The end of American Regional Sports Networks?

[nfotiu]

The writing has been on the wall for a while now, but some big developments this week.

The Sinclair owned Bally's sports Nets (which have 12 NHL teams), missed a debt payment this week which will trigger a ch 11 bankruptcy that could play out a number of different ways, but puts the rights paid to teams in jeopardy.

https://www.forbes.com/sites/bradadg...h=55a0adc325df

And the AT&T sports nets decided to not pay MLB teams the full amount of what they were owed. They have rights with 3 nhl teams (Kraken, Nights and Penguins)

https://www.sportico.com/business/me...ts-1234709889/

Comcast gave away one of their sports nets to the Capitals, and are trying to offload the others.

There is basically nobody who wants to stay in this business as cord cutting has eroded the carriage fees to the point that they owe the teams more than they are bringing in.

This is shaping up for a pretty big shake up of MLB, NHL and NBA local TV revenues.

[pokerNhockey]

My Understanding is that national broadcast revenues are split by all the teams in that country and regional go to the local market (may be shared with the away team?)


As such this will likely have the biggest impact on mid-market teams that are in the sweet spot of most of the games being regional but also bigger markets which presumably have better deals, all else equal.


I wonder if you will start to see more teams / leagues hosting their own "regional" networks like the Rangers do, cutting out the middle man and focusing on online rather then cable.

[bzoo02]

Just cut ties with cable all together and offer a streaming subscription service in 4k with no blackouts.

[Toonage]

Originally Posted by pokerNhockey

I wonder if you will start to see more teams / leagues hosting their own "regional" networks like the Rangers do, cutting out the middle man and focusing on online rather then cable.

MSG Network? Rangers/Knicks/Devils/Isles have about as much money behind them if not more than the league itself. I don't see a team like say, Columbus being able to do this.

[pokerNhockey]

Originally Posted by bzoo02

Just cut ties with cable all together and offer a streaming subscription service in 4k with no blackouts.

I suspect that is the way it is going, but from a revenue perspective it is unlikely that will be as profitable for the league -> there is a reason the contracts get awarded to cable companies and it isn't because they pay less then alternatives.

[pokerNhockey]

Originally Posted by Toonage

MSG Network? Rangers/Knicks/Devils/Isles have about as much money behind them if not more than the league itself. I don't see a team like say, Columbus being able to do this.

I could see a similar thing like how the team websites are hosted by the league where they share core infrastructure and then just have a team "page" so that you get cost efficiencies from scale so that the Columbus' of the world could do it.


No way is it as profitable for the teams as the current arrangement.

[Toonage]

I'd suggest NHL Live (or whatever they called it in the US) should be resurrected and tiered/structured for regional as well as national consumption but I suspect ESPN might have something to say about that at this point.

[memphusk]

I would rather pay 10 bucks a month direct to the Calgary flames than give a dime to sportsnet.

[Toonage]

Originally Posted by memphusk

I would rather pay 10 bucks a month direct to the Calgary flames than give a dime to sportsnet.

I remember Flames PPV, I'd hold onto that $10 for now

[ResAlien]

Team owned channels are working great for Denver. Avs haven’t been on television in years, there are zero streaming options from the team and channel itself, and there is no resolution in sight.

It doesn’t matter a ton because Avs “fans” only show up when the team is doing well and stop caring the second the city’s QB takes a dump but it’s a good example of a team owned channel being garbage for any fanbase.

[nfotiu]

Originally Posted by ResAlien

Team owned channels are working great for Denver. Avs haven’t been on television in years, there are zero streaming options from the team and channel itself, and there is no resolution in sight.

It doesn’t matter a ton because Avs “fans” only show up when the team is doing well and stop caring the second the city’s QB takes a dump but it’s a good example of a team owned channel being garbage for any fanbase.

Yeah, that was bad timing, and the ship has sailed on that. Trying to negotiate carriage for a new network is not going to go well any more.

There is a pretty good possibility that MLB teams end up the owners of the networks that are going bankrupt though, and can ride them out for a bit. Not sure if the NHL teams want to go down that path. TV deals like MLS and Apple may well be the future for the NHL and MLB. But the revenue will never match the carriage fee based RSN money.

[Yeah_Baby]

So, um, this is Salary Cap implications potentially right?

[Toonage]

^ Yes.

[Street Pharmacist]

hard to find hard numbers, but the most recent Disney deal only pays $400M a year our of the $5.2B revenue. While I'm sure there's potential significant impact, I'd much more hate to be Baseball right now

[Geeoff]

someone will for sure pick up the games these networks used to broadcast.

[Flames1217]

Blackouts and regional deals made the league more money in the short but it was never a viable long term plan.

Blackouts are stupid for consumers and the costs of a package without blackouts put people in a position where they simply can't afford it.

Hopefully one day Canadians will be able to get a proper viewing option that offers all games, no matter where you are for a proper price.

Just stream the games on YouTube and charge 10$ a month for subscribing. I would be more than willing to pay that price.

[PeteMoss]

Sinclair wildly over-paid all the stations (which seemed obvious at time). There is obviously a market for these rights but I suspect you need to bundle them up with streaming rights as well. Sportsnet up here has TV rights for the Flames but also streaming rights - so they get their money no matter how you watch it.

Most sports have bundled up their streaming rights in giant packages for the entire league. If you want to keep local revenue - you need to split it out into regional packages. But its hard to put the toothpaste back in the tube.

MLB for example - you can pay $25/month and get every game. Its a tough sell to get someone to pay $20 for the local only games. Especially when its probably on some streaming service that will suck compared to the something that like MLB which built the platform that ESPN bought/uses.

[PeteMoss]

Originally Posted by Flames1217

Blackouts and regional deals made the league more money in the short but it was never a viable long term plan.

Blackouts are stupid for consumers and the costs of a package without blackouts put people in a position where they simply can't afford it.

Hopefully one day Canadians will be able to get a proper viewing option that offers all games, no matter where you are for a proper price.

Just stream the games on YouTube and charge 10$ a month for subscribing. I would be more than willing to pay that price.

You can steam the Flames on Sportsnet for $15/month right now (assuming you are local).

Cost more to get out of market games.

[Coach]

Originally Posted by pokerNhockey

I suspect that is the way it is going, but from a revenue perspective it is unlikely that will be as profitable for the league -> there is a reason the contracts get awarded to cable companies and it isn't because they pay less then alternatives.

If they can package it correctly they could make more from it potentially. Behind the scenes add ons and packages, etc. I’ll pay to turn the commentary off and hear the ice. Please let that be an option.

Currently the NHL makes zero money from me so there’s 10-20 they can have

[DoubleK]

Originally Posted by Geeoff

someone will for sure pick up the games these networks used to broadcast.

For pennies on the dollar. This is suboptimal for HRR.