NBA Vote Set On July Return Scenario, Whetting Appetite Of Fans, TV Nets, Ad Buyers

Dade Hayes
·6-min read

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The NBA is poised to confirm its return to the court in July, setting up a dramatic revival months after the league’s abrupt shutdown due to COVID-19 became an instant symbol of the chaotic sweep of the virus.

According to recent media reports (one of which was posted Wednesday on NBA.com), owners will vote on a conference call Thursday to finalize a resumption of the season by 22 of the league’s 30 teams. Plans call for eight regular-season games to be played by those teams (which have all either secured or are jockeying for playoff spots) starting around July 31 at a single site, ESPN Wide World of Sports. The complex one of many large Disney-owned parks in the Orlando, FL, area and will be able to accommodate teams and a large testing apparatus as well as medical and safety procedures.

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Major League Soccer said Wednesday it is also considering the same site for its own season resumption, one of several sports ramp-ups under way after months of so little action that wagering outfits like DraftKings have actually taken bets on who wins Survivor. The PGA Tour is starting up next week, the NHL is close to getting back on the ice and college and NFL football have indicated a season start is likely in September, with limited (if any) fans in the stands. Major League Baseball is trying to hash out the financial details of a potential mini-season.

The remaining regular-season NBA games in Orlando would be played in fan-free (though televised) settings in order to determine seeding for playoff rounds. Regular season games are also promised to local TV networks, so playing at least 70 games for the season would fulfill that obligation.

The playoffs could stretch well into October, likely delaying the start of the 2020-21 season, and setting up several potential showdowns with top-rated football telecasts. In addition to the scheduling chess match of how to position a LeBron James-Giannis Antetokounmpo matchup without going up against an NFL or SEC football game, there is also the issue of player salaries. If 15% of the regular season is not completed, players are at risk of forfeiting $610 million in player salaries. Those details are still being hashed out.

As they negotiate across many fronts, the NBA commissioner and team owners have kept mum about the proposal, but some players have reacted on social media. The timing is delicate for the league, with the U.S. still in the throes of highly charged demonstrations in dozens of cities over the death of George Floyd at the hands of police. Patrick Beverly of the LA Clippers used all-caps to reply to a tweet by ESPN’s Adrian Wojnarowski about the restart, asserting that basketball “is NOT IMPORTANT RIGHT NOW.”

From a business standpoint, though, there are considerable dollars at stake, not to mention momentum with fans and business partners. The NBA is about two-thirds of the way through a $24 billion rights deal with ESPN and Turner Sports, a pact that has proven valuable across both media companies’ portfolios. For Disney, whose businesses has been pummeled by COVID-19 across its parks, movie and TV networks businesses, the resumption of NBA play would pump much-needed revenue back through its bloodstream, especially ESPN. ABC would get important prime-time programming in the fall, to replace the usual September fare waylaid by production shutdowns.

Turner parent WarnerMedia also has holdings that rely heavily on the NBA. Bleacher Report’s popular House of Highlights brand, which began as an NBA-specific offering and still features the sport prominently, reaches 25 million monthly viewers on Instagram, TikTok, YouTube and other platforms.

Some financial details of the Orlando arrangement are unclear, mainly how teams and the league will manage financially without any ticket or merchandise revenue. Ticket sales, which account for about one-fifth of league revenue, would have generated hundreds of millions of dollars during the shutdown. Players, coaches and staff members won’t have to travel when playing at a single site, but they will still need housing and day-to-day expenses, some for up to three months.

Advertisers, too, would greet the NBA like a cool drink of water in the desert. Before the NBA season was suspended on March 11, with at least 10 players contracting COVID-19 (all of whom have recovered), the sport was a premium marketing platform. One network ad exec said many ad buyers have multi-year commitments to the league and its potency with young male viewers is such that buyers have already indicated they will keep their money committed, regardless of the season when games are played.

An eMarketer study in April said about $12 billion in TV ads (more than one-sixth of the full-year total) were put at risk by the pandemic’s hit to sports, but it also conceded that sports advertising “could return in force” if games are played again. Certainly, with an overall migration to streaming, sports are the largest safety pins holding the traditional TV bundle together.

Optimists in the ad world point to the NBA playoffs’ potential September/October timing. While many ad categories have taken a direct hit, those with deep pockets include consumer technology. Fourth-quarter product launches not previously workable with the NBA’s usual May/June climax could now enter the equation. New devices from Apple and updated gaming platforms from Sony PlayStation and Microsoft Xbox are due out for the holiday season, and all will be supported by a major fourth-quarter ad push.

The safety element, of course, could dash a whole interlocking set of well-intentioned plans related to sports’ return. While COVID-19 rates of infection and death have declined markedly in most of the U.S., the risk of a “second wave” as weather cools in the fall is a looming risk. There’s also an element of uncertainty even for “bubble” scenarios like the NBA’s Florida scheme. A single infection there could sideline entire teams, raising a host of logistical and fairness questions. Would TV viewers still tune in if something further compromised an already otherworldly year of sports? It’s a question facing every league trying to work through a return.

“A lot depends on what happens with the other sports,” NFL Players Association head DeMaurice Smith said recently on HBO’s Real Sports with Bryant Gumbel when asked to assess the NFL’s outlook. “To say that we aren’t looking at what’s going to be happening in basketball and baseball and how they’re working through these things, I’d be lying if I said we were not.”

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