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Cubs TV Deal: Regional Blackout Progress, Cable Bubble Concerns, Huge Deal Coming, More

Chicago Cubs

kid-watching-tvThere are a ton of Cubs-related TV notes to share, so we’ll just do this list style. And since Spring Training games are starting this week, and we’re talking about TV anyway, I would be remiss if I didn’t remind you that a significant chunk of Cubs Spring games will be available via some form of video this year. To that end, I recommend getting, which I, myself, have already purchased and am super itchy to fire up. You can add for half price right now if you get them at the same time, and when you buy via the links here, it supports BN in the process.

OK, on to a whole bunch of TV notes …

  • Any mention of necessarily brings up a blackout discussion, and there is some definitely some good news on that front. As we’ve discussed, with the Cubs splitting their games between CSN Chicago and the local WGN and ABC channels, folks who live within the Cubs’ blackout region, but who don’t get WGN-9 or ABC-7, are at risk for not being able to see those games no matter what. The Cubs have said this is being worked on via local syndication deals, and have added that MLB may consider lifting the blackout for folks in the Cubs’ zone (basically most of Illinois, Iowa, Indiana, and a little of Wisconsin) who do not otherwise have access to those games at all (don’t get your hopes too high just yet, but it’s possible). As for the non-Chicago local syndication deals, we have some confirmation that these deals are being finalized right now, with Peoria’s WAOE My59 announcing that they’ll be carrying 45 of the Cubs’ WGN games in 2015 (in HD). (Hat tips here, here, and here.)
  • Obviously that’s just for folks in the Peoria area, and it’s just a start, but I’ve been told these kinds of deals are being worked on in several other areas, so this is a good sign. Word on these deals will trickle out in the coming weeks, I’d expect, and I’ll make sure to keep you updated as areas get coverage. I’ll also make sure to update folks if and when MLB officially agrees to lift blackout restrictions in areas that cannot get the games (at which point you’d be able to get them on; folks outside of the blackout region, of course, don’t have to worry about this stuff).
  • Turning from the short-term deal stuff to the long-term deal stuff, we’ve got a little more info on the long-term deal the Diamondbacks (much smaller market, less desirability, I’d think) just signed, per Nick Piecoro: the deal is for 20 years, and worth more than $1.5 billion. It likely also comes with an equity stake in the RSN, which is becoming increasingly common (equity distributions are not presently subject to revenue sharing). The deal is far short of the megadeals inked by the Dodgers and Phillies in recent years, but, given the market – and given the fact that we’re already in the “oh no, bubble maybe bursting” era – this is probably a good sign for the Cubs’ long-term deal. Recall, the Cubs’ CSN contract is not up until after the 2019 season, but the tentative expectation is that the Cubs will try and figure out a way to ink their long-term deal before then.
  • When he addressed the media in Mesa, Cubs owner and chairman Tom Ricketts said he wasn’t worried about the live sports bubble bursting any time soon (CSN), and also made reference to the Cubs getting their game-changing long-term TV deal “in the next few years.” Again, that suggests the Cubs won’t wait until 2020 to finalize the new deal. Given how much having a premium long-term deal (for the Cubs, it will probably involve starting their own network) impacts the revenue picture, this remains a huge story in the coming years. Relatedly, it’s another reason to hope the Cubs are competitive and compelling in the next couple years so they can demonstrate just how huge the TV draw can be.
  • Meanwhile, the size of that Dodgers deal continues to be a problem for actual Dodgers fans. Why? Because the carriage fees Time Warner wants/needs to charge to make the deal profitable for them is so high that a large number of cable and satellite providers refuse to pay it. That left upwards of 70% of homes in the area unable to get Dodgers games in 2014, and that could be the case again this year. For their part, the Dodgers are adamant that they will not lower their take from the $8.35 billion rights deal in order to get Time Warner to lower its carriage demands. The team wants its money, no matter what. Thankfully, the Cubs are in a position to learn some lessons from this fiasco, and will hopefully better gauge that tenuous balance between huge guaranteed rights fees to the team, and reasonable projected carriage fees charged by the RSN.
  • (And, also, I’ll keep saying it: hopefully the Cubs sagely project how distribution is going to change in the coming years so that they’re not locked into some dying technology or worthless medium.)
  • Speaking of streaming, Commissioner Rob Manfred is keenly aware of the changing landscape (he even referenced HBO’s plans to offer an a la carte streaming option this year), and it sounds like MLB will be in a good position to adjust/adapt. Considering that HBO’s streaming service is actually supported by MLB Advanced Media – because was built out as one of the first, wide-reaching streaming services, they actually ended up providing the architecture for a number of other, non-baseball streaming services – this is an area where MLB has always seemed to be ahead of the game.
  • Speaking of which, there’s a chance that, at some point, MLBAM splits off its streaming arm into an entirely separate technology company, because, at some point, that’s what they are. It’s just kind of cool to think about a non-baseball streaming technology behemoth being born out of MLB’s desire to get games to its fans over the Internet 15 years ago.
  • In that Forbes piece, Manfred also mentions how the blackout regions are integral to the economics of the sport, but they are currently being challenged in federal court. (Get ready for some cognitive dissonance: without the blackout territories, everyone would be able to get and watch any game anywhere anytime … but the Cubs probably wouldn’t get as gigantic of a mega-deal with an RSN. So, which way you rooting on that lawsuit?)

Author: Brett Taylor

Brett Taylor is the Editor and Lead Cubs Writer at Bleacher Nation, and you can find him on Twitter at @BleacherNation and @Brett_A_Taylor.