Collapse of Regional Sports Networks (Diamond Sports Group files bankruptcy, Warner-Discovery looking to leave business, Xfinity drops Bally)

[KevFu]

I think one major league partner would be better as it's fewer ways to split the pie and with the MLB there's relatively little overlap in seasons compared to the NBA. When you have significant season overlap, my concern would be around discussions on how to attribute subscribers and thus revenue to either league to inform what the revenue split would be. You could analyze direct viewing data but this would likely result in the NHL getting squeezed as it's the smallest of the 3. Compare that to a revenue share between two leagues with each league getting the revenue allocated based on viewership during specific quarters of the year.

Also there would be the hold up on national contracts with ESPN and Sportsnet. A streaming partner would want to get the NHL in its entirety, not just teams as their local deals fall off. But the ESPN and Sportsnet deals still have term left.

Yeah, I see the point of splitting it less ways. But I also think that can be off-set by the structure and make more money based on consolidation for fans.

Let's say that hypothetically, each RSN has a DTC streaming option for $30 a month.

How much you pay depends on:
A. Which teams you want to watch
B. What networks those teams are on.
C. How many teams you'd be willing to pay for.

In Detroit, if you like all three teams, you're golden: $360 for Tigers, Wings, Pistons on one service). You can cancel for six months and pay $180 if you like just baseball, or just a winter team.

In Boston, you need to get NESN AND NBC Boston for all three teams ($570).

New York, is crazy. Depending on what combo of teams you like, it could be $180, $210, $360, $390, $570 or $600 to watch three teams.

The number of people who probably don't pay for a "second purchase" is likely quite high.


But if you had the three leagues bundled together, with two options:
A. "Local" teams. Whatever teams are local to where you live, you get MLB, NBA, NHL;
B. "Everything." All 92 teams, no blackouts of any RSN game.

I think you'd make a ton more money total based on the "second purchase" people being all in now.

AND you'd also have a massive amount of customers in "disputed territory" who go from not buying ANYTHING because it's prohibited, to buying EVERYTHING because now they can get their team for the first time, ever.

I don't know that you NEED to divide the money based on who WATCHES what... split the money from each "A Package" purchase among the teams available there. Split the money from B packages among every team.

 

[KevFu]

That would have to be an expensive deal, if each team averages 30-40 million in RSN deal, to have to replace that, and make it like one big National deal.
Or the league just gives up on a billion in revenue, which would lower the cap by about 15 million.

But the RSN bubble has just burst. The dollar amounts per team were based on cable subscribers which are plummeting with streaming/cord-cutting.

This is a way to make all sports fans subscribe to local/national RSN network instead of just watching Netflix as a cableless person who's blacked out from streaming.

SD and ARZ got dumped from Bally's, but an incredibly higher amount of people can watch their games now. The TV numbers are the SAME for the Padres as they were on Bally's... but now there's streaming purchases that didn't exist before.

 

[Golden_Jet]

But the RSN bubble has just burst. The dollar amounts per team were based on cable subscribers which are plummeting with streaming/cord-cutting.

This is a way to make all sports fans subscribe to local/national RSN network instead of just watching Netflix as a cableless person who's blacked out from streaming.

SD and ARZ got dumped from Bally's, but an incredibly higher amount of people can watch their games now. The TV numbers are the SAME for the Padres as they were on Bally's... but now there's streaming purchases that didn't exist before.

That doesn’t address how to make up the billion in revenue lost.
It would be better, just don’t know how it happens, with that much money gone per team.

 

[KevFu]

That doesn’t address how to make up the billion in revenue lost.
It would be better, just don’t know how it happens, with that much money gone per team.

I don't know that you CAN make up for the revenue lost of the bubble bursting due to streaming/cord-cutting.

That money came from people who paid RSNs every month through their cable bills, who didn't watch those channels. Now that people who don't watch live sports don't NEED cable, because they switched to streaming TV shows via Peacock, Hulu and Paramount+ that revenue is just gone.

So you need new customers to replace them. And the best place to look would be the fans of teams who cannot pay to watch their teams because of blackouts.

Think about Austin and Columbus. You grow up rooting for the MLB team from "Your side of the state" and go to college at Texas or Ohio State and get a job. You're in "enemy territory" and you can't watch your team even if you're willing to pay for MLBtv.

