NBA, Verizon To Announce $400 Million Mobile Content Deal

Verizon and the National Basketball Association will announce a marketing deal this morning that revolves around the new, ad-supported Go90 mobile video streaming service targeting younger consumers that rolled out last month.

The NBA “will bring daily league highlights, new original series and access to some live games,” reports Emily Steel for the New York Times. “The deal … also establishes Verizon as the official wireless provider of the NBA. As part of the agreement, Verizon will become the title partner of the NBA All-Star Slam Dunk contest and a partner of the NBA Draft.”

“The deal is valued at more than $400 million and runs for three years, according to a person familiar with the terms who was not authorized to speak publicly," reports Edward C. Baig for USA Today. “The non-exclusive arrangement frees the NBA to shop content to other streaming outlets.”



“Go90, whose name refers to the way users flip their phone horizontally to watch videos, is now one of several offerings from TV and communications providers who are angling to compete at a time when cable television subscriptions are on the decline, as users turn to streaming services like those from Netflix, Amazon, Hulu, HBO and others,” Sarah Perez wrote for TechCrunch when the app launched on the iTunes App Store and Google Play last month.

“Unlike Sling TV, which focuses on cable TV or [Comcast’s] Watchable, which is more about online video, Go90 aims to offer a mix of content from traditional TV networks alongside online video and content from multi-channel networks, plus live events, including NFL games and concerts,” Perez reported. 

The service is squarely aimed at the Gen Z and Millennial generations, “about 75% of whom turn to mobile first as their video platform of choice,” Baig reports. “The app and service are free, and a Verizon cellular contract is not a requirement; you can access Go90 via any U.S. carrier or on wifi.” 

“People ask why Go90 is different than Comcast’s Watchable, YouTube, Netflix and Hulu. Live sports is one major reason why,” Brian Angiolet, Go90’s SVP for product and marketing tells the NYT’s Steel.

“Go90 is really targeted at the young, millennial, tech-savvy subscriber, and that is something that we are also hoping to reach,” William S. Koenig, president of global media distribution for the NBA, tells Steel, who points out that many of them do not subscribe to cable television. “We’re really trying to get our games out there to people on whatever device they want to consume them.”

In partnering with Verizon, the NBA is ditching Sprint, its most recent marketing partner, Baig suggests. Actually, Sprint told the NBA in July that it would not renew the $222 million NBA sponsorship it signed during the 2011 lockout, replacing T-Mobile, as Terry Lefton reported for Sports Business Daily at the time.

Lefton and his colleague, John Lombardo, got wind of the pending deal with Verizon earlier this week, although they said “would almost certainly not include live NBA games,” pointing out that ESPN/ABC and TNT retained those rights in nine-year deals taking effect next season.”

In commenting on that story, Awful Announcing blogger Andrew Bucholtz observed: “It’s notable to see these kind of deals being struck around new content pathways. It’s a further indication that the sports broadcasting business is changing rapidly, and that the future will involve deals for much more than just conventional television rights.”

Meanwhile, Sprint yesterday said it has added more postpaid phone customers than it lost in a quarter for the first time in two years (up 237,000, although 199,000 were converted from prepaid to postpaid), Ryan Knutson and Chelsey Dulaney report for the Wall Street Journal, but it still lost $585 million for its second quarter. The loss was “bigger than analysts expected and significantly larger than a loss of $20 million in its first quarter,” the write.

Sprint also announced a $2 billion cost-cutting plan — including layoffs — aimed at restoring it to profitability for the first time in 11 years, Re/Code’s Ina Fried reports. CEO Marcelo Claure “urged employees to take on an ‘owner’s mentality’ when it comes to costs,” such as taking out their own trash and using Uber instead of private town cars.

“Asked for an example of more transformative changes, Claure pointed to new 15-second television ads that he says are half as long but just as effective,” Fried writes.

And more palatable on mobile devices favored by younger consumers.

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