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

[jsnpritchett]

 

Could be some news on this as early as this weekend.  Looks like Ballys may want to focus on NBA/NHL and potentially get out of MLB altogether.

https://www.sportico.com/business/media/2023/diamond-sports-mlb-rsns-bankruptcy-1234740477/

"At least a few people who are tangentially plugged into the Diamond discussions believe the company will offload its distribution deals with the 12 MLB clubs that remain after the defections of the Padres and Diamondbacks. Beyond the simple expedience of wiping out some $800 million in rights fees in 2024 alone, offloading its baseball commitments would free Diamond to sell off its single-/zero-team RSNs in Cleveland, Kansas City, Phoenix and San Diego. MLB presumably could snap up those gently used assets at a nice price, which in turn would provide ready-made platforms on which to build an in-house distribution network. 

Ending the often contentious relationship with MLB would create its own set of logistical nightmares—quitting baseball amounts to a loss of 1,600 live telecasts per year, give or take, and would leave a ragged hole in the schedule for a good four months out of every 12—but Diamond this summer was already looking to jettison a handful of other team affiliations before the bankruptcy court ordered it to honor its contractual agreements.

In the meantime, Diamond has demonstrated its desire to stay in the NBA and NHL business, as the company continues to meet the conditions imposed by the former while also making good on payments to teams from both leagues. Most recently, Diamond renewed its contract with the Los Angeles Kings and wrote its first checks of the 2023-24 season to the Milwaukee Bucks and New Orleans Pelicans."

[Vegas Halo Fan]

On 5/6/2023 at 2:26 AM, HaloBronco said:

I couldn't agree with you more...

It's a shitty app. 

Just waiting for the day the stupid local blackout resrtrictions get lifted and I can watch the games on the MLB TV app, like I can during the spring training games.     

Our blackouts extend not only to spring training games, but even replays of them.

Commissioner Manfred says that it is a priority to revise the broadcast model and eliminate blackouts.

At least if we get the A's, six teams can't claim Las Vegas as a home market. Of course, the ballpark won't be ready until the 2028 season, so hopefully something happens soon.

[jsnpritchett]

From court filings this week, it seems like Bally Sports might be done for good with MLB after 2024.

 

 

[Blarg]

A lot of people are going to lose their jobs because of this. 

[jsnpritchett]

What a shitshow.  This seems to back up what I posted last week.  Seems more and more likely that the Angels (and every other team that still has a deal with Diamond/Bally) will have a new broadcast and/or streaming partner after 2024.

"Diamond, which runs the Bally regional sports networks, still has deals in place with 11 MLB teams, but two are in jeopardy and could soon be terminated. Per people briefed on the proceedings who were not authorized to speak publicly, the teams whose TV agreements are on the chopping block are the Cleveland Guardians and the World Series champion Texas Rangers.

If Diamond drops those two teams, the clubs would get their rights back and could be broadcast either by the league in 2024, as the Padres and Diamondbacks were for part of the 2023 season. Alternatively, the Guardians and Rangers could strike a deal with another broadcaster to carry games.

“Our intention is to broadcast almost all of (our) Major League Baseball teams next year,” a lawyer for Diamond said in court Wednesday. “There are a few, a very few, for which we do not have agreements in place. And that, frankly, at this point, are too expensive for us to broadcast without concessions. I am told that those discussions are taking place, there have been reach-outs to both of the teams involved.”

The Guardians received $55 million in 2023, per Cleveland.com. The average annual value of the Rangers’ 20-year deal, which began with the 2011 season, has been said to be $111 million.

“There’s no deal with MLB, there’s no deal with the Rangers, we don’t know what (Diamond’s) intention is with respect to the Rangers,” a lawyer for the Rangers said on Wednesday in court.

MLB declined comment after the hearing. The league has been pushing for certainty as to its 2024 broadcast agreements and revenues, and a hearing on a motion the league brought is expected no later than Dec. 8. As of now, nothing prevents Diamond from potentially dropping additional teams beyond the Guardians or Rangers before the end of the 2024 season."

 

[Blarg]

I guess winning the World Series just isn't worth much these days. 

[HaloBronco]

Was hoping the broadcast would be moved from Bally's in 24, unfortunately looks like we're stuck for another season.  

[nando714]

Remember in 2012, media deals were all the rage 

lol

[totdprods]

16 hours ago, jsnpritchett said:

The average annual value of the Rangers’ 20-year deal, which began with the 2011 season, has been said to be $111 million.

OOF. Even after winning the WS, have to think they may be sweating a little bit after spending so much. 

[Hubs]

This was about the debt used to finance the deal, more than the revenues being down from cable and streaming but those did have an effect. It was a bad deal that shouldn't have been approved...the debt load alone was way too massive.

Going forward, the teams with the best opportunity to have a streaming package will be kept, likely and the ones without will be dropped.

[jsnpritchett]

22 minutes ago, Hubs said:

This was about the debt used to finance the deal, more than the revenues being down from cable and streaming but those did have an effect. It was a bad deal that shouldn't have been approved...the debt load alone was way too massive.

Going forward, the teams with the best opportunity to have a streaming package will be kept, likely and the ones without will be dropped.

We've been back and forth on this a few times before.  Yes, the debt is an issue--but the dramatic loss of cable subscribers and the massive pushback from cable providers on carriage fees have become more immediate concerns.

