If Diamond Sports Defaults, MLB Network Will Air Games; Could YouTube TV Have to Bring Back the Channel?
Earlier this week, Diamond Sports Group (DSG), an independent subsidiary of Sinclair Broadcasting Group, announced to the world that it would miss a scheduled interest payment on its debt. That started a 30-day clock, by the end of which DSG must have a plan in place for putting its collection of 19 regional sports networks (RSNs) under the Bally Sports brand on a path to profitability, or the company will almost certainly be forced to declare bankruptcy.
The proceedings won’t have a direct effect on the consumer initially, but they will have a big impact on major sports leagues like Major League Baseball. Several MLB teams are due broadcasting rights payments from DSG in the next month, and the league’s commissioner Rob Manfred said on Wednesday that if the media outlet misses even one of those payments, the league and its teams have cause to terminate its contracts.
“We’ve been really clear that if Diamond doesn’t pay under every single one of the broadcast agreements, that creates a termination right, and our clubs will proceed to terminate those contracts,” Manfred said during a press conference.
MLB is clearly reaching the end of its patience with DSG. Negotiations between the two sides have been ongoing since October, but progress has been hard to come by. Baseball executives have stated that while they'd rather DSG be able to meet its financial obligations than have to do something drastic, the second of those two possibilities is looking increasingly likely.
The league has been preparing as if it will have to take over broadcasts of games from Bally Sports RSNs, and Manfred’s comments gave more details about what that might look like. Manfred said that the league would use MLB Network to broadcast games that the league reclaims from DSG, allowing MLB to negotiate carriage deals directly with cable providers.
“In the event that MLB stepped in,” he said, “what we would do is we would produce the games, we would make use of our asset with the MLB Network to do that, we would go directly to distributors — Comcast, Charter, the big distributors — and make an agreement to have those games distributed on cable networks.”
Manfred also said such an arrangement would offer more flexibility for the league’s out-of-market streaming service MLB.TV. The commissioner made it clear that offering in-market games on the service would be a part of his strategy, as well.
“We would also be seeking flexibility on the digital side so that, when you look at MLB.TV, you could buy your out-of-market package like you always had,” he said, “but have the option to buy up into in-market games, something the fan has never had before, which I see as a huge improvement for fans.”
The offering of in-market games on MLB.TV would be a major step for the league. One of the biggest hurdles for other sports, as they ponder the best ways to move to a streaming format, is getting around contracts with broadcast and cable networks that call for local streaming blackouts in markets where games are on TV already.
If MLB Network does become the new home for games formerly broadcast by Bally Sports RSNs, it could be a good incentive for YouTube TV to start carrying the channel again. The live TV streaming service dropped MLB Network in a carriage dispute in January, but a higher volume of live games on the cabler might convince YouTube TV to fork over a higher carriage fee.
No matter how the Diamond-MLB dispute shakes out, the league is probably quite pleased with its hire of current Executive Vice President of Local Media Billy Chambers. Thanks to Chambers, the league has a coherent strategy in place if DSG fails to meet its contractual obligations, and will likely be bringing more games to both TV and streaming because of it.
MLB.TV
MLB.TV is the official streaming service of Major League Baseball. You can see every out-of-market game live or on demand, and choose home or away TV and radio feeds. The app allows fans to watch up to four games simultaneously on the same screen through their Multi-view feature.