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Joe Tsai: Think digital in thinking about new revenue for Nets

Los Angeles Lakers v Brooklyn Nets - NBA China Games 2019 Photo by Yanshan Zhang/Getty Images

In the midst of last week’s international incident(s), Joe Tsai spoke about his open letter to fans, as Brian Lewis reported. But he spoke as well about how he plans to generate new revenue for the Nets ... a priority that could get higher with so much uncertainty about the NBA’s future in China.

Not surprisingly, the co-founder of China’s Alibaba, spoke about how the Nets and YES Network need to think big on digital rights. YES controls those rights as well as the TV rights to Nets games.

“It’s an exciting new world,” Tsai told Lewis. “Looking at the business of sport from my perspective, I’m coming from the internet world where you’re seeing a massive shift of, first, young users coming online; and usage going on mobile.

“Those are very big trends — what you could do with that and how young people consume content. You can do a lot of very interesting things with sports. I’m very excited about the future.”

Critical to making digital rights a big money-maker, said Tsai, is the relationship between his new CEO, David Levy, and YES president Jon Litner. The two are expected to meet soon.

“We have a long-term contract with YES. It’s a fixed amount, but there’s definitely room to look into new ways of delivering the content locally,” Tsai said. “YES is a linear TV presentation; they really haven’t leveraged the digital rights yet.

“This is a perfect example of David Levy — who knows Jon Litner really well — and they’re going to hit it off and have a conversation because what we want is a win-win situation. It makes a lot of sense for YES Network. It also makes a lot of sense for us to figure out a way to better leverage our digital rights on a local TV basis.”

The Nets and YES extended their relationship in 2015. At the time, Sports Business Journal reported that under terms of the proposed agreement, YES retained all broadcast TV and digital rights to the Nets programming. The end date for the agreement was not disclosed but it runs well into the next decade, said SBJ.

Television industry sources told NetsDaily in 2015 that the agreement would provide the team with “well above” the $20 million a year the Nets had received from YES prior to that and “substantially more” than even the $40 million Sports Business Journal had reported.

With Kevin Durant, Kyrie Irving and Caris LeVert all signed to long term deals, that seems to be a bargain for YES. As Lewis wrote, the Nets are “delivering a different caliber of team than the one YES Network negotiated to broadcast.”

Indeed, said Tsai, he believes the Nets have built a solid foundation all the way around.

“My job is to make sure that we have the best people in place … so I’m very lucky on the basketball side. I stepped into a very good situation with Sean Marks,” Tsai told The Post. “The last three years, the work speaks for itself. I don’t even need to say anything more.

“And then we found David Levy, who joined us as CEO — a terrific guy and someone who’s got tons of experience and lots of expertise and familiarity with the league. So for him to run the business side of things is tremendous for us. The good thing about having David in place is he’s very creative, very entrepreneurial.”