When the idea for Venu was announced it sounded like a juggernaut. Offering ABC Sports, ESPN and TNT’s access to the NBA along with network access to NFL action (minus NBC) built a pretty substantial sports package on those two pillars alone. The service still has Disney’s networks and TNT in toe, but it is pretty obvious that TNT will no longer be bringing the NBA to the table after the 2024-2025 season. TNT will offer NASCAR, a couple of games in the now-expanded college football playoffs, and the French Open, but it should be noted that two of those three attractions are annual events not regular weekly programming.
Could the loss of NBA cause friction in the joint venture?
I think so. Venu looks like an alliance of convenience to me. I honestly wonder if WBD would have even been approached as part of the service if it had not had the NBA in its portfolio ahead of time. Do you really think if the service came together in late 2024-early 2025 that NBC or Peacock would not have been in the conversation instead? Between Fox sports and ESPN Venu has plenty of MLB action locked down without TBS and TNT, it will have all the NBA action that is not on Amazon and NBC/Peacock. It will have as much NFL content as was promised in the early announcements. On top of that, recent reporting indicates that the entirety of the Warner Brothers Discovery merger is outright failing. Even before stocks fell on the news that TNT was out of the NBA. Since then it has gotten worse. WBD’s Venus partners really should have seen this coming a long time ago when David Zaslav essentially wrote off the NBA saying
“We don’t have to have the NBA. And if we do a new deal with the NBA, it’s gonna look a lot different,” Zaslav said. “I’d like to do a deal with the NBA, but it has to be a deal for the future. It can’t be a deal for the past.”
WBD may not even exist as we know it much longer
It won’t happen overnight, but an analyst quoted in a story from Reuters said
“While Turner could save $1.2B+ in rights fees, it will lose ad revenues and may face pressure to reduce affiliate fees,” Rosenblatt analyst Barton Crockett said.
“The silver lining is that these pressures might make WBD more open to a breakup, which in our view could boost value.”
So good news WBD. You might be able to start breaking down the company and sell off assets only 2 years after you put it together in the first place. So if TNT was sold, would Venu’s partners automatically partner up with whoever purchased it? The best-case scenario for the venture would be selling the networks off to Fox or Disney. But Fox and Disney may decide an even better scenario would be to split the profits two ways instead. I don’t know the inner workings of the multiple agreements that are in place between the high-powered executives. Nor do I know if there is an escape clause. But the fact that this service was so favorably compared to the original set up of Hulu at launch, leading some to call it “SPULU” Sports Hulu causes me to think it will come apart the same way the joint-owned streamer eventually did as the partnership between Comcast, Disney and Fox eventually led to Comcast staring Peacock and Disney buying 20th Century Fox and taking full ownership of Hulu. We have been expecting TNT be sold since that statement but we will have to see if we are right over time. One also has to wonder if the deal to share the college football playoffs with TNT was done with the idea that TNT was part of the Venu family and it would allow the whole College Playoffs to be offered through Venu. Without TNT it could have just as easily been picked up by FOX Sports, who already have a major stake in college football.
Will Venu be worth the money?
As of right now we do not know how much Venu will cost. What we do know is that broadcast networks and sports content are the most expensive parts of any bundle. And we also know that networks pay billions for the rights to get the sports content that they offer. So there is that. By being able to offer the full slate of the NBA as far as major network coverage goes along with MLB, Venu was a year-round scenario. Subscribers could expect to see the vast majority of NFL games, NBA games, and MLB games in one package. Without it I have to wonder if this will push Disney to more quickly develop its own ESPN offering separately from Venu or even a smaller Hulu package built around sports. It will be up to the consumers as the old folks say “vote with the pocketbook”.
