Why the NBA’s Ratings Are Down Big — And Why Its New Media Partners Should Care

If the NBA were a player and its media partners were its coaches, the message to the league would be simple: You are underperforming after signing your big new contract.

A month into the season, the NBA’s ratings are down 28% on ESPN through Nov. 21. Meanwhile, the ratings for its games on TNT are flat at 1.8 million viewers per game, while ESPN is slightly behind at 1.77 million viewers per game. This comes after every major studio fell over itself vying for the rights to air NBA games this year, resulting in a $76 billion total deal.

What’s behind the league’s popularity decline? While it is tough blame any one factor, analysts say the NBA has too many regular-season games and lacks continuity, with players changing teams more frequently and teams changing uniform designs more often, which has confused and turned off some fans. The NBA’s social justice focus, starting with Black Lives Matter, made the league a target for conservative pundits and turned off right-leaning viewers. And the league and its players have shown a penchant for not valuing the regular season enough — coaches are still resting star players for long stretches to save them for the playoffs — which has further hurt fan engagement.

The ratings drop has been conspicuous — and potentially worrying — considering the NBA signed its 11-year, $76 billion TV deal this past summer. The new deal, which nearly triples the annual revenue the league brings in from its current contract, will see the league remain on Disney-owned ABC and ESPN, plus bring games to Amazon’s Prime Video and NBCUniversal, starting next year.

Wall Street analysts, however, said it’s too early to panic.

“All of these media partners have entered into long-term deals with the NBA, and I’d say they’re all very excited about the path ahead and the trajectory of the league,” MoffettNathanson senior analyst Robert Fishman told TheWrap. “And so any sort of short term ratings blip is really not what they’re focused on.”

Still, the networks bet big on basketball, and the ratings dip means the cost to acquire viewers is going up. The increasing premium placed on sports rights and live entertainment helped spur a bidding war for the NBA’s TV packages. At the same time, the rise of streaming added new deep-pocketed bidders to the market — ultimately leading to Amazon securing its NBA package for $1.8 billion per year.

The NBA’s acceptance of Amazon’s offer led the league to reject Turner’s bid, a move that severed a 38-year relationship with the network. That caused Turner parent company Warner Bros. Discovery to sue the NBA. The lawsuit was settled earlier this month, with WBD retaining rights to a few international markets and being able to license its popular “Inside the NBA” show to ABC starting next year. But WBD’s stock price took a hit when it lost the NBA and caused Wall Street analysts to speculate whether the company could prosper without it.

While it’s only been a month, the rating dip may well not be a blip. The NBA’s ratings have been heading in the wrong direction for several years now. ESPN’s first-month ratings are down 7% compared to the 1.9 million viewers the network averaged during the 2016-17 season. And the drop-off is even more severe than that, considering Nielsen started including out-of-home viewership from places like sports bars in its ratings in 2020. In other words, the ratings are beefed up compared to a decade ago — and the NBA still can’t match its past performance.

Why the new media partners should care

The ratings dip matters because it means the cost to acquire a viewer is rising for the league’s media partners.

Heading into this season, the NBA’s new deal averaged $12.12 per viewer. The networks are paying an average of $6.40 per viewer for Disney’s package to $25.45 per customer for Amazon’s package, according to Guggenheim research shared with TheWrap.

On average, that means the NBA’s new media partners are paying more than three times what the media partners for the National Football League pay per viewer.

The NFL’s most recent deal, signed in 2021, pays the league $110 billion over 11 years. It includes CBS, Fox, NBC, ESPN and Amazon as media partners. (Netflix also signed a deal with the NFL in May to broadcast two games on Christmas, starting this year. Each game cost the streamer $75 million.)

That “doesn’t necessarily mean [the NBA] is a bad deal,” Michael Morris, an analyst at Guggenheim Partners, told TheWrap. “Maybe the NFL is just a complete steal.”

It means, however, that if the NBA’s ratings continue to decline, its media partners will have to find ways to offset the increasing cost to acquire viewers.

“As ratings decline and the relative cost per viewer goes up, the pressure on generating additional revenue is greater in order to get the expected return on these rights investments,” Morris said.

Here, the media partners may have different strategies. ESPN and NBCU could look to double down on their sports betting operations in order to make more money from NBA viewers. Amazon, on the other hand, can leverage its expertise in online shopping to drive sales — a Lakers fan who is watching a game on Prime Video could easily be hit with an ad to buy an Anthony Davis jersey, for example.

