- Warner Bros. Discovery will lose the rights to broadcast NBA games, one of its biggest assets.
- Now, WBD is suing the NBA, seeking to overturn the league's contract with Amazon.
- Fighting a longtime sports programming partner in court is probably a bad idea, but WBD has found itself in an unpleasant predicament.
Two years ago, Warner Bros. Discovery president David Zaslav told investors he didn't mind missing NBA games, which his TNT network has shown for decades.
He then changed his mind, but it was too late: Next season will be the last year people can watch the NBA on TNT, after the NBA signed new broadcasting deals with Disney, Comcast and Amazon worth $76 billion.
So Zaslav now finds himself in an unusual position: He's filed a Hail Mary lawsuit against the NBA, demanding that it give up the packaging for the games it has instead decided to sell to Amazon.
You can read Puck’s John Ourand’s in-depth article on the failed negotiations between WBD and the NBA here (Summary: Zaslav and his team miscalculated badly.) But the next chapter in his story will be interesting as well.
Because there are a few different outcomes here, and none of them are good for WBD.
One is that WBD will somehow win the lawsuit, forcing the NBA to give up the games WBD wants to sell elsewhere.
I'm not a highly paid media executive, but I know I don't want to enter into a long-term relationship with a programming partner who is only forced to cooperate by court order.
And there are two other possibilities: one is that WBD doesn't get any games but extracts some sort of settlement from the NBA for an alleged breach of contract, and the other is that WBD gets nothing at all.
And the results of both terrible For WBD.
WBD's traditional TV channels are already expected to decline sharply, which has led the company to float a proposal to separate them from its more valuable HBO and Warner Bros. Studios assets.
But without the NBA on those channels, things get trickier. It will be much easier for pay-TV distributors like Comcast to hard-line WBD when negotiating new contracts, and it will be much more difficult for the company to try to strike direct-to-consumer deals like the sports joint venture it plans to launch this fall with Disney and Fox.
WBD tried to mitigate the loss of the NBA in advance by striking deals for other sports programming, including college football playoff games, which it somehow purchased from Disney.
College football is popular. Not as popular as the NFL, but nothing is as popular as the NFL. So it's better than nothing. But it's obviously not the exchange WBD was hoping for. That's why WBD is heading for a legal battle, and the best outcome is still not good at all.
