In October of 2014, the NBA reached a new media rights deal with ABC and Turner Sports worth an insane $24 billion. The deal, which will last nine years, will have a major impact on not only the NBA, but sports broadcasts in general. In the past five years, Television ratings across the board have been decreasing for a variety of reasons including DVR and streaming services. However, televised sports have not been affected by this trend, leading to the massive deal that the NBA inked late last year.
According to ESPN, the deal will bring 10 additional regular season games to ABC/ESPN and 12 more games to TNT. This, along with increased flexibility between the two networks, will hopefully address the league's problem of prioritizing market size over quality. For example, the NBA's two most popular teams, the Lakers and Knicks, received 28 and 23 nationally televised games respectively. Thus far, both teams have been bottom dwellers in their divisions, combining for a minuscule 25 wins. Compare that to the Atlanta Hawks, right now the best team in the NBA, who have only 4 national television appearances as a 45 win power.
The new deal will also have immense ramifications on upcoming NBA CBA negotiations. The NBA's salary cap is currently set up as being roughly forty-five percent of the leagues basketball related income(BRI). The BRI, which represents the revenue that is earned from media practices and television, will see a huge spike in response to the deal. This in turn will bring player salaries to a new high point. If you were curious as to why Lebron James signed only a two year deal with the Cleveland Cavaliers this summer, here is your answer. James could earn as much as 8 million more per year after the 2016-2017 season. With this influx of new money for the league, another lockout is looming and is almost unavoidable.
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