The NBA and Verizon are nearing a content deal that could provide the wireless carrier with new and original content. Although terms have not been disclosed, there is doubt that any deal would include live game coverage. Instead, Verizon would most likely get shoulder programming and may get D-League, WNBA or USA Basketball content. It is that national team content that could be the biggest win for Verizon.
The D-league and WNBA won’t move the needle, but USA Basketball could. Whether it is the U-22 teams filled with college stars or the prep games for larger tournaments such as the FIBA Basketball World Cup, NBA fans and some casual fans will tune in to watch the national team play. This inventory of content could allow Verizon to feel it is securing actual games while not angering current TV partners Turner and ESPN.
Make no mistake about it though, the traditional partners probably won’t be excited about the deal. First, TNT and ESPN could have leveraged the national teams content themselves through their streaming platforms. Second, this just helps create another future competitor. Verizon — and wireless companies in general — are moving into content distribution. The more competitors in the distribution market, the higher the price point to gain the rights to provide that service. Turner and ESPN would much rather be an exclusive distribution arm for the league. That way all ancillary revenue comes back to them. After all, ESPN and Turner did just sign an agreement valued at $2.66 billion per year.
This is a continuation of the NBA’s plan to create a strong digital and mobile footprint. When discussing the new deal, NBA leadership pointed out that the league needs to have greater digital distribution. The NBA is now offering single-game purchases at $6.99, and NBA League Pass is a great digital option for any basketball junkie. Now Verizon will enter the mix, and continue to build upon the league’s content and distribution mechanisms. It will depend what type of content Verizon receives to see if this deal will be a success.
Michael Colangelo is Managing Editor of The Fields of Green and Assistant Director at the USC Sports Business Institute.