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Sinclair says it could make $50 million annually from the Marquee Network

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What would that mean for Cubs finances?

As you know, the Cubs will be leaving NBC Sports Chicago and WGN-TV after 2019 to form their own TV channel, to be called the Marquee Network. The network will be distributed by Sinclair Broadcast Group.

Earlier this week, the Tribune reported that the network will likely generate a large amount of cash for Sinclair:

Chris Ripley, Sinclair’s president and chief executive officer, said the Maryland-based broadcaster is looking at the Cubs TV network, announced earlier this month, as a boon to the bottom line and a model to partner with other teams.

“We expect (the Cubs network) to contribute about $40 (million) to $50 million of free cash flow,” Ripley said during Sinclair’s 2018 earnings call.

Setting aside for a moment any thoughts you have about Sinclair as a company (and again, I ask you to keep your political opinions to yourself in commenting), what would a $50 million cash flow for Sinclair on an annual basis mean for the Cubs, and particularly for Cubs player payroll?

The Cubs, as of 2016 (and I believe that number is still valid and current) were pocketing about $65 million in rights fees from their current TV deals. $50 million is obviously less than $65 million, so you’d think the Marquee Network, which after it’s created will pay the Cubs a rights fee, will have to pay the team more than $65 million — and likely significantly more — in order to make this entire exercise worthwhile.

The most lucrative local TV deal, as noted in that link above, is the Dodgers’. They are in the middle of a 25-year, $8.35 billion contract with SportsNet LA. Those numbers translate to an AAV of $335 million, though I don’t know specifically how that contract is structured. Note that the Dodgers are getting their money regardless of how much coverage they have in the Los Angeles area. Part of the reason the Cubs are partnering with Sinclair is, presumably, so they don’t wind up with this problem and that everyone who wants to see the Cubs can, in fact, get the Marquee Network.

Also of note in the Tribune article:

Sinclair also is looking to buy some or all of the Fox-owned regional sports networks, which must be sold as a requirement of its pending merger with Disney.

“(Marquee) is a model for other partnerships going forward,” Ripley said. “We certainly will be looking for other opportunities and there will be some coming up.”

Major League Baseball is one of the other entities looking to possibly buy the 21 Fox-owned RSNs (15 of which broadcast MLB games). It will be interesting to see where those channels eventually wind up.

In the meantime, if the Cubs do get their presumed windfall from Marquee Network money, one would hope they’ll spend it on baseball players.