As consumer viewing habits change, the NBA puts future gains ahead of short-term losses as the league strategies its media future.
While speaking at the NBA Board of Governors Press Conference last week, NBA Commissioner Adam Silver gave insight into how the league is approaching its future local game broadcasts, with what he says is “a broken RSN model,” as millions are cutting the cord.
Sliver’s vision of the NBA’s focus on streaming is evident as its new media deal will bring national games to Prime Video, and Peacock beginning the 2025-26 season. For local games that air on RSNs, the NBA’s head honcho noted that cable distribution is down 50 percent since the NBA negotiated their last TV deal in 2014.
RSNs were found in many cable and satellite packages, but aren’t as widely available in live TV streaming platforms. The league’s biggest RSN partner Bally Sports, which aired 18 NBA teams, has been greatly impacted by cord cutting to the point that its parent company had to file for bankruptcy.
While currently working their way out of bankruptcy, Bally Sports managed to secure rights to NBA teams for the upcoming season. However, the RSN had to drop two teams as part of that deal and the other teams can become free agents if the company doesn’t meet its financial obligations. With the agreement, the NBA agreed to a 30% to 40% reduction in the extant rights fees Bally Sports pays.
Since the NBA added a third TV partner in its national deal, fewer games will be available on RSNs, and Silver was asked how that would affect the local games during the BOG press conference. Silver answered that 18 of their RSNs were defunct or in bankruptcy, and the “decline in the number of homes covered by those RSNs and decline in revenue,” was something that they were paying a lot of attention to.
As those numbers decline and viewing habits in streaming sports and events are increasing, Silver stated:
“But I think coming out of this, when we look at the interest of streaming services to carry local games and all the additional functionality that will come to that, there will be a transition and transition for our viewers, as well, in terms of how they discover those games and how they watch them, that I think the end result will be a much better consumer experience” (H/T NBC Sports for the transcript).
Teams Are Ditching Traditional RSNs for OTA Channels
A growing number of NBA teams have ditched the old pay-TV exclusive RSN model for free over-the-air channels and their own subscription-based direct-to-consumer streaming services. The move to local channels has helped smaller media companies like Gray TV, among others become major players in the sports broadcasting space.
Since 2023, the Atlanta-based Gray TV has launched numerous OTA RSNs for NBA, MLB, and NHL teams that aired on traditional RSNs. Last season, the Hawks and Pelicans, whose games aired on Bally Sports South and Bally Sports New Orleans, respectively, aired games OTA in partnership with Gray.
The Pelicans expanded their reach with the highest ratings ever for the team. This led to the team leaving Bally Sports to form Gulf Coast Sports & Entertainment Network (GCSEN) in partnership with Gray Media, which will make their in-market non-exclusive nationally televised games available in 4.1 million households, a sixteen-fold increase, according to the team. Gray’s New Orleans station WVUE (FOX 8 Local First) will be the anchor station with games airing throughout Louisiana, Mississippi, and Alabama on other Gray TV stations via OTA and pay-TV providers.
The Dallas Mavericks are also leaving Bally Sports, joining the Pelicans as the other team to do so for the upcoming season. The Mavs struck a multi-year agreement with TEGNA to bring all in-market non-exclusive nationally televised games to approximately 10 million Texans statewide. This deal tripled the current number of households the Mavs reach in the state, giving fans a way to watch Luka Doncic, Kyrie Irving, and the defending Western Conference champions for free.
The Chicago Bulls who previously aired games on the soon-to-be-defunct NBC Sports Chicago RSN have teamed up with the White Sox, and Blackhawks in partnership with Standard Media to to form the Chicago Sports Network (CHSN). The network launches on October 1 and will offer full-time programming OTA in the Chicagoland region on Channel 62.2 and Channel 62.3. As of today, DIRECTV STREAM will stream the network and CHSN is currently negotiating with other providers to offer the network on premium platforms,
The earliest adapter to the full-time OTA model in recent years was the Phoenix Suns. In 2023, Bally Sports Arizona shut down and the Phoenix Suns began to air games OTA and the Suns Live streaming service. OTA games gave over 2.8 million homes access to games that air on Gray TV’s Arizona’s Family Sports and Entertainment Network (Arizona’s Family Sports). The team saw a spike in viewership that doubled the previous year on Bally Sports Arizona. In addition to OTA access, Arizona and Albuquerque metro area residents can stream games on the go or at home with a Suns Live subscription.
Last season, the Utah Jazz found a new home after AT&T SportsNet shutdown, Like their Western Conference rivals the Phoenix Suns, the Jazz offered a hybrid OTA and streaming model. Fans throughout Utah and in parts of Nevada and Idaho can watch games on KJZZ and other affiliated OTA channels, which increased viewership by more than 50% compared to their previous season on AT&T SportsNet Rocky Moutain, according to the team. Back in March, Jazz executive Caroline Klein told NextTV that the team’s DTC streaming platform Jazz+ had more than 20,000 subscribers.
The NBA team that is credited for innovating the direct-to-consumer for local viewers is the LA Clippers. In 2022, the team launched ClipperVision, which was the first of its kind for the league. The DTC platform allowed in-market subscribers to stream 70+ local games without the need for an expensive cable or satellite package. Plus, on-demand viewing, Spanish and Korean-language broadcasts, alternative broadcasts, other features, and streams are included. Bally Sports RSNs still air most Clippers games, and KTLA offers select games OTA, all of which can be viewed with ClipperVision. The DTC service is available to use in the BallySports and NBA app unlocking an untapped market of fans in the LA region that weren’t watching on pay-TV providers.
The New York Knicks and Brooklyn Nets are the NBA’s latest teams to go DTC with the Gotham Sports App expected to launch later this fall. The Nets’ YES Network and the Knicks’ MSG Networks are partnering up to create Gotham Advanced Media and Entertainment (GAME) a digital joint venture to serve fans in the NBA’s largest market. In the Gotham Sports app, customers can purchase MSG+, the YES app, and the Gotham Package (MSG+ and YES) to stream live games. Subscribers to traditional pay-TV providers can use the app with sign-in authentication for no additional charge.
What’s Next for the NBA & the RSN Model?
Going forward, more NBA teams may offer DTC streaming packages or transition to free OTA games. There are reports that Amazon may offer local games from Bally Sports. Discussions are in the early stages, but games from the Bally Sports streaming service could migrate to the Amazon platform. If the deal does happen, this would expand the reach of Bally Sports and establish Amazon as a must-have for many basketball fans.
There is also an ongoing lawsuit between TNT and the NBA. There were reports of the network possibly getting a small package of games in what would’ve been a fourth broadcast partner for the league. Now with the suit, if the two sides can reach a settlement and avoid drawn-out litigation, games on Max aren’t completely out of the question.
As the NBA comes to terms with its future, getting more local games on distributors like DIRECTV STREAM, Fubo, Hulu + Live TV, Sling TV, and YouTube TV will be key. Of the big five services, Sling TV is the only one that doesn’t offer any RSNs from NBC Sports, Bally Sports, and others. Fubo and DIRECTV STREAM currently have the most, but depending on where you live, those services may not carry in-market games for your team. Hulu + Live TV and YouTube TV have a few RSNs, and all five services could add more teams if they transition to more OTA channels.
More live TV streaming distributors may offer genre-based packages over the upcoming years. As media industry standards change with consumer viewing habits, that will undoubtedly help the NBA and its partners when negotiating new deals and give customers inexpensive ways to watch.
The NBA’s commissioner said that the current RSN model is broken at the BOG press conference, but it’s looking like the league is innovating ways to fix it.