Analysis: The digital sports site aims to help the media giant attract streaming audiences while keeping cable partners from getting jittery
Bleacher Report has a new way of analyzing the game.
Visit the sports commentary site, part of the Warner Bros. Discovery stable since 2012, and you’ll see the usual: a ranking of the top superstar duos in the NBA; Speculation as to whether the Atlanta Hawks will trade for the Toronto Raptors’ Shams Chanria; and a compilation of a story about the Kansas City Chiefs and defensive tackle Chris Jones. A message is missing about the new feature of the website for their parent company.
Warner will transfer its sports portfolio – previously the domain of cable giants TNT and TBS – to its streaming service Max under the Bleacher Report name this fall, according to two people familiar with the matter. Warner Bros. Discovery declined to make executives available for comment. Warner executives last week hinted at the debut of a new sports offering on Max and hinted that they might try to charge subscribers an additional fee to watch it. Warner Bros. Discovery declined to make executives available for comment. CNBC previously reported new details about the plan.
Warner will use the digital sports outlet to achieve a very difficult situation. The company’s schedule of NBA games, NHL competitions and MLB games is a critical part of the economics of TNT and TBS, which generated $1.6 billion last year, according to data from Kagan, a market research unit of S&P Global Intelligence contributed to advertising. account for nearly 5% of the company’s total sales by 2022.
Warner Bros. Discovery CEO David Zaslav might want consumers to subscribe to Max — a streaming amalgam that offers great HBO series like “White Lotus” and reality series like “Naked and Afraid” — but he probably wants to don’t give up He doesn’t want to forego such a cash flow, nor does he want to forego the distribution fees that the two cable channels generate. That likely means the required number of games from each league will be broadcast over the company’s cable networks, rather than trying to build a new digital business with streaming-only extras.
Max’s use of Bleacher Report as a topic index provides Warner with the illusion of providing a view of games that appears different than what the average cable subscriber gets on TBS or TNT. And while Max games are likely just simulcasting the TNT and TBS feeds, the Max wireless subscriber shouldn’t care, these folks say, as long as they get instant access to a live sports event. In the meantime, Warner will no doubt hope its cable and satellite distribution partners don’t take offense.
For now, the question remains whether Warner could try to place commercials at a level where subscribers have to pay extra to access them. At least from a Wall Street perspective, the company might be wise to force the issue. According to Vivvix, an ad spend tracker, advertisers in MLB, NHL, and NBA programs spent before, during, and after games on TNT and TBS in 2022 — just a few percentage points more than the $846.3 million they spent in 2021. In the TV industry’s recent “upfront” market, with broadcasters trying to sell off the bulk of their commercial inventory, Madison Avenue has siphoned dollars from linear television and they stuck in sports and streaming. There is undoubtedly interest in sponsoring Bleacher Report streaming games.
Warner has other reasons to start streaming sports. Yes, traditional rivals like Disney and NBCUniversal are already doing this with Sunday baseball on Peacock and NHL games on ESPN+ and Hulu. Perhaps even more concerning are digital giants like Amazon and Apple, which have dipped their toes in similar waters. Apple offers Friday night MLB streams, while Amazon announced a deal to stream NBA games for Prime Video subscribers in Brazil last year.
If that’s a sign Amazon has plans for US NBA rights, Warner should be cautious. The current US rights deal for NBA games, now split between Warner Bros. Discovery and Disney, will end after the 2024-2025 season, and some behind-the-scenes scrambles have already begun. The NBA will likely have a wide range of applicants, some who may see a chance to stream games for local markets only and others who want a piece of the national pie.
Last November, Zaslav caused a stir among league officials and even his own employees when he told investors during a conference call that Warner Brothers Discovery “doesn’t have to have an NBA.” The efforts and numbers described above suggest that this is the case. Whether Warner will certainly agree to a significantly higher price for the same package, or seek to reduce spending by curtailing its NBA offering remains to be seen.
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