Welcome to the latest issue of The Varsity, my twice-weekly private email on the inside story animating the business of sports and the egos who run it. I’m sending this today from the Acela after a couple days’ worth of meetings in New York.

Thanks for the overwhelmingly positive feedback on my last story about the NBA rights lottery. The battle between Zaz and Brian Roberts for the “B package” is truly turning out to be one of the great stories of our time… Oh, also: Stop forwarding this email to your colleagues who pretend they can’t afford Puck! (You know what you pay them, and how much Horace Mann and Harvard-Westlake cost per year!) The next culprit we identify will get a parcel with Marchand’s lithographs from his Blue period.

Okay, let’s get started!

Big money is also getting back into the league. Warriors owner Joe Lacob is launching a team in San Francisco next season. The league also wants to add another franchise, and at least one NBA owner—the Rockets’ Tilman Fertitta—has expressed interested, having publicly noted his desire to bring the WNBA back to Houston. Meanwhile, the terminal value for these assets is only climbing, as recent women's soccer club transactions demonstrate. All arrows are pointing upward for Engelbert and the league. I’ll be monitoring to see if the commissioner can carry this momentum through the season.

1. Nothing to see here: My NBA update today is that there’s no real update. Adam Silver and league content president Bill Koenig are continuing their talks with both Zaz and Luis Silberwasser at Warner Bros. Discovery and Mark Lazarus and Rick Cordella at NBC about the “B package”—a weekly slate plus programming around NBA All-Star weekend, one conference finals series every other year, and early-round playoff action. NBC’s talks are not far enough along yet for the league to start conversations around WBD’s all-important matching rights.

   NBC and the NBA would have to be close to a signed deal for negotiations over those matching rights to truly commence. And it’s also still an open question whether WBD can equal NBC’s offer of allocating two primetime broadcast windows for NBA games during most weeks. The NBA’s deals with ESPN and Amazon also are not signed, though sources say they’ve agreed to a framework.

   Back in January, many of my sources believed the NBA would be lucky to double its media rights deals. Now, Silver and Koenig have pursued a strategy that will see the NBA nearly triple its media haul from $2.7 billion to likely ~$7 billion per year.

2. No end in sight!: Here’s all you need to know about the Comcast-Diamond Sports cliff path versus glide path grinfuckfest impasse: The two sides have barely spoken in the nine days since Comcast dropped all of Diamond’s Bally Sports Networks from their Xfinity cable systems. In fact, there’s really not much to talk about—both sides are entrenched in their positions. Comcast wants to send the R.S.N.s to a digital tier immediately (say it with me, “cliff path”) and Diamond wants a more gradual migration (the “glide path”... Drink!).

   Any potential solution seems unlikely given the animosity that spilled over into public view this week. I won’t bore you with the back-and-forth (you’re welcome, dear reader), other than to say that Diamond took out ads in its local markets blaming Comcast, and Comcast made one of its executives available—on the record—to blame Diamond.

   These types of disputes used to happen all the time in the cable business, but they’re now a relic of a more hard-charging era. And yet, the fact that Diamond’s David Preschlack and Comcast’s Greg Rigdon haven’t been engrossed in round-the-clock meetings—the best way to actually find a middle ground—means that this quarrel isn’t ending anytime soon. So who knows what might happen, or not, next…

3. This ain’t the NBA: CBS Sports’s deal with the Italian soccer league Serie A expires in a couple of weeks and the two sides are not close on a renewal, but it’s unclear whether the league will have other suitors in the U.S. market. World Soccer Talk broke the story yesterday, and I confirmed most of the details. Talks aren’t dead, but Serie A would have to swallow a significant reduction. Apparently, CBS pays about $75 million per year for both Serie A and Coppa Italia.

   The difference comes down to the tightening sports rights market that I’ve been writing about every week since coming to Puck. Serie A is a nice-to-have, but decidedly not a must-have, for CBS—which, itself, is in the throes of a world-historically botched M&A process overseen by a three-headed “office of the C.E.O.” and a Napoleonic controlling shareholder. Also, CBS already carries the Champions League on Paramount+. How many extra subscribers does Serie A bring to the streaming service, which will probably cease to exist once Gerry Cardinale or the Apollo guys get their hands on it? The operating thesis is that Serie A fans will subscribe to Paramount+ for Champions League even if CBS passes on their favorite domestic league. We’ll see.

