MLB, ESPN in Discussions to Stream In-Market Games Next Season as Disney’s Sports Plans Continue to Evolve
Disney is once again attempting to flex its sports streaming muscles. A new report from The Wall Street Journal indicates that Major League Baseball has been in early talks with Disney regarding the possibility of streaming the games of select teams in their local markets next season.
The league has been watching the bankruptcy proceedings of one of its biggest local broadcasting partners Diamond Sports Group (DSG), which owns 19 Bally Sports-branded regional sports networks (RSNs). MLB has been crystal clear throughout the process that it wants its local rights back from DSG, but so far has only reclaimed two of the 14 teams that DSG began the year with: the Arizona Diamondbacks and San Diego Padres.
MLB has taken over the broadcasts of those teams in their home markets, and given local fans the chance to subscribe to MLB.TV to stream their games. But MLB.TV is normally an out-of-market platform, and it appears that the league would rather partner with ESPN to stream locally next season rather than continue with its 2023 arrangement. Select Major League games already stream on ESPN+ and Hulu as part of Disney’s existing broadcast agreement with the baseball league.
This could be a sign that MLB commissioner Rob Manfred's dream of an MLB-owned local streaming platform featuring all 30 teams is officially dead. Such a platform faces considerable pushback from inside the league, as some of the biggest teams like the Boston Red Sox (NESN 360), New York Yankees ([YES Network App]), and Chicago Cubs (Marquee Sports Network app) already have their own in-market streaming platforms. They get to keep a larger share of revenues for themselves by creating their own platforms but would have to share subscription profits with other MLB owners on a league-run service.
Streaming games via ESPN instead would sidestep the issue, allowing the league to give fans an in-market streaming option if the teams themselves don’t want to create one. The Journal mentions ESPN+ as a possible repository for such games, which could create an additional baseball streaming tier to house them. That tier would naturally cost more than the $9.99 monthly subscription fee ESPN+ currently charges.
One potential stumbling block is that Disney reportedly doesn’t want to pay big broadcasting rights fees, as TV providers have traditionally done to air live sports games. One way to get around that issue would be to sell MLB a portion of ESPN instead; Disney has been in contact with leagues like MLB, the NFL and the NBA about purchasing a minority stake in the channel, in order to offset losses from cord-cutting and help launch it into a future in which ESPN is available via streaming without a cable or satellite subscription.
That future is still two or three years away, and likely won’t occur until ESPN falls below 50 million linear subscribers. It currently sits at around 71 million, so the transition won’t be immediate. Such a service will likely feature a premium subscription cost of $30 per month — or much higher, though WSJ also reports that Disney is considering keeping ESPN+ as a standalone service so that users with smaller budgets will still have an option.
Right now no option is off the table for Disney when it comes to its linear channels. The company is reportedly willing to divest itself of ESPN entirely if it can’t find the right strategic partners to help it into the future, but conversations with MLB about streaming games in local markets next year suggest that Disney wants to try everything it can to keep ahold of the channel for the long term.
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