A major development in MLB’s media future likely hinges on Diamond Sports Group’s fate in bankruptcy court.
In February, commissioner Rob Manfred said he hoped to launch a national, in-market streaming package in 2025 with about half of the league’s teams. Bringing that to fruition would be a huge deal. Not because it would make a lot of money at the outset, or any money. Streaming is often a losing business.
Advertisement
Rather, its importance would be in reach. A national package would be one of the easier ways for fans to watch any team that’s included.
But if Diamond and its Bally-branded regional sports networks successfully emerge from bankruptcy, it’s basically impossible for MLB to launch even a half-national package as soon as next season.
The 2025 timetable might always have been aggressive, but it had a logical origin. MLB would have a dozen teams in need of a new broadcast partner if Diamond disappeared. If Diamond now survives bankruptcy — and that looks increasingly likely — MLB won’t control enough teams’ rights to launch a viable product.
Manfred said in February he’d need at least 14 clubs to get it off the ground, a figure that still might leave sales lacking. But if Diamond is still in operation, he probably would have a maximum of only nine.
There are the three teams whose games MLB itself is producing this season: the Arizona Diamondbacks, Colorado Rockies and San Diego Padres.
Then there are three teams whose games are not produced by the league but who were cut loose by Warner Bros. Discovery last year: the Houston Astros, Pittsburgh Pirates and Seattle Mariners.
The Cleveland Guardians, Minnesota Twins and Texas Rangers bring the total to nine; that trio is carried by Diamond this year but on one-year deals, making them free agents at season’s end.
Diamond has a June court date to confirm a get-out-of-bankruptcy plan backed by Amazon. If it’s shot down, MLB could have as many as an additional nine teams to work with.
But that just doesn’t seem likely. Diamond’s bankruptcy process is entering a late stage.
“On something like this, where it seems that most of the major players are parties to a restructuring support agreement … I would say that this is headed toward confirmation,” said attorney Brian Davidoff, chair of the bankruptcy group at the firm Greenberg Glusker in Los Angeles.
Advertisement
Does that mean MLB is rooting against Diamond in court? Not necessarily, and perhaps not at all. Team owners generally love the regional sports network model because it usually comes with a long-term commitment and a lot of money. The league won’t mind if Diamond can keep paying its teams for years to come.
That’s the rub, though: In court, MLB has been highly skeptical of Diamond’s ability to do just that.
Comcast on Tuesday stopped carrying Diamond’s channels in a carriage dispute, leaving fans who subscribe to Comcast’s Xfinity service without Diamond telecasts while the sides fight it out.
Driving the dispute is a question about which tier of service Comcast puts Diamond RSNs on, and how quickly any changes in tier are made. Teams and leagues want their games to be part of basic service, rather than a premium add-on.
“I always thought when it came to these distribution negotiations, Comcast was going to be the hardest,” said media consultant Patrick Crakes, who runs an eponymous consultancy. “They’ve made a commitment to move RSNs … to digital tiers.”
Presumably, Comcast and Diamond will eventually reach a deal. Diamond recently agreed to long-term deals with two other major distributors, Charter and DirecTV. One of the key questions for Judge Chris Lopez in federal bankruptcy court in Houston will be whether the terms of those deals line up with Diamond’s projections and overall plan.
Even as MLB doubts Diamond’s long-term viability, Crakes said that Diamond’s survival is in the best interest of baseball.
“Given the economic struggles of stand-alone streaming, it’s pretty obvious these regional sports networks have to survive and that distributors want them, and that they’re the best way for the teams to get economics from local rights flowing to them, even if it means there’s no growth, or even in some cases some walks backwards today or probably in the near future,” Crakes said. “And baseball’s behavior says that.”
(Photo: Casey Sykes / Getty Images)
Subscribe to The Athletic for in-depth coverage of your favorite players, teams, leagues and clubs. Try a week on us.
Evan Drellich is a senior writer for The Athletic, covering baseball. He’s the author of the book Winning Fixes Everything: How Baseball’s Brightest Minds Created Sports’ Biggest Mess. Follow Evan on Twitter @EvanDrellich