MLB Advanced Media, known in the industry as “BAMtech,” has been sold to Disney, who will run it for MLB (and the NHL, which now uses the same technology), and also use it to try to leverage more viewers for its ESPN properties.
MLB is making $1.5 billion on this deal and here’s why that’s important:
The $1.5 BILLION dollar deal is also going to have a sizable impact in Major League Baseball. Why? According to SBJ’s Eric Fisher, each club will pocket approximately $50 million dollars from Disney’s acquisition of BAMtech.
In new SBJ, MLB team owners looking a payday of ~$50M each following Disney move for controlling stake of BAMTech $ https://t.co/qNb2J3pcup— Eric Fisher (@EricFisherSBJ) August 14, 2017
Fifty. Million. Dollars. The SBJ article is behind a paywall, but it’s being described as one of the largest payouts to clubs in the history of American professional sports. And whereas part of Disney’s first investment in BAMtech went back into continuing to grow the service, this time MLB is getting all of the cash.
What could the Cubs do with $50 million? For one thing, that would pretty much pay the remaining years on Justin Verlander’s contract, if the Cubs wanted to pursue him in the offseason. I’d think the Cubs would definitely put that into player payroll. For some small-market teams it could increase their 2018 payroll by nearly 50 percent. According to Spotrac, the Brewers have the lowest current payroll in baseball right now at approximately $84 million. Four other teams (White Sox, Rays, Padres, Athletics) are below $100 million.
In addition, Awful Announcing cites this Hardball Talk article which indicates even more money is going to be coming to MLB from Disney/ESPN:
A source familiar with the big Disney-BAMTech acquisition tells NBC Sports that, as a result of the deal, Disney will get one major league game a night to stream on its new ESPN-branded streaming service. The game will be behind a pay wall. In exchange Disney will pay Major League Baseball a “significant” sum, over and above what it already pays MLB for ESPN’s broadcast rights and over and above the $1.58 billion Disney paid for the additional 42% of BAMTech it acquired. The exact figures were not disclosed.
The game will not be exclusive, meaning that fans of the local teams involved will still get the exclusive TV broadcast on their regional sports network and out-of-market MLB.tv subscribers will still get the game as well. The game will be an out-of-market game for all ESPN streaming users.
So more baseball on TV, and based on this, when the Cubs are involved there won’t be any blackouts as long as you subscribe to that “ESPN-branded streaming service.” That’s likely a way to get baseball fans to sign up for that service, I’d think.
In any event, there’s going to be a lot more money coming into an already cash-flush business. Hopefully, teams will use this windfall to pay players, instead of just pocketing it.