 

[joelef]

I don't know that you CAN make up for the revenue lost of the bubble bursting due to streaming/cord-cutting.

That money came from people who paid RSNs every month through their cable bills, who didn't watch those channels. Now that people who don't watch live sports don't NEED cable, because they switched to streaming TV shows via Peacock, Hulu and Paramount+ that revenue is just gone.

So you need new customers to replace them. And the best place to look would be the fans of teams who cannot pay to watch their teams because of blackouts.

Think about Austin and Columbus. You grow up rooting for the MLB team from "Your side of the state" and go to college at Texas or Ohio State and get a job. You're in "enemy territory" and you can't watch your team even if you're willing to pay for MLBtv.

It was never a bubble just a platform dying with nothing replacing it

 

[joelef]

It's probably really unrealistic, but....

MLB, NHL and NBA teaming up as investors for a system of RSNs with DTC streaming that has no blackouts would be ideal.

No they’re going continue to blackouts even if they get less money . These leagues want to die on the blackout hill.

 

[mouser]

It's probably really unrealistic, but....

MLB, NHL and NBA teaming up as investors for a system of RSNs with DTC streaming that has no blackouts would be ideal.

Not only unrealistic, but also potential legal anti-trust issues depending on how the new enterprise is structured.

 

[joelef]

Not to go full on media theory, but there's an interesting case to be made that the most popular sports in America have been driven by the primary means of consuming them - as they say, the media is the message - in this case the most popular sports.

Baseball, Horse Racing, and Boxing, all leant themselves to being recapped in newspapers, especially baseball with dailies, and with the rise of more popular media, those sports were replaced.

With broadcast TV, hockey saw it's most popular time, and we saw the dominance of the NFL - Now we have youtube, and streaming, and that's tailor-made for the star-power and individuality of the NBA - The NFL should be given credit for stuff like fantasy and packaging highlights allowing themselves to dominate in this new space. Also, top-flight soccer is easily accessible thanks to streaming for the first time ever.

The NHL has really lagged behind digitally, and I think that's why we're seeing stagnation in popularity.

Obviously this theory has flaws, but it's interesting to think about, and probably has enough truth to shape league policy moving forward for the big american sports.

The nhl is staginatingw because they don’t market there stars. Conor mcdavid has been in the league for almost a decade and yet we got women college basketball playlets and who are known more then him.

 

[Spydey629]

It was never a bubble just a platform dying with nothing replacing it

It is/was most certainly a bubble. The rights fees for teams and leagues has been growing year after year. It was a bubble that was due to burst for 10-15 years now.

It was how the bubble burst that was different.

 

[KevFu]

No they’re going continue to blackouts even if they get less money . These leagues want to die on the blackout hill.

I don't think that's true, I think there was just no reason to tackle the massive challenge.

The blackouts exist because there was one delivery system of local broadcast rights when contracts were written selling those rights to RSNs. The blackout rules made total sense. (And mirrored the FCC rules about cable companies importing out-of-market stations with duplicate programming).

When technology advanced from 30 channels to 500 channels and now there was capacity to sell out-of-market games on cable packages, then years later via streaming; those blackout rules made less sense, but all the rights were tied up into 30 different contracts (per league) with RSNs.

Those deals were not synced up to all expire at short intervals, and tons of those deals were really long. Removing blackouts would require each team BUYING BACK those rights from RSNs who have no reason to give up that protection.

The only way to do it would be tell every team to change their next contracts going forward (forcing teams to leave money on the table while waiting on the longest team's deal to finally be up. Non-starter). OR tell teams to not sign deals past the current longest deal's expiration date so the league could change policies, THEN everyone renegotiate (which probably also wouldn't work because 80% of the league are on THREE RSN systems to negotiate new deals with. They'd see what the teams were doing.

And the leagues didn't have a plan for the future that was better without the RSNs yet, anyway. So it was just easier to sit back and wait.

The leagues themselves don't care about the blackouts that much. It's the RSNs that want them.

They still exist because technology advancements move faster than the length of TV deals.

 

[KevFu]

Not only unrealistic, but also potential legal anti-trust issues depending on how the new enterprise is structured.

Definitely not an anti-trust expert, but it's not anti-competitive to sell your own product yourself.

The anti-trust issues would come from WITHIN: if teams (NY, BOS, LA and PHI teams) didn't want to participate but their leagues forced them.

