The NBA begins 2020 facing an unavoidable bout of nostalgia.
With David Stern’s death on New Year’s Day following a recent brain hemorrhage, the former commissioner leaves behind a stronger league than the one he inherited in 1984 — but one that is now struggling to match its Nielsen ratings peaks of the 1990s and early 2000s.
Under Stern, the NBA grew from an unpopular league in the 1970s to an international empire that commanded a $24 billion media deal just months after his retirement in 2014.
The contract tripled the value of the previous deal while giving ESPN and TNT exclusive national broadcast rights through the 2024-25 season. Naturally it was celebrated as a tremendous triumph for Stern’s successor, Adam Silver, who placed atop Sports Business Journal’s ‘Most Influential’ list that year.
But now, with Nielsen ratings sagging 11 percent from last year and ESPN’s Christmas Day games suffering a 10 percent downtick, the cable deal is starting to look outdated, like a Blockbuster Video next to an Apple Store.
As experts, owners, and even Silver himself have acknowledged, the problem isn’t demand, as was the case in the 1970s before Stern became commissioner.
Silver’s dilemma is that supply has diminished with the demise of cable television.
Former commissioner David Stern (right), who died at 77 on New Year’s Day, helped build the league into a Nielsen ratings powerhouse in the 1990s and early 2000s. His successor, Adam Silver (left), signed a $24 billion media deal in 2014, months after Stern’s retirement, that gave exclusive national TV rights to ESPN and TNT, but may have ultimately hurt Nielsen ratings
‘When your flow of revenue is fixed to cable television, and ESPN is now in less than 75 percent of American homes… it makes it more complicated [for consumers],’ Syracuse media professor and former ESPN producer Dennis Deninger told the Daily Mail. ‘And complicated is never beneficial for commerce.’
Critics have alternately explained the ratings downturn with every conceivable culprit, such as injuries to stars like Kevin Durant, the Western Conference’s perceived dominance over the East, players’ disparagement of Donald Trump, and the league’s spat with China over Rockets G.M. Daryl Morey’s support for protesters in Hong Kong. (Nielsen ratings only refer to audiences in the United States, so China is not included in those figures)
One popular theory is that LeBron James’s decision to leave Cleveland for the Los Angeles Lakers in 2018 deprived the Eastern Conference of its biggest star and only served to strengthen the dominant Western Conference.
‘I think him not being [in Cleveland or Miami] hurts because there was not a particularly strong replacement for LeBron out East,’ Jon Lewis, who covers sports television ratings at SportsMediaWatch.com, told the Daily Mail.
Although it’s hard to dismiss those theories entirely, the reality is that the NBA’s popularity remains strong when judged by other metrics.
One popular explanation for the league’s ratings issues LeBron James’s decision to leave Cleveland for the Los Angeles Lakers in 2018 deprived the Eastern Conference of its biggest star and only served to strengthen the dominant Western Conference
League attendance is up 1 percent after setting records over the last two years – and this is in spite of the declining Golden State Warriors, winners of three of the last five NBA titles who now play in a new, smaller arena and currently sit in last place without injured All-Stars Stephen Curry and Klay Thompson.
‘Injuries are on the excuse bingo card,’ Lewis added. ‘But when all is said and done, yeah, for sure the Warriors being this bad is a product of injuries, and that’s a fact.’
Merchandise sales have been a boon for NBAStore.com, rising by 3 percent prior to the holidays.
Furthermore, the NBA actually has more Twitter followers than the NFL, which has enjoyed rising Nielsen ratings over the last two years.
And on ESPN’s annual list of the world’s most famous athletes – a calculation based on web searches, endorsement dollars, and social media followers – LeBron James (No. 2), Curry (No. 9) and Durant (No. 11) all placed ahead of Tom Brady (No. 31), the NFL’s top-ranked player. No MLB or NHL players even made the list, which was largely comprised of cricket and soccer players.
Even Silver suggested the cable model is ‘broken to a certain extent’ during a Sports Business Journal conference last month, and he wasn’t just paying lip service to television’s modern day boogie man, the cord cutter.
‘The problem is [the NBA has] a young audience and the young audience is just not subscribing to cable,’ Deninger said. ‘Let alone cord cutters – these are the cord nevers.’
Dallas Mavericks owner Mark Cuban pointed to a broken cable model to explain the downturn
The trend is hard to dismiss.
