Amazon in Talks with NBA for Exclusive Streaming Rights Worth $120m a Year

Rekindling buzz from last week’s news broke by The Athletic that speculates Amazon and the NBA are negotiating an agreement potentially lasting a decade which would see exclusive streaming rights for games starting in 2025, it appears plausible that such conjecture could come to fruition. Prime Video – accessible via standard subscriptions to Amazon Prime- holds over 167 million U.S.-based users as per estimates; however, this is not likely the primary motive for Amazon’s pursuit of NBA rights. Instead, it seems more plausible that securing such a package would serve to increase new sign-ups and subsequent retention rates – both crucial factors in determining the value of sports packages by streaming services like Prime Video and Peacock (which previously reported NFL broadcasting as its main attraction). As was divulged following the 2021 NFL season, newly registered subscribers drawn to view Peacock’s exclusive airtime for a Wild Card matchup between Kansas City Chiefs and Miami Dolphins in January resulted in approximately three million new sign-ups. Of these freshly acquired users, roughly seventy percent remained active paying customers two months later – data that has triggered an auction war amongst prospective partners aiming to procure rights for future annual streaming games, which Amazon ultimately won by agreeing on a $120m yearly fee. Despite Americans’ grumbling about the additional costs of viewing NFL matches via streaming services like Prime Video and ESPN+ (for international contests), they still pay up – an indication that these packages hold enough value to justify such expenditures. The NBA, however, does not enjoy similar popularity levels as it did a decade ago when partners overpaid for the rights to keep other broadcasters at bay; moreover, ESPN/ABC and TNT recently declined renewing their current deals with the league after they lapsed last week, according to Wall Street Journal sources. These two networks desire fewer NBA games than previously arranged because of dwindling popularity levels that were not as high a decade ago when partners overpaid for rights in an attempt to keep other broadcasters at bay.
However, Amazon’s imminent investment in regular-season basketball is somewhat questionable considering the decreasing significance attached to these matches. Star players frequently skip games because they care little about their outcomes; nevertheless, if such a deal comes into fruition as expected by many pundits and analysts, it will be interesting to see whether Amazon can secure marquee matchups between popular teams like Boston Celtics, Los Angeles Lakers or Golden State Warriors – although given the league’s intention of maintaining ESPN/ABC & TNT’s partnership status as their premier broadcasting partners for now (indicating that these networks will retain exclusive rights to air most high-profile matches), it seems unlikely. Furthermore, Amazon’s timing is not ideal either since LeBron James – the NBA’s biggest star at present – turns forty next season; hence we doubt if Prime can get four years out of him.
Moreover, many observers feel that basketball as a sport currently lacks an obvious successor to superstars like Michael Jordan and Kobe Bryant who could potentially transcend beyond the confines of sports media. Colin Cowherd recently expressed his concerns about NBA ratings being down significantly – suggesting that there is no clear-cut replacement for these legendary figures at present.
If Amazon intends to extract a substantial portion out its exclusive broadcasting rights, it may need fans willing to pay extra fees beyond their standard Prime subscriptions in order to view games they previously watched free of charge on traditional television networks. This scenario bears some resemblance with CNN+ – an ill-fated streaming service that was shuttered just one month after launch due to a lackluster response from the public.
However, only time will tell whether Amazon’s NBA investment can succeed where other competitors have failed before; regardless of its potential success or failure, this news undoubtedly signals yet another major coup for Jeff Bezos and his burgeoning empire.