Sinclair CEO Says His Company Has Enough Streaming Rights to Launch A Bally Sports DTC App, Others Aren’t So Sure
Despite strong words from powerful people in the sports world, Sinclair’s CEO says his company has the broadcasting rights needed to start a standalone DTC Bally Sports streaming service.
While speaking at the Bank of America Leveraged Finance Virtual Conference, Sinclair Broadcast Group CEO Chris Ripley said his company could have additional streaming rights coming soon and believes they have enough content to successfully launch their own DTC streaming app. Ripley also said Sinclair is in “active and ongoing negotiations,” with the NHL and the NBA for streaming rights, and that although it only has rights from four major league baseball teams, that could change soon. “I do think there will be some news around some of these renewal negotiations shortly,” Ripley said regarding MLB rights.
Ripley and Sinclair will have a tall, tall mountain to climb when it comes to Manfred and the MLB, however. MLB commissioner Rob Manfred has already said publicly that Sinclair does not have enough rights to launch a viable DTC streaming app, and has said that they're not in the business of throwing Sinclair a bone to get them there, either. “We’ve been very clear with them from the beginning that we see both those sets of rights as extraordinarily valuable to baseball,” Manfred said, “and we’re not just going to throw them in to help Sinclair out.
NBA commissioner Adam Silver voiced similar concerns when approached with the subject of Sinclair’s streaming app, and even made comments about Sinclair’s rights deal. “They paid $10 billion, it’s not clear, it’s a good deal with $5 billion,” Silver said. A source close to the deal responded to Silver’s comment and was quoted by The Athletic saying, “it’s sort of making a statement about the value of his rights more than he is about the value of the RSN rights,” the source said. “So he’s sort of denigrating the value of his own rights in a way, which is curious.” Silver did say he’s “trying to work” with Sinclair, but that was in October, and nothing has come of it since then.
Then, of course, there’s an even bigger issue going on with the MLB — a lockout, the league’s first in 26 years. While there’s not much worry going around at the moment, the lockout could spell disaster for Sinclair if it bleeds into the season. Without MLB, there’s not much of a market for RSNs, and with Diamond Sports Group, the subsidiary of Sinclair that technically owns the Bally Sports RSNs, reportedly inching closer to bankruptcy, a locked-out MLB season could be the nail in the coffin for Sinclair’s — and Ripley’s — dream app.
“I think that the negativity surrounding the RSNs has been increased exponentially as a result of the situation with the Sinclair subsidiary Diamond. Part of their problem is cord-cutting. The other part of their problem is there’s excessive leverage on that business,” Manfred said. “If you think about what they paid for it, how much debt they have on it, I mean, you think it’s over 80%, it’s a huge number. And that leverage has produced headlines that are more negative. There are RSNs out there that aren’t thriving or growing, but they’re going to survive. Look, look, there are RSNs — [YES] and NESN — that have businesses that remain profitable, they’re affected by cord-cutting. But the fact of the matter is I think the negativity has been increased by the Diamond (Sinclair) situation.”