Tencent: Houston Rockets blackout the least of NBA’s China worries
- President Donald Trump’s executive order banning Tencent-owned WeChat puts future of US$1.5 billion streaming deal in spotlight
- Ongoing trade war and political recriminations stand to affect US major leagues beyond CCTV refusing to screen the NBA
The Houston Rockets making the play-offs was a headache the NBA could have done without.
Once the most popular in China, the Rockets are now the team who cannot be named and broadcaster Tencent still refuses to show their games.
Will that change if the Rockets go deep?
There are surely people who would rather not find out. The easy option is that the Oklahoma City Thunder win their series, which tips off on Tuesday in the US.
But there are bigger issues ahead for the NBA with China.
Last July, which seems like a lifetime ago, NBA China’s valuation was said to have tipped the US$5 billion mark for the first time, thanks to Tencent’s US$1.5 billion renewal for streaming rights, up from US$500 million for the previous five years.
It was a time of great hope.
The deal was done, cementing China’s value as the league’s biggest market outside the US, and the NBA China Games would touch down in October with the Los Angeles Lakers – led by LeBron James – taking on the Brooklyn Nets in Shanghai and Shenzhen.
“There was an incident, as you may recall, last fall where an NBA general manager tweeted something in support of Hong Kong,” is how NBA commissioner Adam Silver described what happened next in an interview with PBS’s Jody Woodruff last week.
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“As a result, we were taken off the air, Chinese Central Television, for the first time in 30 years. And our games are still not back on the air, as a result of our supporting that general manager and supporting, frankly, American values, the values of free speech.”
CCTV has stood firm while several sponsors pulled out, too, with Silver estimating the loss at US$400 million at the All-Star Game in February.
Six months on, the situation might be even worse for the poster boys of US sports leagues expanding into China, who had grown hundreds of millions of fans in 40 years.
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While the NBA-China relationship has become increasingly politicised in recent weeks, US President Donald Trump’s decision to ban WeChat stands to make it more complicated.
The Tencent-owned app is a threat to the “national security, foreign policy and economy of the United States”, Trump said.
That makes the NBA’s broadcast deal problematic and US$1.5 billion lost if the deal does not survive, putting that US$400 million figure in the shade. It also makes it difficult for the league, its teams or any other US businesses to operate in China.
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Silver told PBS that they are “listening closely” as to what the league and indeed the US’s relationship with China should be, although he remains hopeful.
“I continue to believe that sports in particular can be a force for change, and that these cultural exchanges are critically important. And so, of course, If we decide not to trade with China, and that becomes something that our government is no longer favouring, we will stop as well.
“But, at least for now, we think continuing to be an exporter of American culture, demonstrating to the Chinese who can still see our games through some streaming services what we are about, what the expression is that comes with the NBA, we think is positive.
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“But we are always examining what works best for – not just the NBA – but for our country.”
Casualties in the Sino-US trade war will not be limited to the NBA. China has become ever more important to US sports, from NCAA basketball to Major League Baseball to the US PGA Tour.
The NHL launched its China Games in 2017, ahead of which commissioner Gary Bettman said “the opportunity and the possibilities are limitless”.
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“China is a priority market for the NFL,” commissioner Roger Goodell said ahead of Super Bowl LIII in Atlanta last year. “We believe that our game has a great deal of potential to expand to grow and bring new fans into our game.”
The NFL mooted a game as early as 2007, though it is still yet to happen. Now, you have to wonder and not just because of Covid-19.
The pandemic offers a very useful mask to dodge difficult questions about preseason games not going ahead, but outside these big ticket events there are plenty of opportunities for relations to sour.
US sports teams and their individual players are engaging in China – often through WeChat – and these could fall foul of escalations elsewhere.
Even sports in the US have been affected. The trade war, which kicked off with US tariffs in 2018, already threatened prices for sporting apparel, equipment, televisions and the things that fans need to tailgate. That was the warning of the US National Retail Federation in 2018.
From shoe deals to the shoes themselves, Chinese money is everywhere in US sports and at every level. It has never been more at risk, with the WeChat ban and ongoing trade war – and the inevitable recriminations. In the current climate it is hard to be hopeful about waiting it out and sport shining through.
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The golf-loving president’s executive order coincided with Li Haotong’s remarkable start to the PGA Championship where he became the first Chinese player to lead a men’s major.
He did so while wearing a hat emblazoned with his long-time sponsor WeChat. When asked about Trump’s executive order shutting down the app in the US, Li said, “I don’t know. Who knows?”
Who indeed? As the restarted NBA’s courtside signs say, this is a “whole new game”.