 

[Spydey629]

I don't think that's true, I think there was just no reason to tackle the massive challenge.

The blackouts exist because there was one delivery system of local broadcast rights when contracts were written selling those rights to RSNs. The blackout rules made total sense. (And mirrored the FCC rules about cable companies importing out-of-market stations with duplicate programming).

When technology advanced from 30 channels to 500 channels and now there was capacity to sell out-of-market games on cable packages, then years later via streaming; those blackout rules made less sense, but all the rights were tied up into 30 different contracts (per league) with RSNs.

Those deals were not synced up to all expire at short intervals, and tons of those deals were really long. Removing blackouts would require each team BUYING BACK those rights from RSNs who have no reason to give up that protection.

The only way to do it would be tell every team to change their next contracts going forward (forcing teams to leave money on the table while waiting on the longest team's deal to finally be up. Non-starter). OR tell teams to not sign deals past the current longest deal's expiration date so the league could change policies, THEN everyone renegotiate (which probably also wouldn't work because 80% of the league are on THREE RSN systems to negotiate new deals with. They'd see what the teams were doing.

And the leagues didn't have a plan for the future that was better without the RSNs yet, anyway. So it was just easier to sit back and wait.

The leagues themselves don't care about the blackouts that much. It's the RSNs that want them.

They still exist because technology advancements move faster than the length of TV deals.

That’s where this gets interesting. Vegas signed with Scripps and will be have their games OTA on Rocky Mountain based Ion stations going forward. There is no RSN to negotiate with - in this case.

That’s why I’ve been hyper vigilant about this. If the Pens sign with a Pittsburgh-based OTA station, what happens to those of us who live too far away to pick up the station on an antenna, don’t get it on a cable/streaming package, but live well within the old territory rights under the RSN?

Honestly, the simple answer, for all three “daily leagues” is to ditch the blackouts, period. Force fans to pick up ESPN+ or whatever streaming service carries their preferred teams games if they’re a cord cutter.

Just pull the bandaid and let the market sort itself out, before the house of cards falls apart and they have to do the above in crisis mode, rather than semi-controlling the circumstances.

 

[KevFu]

That’s where this gets interesting. Vegas signed with Scripps and will be have their games OTA on Rocky Mountain based Ion stations going forward. There is no RSN to negotiate with - in this case.

Yeah, the Golden Knights (and Phoenix Suns) have opted for EXPOSURE on OTA, because if subscriptions to the cable providers are down, forcing RSNs to cut rights fees (bubble bursting), then you're getting less money, period. So you might as well be available to more people and hope accessibility increases viewers and you make the money back from charging more for sponsorship, and from those new viewers becoming spending fans, buying more tickets and gear the closer they are to the team.

And I think the "Daily League DTC Stream Service" I was pining for is basically THAT: You're bringing in new money by charging a three-sport price to fans who might only be spending money one team's streaming now.

That’s why I’ve been hyper vigilant about this. If the Pens sign with a Pittsburgh-based OTA station, what happens to those of us who live too far away to pick up the station on an antenna, don’t get it on a cable/streaming package, but live well within the old territory rights under the RSN?

The OTA still owns the local rights, regardless of delivery system. The difference between OTA and RSNs is nothing in that regard -- actually, it's even MORE extreme for the OTA's...

The FCC has a rule that cable providers can't import an OTA from another market if it duplicates programming that a local OTA has.

This is actually why NFL Sunday Ticket has ALWAYS been on DirecTV and now YouTube. (The NFL could have worked around it by producing separate feeds for each game, but that expense offsets the gain of selling more on cable than DirecTV, and now that it's on YouTube, it's moot).

That's why I switched from MLB Extra Innings to MLBtv back in 2007. Once WPIX became a WB affiliate, I had to watch the opponent feed for 20% of the games. But on MLBtv, you can watch the WPIX feeds.

NHL Center Ice in the US won't be able to carry Vegas OTA on Ion in the cities with an Ion affiliate, only the opponent's cable feed. Not sure what the rules are up in Canada, but I also don't expect there's many Vegas fans who've moved to Canada over the past six years!

Honestly, the simple answer, for all three “daily leagues” is to ditch the blackouts, period. Force fans to pick up ESPN+ or whatever streaming service carries their preferred teams games if they’re a cord cutter.