4. Norby succession games: Former Turner Sports president Lenny Daniels, once considered a favorite to replace Norby Williamson at ESPN, has become a much longer shot. Conversations between Daniels and ESPN’s Burke Magnus have not progressed to the point that Daniels has had to formally withdraw from the search. But ESPN is not deviating from its demands that this job be based in Bristol. And Daniels, who currently lives in Atlanta with his wife and teenage son, does not want to relocate.
5. Streaming, gambling, and women’s sports: I spent my Wednesday morning in the U.S. Capitol to address the NFL’s annual “DC Day,” where the league’s top lobbyists offer policy briefings to a group of about 50 team lawyers. I was asked to talk about the media landscape and was slotted in right after House Majority Leader Steve Scalise. I was most intrigued by some of the questions that I fielded, a number of which animated the curiosities and anxieties of the group. I’ve outlined them TL;DR-style here.
1. The first question was about streamers’ slow embrace of sports rights, a trend that’s starting to change. The NFL still has nine years left on its media deals, and the NBA is about to embark on 11-year deals—both dominated by linear TV—so it’s clear that old-fashioned TV isn’t going away anytime soon, and its descent will be measured, as everyone reading this already knows.
2. Another question focused on the chaos at Paramount and what the sales process could mean for one of the NFL’s media partners. My answer: Not much. CBS’s NFL deal is one of the reasons that David Ellison & Gerry and the Apollo guys value the network so much.
3. I was also asked about when the popularity of women’s sports would translate into larger rights fees and richer player contracts. It’s coming… soon, I told the group. The big investments in women’s sports has been a leitmotif for The Varsity since it launched. And, as I noted above, the value of the assets is increasing. Investment in the players will follow soon enough.
4. I was not surprised to field a question about Spulu, and whether Fubo’s antitrust concerns could derail Disney, Fox, and WBD’s plan to launch a sports streaming service this fall. I didn’t pretend to know what the Department of Justice will do. But it is notable that Spulu’s executives are confident that the service will pass regulatory muster.
5. The final question focused on whether some of live sports’s recent ratings gains can be attributed to the rise of sports betting. My simple answer: Of course they can. Bettors watch more games, and watch them longer. But the main reason ratings have increased so dramatically is much more boring: Nielsen changed the way it counts viewers and now includes out-of-home consumption in its early numbers. That one move has increased viewership by a high-single-digit percentage, my sources tell me.

And now it looks like Netflix will wind up carrying the two NFL games scheduled for December 25, per a bevy of sources. Yes, yes, yes, this could all fall apart and all the usual caveats—nothing has been signed yet, and the two sides still have to clear some hurdles before any deal is announced. But Netflix’s emergence as a bidder—and likely winner—is one of the main reasons behind the schedule delay. (For the record, Boomer Esiason was the first one to talk about Netflix’s Christmas plans, on his radio show yesterday morning.)

The NFL takes a tough negotiating posture in the best of times, and networks like NBC, Fox, ESPN, and Amazon have systems in place to quickly turn around this type of deal. For Netflix, however, this would be a brand-new deal and require a different kind of diligence. Based on what I’m hearing, though, it would not herald a headlong thrust into live sports, but instead be a continuation of its current dabbling strategy via the docuseries, the WWE deal, and big one-off events like Sunday’s Tom Brady roast, plus tennis and boxing matches.

For the NFL, the opportunity to grow its relationship with the world’s biggest streamer has its own set of obvious benefits. The NFL’s strategy has typically focused on trying to get new outlets to become addicted to its games. The NFL is not wrong in its belief that it helped grow ESPN, Fox Sports, and DirecTV into three of the country’s biggest media companies. It’s following the same blueprint with Amazon, YouTube TV, and now Netflix. The NFL also likes the idea of potentially adding another bidder as a way to keep its linear TV rights fees high. In fact, it launched NFL Network 21 years ago in order to ensure there was one more bidder for its packages. (Alas, that didn’t totally work out…)

Still, Netflix has a lot more questions than answers right now about its Christmas plan, from who will produce the games to how much it will pay. For comparison’s sake, Amazon paid $100 million for the exclusive rights to that unwatchable Jets-Dolphins Black Friday rain-out contest. Would Netflix pay double for a package of two games, and the chance to own Christmas Day? More? Meanwhile, every other league executive is licking their lips, hoping that the NFL turns Netflix’s dabbling strategy into a true gateway drug.

“David Stern took over the NBA two generations ago. Time flies when you’re defenestrating and grinfucking…” —A Varsity subscriber

“LOL. You have gotten some serious mileage out of the term grinfuck. Soon it will become part of the zeitgeist. Too funny.” —A distribution executive

“Love your emails. However, as a fellow Terrapin, I'm disappointed that you used the word ‘premier’ instead of ‘premiere.’ I initially failed the grammar test to get into the College of Journalism, but after taking there [Sic] Grammer [Sic] Slammer, I passed. Able to improve my grammer [Sic] almost overnight.” —A University of Maryland alum