If the WNBA were a stock, it would be shooting to the moon right now.
The league announced a record month in attendance, with 94% of its arenas filled in May and over half of its games selling out.
It's been a long time coming for the 28-year-old league, but the signs have been there over the last few years as the league's revenue rose, doubling from about $102 million in 2019 to $200 million in 2023, according to Bloomberg.
With the arrival of the 2024 Draft Class spearheaded by Caitlin Clark and anchored by names like Angel Reese and Cameron Brink, the league is garnering national media attention, unlike anything that it's ever experienced in the past.
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But there is a massive hurdle that could keep the league from truly realizing its potential, at least over the next decade.
The WNBA is expected to be tied to the NBA in the next media rights deal for the Men's league, which is set to expire next season. That next deal, according to a report by The Wall Street Journal, is expected to go for another 11 years.
The Washington Post reported that the WNBA will likely be its own separate entity by the time the next deal rolls around. But should the details of the NBA's next media deal stand firm when pen is put to paper, the WNBA will be tied with the NBA for its media rights deal until 2036.
The reason that is important is that media rights deals are major revenue driver for professional leagues, and often times are even the largest chunk of the revenue. For example, the NBA has made about $2.7 billion in annual revenue from media rights since its current deal kicked in back in 2016, and that number was about a quarter of the league's revenue last season.
That means that the NBA will determine the value of the WNBA's rights based on the final number it gets for its entire rights package, which is expected to go for around $7 billion annually.
The WNBA's side of the package is expected to see a similar increase as the NBA's, which is close to three times its last package. The Women's Basketball league's current deal is valued at around $60 million per year, while this next deal will be closer to $200 million, according to The Washington Post.
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The same report also stated that WNBA executives are still viewing the tie-in with the league as positive due to the current financial state of the WNBA. The Women's league has reportedly lost an average of $10 million a year since its inception in 1996.
The NBA also owns a significant amount of equity in the WNBA which is in part driven by its investment back in 1996 and an additional investment during a capital raise of $75 million back in 2022.
But while the WNBA could reap the rewards of working with the established league in the meantime, locking into a deal for the next decade and change could diminish the value of the league toward the backend of the deal.
The NBA is established — but its viewership growth has stagnated over the last few years. On the other hand, the WNBA is on the cusp of breaking through and has a ton of potential to continue to see massive viewership and attendance jumps over the next few years, especially with the addition of several new teams and the continued attention put on NCAA stars like Paige Bueckers and JuJu Watkins.
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If the WNBA separated itself and signed its own deal, it could opt for a shorter deal to be able to test the market earlier to see if their value rises.
They could emulate the formula from Formula 1, which signed a three-year deal valued at around $75 to $90 million with ESPN starting in 2022. The racing league saw its US viewership catapult after the success of Netflix's "Formula 1: Drive to Survive" and has added multiple US races to its calendar as well. The 2024 Miami Gran Prix saw 3.1 million average viewers in the US, the most of any F1 race in history.
That will certainly be part of their bargaining pitch when they get back to the table with ESPN or other potential suitors for their next deal.
The WNBA is obviously in a different financial situation than the legacy racing league, so the risk of that type of strategy may not outweigh the rewards, and it may have not had as much flexibility considering the NBA's equity stake. Nonetheless, the NBA's involvement could be a massive sunk cost that the league will be willing to swallow toward the back half of this deal as its own arrow continues to point up.
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