Just pull the bandaid and let the market sort itself out, before the house of cards falls apart and they have to do the above in crisis mode, rather than semi-controlling the circumstances.

Like I said, the blackouts are part of the contracts with the local rights holders (RSN/OTA). That's a privilege guaranteed to them in the deals to be the exclusive provider in market.

So "ditch the blackouts" only works when you have control of the rights and an RSN/OTA doesn't. Right now, that's only MLB in San Diego and Arizona. Offering in-market streaming via MLBtv was cake. They had the system in place, they just lifted the geo-block in those markets!

You're absolutely right that the leagues can offset RSN bubble burst revenue lost by offering DTC streaming without blackouts.

It's not the leagues preventing cord-cutters from buying streaming in-market, it's the rights holders (RSNs). That's literally what they're fighting about in the Bally's bankruptcy case and what this thread is about. SD and ARZ got dropped because the teams refused to give Bally's the DTC streaming rights.

There's probably a way to articulate it better.

 

[Tom ServoMST3K]

The nhl is staginatingw because they don’t market there stars. Conor mcdavid has been in the league for almost a decade and yet we got women college basketball playlets and who are known more then him.

You need a player with some sort of personality off-ice.

I could not tell you one thing about McDavid other than stats and on-ice stuff.

 

[joelef]

You need a player with some sort of personality off-ice.

I could not tell you one thing about McDavid other than stats and on-ice stuff.

I understand but that fact that a 5 billion league can’t even put out a billboard in every city is pathetic

I don't think that's true, I think there was just no reason to tackle the massive challenge.

The blackouts exist because there was one delivery system of local broadcast rights when contracts were written selling those rights to RSNs. The blackout rules made total sense. (And mirrored the FCC rules about cable companies importing out-of-market stations with duplicate programming).

When technology advanced from 30 channels to 500 channels and now there was capacity to sell out-of-market games on cable packages, then years later via streaming; those blackout rules made less sense, but all the rights were tied up into 30 different contracts (per league) with RSNs.

Those deals were not synced up to all expire at short intervals, and tons of those deals were really long. Removing blackouts would require each team BUYING BACK those rights from RSNs who have no reason to give up that protection.

The only way to do it would be tell every team to change their next contracts going forward (forcing teams to leave money on the table while waiting on the longest team's deal to finally be up. Non-starter). OR tell teams to not sign deals past the current longest deal's expiration date so the league could change policies, THEN everyone renegotiate (which probably also wouldn't work because 80% of the league are on THREE RSN systems to negotiate new deals with. They'd see what the teams were doing.

And the leagues didn't have a plan for the future that was better without the RSNs yet, anyway. So it was just easier to sit back and wait.

The leagues themselves don't care about the blackouts that much. It's the RSNs that want them.

They still exist because technology advancements move faster than the length of TV deals.

They want to continue blackout so they can squeeze out every penny nefore rsn become truly dead. Even if it means less viewers

 

[Golden_Jet]

I don't know that you CAN make up for the revenue lost of the bubble bursting due to streaming/cord-cutting.

That money came from people who paid RSNs every month through their cable bills, who didn't watch those channels. Now that people who don't watch live sports don't NEED cable, because they switched to streaming TV shows via Peacock, Hulu and Paramount+ that revenue is just gone.

So you need new customers to replace them. And the best place to look would be the fans of teams who cannot pay to watch their teams because of blackouts.

Think about Austin and Columbus. You grow up rooting for the MLB team from "Your side of the state" and go to college at Texas or Ohio State and get a job. You're in "enemy territory" and you can't watch your team even if you're willing to pay for MLBtv.

If your in Texas, you can watch a game in another state, blackouts are for locals (RSN).

 

[Headshot77]

That doesn’t address how to make up the billion in revenue lost.
It would be better, just don’t know how it happens, with that much money gone per team.

You don't. The bubble burst. It happens. Sports rights are inherently less valuable now.

 

[rsteen]

You don't. The bubble burst. It happens. Sports rights are inherently less valuable now.

And that's why the NHL isn't ripping off the bandaid and buying back the rights from the RSNs that still have contracts and are fulfilling them. Well, that and Jeremy Jacobs owns part of NESN and I assume any revenues he gets direct from NESN are not HRR so he keeps it all.

 

[Golden_Jet]

You don't. The bubble burst. It happens. Sports rights are inherently less valuable now.