A two-year-old Nielsen study found that households without cable or satellite television that strictly use a digital antenna increased 50 percent over the previous eight years, with 14 percent of all U.S. households watching free television rather than paying annual fees to the likes of Verizon, Comcast, or AT&T.
That means fewer homes are getting ESPN and TNT.
As Dallas Mavericks owner Mark Cuban explained on Twitter, this is not a problem for the NFL, which leveraged its overwhelming popularity into deals with broadcast TV networks like NBC, Fox and CBS.
‘Ratings are down because all of our national broadcasts are exclusively available on cable, which is losing [subscribers] daily,’ Cuban wrote. ‘Football benefits from being on broadcast tv.’
And according to Cuban, television ratings are hardly a complete picture of the NBA’s popularity. (Nielsen ratings do not currently include out-of-home data, such as the number of fans watching in bars, but the company will begin incorporating those figures in the fall)
‘Ratings also don’t capture the full commitment to a sport,’ he wrote. ‘Look at social media, YouTube, [Instagram, Snapchat, Facebook streams], live and highlights. They don’t pay as much, but they are a reflection of demand for younger demos and global interest.
‘It’s truly an Innovators [sic] Dilemma.’
The solution may be to cut cable networks out entirely.
‘In the future, the leagues may very well have to become their own one-stop shops for their own product,’ Deninger said.
Milwaukee may not be the biggest market, but fans might want to see the Bucks face the Los Angeles Lakers in the NBA Finals after their regular-season meeting drew 2.8 million viewers
Currently the NBA offers a streaming service, League Pass, for $17.99 a month, but due to the exclusivities promised to ESPN/ABC and TNT in the current media deal, national broadcasts are blacked out, depriving subscribers of the most desirable matchups. (NBA League Pass viewership is up 2 percent worldwide since last year)
When the NBA’s next media deal is ironed out before 2025, those exclusive guarantees could be gone.
‘What if you were an NBA fan, no matter where you lived in the world, and by paying one League Pass fee per year like an NBA season ticket holder, you have access to every piece of NBA video no matter where it’s coming from?’ Deninger asked rhetorically.
‘Now that’s a type a thing that might be really appealing to young people, and I think there might be some leagues that carve that model into some future deals.’
That’s not to say cord cutting explains all of the NBA’s ratings problems, some of which resulted from tougher head-to-head matchups with Thursday night NFL broadcasts and Games 2, 3, and 7 of Major League Baseball’s World Series.
NBA deputy commissioner Mark Tatum pointed to the league’s ‘bad luck’ with injuries during an interview with Yahoo on December 9.
‘Two-thirds of our games this year on national TV on ESPN and TNT featured teams that had at least one player injured,’ Tatum said. ‘Players like Steph Curry, Klay Thompson, Kevin Durant, Zion Williamson, these were all players people wanted to see and they have not been able to because they’re all injured.’
The injuries are also exacerbating the league’s transition from one era, dominated by the internationally recognizable Warriors, to a new one in which the NBA’s preeminent stars and teams have yet to fully reveal themselves.
New Orleans Pelicans rookie Zion Williamson helped Duke’s ratings jump 30 percent in his only season of college basketball before being taken with the first pick of the 2019 NBA Draft. But, following his arthroscopic knee surgery in October, both TNT and ESPN suffered for having front loaded their national schedules with Pelicans games in anticipation of his arrival. There is optimism that Williamson’s imminent return will boost NBA ratings this season, particularly when coupled with a strong national TV schedule over the season’s final months
Some have blamed injuries to All-Stars for the league’s sluggish ratings. Brooklyn Nets star Kevin Durant (near left) and his former Golden State Warriors teammates Klay Thompson (dark blue blazer) and Stephen Curry (sky blue blazer) are out indefinitely with serious injuries. Durant’s new teammate Kyrie Irving (far left) has also missed time with a shoulder problem
New Orleans Pelicans rookie Zion Williamson helped Duke’s ratings jump 30 percent in his only season of college basketball before being taken with the first pick of the 2019 NBA Draft. But, following his arthroscopic knee surgery in October, both TNT and ESPN suffered for having front loaded their national schedules with Pelicans games in anticipation of his arrival.
There is optimism that Williamson’s imminent return will boost NBA ratings this season, particularly when coupled with a strong national TV schedule over the season’s final months.
