NEWSLETTER
As discussed this morning, the long-standing Diamond bankruptcy, with the former Bally-branded Regional Sports Networks wrapped up therein, has more or less finally fully resolved as far as MLB teams are concerned. The company, with the RSNs rebranded under the FanDuel name, is going to try to make a go of it after coming out of bankruptcy. They’ll have the rights for a number of MLB, NBA, and NHL teams to try to make it work, but probably only about two or three years of real runway before contracts are up once again and everyone takes another look at how the streaming world has evolved. We know MLB Commissioner Rob Manfred wants to centralize as many of the MLB teams’ rights as the league can by then, but we’ll get there when we get there.
In the meantime, even as all of the affected teams (excepting perhaps the Braves) are going to have to take a significant haircut in revenue to get their games on the air – either on the FanDuel RSNs, on a streaming-only option via MLB, or some other new broadcast deal – they all do now have some certainty, at least. Short-term? Yes. Lower-dollar? Yes. But it’s not this big black cloud of the unknown hanging over the teams and their budgets.
So, then, is that part of the reason we’re seeing more early movement in free agency this year than in recent years past? And if so, does it bode well for a more exciting two weeks ahead, rather than the drip, drip, drip of so many substantial moves being held up until well into the spring?
At least one involved part thinks so. And he thinks the money will wind up find in the end.
When he was asked why some teams are more eagerly spending money on the earlier side this offseason, agent Scott Boras told ESPN: “I wish I can answer those questions. I do. I think a lot of it has to do with media certainty, platforms working the way they should, and the streaming thing that they have going on is very viable, very profitable. I don’t think they like to say that, but obviously the markets indicate that there is a different attitude about what it is.”
Whether we believe direct-to-consumer streaming options will ultimately be as profitable locally for teams as the days of massive cable broadcast deals (I strongly doubt it), Boras is not wrong that the free agent market is operating as though everything is going to be fine on the TV revenue side for years to come. Of course, some of that is disproportionately weighted by the fact that a team like the Dodgers has an iron-clad, ultra-massive broadcast rights deal through 2039 (it pays far more AND is far more secure than any other deal in baseball). Still, we’re not seeing any kind of across-the-board hit in salaries that you might expect if half the league were dramatically cutting spending. Sure, some teams will step back, but we’re not yet seeing the manifestation of a spending crisis. That was a very real fear a couple years ago.
Now, then, as more of these streaming options get rolled out, and as we head toward 2028 when more of these interim deals expire? Will we have learned that they just aren’t going to be as profitable as hoped? Or that some monster national streaming deal from Netflix or Peacock or ESPN or whoever is simply not going to be available? Or that the large-market teams who are happy with their local broadcast deals work extra hard to block a national deal? We’ll see. This is going to play out over several years, not just this winter.
Also looming? The current Collective Bargaining Agreement runs through 2026. These issues will impact player-owner battles, and also owner-owner battles. Maybe more than any other issue on the table. So that’ll be fun.
