organic banter with his cohosts: Ernie Johnson, Kenny Smith, and O’Neal. Inside the NBA premiered when NBA games began airing on TNT in 1989, but Barkley’s arrival in 2000 transformed the show into a bona fide cultural institution. O’Neal joined in 2011, rounding the panel into the sports media equivalent of a superteam. Few programs in any genre of television have ever boasted a higher approval rating; if you’re a fan of the league, you’re probably a fan of Inside the NBA.

But now, those fans are forced to contemplate a future without the show. Two days after Barkley turned Galveston into a punchline, news broke that Comcast, the parent company of NBCUniversal, had prepared a $2.5-billion-per-year bid to pry the NBA’s broadcast rights away from TNT owner Warner Bros. Discovery. (A spokesperson for NBC didn’t immediately respond to a request for comment.) With the league’s current media deal set to expire at the end of next season, the NBA’s pursuit of a new pact has unfolded in the backdrop of the league’s postseason. Sources familiar with the talks stressed that the negotiations are fluid and far from over. One source told me that a deal is probably still weeks away. “They’re juggling multiple partners and multiple agreements and multiple situations,” another source said of the NBA. Whenever that day comes, there is a real possibility that TNT will be the odd one out, making the negotiations yet another referendum on Warner Bros. Discovery CEO David Zaslav, whose efforts to cut costs and pay down debt may come at the expense of a storied sports broadcasting partnership. And no matter who prevails in the negotiations, the new deal is guaranteed to look much different from the current one.

Ten years ago, network executives didn’t even really break a sweat during negotiations with the NBA. At the time, the league opted to renew with its incumbent partners––Disney, which owns ABC and ESPN, and Time Warner, the then parent company of TNT––while still in the exclusive negotiating period rather than open bidding to other networks. John Skipper, president of ESPN at the time, said that the companies submitted a joint bid early in the process in order to thwart any would-be competitors, one that “was good enough that [the NBA] didn’t need to create a third package.” The deal, which was worth $24 billion over nine years, enshrined the networks as the national broadcasting partners for the NBA’s regular season and playoffs.

This time around, the league is seeking something bigger, with more partners and money attached. And that means, yes, you’ll likely need more streaming and cable subscriptions to watch a complete season. The NBA, and premium live sports more generally, is one of the last reliable audience drivers in an increasingly fragmented TV landscape, and various reports have indicated that the league is pursuing a deal worth more than twice as much as the last one. Instead of renewing with incumbents during the exclusive negotiating period, the league took the bidding to the open market, where it has unsurprisingly not struggled to find new suitors. In addition to interest from NBC, Amazon has made a reported bid of $1.8 billion per year to get its own slice of the package, which would give the company another major sports league to add to its streaming portfolio after it became the exclusive home of the NFL’s “Thursday Night Football” in 2022.

Skipper said the proliferation of streaming in live sports represents the biggest change from the NBA’s previous deal. “Last time, there was no advantage to creating a third package,” he said. “This time, the streamers are all in different stages of being involved in sports. You don’t want to be left out of that experience.” According to multiple reports, the NBA has agreed to a “framework” of a deal with both Disney and Amazon. On an earnings call last week, Disney CEO Bob Iger said he was “confident” that the company will renew with the league. The company has made a reported $2.6-billion-per-year offer to remain the league’s top media partner.

That has turned the negotiations into a battle between NBC and TNT for the third piece of the package. Comcast’s reported $2.5 billion offer to bring the NBA back to NBC is more than twice what Warner Bros. Discovery pays annually to broadcast the league’s games on TNT. For NBC, landing the NBA would mark a grand reunion after losing rights to the league more than 20 years ago. The network was synonymous with the NBA throughout the 1990s, broadcasting during the glory days of Michael Jordan and the Chicago Bulls, and soundtracking the era with its indelible theme song, “Roundball Rock.” (John Tesh, the musician who composed the anthem, told CNBC last month that NBC would be free to license the song should it win the rights.)