But if the ratings continue to slide, networks will have to get more creative than that to make this new NBA deal look anywhere close to as good as the NFL’s.

The big issue

What is going on? Ethan Strauss, a sports and culture writer who covered the Golden State Warriors and now writes about the NBA on his House of Strauss Substack, believes the “core issue” behind the falloff is simple: How does the league make the players try harder? That “seems like a question you wouldn’t even be considering 15 years ago or even 10 years ago,” Strauss told TheWrap. “And it seems like it’s so mundane that you should be able to solve this problem.”

But it hasn’t been solved. Player effort and availability has been a thorn in the side of NBA Commissioner Adam Silver for years now. Spurs coach Gregg Popovich popularized a trend dubbed “load management” during the 2010s, where teams rest their star players during the regular season in order to keep them fresh for the playoffs. The NBA has tried to curb load management by adding games-played incentives to contracts and barring players who haven’t played enough games from being eligible for major awards. But the trend has held strong.

Before the start of the season, Philadelphia 76ers star Joel Embiid said he planned on never playing the second game of a back-to-back (where teams play games on consecutive nights) ever again. And Clippers star Kawhi Leonard has routinely sat out games, despite being healthy, during his career.

This, Strauss said, has delivered an unmistakable message to fans: The league and its players don’t value the regular season. And fans have responded by not tuning in as much.

“There’s just too much awareness that an individual game really doesn’t matter — that an individual game is one out of 82 and it’s important not to get injured, and it’s important to be there for the postseason,” Strauss said. “So you pick your spots.”

This should be a bigger concern for Wall Street analysts and league partners, he said, because it makes it less likely casual fans will tune in during the playoffs, when ratings are scrutinized more closely.

As Strauss put it: “It’s hard to get people to tune in for the season finale if they haven’t watched the show to that point.”

Other potential factors

There are other factors that are potentially pushing down ratings.

Social Justice: The NBA has been the most outwardly pro-social justice league among the three main sports in the U.S. The league allowed players to replace their last names on jerseys with phrases like “Black Lives Matter” and “I Can’t Breathe” after the death of George Floyd in 2020. The NBA also canceled games after players boycotted the death of Jacob Blake, a 29-year-old black man who was shot and paralyzed by police, after cops attempted to arrest him for breaking into the home of a woman he allegedly sexually assaulted. More recently, the league has tried to move away from social justice issues and be less political, although stars like LeBron James and Steph Curry publicly backed Kamala Harris for president. But the league’s pivot may have come too late. Strauss said the NBA’s social justice focus made it a “woke pinata” for conservative pundits to bash and simultaneously turned off some right-leaning viewers.

Too Much Inventory: There are too many games for fans to care about, many league observers have said. “There’s too much of it and it’s too available. [There’s] Nothing special about it,” Bill Simmons said on “The Town” podcast earlier this month. The NBA’s 82-game season stands in stark contrast to the NFL’s 17-game season, which makes each regular season football game an event.

Style of Play: All NBA teams shoot way more three-pointers than they did a decade ago — something that’s been a byproduct of Curry’s revolutionary shooting range. Lakers legend Shaquille O’Neal said earlier this month that is bad for fans, though, because not //not? Or now?// every player can shoot like Curry. Now, “everybody’s looking at the same thing” when they watch an NBA game — a ton of long shots being jacked up.

Lack of Continuity: The NBA has made it hard for casual fans to follow the game in recent years because of added “noise,” as Strauss said. Teams now have several alternate jerseys and court layouts, and teams are not relegated to wearing lighter color jerseys at home anymore — making it hard for fans to tell which team is playing at home or on the road when watching on TV. Players also change teams more frequently than in decades past. And last season, the NBA added an “in-season tournament” that awards a trophy and cash to the winning team — a move that devalues its actual championship. The overall lack of continuity complicates matters for fans and makes it harder to follow the league.

Dearth of American Stars: Three of the top five players in the league, according to most experts, were born outside the States: Nikola Jokic (Serbia) of the Denver Nuggets, Luka Doncic (Slovenia) of the Dallas Mavericks, and Giannis Antetokounmpo (Greece) of the Milwaukee Bucks. The league, in this sense, has been a victim of its own success in its multi-decade push to make basketball a global game. Non-American stars, for one reason or another, haven’t connected with American viewers as much as homegrown talent.

“A lot of people are under this illusion that you could become more international while being just as resonant domestically,” Strauss said. “I don’t think that’s the case. It’s actually a trade off. And some of what we’re seeing [with ratings] is that trade off.”

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