NBA Viewership Dropping Like A Stone

Over the last couple weeks, we discussed the troubles that ESPN is facing. The most recent turmoil came as the result of firing many on air personalities. Disney, the parent company, is trying to cut $5 billion in expenses.

This is not the only household name related to sports that is suffering.

Not often discussed in the media is the long term trend of the NBA. This was overlooked by Michael Jordan selling his stake in the Charlotte Bobcats for over $3 billion. Perhaps he sees the writing on the wall.

How come nobody is discussing what is taking place?

In this article we will look at the numbers to see what is going on.

NBA Finals

For sports, the championship should be the ratings bonanza. The Super Bowl. World Series. Stanley Cup.

Here is when the ratings should be at their highest.

Another thing to factor is the growth in population over the last 25 years. There are now roughly 50 million more people in the US as compared to 30 years ago. So how do we explain these numbers?

Source

Notice the trend.

As we can see, the viewers topped 30 million back in 1998. This was likely the heyday of the NBA. They were still living on the success generated in the 1980s. Stars like Jordan, Magic, Bird, and others brought the game to a new level. Commissioner David Stern was known as a marketing genius, a claim that is hard to dispute.

The problem is we see a decline in the number of viewers. As we can see, it is not a small drop. This is significant. We are talking drops similar to Bitcoin pullbacks. We are talking more than 70% here.

Is that something talked about?

Imagine if ESPN lost 70% of its viewers? Would that be a story worth writing about?

Big Money

There is obvious reason to keep the demise of the NBA quiet. There is a lot of money in these teams. As the Jordan situation shows, people are still putting up big money for NBA teams. We also have players commanding huge salaries.

Where does all of this money come from?

While ticket sale revenue is likely strong, the bulk of the money comes from broadcast rights. This is a world where we see multi-billion dollar television deals. All this money ends up being pushed into the system.

How long can this continue?

Unfortunately, fans tend to be generational. What that means is that one generation leaving means that news ones aren't going to join. Over a 25 years period, we are seeing the exiting of one generation and not being replaced by another.

Will this eventually show up in the numbers? It is already being seen with the NBA Finals.

Generational Shifts.

Entertainment is seeing many transitions.

We already discussed cable news and how that is suffering. Broadcast television is also a dying animal, including ESPN. Could we add the NBA to the list?

The attention economy is shaping up to be radically different as compared to what is in place today. Web 3.0 is going to transform things even more than the present Internet. What we saw in the past is nothing compared to what is coming.

Newspapers were hammered a couple decades ago as information distribution changed completely.

This is spreading out to many other areas of entertainment and information.

I am of the view that major media companies are going to find that everyone, talent and customers, have other choices. As technology expands, the options are only increasing. People are now able to set up their own "broadcast companies" with a minimal investment.

That was unheard of a few decades ago.

Ultimately, this is going to seep into all areas. As generations grow up with choices, the traditional areas of focus such as the NBA might face a decline.

The market is rapidly changing.

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