July 25, 2024

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The repercussions have started for Warner Bros. Discovery after the NBA finalized its next round of national media rights without the TNT Sports parent company. … Real Madrid makes financial history with a record-setting revenue haul. … On Front Office Sports Today, the Paris Olympics begins with an unusual dose of competitive drama. … MLS commissioner Don Garber taps the brakes on expansion. … Plus: More on Ohio State, Unrivaled, DeShaun Foster, and Olympic soccer.

— Eric Fisher [[link removed]] and Colin Salao [[link removed]]

WBD Faces Investor Backlash As NBA Rights Loss Triggers Stock Plunge [[link removed]]

Kevin Jairaj-USA TODAY Sports

The day after the NBA rejected [[link removed]] the media-rights matching effort from TNT Sports, the reckoning began for network parent company Warner Bros. Discovery.

Investors were quick to make their sentiments known about WBD losing its NBA rights, immediately driving the company’s shares down 9% at Thursday’s market open, with the stock then closing at $7.99 per share, down 5.7% and wiping out roughly $1 billion in market value. WBD shares have now lost 36% of their value over the past year, and are less than one-third the level they were at when the current company was formed in April 2022 from WarnerMedia’s spin-off by AT&T and a merger with Discovery, Inc.

Financial analysts, meanwhile, began to convey a similar sentiment, cautioning that the outlook for WBD on both linear TV and the Max streaming platform is increasingly challenged without NBA rights following the 2024–2025 season.

“We have held onto our WBD rating in hopes that it would retain the NBA; losing these key rights means it now loses a core content asset for both its linear networks and its Max streaming service,” wrote Tim Nollen of Macquarie Equity Research in a note to clients. The firm downgraded WBD stock from “outperform” to “neutral.”

“[Linear] ad revenue will now drop sharply starting in [2025’s fourth quarter], and bargaining leverage on cable affiliate renewals now falls. But it’s the lost opportunity for the Max streaming service that worries us the most over time,” Nollen continued.

Even before the NBA rendered its decision to formally enter into an 11-year, $76 billion set of deals with Disney, NBC Sports, and Amazon, discussion had been rising [[link removed]] both inside and outside of WBD about the need for a catalytic event such as a split of company assets or a large-scale merger to fundamentally reshape itself. Those calls will almost certainly grow now.

Improper Target?

As the NBA-WBD dispute is now potentially headed to a formal legal challenge, the issue centers on how TNT Sports’ matching rights with the league are defined [[link removed]]. The network argues that it has met its obligation to match the terms of Amazon’s “C” package with the league, that the NBA has “grossly misinterpreted our contractual rights” in rejecting the latest offer.

The league, however, has countered with a very different opinion. Multiple reports said the NBA detailed its position in a letter sent Wednesday to TNT Sports, saying in part that WBD’s rights do not apply to an all-streaming rights package such as what Amazon now has.

That stark division reveals an even bigger question surrounding matching rights in sports media. Those provisions are often designed to aid incumbent rights holders and promote renewal. But here, WBD is essentially alleged to have done two things: misunderstanding what its matching rights provide, and then targeting the wrong package. The NBC Sports deal [[link removed]], known as the “B” package and estimated at $2.5 billion per year, in many respects is more similar to what WBD currently has, but is substantially more expensive than Amazon’s $1.8 billion per year agreement.

All Eyes on Chuck

The prospect of a lame-duck season for TNT Sports, as well as the status of its popular and influential Inside the NBA show, threatens to create its own seismic impacts across all of sports media. Each of the incoming NBA rights holders are assessing the prospect [[link removed]] of pursuing Charles Barkley (above) and the entire cast of Inside the NBA.

That interest could soon spark a bidding war, with Barkley in particular in line for annual deals exceeding $20 million. It also raises the possibility of the already outspoken Barkley hitting an even higher level of candor during a final season of the show on TNT Sports.

“We’ll have to see how all this plays out. We just signed the deal,” Jay Marine, global head of sports for Amazon Prime Video, tells FOS. “They’ll have no shortage of options depending on what they want to do.”

Senior writer Michael McCarthy contributed to this report.

Real Madrid Sets Single-Year Record With $1.16 Billion in Revenue [[link removed]]

Kevin Jairaj-USA TODAY Sports

Real Madrid is a few weeks away from beginning its defense of the LaLiga crown, but it’s already been awarded a new title.

The football club announced [[link removed]] revenue of $1.16 billion for the 2023–2024 season, the largest in a fiscal year for any sports franchise in history. The figure is up 27% versus 2022–2023 ($913.97 million), even though it already topped all European football clubs in revenue last year.

Two other sports franchises have breached the $1 billion mark in revenue—FC Barcelona in 2017–2018 [[link removed]] and 2018–2019 [[link removed]], and the NFL’s Cowboys in 2022–2023 [[link removed]]—but Real Madrid is the first to pass the billion-Euro mark (€1.073 billion).

A key driver to the revenue jump was the renovations to its stadium, Santiago Bernabeu. The club has spent nearly $2 billion on improvements to the stadium, which includes a retractable roof and turf.

Real Madrid also noted that Santiago Bernabeu renovations drove a “progressive increase in terms of capacity and commercial operations” last year, though the stadium will only be fully operational by the 2024–2025 fiscal year. One of the main goals of the renovation was to open up the stadium to non-soccer events—and the team already announced [[link removed]] that it will host an NFL game in 2025.

All of this revenue growth comes before Kylian Mbappé has played even a minute for the club. The French superstar will debut for Real Madrid this season after leading Paris Saint-Germain to six Ligue 1 titles in seven seasons.

