The ongoing bankruptcy of Diamond Sports Group, who own the Bally Sports group of regional sports TV networks, had put in jeopardy some MLB teams’ broadcasts for 2024. Some of the teams with Bally Sports affiliation have already left the group.
But according to this Next|TV article, the league and the RSN operator have come to an agreement to carry some teams’ games next year:
Signaling a major thaw in the icy relationship between Major League Baseball and bankrupt regional sports networks operator Diamond Sports Group, lawyers for the league on Friday said they have agreed, through mediation, on a framework to keep 11 MLB clubs on Bally Sports channels through the 2024 season.
Attorneys representing MLB commissioner Rob Manfred told U.S. Bankruptcy Judge Chris Lopez that they were dropping their motion to have Diamond accept or reject the existing local TV rights deals for each club.
This is good news for fans of the Atlanta Braves, Cincinnati Reds, Cleveland Guardians, Detroit Tigers, Kansas City Royals, the Los Angeles Angels, Miami Marlins, Milwaukee Brewers, St. Louis Cardinals, Tampa Bay Rays, and Texas Rangers, the 11 teams remaining with contracts with Diamond Sports.
Also at Friday’s hearing, lawyers for the World Series champion Texas Rangers told the Houston bankruptcy court that the team might agree to reduce its contractual rights fees with Diamond to keep the Rangers on Bally Sports Southwest for one more season.
The Rangers can likely afford this as the defending World Series champions, with revenue coming from many other sources.
As I wrote here just last week, though:
Some teams (Twins, in particular) have even noted they are going to be reducing payroll because of the lower revenue expected from local TV (covered in the second link above), and the Padres took out a $50 million loan earlier this year to help meet payroll expenses.
That’s going to be the issue for not only the Twins and Padres, but for the 11 teams remaining on Bally Sports channels in 2024. Where is their revenue going to come from after 2024?
One team that has taken a different route is the Mariners, who recently took full team ownership of their RSN, ROOT Sports Northwest. Their issue, as per the headline of that article (“Mariners to take full control of ROOT Sports NW, clouding team’s financial outlook”) is that doing so is not necessarily a money-maker for the team. The writers of the article, Ryan Divish and Adam Jude of the Seattle Times, explain:
The uncertainty surrounding ROOT Sports comes on the heels of Comcast Xfinity’s announcement Oct. 10 that it was nearly doubling the cost of a subscription to the regional sports network, or RSN. That is projected to make a sizable dent in viewership for Mariners games next season, and the team will not receive an increased cut from Comcast’s rate hike.
Since Comcast’s announcement, the Mariners have shed some $44 million in player salary commitments. Notably, they traded popular third baseman Eugenio Suarez to the Arizona Diamondbacks and then included former top prospect Jarred Kelenic in a trade to the Atlanta Braves to rid themselves of the contracts owed to Marco Gonzales and Evan White.
As you surely know, some teams have been handing out huge contracts since this winter’s free agent season has begun. Some — the Twins and Mariners, as noted — have been making payroll cuts. This is going to make the dichotomy between baseball’s haves and have-nots even greater over the next few seasons. I think you’d agree that’s probably not good for the game.
I wrote this article late Tuesday and was going to end it as usual with, “As always, we await developments,” and in fact, there was a development early Wednesday. The Wall Street Journal reported that Amazon has entered talks with Diamond Sports to potentially invest with the company that’s now in bankruptcy for “a strategic investment and a multiyear streaming partnership” which could wind up with Amazon being the streaming home for Diamond Sports’ games. The article notes:
Diamond, which has the local rights to about half the teams in Major League Baseball and the National Basketball Association and about a third of the National Hockey League teams, would continue operating its cable networks through its existing partnerships. It isn’t clear how much money Amazon is planning to invest or at what valuation.
Diamond has received support from a select group of creditors for proceeding with the talks. Any transaction is subject to bankruptcy-court approval and could still fall through.
Should the companies manage to strike a deal, it could help enable Diamond, which operates Bally Sports-branded networks, to stave off liquidation.
So, that’s quite the development. We await further word.