And if you've been following the most recent articles and reporting, it seems unlikely at this point that Bally will keep any sort of MLB rights package (whether broadcast, streaming, or a mix of the two) in the medium/long run, even for individual teams.

[Hubs]

49 minutes ago, jsnpritchett said:

We've been back and forth on this a few times before.  Yes, the debt is an issue--but the dramatic loss of cable subscribers and the massive pushback from cable providers on carriage fees have become more immediate concerns.

And if you've been following the most recent articles and reporting, it seems unlikely at this point that Bally will keep any sort of MLB rights package (whether broadcast, streaming, or a mix of the two) in the medium/long run, even for individual teams.

The loss of carriage and rights fees wouldn't be as pressing without the massive debt. They have no positive cash flow to speak of. Terrible deal. 

[Inside Pitch]

18 hours ago, nando714 said:

Remember in 2012, media deals were all the rage 

lol

The "death" of cable or the rise of streaming.... Its all had an impact.  Waiting for teams to cut deals with Tiktok, no baseball, just players doing dances and other vapid BS.

[RallyMo]

The potential sequel to this with the B1G is gonna be a blast to watch.

[gotbeer]

On 11/17/2023 at 4:14 AM, Inside Pitch said:

The "death" of cable or the rise of streaming.... Its all had an impact.  Waiting for teams to cut deals with Tiktok, no baseball, just players doing dances and other vapid BS.

We were ahead of our time.

[Docwaukee]

could be the main reason why an Angels sale never got done.  

Uncertainty surrounding $150 mil per year in revenue might be a pretty big deal.  

[jsnpritchett]

More delays in the Bally Sports/Diamond nonsense:

 

[HaloBronco]

5 hours ago, jsnpritchett said:

More delays in the Bally Sports/Diamond nonsense:

 

Can't wait for Bally sports to go away, the sooner the better. 

[jsnpritchett]

This is interesting: Amazon may step in to partner with Diamond/Bally Sports:

https://www.wsj.com/business/media/amazon-in-talks-to-invest-in-diamond-sports-b07af4d9?mod=followamazon

"Diamond Sports Group, which carries the games of more than 40 major sports teams across the country and filed for bankruptcy earlier this year, is actively negotiating with Amazon about a strategic investment and a multiyear streaming partnership, according to people familiar with the matter.

If an agreement is reached, Amazon’s Prime Video platform would eventually become the streaming home for Diamond’s games.

Diamond, which has the local rights to about half the teams in Major League Baseball and the National Basketball Association and about a third of the National Hockey League teams, would continue operating its cable networks through its existing partnerships. It isn’t clear how much money Amazon is planning to invest or at what valuation."

My guess is that even if this happens, Diamond would still look to get out of some additional MLB deals altogether and try to renegotiate some others to lower rights fees.

[Hubs]

Sinclair should never have been permitted to buy these stations solely with debt. The unsecured debt payments alone doomed this deal, and they furthered it by spinning it off and then trying to charge for management services.

They are getting denied. Which they should, they should not pay themselves (spin off or not) for management before paying the team for rights fees they owe.

This is a truly fucked up deal, and yes, while viewership and cable declined, the onus of this bankruptcy comes down to the debt used to purchase the deal, and the way in which it was structured, which never should have been allowed. 

I'm annoyed because I bank at one of the banks that made a stupid unsecured loan and will get stiffed. Sinclair is one of the worst companies in Media, and they should be responsible for their bad deal, instead of stiffing and shifting blame. This is the problem with bankruptcy laws in the USA. Too easy to manipulate. 

[ettin]

On 11/17/2023 at 4:14 AM, Inside Pitch said:

The "death" of cable or the rise of streaming.... Its all had an impact.  Waiting for teams to cut deals with Tiktok, no baseball, just players doing dances and other vapid BS.

All I know, is that MLB has a real image problem and they really need to jump start additional avenues to increase fan interest in the sport overall, in my opinion.

Also, if any of you have Tiktok, I'd highly recommend uninstalling it, the Chinese government uses the app to harvest information off of your phone, it is a serious issue.

[Blarg]

10 minutes ago, Hubs said:

This is the problem with bankruptcy laws in the USA. Too easy to manipulate. 

[Blarg]

8 minutes ago, ettin said:

All I know, is that MLB has a real image problem and they really need to jump start additional avenues to increase fan interest in the sport overall, in my opinion.

Also, if any of you have Tiktok, I'd highly recommend uninstalling it, the Chinese government uses the app to harvest information off of your phone, it is a serious issue.

Hah! That ain't gonna happen. Tictok is like a meth addiction to this generation. 

[Hubs]

I will point out that the lack of a streaming option most certainly caused the devaluation in the Bally Sports Groups RSN's, but if they had not been purchased with 10B in unsecured debt and that Sinclair was allowed to manipulate and then sue their own subsidiary was ridiculous.

These stations, left on their own with their own rights deals and such were certainly profitable when they were bought in 2019, and yes Covid... upped the streaming boom, but they are less profitable now, and they would still be able to afford the rights fees, if not all of them...

Having to pay 10B in debt, caused this fall, and no one points this out, they all jump to rights fees and cable subscribers, etc. It's lazy journalism. 

It's like ignoring the mortgage on the house, but complaining that costs on the utilities went up, so you can't afford the rent anymore. There is still a gigantic loan to satisfy first. That's causing all of these issues.

[The Ghost of Bob Starr]

I’m so glad I have IPTV and every channel. I never have to worry about this nonsense.