The reported offers from both Disney and Comcast are even more staggering given that there will be fewer games to go around in the new deal. Sportico reported last week that, under the tentative agreement between the NBA and Disney, ESPN would see its regular season games reduced from 100 to 80. However, the outlet said ABC was a “shoe-in” to remain as the exclusive home of the NBA Finals and one of the two conference finals. ESPN would continue to air games on Wednesday nights during the regular season but, according to Puck, lose the Friday night games the network airs under the current media deal. And should NBC prevail, its package will be less robust than what TNT currently boasts. Under the new deal, the other conference finals would reportedly alternate between Amazon and the third rights holder year-to-year. (The NBA did not immediately respond to a request for comment regarding the current status of the negotiations.)

There is anxiety inside the halls of Warner Bros. Discovery––and on the set of Inside the NBA. “We might lose it,” Barkley said on ESPN Chicago radio Tuesday. “Everybody’s scared to death.” For Zaslav, the NBA negotiations are another source of turbulence in what has been a choppy tenure overseeing the media and entertainment conglomerate, which was born out of the 2022 merger of WarnerMedia and Discovery. Zaslav’s compensation, almost $50 million last year, has drawn the ire of both Wall Street and Hollywood. During last year’s writers and actor strikes, he was arguably public enemy No. 1. Meanwhile, Warner Bros. Discovery has suffered significant losses—$7.4 billion in 2022 and $3.1 billion last year––while its stock has plummeted nearly 70% since it started trading two years ago. Following The Wall Street Journal’s report about NBC’s bid for the NBA, the stock dropped to a new low last month.

Zaslav has overseen deep cost-cutting measures at Warner Bros. Discovery while trying to pay off the $56 billion in debt the company racked up to finance the merger, which stood at around $44 billion at the end of last year. At an investors conference in 2022, Zaslav suggested that it wasn’t necessarily imperative for the company to keep the league in its portfolio. “We don’t have to have the NBA,” he said, a comment that was not well-received at the league’s Fifth Ave headquarters. It also left industry veterans puzzled. “Zaslav messed this up dramatically,” a former executive told me. “He should never have said they don’t need it. You just don’t do that.” If Zaslav was signaling to the NBA that he wouldn’t overpay, that may have also been a miscalculation. “It just doesn’t do any good. You don’t get anything off of the deal ever by telling them publicly that you’re not going to overpay,” the executive said. “And they remember it.”

It now appears that Zaslav is trying to stage a fourth-quarter comeback. Whether he was spooked by the reaction from Wall Street or the outcry over the potential end to Inside the NBA, Zaslav has undergone a noticeable shift in his public posture lately. He was courtside at Madison Square Garden for a pair of New York Knicks playoff games last month, and again on Tuesday night, with TNT not-so-subtly panning to him during the broadcasts. “We love the NBA,” Zaslav said last week at the Milken Institute Global Conference, adding that the company is in “constructive negotiation” with the league. On a Warner Bros. Discovery earnings call last week, he struck a similar note, telling investors that the company had strategies for various potential outcomes. “We’ve enjoyed a strong partnership with the NBA for almost four decades,” he said. “We’re in continuing conversations with them now, and we’re hopeful that we’ll be able to reach an agreement that makes sense for both sides.” Zaslav was noticeably absent at Warner Bros. Discovery’s upfront on Wednesday in New York, but both Barkley and O’Neal were on hand for the annual presentation to advertisers.

The company has matching rights that would enable it to match NBC’s offer before the league enters an agreement. Still, it’s unclear if the league is open to a deal with four partners, which would result in both TNT and NBC receiving games. Sources at Warner Bros. Discovery believe that its status as an entrenched league partner could also work to its advantage. The company comanages NBA Digital, a portfolio that includes NBA TV, which produces programming in Atlanta across the hall from Inside the NBA’s studio.

For weeks, fans of the show have fretted over the possibility that their nights with Charles, Kenny, Ernie, and Shaq could be numbered. (“Please save Inside the NBA,” pleaded Yahoo sports columnist Dan Wetzel last week.) Industry insiders have speculated that the show could land on one of the NBA’s new partners––Amazon or NBC. Barkley said earlier this month that the 10-year contract he signed in 2022 contains an opt-out if TNT loses the rights to the NBA, raising the possibility that he could become a highly sought free agent. But Johnson, the beloved anchor of Inside the NBA who referees the show’s more absurd moments, will reportedly stay at TNT regardless of how the new deal shakes out. Whether O’Neal and Smith would follow Barkley elsewhere is unknown, but any zombie incarnation of Inside the NBA will be different––and let’s face it, probably worse.