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Falling local television revenue is shaping the NBA's long-term financial strategy, with league officials targeting 2027 to consolidate most local media rights under a single partner, according to sources that spoke with ESPN.
The league's salary cap increased just 6.7% this offseason, well below the 10% maximum allowed under terms negotiated with the players' union.
A shorter postseason contributed to the shortfall, but declining local broadcast revenue remains the larger structural drag, sources said.
Two years ago, the NBA signed 11-year national media rights deals worth more than $77 billion with ESPN, NBC and Amazon, tripling the value of its previous agreement.
To prevent a cap spike similar to 2016, when the figure jumped 35% in a single year, the league and union agreed to cap annual increases at 10% over three seasons.
New national television money has softened the impact of shrinking local deals, but the decrease remains significant.
Even the New York Knicks, one of the league's marquee franchises, accepted a 28% reduction in annual payments from MSG Networks last year, cutting their local television income by $41 million.
Similar reductions are playing out across the league and are expected to last into next season.
The NBA hopes to address the issue in 2027, when most local rights agreements expire, by bundling them under one national partner.
"It's one of the most significant financial things going on in the league right now," said one team president.
"It's played at least some role in moving forward with expansion.".