James’s Lakers, arguably the league’s most popular team, will be on national television 21 more times this season after appearing in just 10 national games over the first three months of 2019-20.
Reigning MVP Giannis Antetokounmpo of the Milwaukee Bucks offers hope that the NBA’s Eastern Conference can begin to rival the West, which usually plays its games after larger East Coast markets have gone to bed.
And a Lakers-Bucks NBA Finals could be particularly popular, seeing that their December 19 matchup averaged 2.8 million viewers, making it the most-watched NBA game of the season outside of opening night and Christmas Day.
The Lakers-Clippers game was the second most-watched Christmas primetime game ever, with nearly 9 million viewers on ABC – a promising sign for the NBA, considering the crosstown rivals could meet again in a best-of-seven playoff series
‘The good thing for the league is that the East looks really competitive,’ Lewis said. ‘And Miami is getting better, Milwaukee looks like a Finals favorite, Boston is OK, Philadelphia – that could all help later on.’
As for ESPN’s disappointing performance on Christmas, which is traditionally a strong day for the NBA, a closer look paints a rosier picture.
Christmas Day viewership was up 4 percent from 2017 despite the fact that the Warriors played without Curry and Thompson while the Pelicans were without Williamson.
In fact, the Lakers-Clippers game was the second most-watched Christmas primetime game ever, with nearly 9 million viewers on ABC – a promising sign for the NBA, considering the crosstown rivals could meet again in a best-of-seven playoff series.
For that matter, TNT enjoyed a 14 percent increase in viewership in December following a difficult November, and the network’s upcoming Martin Luther King Day menu features a highly anticipated game between traditional rivals, the Celtics and Lakers.
Although Morey has since deleted it, the tweet caused the NBA a torrent of negative press within the prized Chinese market, which is reportedly worth over $4 billion to the league
People hold the Chinese flag (left) and a protest banner (right) in reference to a controversial tweet by Rockets GM Daryl Morey ahead of a Nets-Lakers preseason game in Shanghai
Activists hold signs in support of Hong Kong before the game between the Washington Wizards and the Guangzhou Loong-Lions at Capital One Arena in October. Many people criticized the NBA for its perceived acquiescence to China following Rockets GM Daryl Morey’s public support for anti-government protesters in Hong Kong
Activists hold up a sign before an NBA exhibition basketball game between the Washington Wizards and the Guangzhou Loong-Lions in Washington D.C. on October 9, 2019
Conservative outlets such as the Epoch Times and Breitbart blamed the ratings problems on negative reactions to Silver’s perceived acquiescence to China over Morey’s support for protesters in Hong Kong.
However, that explanation is less viable.
Silver never actually punished Morey or issued any edict demanding league personnel avoid the topic of China’s human rights violations. And although many Chinese fans were outraged, Morey’s decision to tweet support for anti-government protests in Hong Kong does not appear to have effected American NBA fans, even if it did anger conservative critics in the U.S.
‘The NBA-China situation, I strongly doubt that had anything to do with the ratings situation,’ Lewis said. ‘That’s just not something that would resonate beyond the first few days. I don’t really think the people who watch the NBA even care. The underlying issue is obviously very serious, but it’s also the case that people are not following that particularly closely.’
Some have suggested that David Stern’s NBA had better Nielsen ratings because of the likes of Michael Jordan (right), but experts are quick to point out that nearly every entertainment property struggles to match its numbers from the 1990s and early 2000s
Some have suggested that David Stern’s NBA had better Nielsen ratings because of the likes of Michael Jordan and Shaquille O’Neal, but experts are quick to point out that nearly every entertainment property struggles to match its numbers from the 1990s and early 2000s.
‘I think it’s dangerous to compare anything now to the mid-1990s,’ Deninger said. ‘That’s when the major online services came on… Those services gave people more choices with their leisure time and how you used your leisure time before the mid-1990s has nothing to do with how you spend your leisure time now.’
Silver and the NBA obviously face a number of challenges in 2020. But unlike 1984, when the U.S. was rediscovering professional basketball with Magic Johnson and Larry Bird, the league now has a strong fan base around the world.
That development is now a significant part of Stern’s legacy within basketball.
Capitalizing on that popularity, and helping the NBA become more accessible to fans, could ultimately be part of Silver’s.
‘They still have high demand,’ said Deninger, ‘but they’re having trouble getting the supply of the NBA to these young fans.’