The NBA’s nine-year, $US24-billion TV rights deal with ESPN and Turner contains a plan for splitting up revenue from potential jersey advertising, John Ourand and John Lombardo of Sports Business Journal report.
According to SBJ, a plan to put 2.5-inch by 2.5-inch advertising patches on jerseys was shelved in 2012 over issues of “how teams would split revenue and the role Turner and ESPN would have in any jersey ad deal.”
The new TV deal eliminates one of those two obstacles, clearing the way for ads on jerseys to become a reality.
SBJ reports that the TV networks and the league will share the new sponsorship money:
“Early parameters indicate a distinction between whether a national brand or a local/regional brand buys a team’s jersey sponsorship. A national brand with a popular team would mean more money for the networks than a local/regional brand with a team that’s not on national TV very often.”
The 2012 plan that was eventually tabled would have brought in an estimated $US100 million in revenue. With the value of jersey sponsorship rights skyrocketing in other sports, it could be a significant new source of revenue.
NBA commissioner Adam Silver called the ads “inevitable” back in the spring.