Yahoo News Warner Bros. Discovery Bets That ‘Inside the NBA’ Can Give It an Edge in Unusual Upfront
With the writers strike sowing doubt about long-term scripted entertainment, and the overall advertising market still in a downturn, Warner Bros. Discovery and other major media companies are now leaning into a form of entertainment that has proven to be resilient: Live sports.
And it is a particularly strong moment for sports at WBD, which is fresh off the March Madness basketball tournament, at the beginning of the MLB season, and smack in the middle of the NBA and NHL playoffs.
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“Our strategy in many ways is very different from other players, right? We’re not into tonnage, we’re really about picking and having the most premium sports out there,” says Luis Silberwasser, the chairman and CEO of WBD Sports. “Whether it’s on TNT or TBS, or TruTV, it just it creates a cultural moment, right? So when these games are happening on primetime, people come to us.”
And in fact the company’s sports offerings are beginning to have an impact on its bottom line.
“In what’s been an otherwise rather lackluster ad market, sports is a bright spot,” says Jon Steinlauf, WBD’s chief U.S. advertising sales officer. “I think sports is the most important genre in all of ad-supported television … When we talk to advertisers — they could be in categories that are relatively new to TV like pharma — you know, they’re saying sports is really where we’re gonna get the quick impact and the immediate reach and the and live audience that’s really connected and engaged.”
That was evident in WBD’s second-quarter earnings report, released May 5. TV advertising declined by 14 percent year over year, due to the soft ad market and declining ratings on entertainment and news programming, but it was “partially offset by higher domestic sports advertising driven by the NCAA March Madness tournament.”
In other words, even in the current economic climate, spots is improving on a year to year basis.
WBD Sports has also leaned into another area of differentiation: It’s live studio shows, with Inside the NBA leading the pack (Silberwasser calls the show’s his division’s “secret sauce”). The long-running studio show hosted by Ernie Johnson, Charles Barkley, Kenny Smith and Shaquille O’Neal is among the most popular of its kind on TV, and the company recently signed all the main hosts to new deals.
WBD Sports has tried to create a similarly playful, irreverent vibe on its NHL and MLB studio shows.
“I think one thing to understand about what the way we do it versus others is that we are not only focusing on satisfying the hardcore fan, one of the things that is a big filter for us is that we want to get the casual fan in. We want to get a more diverse audience,” Silberwasser says. “They’re not just talking about facts and figures and stuff that may be interesting only for the hardcore fan, but we want to make make it attractive, we want to make it entertaining. You know some of the moments on Inside the NBA become viral, not because they’re sports moments, but because they’re regular entertainment moments that are pretty cool. And they go outside of the sports world.”
Look no further than Barkley’s response to a “mystery box” on set last month.
But the studio shows still require those premium sports rights, and with the NBA rights set to come up for renewal talks later this year (with new deals to begin in 2025), it is something top of mind for execs at the company.
“The NBA is a an extremely important property for us, and we are a very important partner for the NBA as well. We have almost 40 years of relationship with the NBA,” Silberwasser says. “It’s also what we do beneath the surface, right? It’s the way we produce those games. It’s what we have with our talent.”
“You know, we want to do a deal and hopefully it’s a very responsible and financially attractive deal for both us and for them,” he adds.
Zaslav, speaking on his company’s earnings call, told analysts that the company would be “disciplined” but that he hoped they’d be able to cut a deal, adding that “there is lots of ways that could be re-conjugated,” suggesting some flexibility on the number of games or other sticking points.
But when it comes to sports with favorable economics, it’s hard to top The Match. WBD Sports’ golf brand, which pits athletes and celebrities teeing off against one another, is fully owned by the company.
The latest installment (branded as Capital One’s The Match) will see Kansas City Chiefs stars Patrick Mahomes and Travis Kelce take on the Golden State Warriors’ Steph Curry and Klay Thompson.
“It is in our DNA, our way of taking something that is you know, a premier premium sport and making it fun and relevant and maybe even more attractive than just regular golfing,” Silberwasser says.
Steinlauf recalled how his team quickly turned around to sell the December 2022 installment of The Match, which featured golfers Tiger Woods, Rory McIlroy, Justin Thomas and Jordan Spieth.
“December 2022 was a difficult market, a crowded sports market, but our salespeople in literally lightning speed, like three weeks, I think we brought in 10 different sponsors, that’s how how well it did,” Steinlauf says. “And a lot of the sponsors were affiliated with the golfers and a lot of the sponsors brought their key customers down to Fort Myers to be able to rub elbows with a lot of golf royalty.”
2023 is still a tough year for the ad business, and it remains hard to predict. But when media buyers sit down inside the Theater at Madison Square Garden May 17, they should be prepared for plenty of crowing about the live sports they’ll be able to buy into. And some lifestyle fare and news too.
“We love our hand,” Steinlauf says. “Sports, streaming, CNN going into an election year, HGTV, food, Discovery, TLC, Oprah, Magnolia, these great lifestyle brands.”
“It’s incumbent upon us to be able to present this audience and these brands in the most powerful way possible to the advertiser, and that’s what our plan is for this upfront,” he adds.
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