Regional Sports Networks Going Bankrupt

Yep, the RSN model has been great for MLB, NBA and NHL but the jig is up.

 

I think I have posted it before, but I still get a local TV service. I am just old enough to want the option of flipping through the channels whenever, plus sports and movies. I don't want to try and find all the sports, especially, through a bunch of different services and while there might be a few cheaper providers by a smidge (like Hulu or YouTube), I still want the local sports. So I pay for it. I know I'm a dying breed and I am the only one in my family who usually watches, but I still do it for those reasons for now.

As I said, one of the reasons is local sports. But it is pretty much a scam. We used to have two channels providing coverage of three teams. Now it is down to one, but they have the Nuggets and Avalanche. The Rockies got picked up in many places in the area, but not here yet. Despite that, I pay $14.47 a month for the regional sports fee (just looked it up). So basically for one channel. Now I might pay that for that channel by itself, not sure how many would, but with all the other costs of the service it is crazy. HBO costs $15 and I get that on the TV and I get Max on any device I want and it has way more content.

The cost scale of regional sports really makes no sense.

 

But then you have to go back and drop your price for the outlets that already carry your channel.

 

Minor league baseball teams and most colleges have the equipment and staff to stream their own broadcasts without RSNs. Can't imagine MLBAM doesn't have the ability to contract out everything that the RSNs do live now at a fraction of the cost.

RSNs have outlived any advantage they might have had in the era between over the air and streaming. Cable might as well be dead.

 

FanDuel nearing naming rights deal to replace Bally Sports: report

 

This is laughable. How much $ will MLB teams make doing this? Certainly not the $30M (depending on the team) a year they get from RSNs. Most MLB teams need RSNs and they know it but won't admit it (see offseason spending for teams who don't have a contract or were in limbo).

 

The professional sports teams can easily acquire the equipment and personnel to show the games. The problem is the drop in revenues that the teams will receive. I looked at the financial statements of Diamond Sports and only 15% of the revenues were from advertising. The rest was from subscriptions paid by cable operators.

Comcast has said 70% of their customers never watch an RSN. In today's marketplace how much is a cable operator willing to pay a team, especially a mediocre one, to carry the games?

The sport that is most dependent on RSN revenue is baseball. Teams like the Rockies will be slashing salary quickly if they lose the RSN contract.

 

I don’t think the Rockies have a RSN deal this season?

 

My mistake. I thought the Rockies were with Bally, not AT@T Time Warner.

In 2023 the Rockies were reported to make 57 million dollars from AT@T Time Warner. Total club revenue was reported by Forbes as 424 million. In the link a season package os offered for all MLB for $150 and just the Rockies for $100 for the season. So if the Rockies would have to sell 380,000 packages at $150 a piece to recover the 67 million. Obviously there are other factors that make this a really wild assed estimate.

But I am pretty sure that he Rockies are not selling anything close to 380,000 packages and are taking a big revenue hit. Monfort is not going to eat those losses but will cut costs. Other teams will be doing the same as the Diamond sports package falls apart.

 

The Rockies total payroll dropped by a little over $32 million this year. It's not a coincidence given the revenue that vanished. That said, they made deals with the cable/satellite companies -- and on DirecTV, they air on the channel position vacated by AT&T SportsNet.

 

After Bally's went tits up, Comcast put up a title card on the channel with a message about not getting paid and that customers would get a credit on their bill.
Lo and behold, my bill this month had a $5.60 credit listed as something like "regional sports fee."
That's one of those little transparency things that will infuriate you if you let it. How the hell is a channel that shows Braves games, fishing shows and infomercials worth $5.60 a month!?