Warner Bros. Discovery\u00a0sued the National Basketball Association on Friday as it tries to maintain broadcast rights for a package of live games.<\/p>\n
\u201cGiven the NBA\u2019s unjustified rejection of our matching of a third-party offer, we have taken legal action to enforce our rights,\u201d the company\u2019s TNT Sports unit said in a statement. \u201cWe strongly believe this is not just our contractual right, but also in the best interest of fans who want to keep watching our industry-leading NBA content with the choice and flexibility we offer them through our widely distributed WBD video-first distribution platforms \u2014 including TNT and Max.\u201d<\/p>\n
The media company seeks to prevent the NBA from awarding the rights to Amazon, whose games package Warner Bros. Discovery tried to match, or aims to win monetary damages.<\/p>\n
The NBA said Wednesday it had\u00a0reached agreements\u00a0with\u00a0Disney,\u00a0Comcast\u2019s NBCUniversal and\u00a0Amazon\u00a0on three different packages of games, ending its nearly 40-year relationship with Warner Bros. Discovery\u2019s Turner Sports. The 11-year media rights deal is worth roughly $77 billion \u2014 a massive increase over the previous agreement as the value of live sports booms.<\/p>\n
In response to the suit, NBA spokesman Mike Bass said \u201cWarner Bros. Discovery\u2019s claims are without merit and our lawyers will address them.\u201d<\/p>\n
Warner Bros. Discovery said\u00a0earlier this week\u00a0it submitted paperwork to the league to match one of the packages, which people familiar with the matter identified as the $1.8 billion-per-year group of games earmarked for Amazon. The tech giant\u2019s deal includes regular-season games, the in-season tournament, and some playoff games. The NBA granted Warner Bros. Discovery matching rights when it signed its previous media\u00a0deal in 2014. The provision is meant to give an incumbent company the right of last refusal to maintain its position as a media partner.<\/p>\n
But Warner Bros. Discovery\u2019s decision to match the Amazon package, rather than the $2.5-billion-per-year NBCUniversal agreement, caused the league to say Wednesday that the matching rights are invalid. Warner Bros. Discovery\u2019s offer for that package involves airing the NBA games on its cable network TNT and simulcasting them on its streaming service, Max. That\u2019s not an apples-to-apples comparison to Amazon Prime Video, which is a streaming-only service, the league argued.<\/p>\n
Warner Bros. Discovery argued in a court filing Friday that its matching rights should still apply to the Amazon package because many of the games in that package previously aired on cable TV.<\/p>\n
\u201cThe MRE (Matching Rights Exhibit) further provides that, \u201d[i]n the event that TBS Matches a Third Party Offer that includes Cable Rights\u201d and no other Incumbent matches, then TBS shall have the exclusive right and obligation to exercise the Cable Rights provided for (and on the same terms set forth) in the Third Party Offer,\u201d Warner Bros. Discovery wrote in its court filing. \u201cThat is exactly what happened here: Amazon made an offer for Cable Rights as defined in the MRE, and TBS matched it. But, in breach of the Agreement, the NBA has refused to honor TBS\u2019s match.\u201d<\/p>\n
In a letter the NBA sent to Warner Bros. Discovery on Wednesday, the league pointed to the contractual language of the 2014 matching rights as its reason for rejecting the offer.<\/p>\n
The NBA cited the clause: \u201cIn the event that an incumbent matches a third party offer that provides for the exercise of game rights via any specific form of combined audio and video distribution, such incumbent shall have the right and obligation to exercise such game rights only via the specified form of combined audio and video distribution (e.g. if the specific form of combined audio and video distribution is internet distribution, a matching incumbent may not exercise such games rights via television distribution).\u201d<\/p>\n
CNBC\u2019s David Faber\u00a0on Thursday reported\u00a0Warner Bros. Discovery had moved to sue the NBA.<\/p>\n
In 2022, Warner Bros. Discovery Chief Executive Officer\u00a0said that his company\u00a0did not \u201chave to have the NBA\u201d if the economics weren\u2019t sound.<\/p>\n
\u00a0\u201cWith sport, we\u2019re a renter,\u201d Zaslav said at a\u00a0Nov. 2022 investor conference. \u201cThat\u2019s not as good of a business.\u201d<\/p>\n
Still, Friday\u2019s lawsuit expounded on the value of the NBA to Turner Sports. Owning NBA rights is valuable to the health of Warner Bros. Discovery\u2019s cable TV business, which has suffered in recent years as millions of Americans cancel traditional pay TV in favor of a bundle of streaming services.<\/p>\n
\u201cNBA games drive significant viewership and ratings, as consumers are more likely to watch games live, in real time. This, in turn, affects the price TBS and WBD can charge to their advertisers and downstream distributors that license TNT for transmission to their customers,\u201d the company wrote in the complaint. \u201cNBA distribution rights thus give both TBS and WBD the ability to grow their brands and reach a larger group of consumers that only NBA games bring. NBA telecast rights also give TBS and WBD a competitive advantage over other programmers, particularly when negotiating with other leagues for sports rights.\u201d<\/p>\n
Warner Bros. Discovery argued the NBA brings \u201cintangible and incalculable benefits\u201d to the company\u2019s business and asked for \u201cpreliminary and permanent injunctive relief to prohibit the NBA from licensing these unique and irreplaceable rights [to Amazon],\u201d while adding that if \u201cequitable relief is not granted,\u201d it expects \u201cmonetary damages\u201d from the NBA.<\/p>\n<\/p>\n
Warner Bros. Discovery\u00a0sued the National Basketball Association on Friday as it tries to maintain broadcast rights for a package of live games. \u201cGiven the NBA\u2019s unjustified rejection of our matching of a third-party offer, we have taken legal action to enforce our rights,\u201d the company\u2019s TNT Sports unit said in a statement. \u201cWe strongly believe […]<\/p>\n","protected":false},"author":0,"featured_media":6881,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-6880","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/6880","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=6880"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/6880\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/6881"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=6880"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=6880"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=6880"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}