Regular TV only tiny part of NBA's dream

Scripps Howard News Service
column
By DAVE KRIEGER
Scripps Howard News Service

While you were waiting for Kevin Garnett to be traded to Phoenix, David Stern was negotiating payments to the NBA for technologies that don't yet exist.
While you were pleading for the Nuggets not to trade Marcus Camby to Atlanta, or possibly Chicago, Turner Sports was making plans to stream Charles, Kenny and E.J. straight to your cell phone to talk about it.
And while ESPN pretends to "cover" Thursday night's NBA draft the way independent journalists might, it is in fact promoting a property to which it pays hundreds of millions of dollars in rights fees, the success of which is inextricably intertwined with its own.
"Really, our interests are aligned, if you think about it," ESPN and ABC Sports president George Bodenheimer said Wednesday.
So when you stand up indignantly and say the NBA Finals were lousy, and got lousy television ratings, and that must be bad for business, and therefore the association should do something, you are, unfortunately, missing the point.
The NBA is now only incidentally a basketball association. That just happens to be the origin of its entertainment content. It's really good content, mainly because there's so much of it _ more than 1,200 unique games per season. The challenge is to distribute them through as many revenue channels as possible.
The NBA now is a media company, which, these days, requires it to learn the technology business.
"The desire for sports content has not changed over the years but how fans consume it has," Turner Sports president David Levy said. "Now more than ever, viewers have sports content and information at their fingertips due to the growth of digital platforms, such as wireless and broadband. Over the last few years the media landscape has evolved, and the real opportunity for media companies is how to reach and surround consumers across many touch points in everyday life."
See, as I've been trying to tell you, we don't have enough sports in our lives. We need more touch points.
Of course, I represent the dinosaur in the room. Once upon a time, you could go to a game or you could read about it later in the paper.
Along came radio, and a generation that followed baseball over little monophonic earphones. Then television, with its limited sporting fare, until the menu exploded with cable and satellite TV.
By the standards of modern capitalism, the NBA and other sports leagues were still "wasting" a great deal of original content, letting games evaporate into the ether without properly exploiting their downstream revenue potential.
What the NBA, TNT and ABC/ESPN announced Wednesday was a new eight-year deal worth almost $1 billion a year to the NBA. It is no longer called a television rights deal. It is called a media rights deal because the content purchased by the networks will be shipped to customers over various media.
Keep that in mind the next time you listen to an NBA panel discussion on ESPN. Whatever the merits of the particular issue, these discussions mainly are additional content in support of their aligned interests with the league.
Increasingly, these aligned interests look like a mother lode. No other facet of the entertainment business can produce the quantity of original content that sports do _ fresh material on a nightly basis at a fraction of the cost of a feature film of similar length. Bruce Willis makes one movie for $20 million. K.G. makes 82.
The new deal allows ESPN and TNT to deliver their games, or highlights from them, or discussions of them, over your computer, over your cell phone or on demand for a fee through your set-top box. And that's just the beginning.
"These deals include rights to platforms yet to be developed," Stern said.
Good as this is for TNT and ESPN, the big winner is the NBA. It keeps the roughly 1,000 games per season the networks don't buy and it can deliver them across all the same platforms, through a nascent entity called NBA Digital, benefiting from the vast promotion ESPN and TNT pay to provide.
When Stern was asked about declining television ratings for the Finals, he mentioned no one even counts the content streaming over NBA.com. The media world, he suggested, is changing, and the NBA is ahead of the curve.
Sports are no more meaningful or important than they ever were, but these days we must have them immediately, because we can.
In this battle to extend global and technological reach, the actual quality of the entertainment is secondary. If a derivative action movie can make millions, so can a derivative Finals, assuming it is distributed properly.
In short, if you expect changes in the playoff format to encourage a more competitive Finals next year, don't hold your breath.
Whoever plays, the Finals will provide the necessary content for digital media that will convert the games into unprecedented cash flows. In sports today, that's where the real action is.

(Contact Dave Krieger of the Rocky Mountain News at www.rockymountainnews.com.)