Diamond Sports Group (owner of Bally RSNs) files for Chapter 11 bankruptcy, MLB to produce Padres games after missed payment

[gotbeer]

23 hours ago, Stradling said:

It would end black outs for those markets. But where does the revenue come from for the team?

Bally's isn't trying to cease operations, they are trying to get protection from creditors.  So the broadcasts will probably still continue. But if the creditors go the nuclear option and look to dissolve, then I think what MLB is looking to do is get some kind of stream going.  It'll probably be real basic at first.  I believe all the gear cameras, broadcast truck, cabling, etc is owned by Bally's. Not to mention the broadcasters and cameramen and behind the scenes people are employees of Bally's.  So it's not as easy as flipping a switch and there is the game.  For a while, it'll probably more resemble a minor league or even worse, a high school broadcast of a game.  

But looking at the article.  This is what sticks out.

Quote

Despite the distancing between Diamond and its parent, Sinclair still owns 90% of the group’s equity. Chapter 11 bankruptcy typically wipes out equity holders, who sit at the bottom of the creditor hierarchy. However, the filing likely will have few ramifications for Sinclair’s stock price, given investors appear to have largely written off Diamond’s value to Sinclair after the split, according to Morningstar.

So pretty much Sinclair has already taken the loss and is ready to walk away from Diamond.

Quote

The plan favored by the company and its creditors at the time, Bloomberg said, would turn lenders into owners in a prearranged Chapter 11 process. 

So that sounds like all those loans, would turn into equity stakes instead.  So I don't know if that means that the $1.5 billion owed in broadcast rights gets wiped out, and turned into an equity stake or what?  Which would probably mean the Angels don't get paid, unless Diamond makes money.

[HaloBronco]

Sounds like a workaround, for now. 

[nando714]

Games on KCAL9 please 

tbh we should start a network with the clippers. 
 

let’s face it we’re not the lakers, dodgers, Yankees, etc. teams that have their own network 

[Jay]

10 minutes ago, nando714 said:

Games on KCAL9 please 

KCAL9 could probably get better ratings with re-runs of I Love Lucy.

[Ace-Of-Diamonds]

Can't we just get a new contract from another provider is they default?

[jsnpritchett]

7 minutes ago, Ace-Of-Diamonds said:

Can't we just get a new contract from another provider is they default?

Who is that going to be?  Whoever it is won't be giving them $150M a year.  It can't really be an already-existing RSN that carries baseball, since the team schedules would overlap.

Also, for what it's worth, other RSNs not owned by Diamond Sports Group are having issues.  The Astros, Rockies, and Pirates RSNs made their first rights payment of the year, but for less than the contracted amount. 

https://www.sportico.com/business/media/2023/wbd-att-rsns-light-on-mlb-rights-payments-1234709889/

 

[Jay]

It's a fucking scam. They want to charge everyone in the cable system so that 2% of the viewers can watch the games. Now that there are more options for the viewers the business model is collapsing.

 

[Taylor]

13 hours ago, Jay said:

It's a fucking scam. They want to charge everyone in the cable system so that 2% of the viewers can watch the games. Now that there are more options for the viewers the business model is collapsing.

 

You can't spell capitalism without scam.

[Don]

19 minutes ago, Taylor said:

You can't spell capitalism without scam.

Good point comrade

[TempeAngel]

14 hours ago, Jay said:

It's a fucking scam. They want to charge everyone in the cable system so that 2% of the viewers can watch the games. Now that there are more options for the viewers the business model is collapsing.

 

Not really.

They are part of an add on sports package on Spectrum. It includes 9 other sports channels for $6 per month. You only pay the $6 if you want the sports channels. I watch them all so it's a no brainer.

I don't budget like this but It's more valuable to me than a $6 Starbucks per month. 

It's all good. Chill and enjoy.

[mmc]

 

[mmc]

Are the NBA or MLB Ballys deals more lucrative?  (I imagine the NHL is a distant third)

[mmc]

 

[mmc]

Diamond Sports Group will miss a $140M interest payment tomorrow that will trigger a 30-day grace period before filing for bankruptcy on March 15, but several NHL and NBA teams are still cutting deals with Diamond’s Bally Sports RSNs. The Lightning signed a rights deal with Bally Sports Sun earlier this month, sources said. Sources added that the Hurricanes and Ducks are close to finalizing extensions with Bally Sports South and Bally Sports SoCal, respectively. The Clippers renewed a deal on Bally Sports SoCal just before the regular season started, while the offseason saw the Pelicans extend with Bally Sports New Orleans and the Pacers cut a deal with Bally Sports Indiana. Teams are opting to cut these deals for several reasons. In a best-case scenario, the clubs hope they will continue to be paid for their rights even through a bankruptcy. In a worst-case scenario, these teams think it is better to be paid even for a couple of months. There is still no alternative that would pay as much for rights as RSNs.

