NBA and Warner Bros. Discovery reach a settlement on live game rights lawsuit.

• The NBA has reached a settlement with Warner Bros. Discovery, allowing it to proceed with Disney, NBCUniversal, and Amazon as its media partners.
• ESPN will air "Inside the NBA," which will still be produced by TNT Sports.
• NBA games will be aired in certain international countries by Warner Bros. Discovery, and they will receive free NBA highlights for their media properties.

The league and the company reached an agreement to end its pursuit of owning live NBA games in the U.S. for the 2025-26 season and beyond, resolving all legal disputes.

In July, the NBA was sued by Warner Bros. Discovery for allegedly denying the company's request to utilize its "matching rights" on a collection of live games.

The league has chosen NBCUniversal, Prime Video, and as its U.S. distributors for live games for the next 11 seasons, with a total deal value of approximately $77 billion, according to CNBC's previous report.

The agreement with Warner Bros. Discovery and ESPN will keep Turner Sports involved in NBA content, production partnerships, and licensing deals. However, it marks the end of Turner Sports' 40-year relationship with the NBA as a carrier of live games in the U.S. after this season.

Since 1984, Turner Sports has had an NBA package, with games airing on TNT since 1988. However, the NBA has decided to move away from Warner Bros. Discovery as a media partner due to several reasons, including a lack of confidence in the future of cable TV as an effective way to reach a younger audience.

NBA games are exclusively streamed on Amazon's package, while Disney and Comcast have broadcast networks to showcase them.

Warner Bros. Discovery has secured a deal that grants TNT Sports free access to highlights for its Bleacher Report digital news site and House of Highlights social media platform for the next 11 years. Additionally, the agreement allows Warner Bros. Discovery to license, create, and distribute new and existing NBA content across its media assets, including live game rights in the Nordic countries, Poland, and Latin America, excluding Brazil and Mexico.

The NBA has extended its agreement with TNT Sports for five seasons, allowing Warner Bros. Discovery to provide promotion and various services such as production, content development, and sales operations.

According to sources, Warner Bros. Discovery is not receiving any additional payment from the league beyond the terms of the settlement.

'Inside the NBA'

Disney's ESPN and ABC will license TNT's "Inside the NBA" studio show for premier NBA games during the regular season and playoffs, including the Finals. Meanwhile, ESPN's current NBA studio show, "Countdown," will remain for other ESPN regular season games.

The four hosts of "Inside the NBA," including Ernie Johnson Jr., Charles Barkley, Kenny Smith, and Shaquille O'Neal, will remain with the show for the duration of their contracts and may create new content for Warner Bros. Discovery's cable and streaming platforms, including an "Inside Sports" show currently in development for next season. ESPN has protections in the deal that would allow it to stop licensing the show if key hosts depart, according to two people familiar with the contract.

The upcoming "Inside the NBA" show on Disney's platforms may or may not feature TNT or ESPN branding, according to sources. TNT Sports retains full editorial control of the show, but ESPN talent may collaborate with the hosts, the sources added.

"NBA Commissioner Adam Silver stated that the continuation of the acclaimed and Emmy Award-winning "Inside the NBA" is a significant victory for basketball enthusiasts worldwide. He added, "We are thrilled to expand our longstanding collaboration with TNT Sports and jointly promote NBA content on key WBD and NBA platforms.""

Disney and Warner Bros. Discovery have collaborated on multiple occasions in the past year, including a streaming deal that links Warner Bros. Discovery's Max service to Disney+ and Disney's Hulu, as well as a sports-centric joint venture called Venu that is currently facing antitrust issues.

ESPN has agreed to allow TNT to broadcast 13 Big 12 football games and 15 men's basketball games each season, starting in 2025. This deal provides the Big 12 with more linear TV exposure, as most of the games would have been streamed exclusively on ESPN+.

Earlier this year, ESPN struck a sub-licensing deal with Warner Bros. Discovery for first round and quarterfinal College Football Playoff games.

Consolation prize

David Zaslav, the Chief Executive Officer of Warner Bros. Discovery, will receive something despite failing to reach a deal with the league during its exclusive negotiating window earlier this year.

These agreements guarantee that fans will continue to enjoy TNT's "Inside the NBA" and generate significant value for our entire portfolio as we speed up the growth of TNT Sports, Bleacher Report, House of Highlights, and our international sports business, according to Zaslav.

Last month, Silver stated on CNBC that the league could have reached a deal with Warner Bros. Discovery, but there was a lack of agreement between the leadership on both sides.

"According to Silver, the relationship with the people currently running Warner Brothers Discovery was not long-term. In ideal partnerships, individuals do not need to refer to the contract and specify page eight, paragraph three. Instead, they should understand the spirit of what they were trying to achieve and be willing to adjust based on unpredictable changes. When the contract is actually examined, it indicates that the partnership is not going as well."

Disclosure: Comcast's NBCUniversal is the parent company of CNBC.