Texas Rangers to receive $3 billion in new 20-year TV deal (USAToday)

Here's the money (no pun intended) paragraph (my bold):

"It is the highest TV package for a team that doesn't own its own channel. And yes, that's $150 million a year before even playing a game, plenty enough to re-sign ace Cliff Lee, bring in free-agent outfielder Carl Crawford, or whoever else they wish."

Given the current state of the economy, the magnitude of this deal surprises me, but maybe the length (20 yrs) makes it an attractive gamble for Fox Sports Southwest.

Regardless, this just reinforces in my mind the need for Ricketts to have the Cubs network in place as soon as current local tv contracts expire - or even sooner if there's a way to get out of those deals.

over 1 year ago ballhawk 22 comments 0 recs |

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They better not get Gonzalez!!!

by daily2b on Sep 29, 2010 3:45 PM CDT reply actions

Think they'd want him back?

He’d be quite a fit.

"I'd rather hit home runs you don't have to run as hard." -- Dave Kingman

by BucknerKongCardenal on Sep 29, 2010 8:11 PM CDT up reply actions

Three BILLION dollars?

Man, that’s a lot of money. They better be way sure that the Rangers are a draw for all 20 years, or they will lose a fortune.

But you’re right, the Cubs need that TV network in place soon.

"You can observe a lot just by watching." ~ Yogi Berra

by Al Yellon on Sep 29, 2010 3:50 PM CDT reply actions

Yeah, but

with a discount rate of 6%, the NPV is only $1.72 Billion. So now it makes sense…

"They come to see me strike out, hit a home run, or run into a fence. I try to accommodate them at least one way every game." - Gorman Thomas

by RiskyBusiness on Sep 29, 2010 4:27 PM CDT reply actions

Rangers are the new American Dream

From outhouse to the penthouse at the stroke of a TV deal.

"I'd rather hit home runs you don't have to run as hard." -- Dave Kingman

by BucknerKongCardenal on Sep 29, 2010 8:17 PM CDT reply actions

do the cubs get any money from the wgn or csn?

Man, that would be awesome…just imagine…a payroll like the yankees! Oh, wait, I forgot we already have a really high payroll that does nothing.

by mdcubsfan on Sep 29, 2010 10:07 PM CDT reply actions

The Cubs own 25% of CSN Chicago.

Since WGN is no longer co-owned, they get a rights fee.

None of that money approaches $3 billion, though.

"You can observe a lot just by watching." ~ Yogi Berra

by Al Yellon on Sep 30, 2010 7:46 AM CDT up reply actions

Yes, but not enough

which is precisely why Ricketts will be auctioning off the rights.

Just win the next game...!

by blackhawk24 on Oct 4, 2010 9:38 AM CDT up reply actions

It’s well-past time for the Rangers to begin leveraging the relative wealth of the Dallas area over their AL West competitors.

by bourbon_and_branch on Sep 30, 2010 7:33 AM CDT reply actions

I guess the question is this

With a discount rate of 6%, the NPV is $1.72 Billion. For 20 years, that averages out to $86MM paid by Fox Sports Southwest to the Rangers. Let’s say the Rangers are on Fox Sports Southwest 155 times per year (assuming 7 game on ESPN, etc) plus 20 spring training games. That works out to $491K per game that Fox Sports Southwest need to make in advertising sales, etc.

Can Fox Sports Southwest make $500K per game in advertising of the Rangers?

"They come to see me strike out, hit a home run, or run into a fence. I try to accommodate them at least one way every game." - Gorman Thomas

by RiskyBusiness on Sep 30, 2010 11:17 AM CDT reply actions

That's a lot of spring training games.

Doesn’t seem as if they could sell that much for a ST game, meaning the rest of the games would have to sell for more than that.

"You can observe a lot just by watching." ~ Yogi Berra

by Al Yellon on Sep 30, 2010 1:45 PM CDT up reply actions

Yes, we could remove the ST altogether

The per game advertising sales, etc. would need to be $555K. Still assuming 155 games aired on Fox Sports SW.

For a finance/investment guy, 6% would be a conservative discount rate. if you bumped it up to 8%, the NPV is $1.47 Billion and the per game advertising sales $475K.

No matter what, that’s an nice deal for the new Ranger’s ownership to start off with.

"They come to see me strike out, hit a home run, or run into a fence. I try to accommodate them at least one way every game." - Gorman Thomas

by RiskyBusiness on Sep 30, 2010 2:29 PM CDT up reply actions

This is a bad deal for FSN Swest

Doesn’t seem possible that the net can possibly charge enough for advertising to cover the cost of this deal.

by San Diego Smooth Jazz Man on Sep 30, 2010 12:46 PM CDT reply actions

Ryan Express

Maybe they plan to re-run Nolan Ryan pitched games. Over and over and over…

"They come to see me strike out, hit a home run, or run into a fence. I try to accommodate them at least one way every game." - Gorman Thomas

by RiskyBusiness on Sep 30, 2010 2:30 PM CDT up reply actions

I don't claim to know much about this

But is it possible that (due to inflation, the length of the deal, changes in economy) this could be a bargain for FSN in about 10-15 years?

by thebluecrew1908 on Sep 30, 2010 3:50 PM CDT reply actions

I have been Robbed!!!

Fort Worth Star-Telegram and others are saying the deal is for a piddly $1.6 Billion, not $3 Billion.

Apparently this is also a battle of Fox Sports vs. Comcast.

"They come to see me strike out, hit a home run, or run into a fence. I try to accommodate them at least one way every game." - Gorman Thomas

by RiskyBusiness on Sep 30, 2010 4:08 PM CDT reply actions

where are you seeing a $1.6B figure?

that link takes me to a column by Gil Lebreton which I’ve read it twice and saw no mention of a revised contract figure.

Lou Brown: "My kinda team, Charlie, my kinda team..."

by ballhawk on Sep 30, 2010 4:25 PM CDT up reply actions

It does talk about "gazillions" of dollars.

Which, even in Texas, has to be a lot.

"You can observe a lot just by watching." ~ Yogi Berra

by Al Yellon on Sep 30, 2010 8:27 PM CDT up reply actions

It's Confederate dollars

The Rangers have a nice stadium but the heat is oppressive in summer. They won’t even draw 2.5M fans this year. But most of all, Dallas is a Cowboys football town. This is a great deal for the Rangers but a horrible decision by FOX.

That said, Ricketts is sure to put together a very rich media package within the next 24 months which will spike income to incredible levels. If Texas can get $150M per year, the Cubs should be able to hit $300M. We’ll even be able to extend Soriano’s contract for another 8 years.

If a quality pitching start is 3 runs and 6 innings, then a quality hitting day is 1 for 4.

by tharr on Oct 1, 2010 12:42 AM CDT up reply actions

They've talked about retrofitting that stadium with a roof.

It could be done, given the way it’s designed, and probably a good idea if they can pull it off. Should be a retractable roof so they could play outdoors in cooler weather.

"You can observe a lot just by watching." ~ Yogi Berra

by Al Yellon on Oct 1, 2010 7:55 AM CDT up reply actions

I'll find out about that possibility.

I have a friend who is one of the owners of the architectural firm that designs all the retractables. But still, the Rangers are merely a hobby in the Dallas area. Jerry Jones and the Boys and Girls rule the airwaves up there.

If a quality pitching start is 3 runs and 6 innings, then a quality hitting day is 1 for 4.

by tharr on Oct 1, 2010 3:31 PM CDT up reply actions