The NBA’s New Media Rights Agreement
The NBA is poised to launch a massive new media rights agreement valued at $76 billion over the next 11 years, starting Tuesday night. Even before the season begins, advertisers have already secured a significant portion of in-game advertising for the 2025-26 season. With a marked increase in games scheduled to air on traditional broadcast television, a substantial rise in advertising revenue is anticipated compared to last year.
Advertising Expenditures and Trends
Data from Guideline reveals that NBA advertising expenditures reached $1.52 billion during the previous season, reflecting a 15% increase from 2023-24. Notably, ABC/ESPN experienced a remarkable 20% increase in ad sales, while TNT concluded its partnership with the league by reporting a 9% growth in revenue.
The newly negotiated rights agreements, which encompass national broadcasts on Disney’s platforms and NBCUniversal, as well as Amazon Prime Video, are projected to drive ad revenues even higher. NBCUniversal is set to broadcast 100 regular-season games, distributed evenly between a flagship Tuesday night showcase and an exclusive streaming package through Peacock. Additionally, pricing for ad spots has risen since last fall.
Sean Wright, chief insights and analytics officer at Guideline, highlighted this upward trend, noting a healthy increase in ad prices alongside a boost in the volume of available inventory. He stated, “It’s not just that there’s more games on more platforms; they’re able to charge slightly more, and these CPM increases align with trends we have observed in recent NBA seasons.”
Projected Advertising Growth
According to Guideline’s report, the cost to reach NBA audiences across various television and streaming platforms has surged 19% year-over-year. If the upcoming season reflects previous years, the ad breaks during games will likely feature extensive marketing from a variety of sectors, including automotive, fast-food, retail, film studios, and financial services. However, advertising inventory is limited, with NBC noting that most of its NBA advertising slots were sold during the upfronts earlier this year, although some spots remain for immediate sale.
Despite the significant contributions from advertising, it is essential to recognize that they do not fully cover the costs associated with broadcasting the NBA. Guideline’s figures indicate that ad revenue accounts for approximately 50% of the expenses related to top-tier sports rights, with additional income from affiliate revenues and retransmission consent fees covering much of the remaining costs. This contribution from advertising has remained stable over the past decade, consistently hovering around the 50% mark, even amid economic fluctuations.
For instance, in 2017, U.S. sports advertising revenues were reported at $9.1 billion, which comprised 51.7% of that year’s total broadcast rights fees amounting to $17.6 billion. Looking towards 2026, Guideline projects that advertising sales will rise to approximately $17.1 billion, corresponding to 52.1% of the anticipated $32.8 billion rights fees.
The Importance of Live Sports
As the value of live sports remains indispensable to television viewership, advertising revenues are expected to flow in steadily. Wright predicts that live sports will account for nearly 40% of total advertising revenue in linear TV by 2025, a significant increase from 20% over the previous eight years. This dominance is underscored by sports programming, which occupied 93 of the top 100 most-viewed broadcasts in 2023.
Although it is too early to determine the trajectory of this new NBA season, there is considerable excitement among marketers, as evidenced by sold-out advertising slots and elevated pricing. Notably, NBCU reports that 20% of their NBA advertisers are entering the market for the first time, with 10% of the 170 overall sponsors being newcomers to the NBA brand.
Season Kickoff
The season will officially begin with an East/West doubleheader, starting with the Thunder taking on the Rockets at 7:30 p.m. ET, followed by the Warriors facing the Lakers at 10:30 p.m. Major sponsors for the opening night include Kia, the official automotive sponsor of the NBA, and American Express, a longtime league partner that has endorsed the NBA as its payment service provider since 2010.
