With the writers’ strike casting doubt on the long-term nature of scripted entertainment and the overall advertising market still in decline, Warner Bros. Discovery and other major media companies are now turning to a form of entertainment that has proven resilient: live sports.
And it’s a particularly strong moment for the sport at WBD, fresh from the March Madness basketball tournament at the start of the MLB season and smack in the middle of the NBA and NHL playoffs.
“Our strategy is very different from other players in many ways, isn’t it? We’re not about tonnage, we’re really about selecting and offering the highest quality sports out there,” said Luis Silberwasser, Chairman and CEO of WBD Sports. “Whether it’s on TNT or TBS or TruTV, it just creates a cultural moment, right? So when these games are at prime time, people come to us.”
And indeed, the company’s sports offerings are beginning to impact the bottom line.
“In an otherwise lackluster advertising market, sport is a bright spot,” said Jon Steinlauf, WBD’s chief US advertising sales officer. “I think sports is the most important genre in all ad-supported television … When we talk to advertisers — they might be in categories that are relatively new to television, like pharma — you know, they say sports is really where we are. We’re going to get the fast impact and the immediate reach and the live audience that’s really connected and engaged.”
That’s according to WBD’s second-quarter earnings report, released on May 5. TV advertising fell 14 percent year-over-year due to the weak advertising market and declining ratings for entertainment and news programs, but was “partially offset by higher domestic sports promotion for the NCAA March Madness tournament.”
In other words, even in the current economic climate, Spots is improving year on year.
WBD Sports has also leaned into another area of differentiation: it’s live studio shows, with Inside the NBA leading the pack (Silberwasser calls the show the “secret ingredient” of his line). The long-running studio show, hosted by Ernie Johnson, Charles Barkley, Kenny Smith and Shaquille O’Neal, is among the most popular of its kind on television, and the company recently signed all of the main presenters.
WBD Sports has tried to create a similarly playful, irreverent atmosphere in its NHL and MLB studio shows.
“I think one thing to understand about how we’re doing compared to others is that we’re not just focused on satisfying the hardcore fan, which is one of the things that’s a big filter for us are is that we want to include the casual fan . We want to reach a more diverse audience,” says Silberwasser. “They’re not just talking about facts and figures and stuff that might only be of interest to the hardcore fan, but we want to make it attractive, we want to make it entertaining. You know some of the moments up Inside the NBA go viral not because they’re sports moments, but because they’re regular entertainment moments that are pretty cool. And they go outside of the sports world.”
Look no further than Barkley’s answer to a “mystery box” last month on set.
But the studio shows still require those premium sports rights, and with the NBA rights due for renewal talks later this year (with new contracts beginning in 2025), it’s a key issue for company executives.
“The NBA is an extremely important asset for us, and we’re also a very important partner for the NBA. We have an almost 40-year relationship with the NBA,” says Silberwasser. “We do that under the surface too, right? That’s how we make these games. We have that with our talent.”
“You know, we want to do a deal and hopefully it’s a very responsible and financially attractive deal for both us and them,” he adds.
Zaslav said on his company’s earnings conference call that the company would be “disciplined,” but he hoped they would be able to strike a deal, adding that “there are a lot of opportunities that are newly conjugated.” could become,” suggesting some flexibility on the number of games or other sticking points.
But when it comes to sport in good economic shape, it’s hard to top The match. WBD Sports’ golf brand, which sees athletes and celebrities compete, is wholly owned by the company.
The latest installation (branded as Capital One’s The match) Kansas City Chiefs stars Patrick Mahomes and Travis Kelce take on the Golden State Warriors’ Steph Curry and Klay Thompson.
“It’s in our DNA, our nature, to take something you know, a top-notch premium sport and make it fun and relevant and maybe even more appealing than just regular golf,” says Silberwasser.
Steinlauf recalled how his team quickly turned to sell the December 2022 installment of The matchin which golfers Tiger Woods, Rory McIlroy, Justin Thomas and Jordan Spieth participated.
“December 2022 was a difficult market, a crowded sports market, but our salespeople in literally lightning fast time, like three weeks, I think we got 10 different sponsors, it worked out that well,” says Steinlauf. “And a lot of the sponsors were connected to the golfers, and a lot of the sponsors brought their key clients to Fort Myers to rub elbows with a lot of golf kings.”
2023 is still a difficult year for the ad business and it remains difficult to predict. But when media buyers settle into the theater at Madison Square Garden on May 17, they should expect plenty of crowds for the live sports they can shop into. And some lifestyle dishes and news.
“We love our hand,” says Steinlauf. “Sports, streaming, election year CNN, HGTV, food, Discovery, TLC, Oprah, Magnolia, these great lifestyle brands.”
“It’s our responsibility to present that audience and those brands to the advertiser in the most impactful way, and that’s our plan to do that,” he adds.