NBA still in play for minority stake in ESPN

For all the hoopla around the NFL's media prowess, the NBA is far from a shrinking violet.

The basketball league is still in talks with ESPN about a possible minority stake in the Disney-owned network, according to Front Office Sports' Michael McCarthy. In early January, the New York Post reported that ESPN had been putting together a framework with the NFL that would give America's most popular entertainment company an equity stake.

Last summer, Walt Disney boss Bob Iger told CNBC that the company would look at "strategic partnerships" with ESPN, with the NFL and NBA seemingly in the running from the moment he uttered the phrase. Iger and multiple media industry analysts appeared to believe that giving the leagues minority stakes in ESPN could help the network share the costs, burdens and benefits of producing live game broadcasts and studio shows as cord-cutting continues to upend traditional/linear television. The concept also seemed to dovetail with Disney's overall staffing reductions in 2023 and its real estate plans.

The timing, of course, could not be more beneficial for both sides. The NBA's current broadcasting rights deal with ESPN is set to expire after the 2024-25 season, and the league has famously set an expectation that its next rights agreements would double among its selected partners. ESPN and Warner Bros. Discovery have been in talks about retaining their pacts with the NBA, but Netflix and Comcast's NBCUniversal have both expressed interest in bringing the NBA into their umbrellas in some form.

McCarthy made sure to note that when Disney released separate financials for ESPN last fall, there was still a positive story to tell despite the impact of cord-cutting and carriage disputes on the network:

"According to Disney’s fourth quarter reportings from the fiscal year ending Sep. 30, 2023 (which was released last November), ESPN’s operating income surged 16% to $987 million, off $3.5 billion in revenue. In a previous SEC filing, Disney revealed that Bristol delivered $2.9 billion in profits from $16 billion in revenue in fiscal 2022. That was more than Disney’s entire entertainment business that year, according to The Hollywood Reporter. They were the kind of numbers any sports broadcasters would lust after. Disney could fetch $24 billion selling ESPN on the open market, according to estimates from BofA Global Research."