A Growing, Beautiful Game

It’s no secret that sports franchises have experienced a spike in valuation over the last several decades, and European soccer is no exception.

The five big European soccer leagues—the Premier League, Bundesliga, LaLiga, Serie A, and Ligue 1—were hit hard by the COVID-19 global pandemic; Real Madrid’s revenue was down nearly 14% from 2018–2019 to 2020–2021. But last year, the five leagues combined to generate [[link removed]] a record $20.93 billion, up 14% from the previous season.

According to Deloitte’s [[link removed]] Annual Review of Football Finance 2024, the uninhibited return of fans to stadiums in Germany and Italy, coupled with an increase in the international broadcasting-rights of the Premier League, drove last year’s revenue spike.

However, the figure also illustrates the great divide in European soccer. There are 98 teams across the Big Five, but the top 20 teams, which Deloitte refers to as the “money league,” combined to generate more than half of last year’s total revenue.

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FRONT OFFICE SPORTS TODAY Olympics’ Soccer Scandal

Anne-Marie Sorvin-USA TODAY Sports

The reigning gold-medal-winning Canadian soccer team has excused two employees after they were caught flying a drone over opponents’ practices. Front Office Sports reporter Alex Schiffer joins the show to discuss the decision and its implications on Canada’s hopes to repeat.

Plus, the NBA announces the winner of its TV rights sweepstakes, Mat Ishbia pledges to bring an NHL team back to Phoenix, and more on Brett Favre’s business partner pleading guilty.

🎧 Watch, listen, and subscribe on Apple [[link removed]], Spotify [[link removed]], and YouTube [[link removed]].

LOUD AND CLEAR Not So Fast, Indy

Adam Cairns-USA TODAY Sports

“Right now, there isn’t a specific plan to expand.”

—MLS commissioner Don Garber (above), before the All-Star Game in Columbus, when asked about whether the league is considering expansion once again. His comments [[link removed]] come after Indianapolis mayor Joe Hogsett, who made the trip to Columbus for the game, told local reporters that he would like to accelerate the process of an expansion team in his city.

MLS will welcome San Diego FC in 2025, the league’s 30th team. Garber said that San Diego’s entry “is going to be the end of expansion for a period of time” but spoke glowingly of Indianapolis as a potential option. He said that the city is “doing everything right” in terms of planning for a potential bid, but he stressed that the process takes time.

STATUS REPORT Two Up, Two Down

Robert Goddin-USA TODAY Sports

Ohio State ⬆ Ross Bjork, the Buckeyes’ athletic director, told Yahoo! Sports [[link removed]] that the school’s football players received an estimated $20 million in name, image, and likeness money from collectives and brands this past year. However, Bjork said it’s unclear how that figure will change once the NCAA institutes its revenue-sharing model, particularly in order for Ohio State to remain compliant with Title IX.

Unrivaled ⬆ Angel Reese is joining the upstart 3-on-3 basketball league, the two sides announced [[link removed]]. The WNBA rookie is a strong pickup for Unrivaled, which tips off in January, to attract fans considering Reese has the second-highest-selling [[link removed]] WNBA jersey through the All-Star break, behind only Caitlin Clark. Unrivaled, founded by WNBA stars Breanna Stewart and Napheesa Collier, began announcing its participants earlier this month, including other WNBA All-Stars like Kelsey Plum, Arike Ogunbowale, and Kahleah Copper.

DeShaun Foster ⬇ The new head coach of UCLA football (above) had an awkward [[link removed]] opening statement to his press conference during the second day of Big Ten media days. Foster stumbled as he spoke about the Bruins’ “excitement” in joining the Big Ten, and he described the program by saying, “We’re in L.A.” To his credit, Foster would address reporters in a more intimate setting after the rough outing, and admitted that big speeches don’t factor in his coaching strengths. “I’m not a rah-rah guy,” Foster said.

Paris 2024 ⬇ The Olympics organizers are already facing a controversy before Friday’s opening ceremony. Due to scheduling constraints, the first round of the soccer tournament has already begun, a match between Morocco and Argentina that originally ended in a 2–2 draw due to a late goal that sparked chaos from fans. Cups and bottles were thrown at Argentina players, which led to fans being told to leave the arena. The referees then retracted the goal due to an offside call, and replayed the rest of the game, which Morocco ended up winning, 2–1.

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Conversation Starters The University of Tennessee dropped renderings of its proposed 175,000-square-foot Neyland Entertainment District. Check it out. [[link removed]] The NBA’s return to NBC also means the return of the iconic “Roundball Rock” theme song. Listen and watch here [[link removed]] with some current highlights. Xander Schauffele had not won a major before this year. Now he’s got two—and the chance to defend his Olympic gold. Take a look [[link removed]] at his 2024 accomplishments. Editors’ Picks ‘Down to the Wire’: The Window to Charge Brett Favre Is Closing [[link removed]]by A.J. Perez [[link removed]]Prosecutors could have less than three months to charge the quarterback. It’s NFL Holdout Season [[link removed]]by Margaret Fleming [[link removed]]Key players are still holding in or holding out for contract leverage. Texas Tech Poaches Softball Star With $1 Million NIL Deal [[link removed]]by Margaret Fleming [[link removed]]It’s more money than most college football players get. Advertise [[link removed]] Awards [[link removed]] Learning [[link removed]] Video [[link removed]] Podcast [[link removed]] Sports Careers [[link removed]] Written by Eric Fisher [[link removed]], Colin Salao [[link removed]] Edited by Matthew Tabeek [[link removed]], Or Moyal [[link removed]], Catherine Chen [[link removed]]

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