Ahh ok, I guess we just go with the cap dropping 15 million then if the bubble has burst.

 

[KevFu]

If your in Texas, you can watch a game in another state, blackouts are for locals (RSN).

Yeah, if you're in Texas, you get EITHER the Astros or the Rangers depending on where you live.

My point was that if RSN revenue is going down because of cord-cutting, and that money can't be recovered if people who don't watch RSNs or live sports simply cut the cord and watch Netflix.. then opening up the streaming rights to be universal regardless of location is a way to create new revenue you weren't getting before.

Of course the RSNs won't like it, but I said "the ideal outcome" knowing that it's ridiculously hard to get to. If the RSNs keep losing subscribers and can't pay the rights fees they owe (Like Bally's and AT&T) then the teams get their rights back and can hand them over to MLB like the Padres/DBacks did.

The dividing line between SD/ARZ and those Ballys has paid is the DTC streaming: Ballys is offering in-market streaming packages to offset cable subscription losses. THAT is what is keeping RSNs alive in 20 cities. If the leagues agree to STOP giving the RSNs any streaming whatsoever (As soon as they contractually are able to), MLB can just make MLBtv both an "out of market" AND an "in-market" product like they have in SD/ARZ.

That can create the new revenue streams.

BTW, I use the Rangers/Astros as an example because I once explained why Rangers games were blacked out in Round Rock (just north of Austin)... to Nolan Ryan, in his stadium. Huge life highlight right there.

 

[rsteen]

Yeah, if you're in Texas, you get EITHER the Astros or the Rangers depending on where you live.

My point was that if RSN revenue is going down because of cord-cutting, and that money can't be recovered if people who don't watch RSNs or live sports simply cut the cord and watch Netflix.. then opening up the streaming rights to be universal regardless of location is a way to create new revenue you weren't getting before.

Of course the RSNs won't like it, but I said "the ideal outcome" knowing that it's ridiculously hard to get to. If the RSNs keep losing subscribers and can't pay the rights fees they owe (Like Bally's and AT&T) then the teams get their rights back and can hand them over to MLB like the Padres/DBacks did.

The dividing line between SD/ARZ and those Ballys has paid is the DTC streaming: Ballys is offering in-market streaming packages to offset cable subscription losses. THAT is what is keeping RSNs alive in 20 cities. If the leagues agree to STOP giving the RSNs any streaming whatsoever (As soon as they contractually are able to), MLB can just make MLBtv both an "out of market" AND an "in-market" product like they have in SD/ARZ.

That can create the new revenue streams.

BTW, I use the Rangers/Astros as an example because I once explained why Rangers games were blacked out in Round Rock (just north of Austin)... to Nolan Ryan, in his stadium. Huge life highlight right there.

How is it new revenue if the RSNs are already offering local streaming? It's just the same revenue moved around.

 

[Golden_Jet]

The nhl is staginatingw because they don’t market there stars. Conor mcdavid has been in the league for almost a decade and yet we got women college basketball playlets and who are known more then him.

I know one Female basketball player , the one that was in a Russian jail. Don’t even remember her name.

 

[joelef]

I know one Female basketball player , the one that was in a Russian jail. Don’t even remember her name.

That’s more then people know of Connor mcdavid

 

[kgboomer]

Some NBA stars market themselves, have huge followers. And companies like Nike market their stars, Air Jordan and so on, and did so with Tiger Woods in golf. About the only NHL star to market himself was Subban, and many NHL fans hated that. I guess that's how NHL fans like their stars, just being humble. Personally, I liked what Subban did, and it was fun to see Ovie celebrating with the Stanley Cup on social media. And Kessel celebrating with hot dogs was great stuff too.

 

[Takuto Maruki]

I understand but that fact that a 5 billion league can’t even put out a billboard in every city is pathetic

Then a bunch of people who've already made up their minds about the NHL being an incompetent organization helmed by a cross between Satan and a despot will bitch and moan about spending the money and believe it to be more worthwhile elsewhere.

At some point you just have to freely admit that outside of the Northeast and Canada, with pockets in between, no one outside of the wider American cultural zeitgeist gives a shit about hockey. Learn to live with it and work to further what you have, instead of continually going on a Quixotic crusade against windmills trying to change something that has been the case for 25 years plus.