MLB TEAMS YET TO RE-SIGN: The deals also show that the NBA and NHL are more willing to work with Diamond Sports than MLB. No MLB team has renewed a deal with Bally Sports RSN since 2021. No deal has come up since then, but teams all have stayed away from signing extensions. All eyes are on the Twins to see what that team does with its rights, as their deal with Bally Sports North ends after the 2023 season. The biggest question is whether it will head into bankruptcy with a restructuring plan in place. Diamond needs the NBA and NHL to be on board for this kind of restructuring deal to be put in place. MLB involvement would make this plan even stronger. The alternative is what is known as a free-fall bankruptcy, where nobody -- not Diamond, not its creditors, not the teams, not the leagues -- has control over the outcome or the timing.

[Revad]

Surely this was some factor in Arte’s decision not to sell.  This kind of uncertainty would be an issue for most buyers.

[mmc]

18 minutes ago, Revad said:

Surely this was some factor in Arte’s decision not to sell.  This kind of uncertainty would be an issue for most buyers.

It didn't stop Mat Ishbia from spending $4 billion on the Suns

[James]

21 minutes ago, Revad said:

Surely this was some factor in Arte’s decision not to sell.  This kind of uncertainty would be an issue for most buyers.

How can you say surely when this hasnt been reported at all and quite the contrary from all reports based on the number of interested groups. 

[Revad]

27 minutes ago, James said:

How can you say surely when this hasnt been reported at all and quite the contrary from all reports based on the number of interested groups. 

It’s speculation, but the sale isn’t happening in a void.  People saw this coming well before Arte announced he was considering selling.  Assessing the environment a business operates in would be due diligence.

[jsnpritchett]

I'm still very curious how MLB itself would pull this off, since it would mean providing broadcasts for essentially half of all games.

[mmc]

NHL owners meeting to discuss this

 

[Taylor]

3 hours ago, Don said:

Good point comrade

You can't spell comrade without "rad."

[FIGGY_MVP]

Just wanted to throw this out there for anyone clamoring for an Angels/Clippers Channel.  Balmer, the Genius that he is, was already aware of the issues with Bally Sports and started Clippers Vision at the beginning of this NBA's season. 

 

What is Clipper vision?

 

The LA Clippers are officially launching their very own streaming service. It's a move that will change the way fans watch basketball and likely have a ripple effect on the rest of the NBA. This venture, known as ClipperVision, is the very first direct-to-consumer streaming platform in the NBA.

ClipperVision will stream more than 70 games live in-market directly to fans without a pay TV subscription, with the first stream beginning on October 22. It will launch six different streaming options, with more coming in the future. 

 

https://www.si.com/nba/clippers/news/la-clippers-launch-new-clippervision-streaming-service

[eaterfan]

23 hours ago, jsnpritchett said:

Who is that going to be?  Whoever it is won't be giving them $150M a year.  It can't really be an already-existing RSN that carries baseball, since the team schedules would overlap.

Also, for what it's worth, other RSNs not owned by Diamond Sports Group are having issues.  The Astros, Rockies, and Pirates RSNs made their first rights payment of the year, but for less than the contracted amount. 

https://www.sportico.com/business/media/2023/wbd-att-rsns-light-on-mlb-rights-payments-1234709889/

 

Maybe, or maybe not. The issue for Diamond might not be the revenue stream but the interest payments because they were leveraged to the hilt when they bought it. 

If someone buys the rights for the same price but can reduce costs by not having interest payments due, it's possible to make a profit even paying those prices. I don't know what the margins were and the amount of interest, but it's very possible that deals could be similar. 

Not saying it's likely, but it's possible the costs just got out of hand and the revenue just didn't grow as they needed it to with that much interest due.

[jsnpritchett]

2 hours ago, eaterfan said:

Maybe, or maybe not. The issue for Diamond might not be the revenue stream but the interest payments because they were leveraged to the hilt when they bought it. 

If someone buys the rights for the same price but can reduce costs by not having interest payments due, it's possible to make a profit even paying those prices. I don't know what the margins were and the amount of interest, but it's very possible that deals could be similar. 

BNot saying it's likely, but it's possible the costs just got out of hand and the revenue just didn't grow as they needed it to with that much interest due.

But, again, who would that be?  What currently available networks could take on their broadcasts? 

[Taylor]

3 hours ago, jsnpritchett said:

But, again, who would that be?  What currently available networks could take on their broadcasts?