Major League Baseball heads into Hot Stove season at a sports media crossroads with the forthcoming moves potentially shaping the finances of the game for years to come.
Let’s go through it.
1️⃣ We want to state this clearly as the first point: This is not a “sky is falling” look at baseball. The sport is far from dying. We would argue it made significant progress this season with the new rules around the pitch clock, and, if anything, is on the way up.
2️⃣ However, the changing media landscape is going to impact the game. I’m laying out the scenarios, but as a legendary Yankees broadcasting philosopher has said on more than one occasion, “You can’t predict baseball, Suzyn.” Media is no different. No one truly knows how everything is about to turn out because there is a lot going on.
3️⃣ The first issue that will play out over the next year is the regional sports network question. Diamond Sports, with the local TV rights to just fewer than half of MLB teams, already began the bankruptcy process. Commissioner Rob Manfred has a disdain for Sinclair/Diamond, which he recently expressed again on the podcast John Ourand and I host. This saga is likely coming to a head before or during the 2024 season. Last year, MLB took over the distribution and production of the Diamondbacks and Padres games after Diamond Sports, a subsidiary of Sinclair, failed to make payments. MLB charged $19.99 per month for streaming these teams’ games and got distribution on cable and satellite.
4️⃣ Before the World Series, Manfred said, “We will be in a position that we can handle up to 16 teams next year,” Manfred said. MLB is prepared to take over the other Diamond Sports teams, if need be.
Here’s the list of the remaining Diamond clubs: Cincinnati, Cleveland, Atlanta, Detroit, Kansas City, Los Angeles Angels, Miami, Milwaukee, Minnesota, St. Louis, Texas and Tampa Bay. A couple of other small-market non-Diamond teams possibly could shake loose, too, which could bring the total to 16.
You will notice that these are all smaller markets — I would even include the Angels, who are really in Anaheim and are distant second in the L.A. market to the Dodgers, and the Rangers in Arlington/Dallas, which I would consider more of a small market for baseball.
5️⃣ Manfred said MLB sold 18,000 digital subscriptions for the Padres after taking over during the season. Let’s say every customer paid the full-year one-time payment of $74.99 — that would be $1.35 million in revenue. MLB likely expects the subscriber number to go up, saying the new digital-distribution structure allows it to reach more than 3 million people in the San Diego area, nearly 2 million more homes than Diamond. The Padres also received undisclosed cable, satellite and advertising revenue after MLB took over distribution. The Padres were supposed to receive $60 million annually from Diamond on a contract that was set to run through 2032. MLB said it would cover 80 percent of the shortfall when teams did not receive payments from their RSNs.
Sportico’s Barry Bloom said the Padres received $52 million of the expected $60 million this year. The Athletic’s Evan Drellich, Dennis Lin and Ken Rosenthal reported last week that the Padres took out a $50 million loan in September to help cover their huge payroll. I’m told the loan and the TV situation have nothing to do with each other, but it can’t help that the Padres cannot count on the money that Diamond was obligated to pay in the future.
6️⃣ Big-market teams such as the Yankees, Mets and Red Sox are still well-positioned in the RSN world. If you haven’t heard, cable and satellite subscriptions are going down, but these teams and their networks still can demand top dollar. While it’s less than it used to be, they still make a lot. The Yankees and Red Sox have added their own direct-to-consumer products, and it would figure that Mets and SNY should be right around the corner. Overall, though, RSN ratings for all clubs were up 7 percent on the season, despite the fact that an estimated 7 to 13 percent of subscribers were lost by the regional sports networks, according to MLB.
7️⃣ Besides the regional sports network question, MLB is going to have to figure out national baseball coverage. Again, we believe the sport is in a good place, but in a world where nearly every game can be accessed by nearly everyone (except those in the blackout regions), it is difficult to make regular-season games special. It is why, as we reported a few weeks ago, ESPN likely will consider opting out of its baseball deal in two years. Would Warner Bros. Discovery rather invest in college football in the future, as opposed to baseball? It has significant MLB playoffs rights, including one LCS each year, so its package has appeal.
8️⃣ Meanwhile, MLB has gotten involved in national streaming as Apple (on Friday nights) and Peacock (on late Sunday mornings) have dipped their toes in the water. They have not released any viewership numbers, which, from my experience, means they aren’t great. I’ve also heard the numbers aren’t great from sources, though nothing definitive enough to fully report. Common sense says these one-off games are not that popular. The same game is played either the two days after or the two days before.
9️⃣ The dilemma this creates is: If the goal of, say, Apple is to one day apply its MLS strategy to bigger leagues, how does it work? Apple has the rights to all MLS regular-season and playoff games. Fox Sports simulcasts some games. The issue for bigger leagues, if they ever did something equivalent, is there would be no other deals to be made. If you splintered off some national games, the Apple model doesn’t work.
1️⃣0️⃣ This brings us to the World Series ratings. Oh, dear SportsClicker, how could you wait until now to bring up the lowest ratings ever? Because the news is overrated.
Fox had two non-national teams in the Diamondbacks and Rangers and then only got five games. The final tally was an average rating of 9.11 million viewers. However, if I’m MLB, I like that Game 5 was 11.48 million. If it had gone six or seven games, the ratings would have been OK. It happens. The World Series also still outperformed all the entertainment programs it competed against for the eighth straight year, according to Fox Sports president of analytics and analysis Mike Mulvihill. Plus, prior to the World Series, even with the Yankees, Red Sox and Mets failing to qualify and the Dodgers losing early, the playoff ratings were up 3 percent.
But the reason the sky is not falling is because there is always a focus on what baseball doesn’t do well as opposed to what it does well. It has a huge audience and soaks up a lot of time from its viewers. It is well-positioned for the future because of that.
However, change is in the air because the media is splintering. There will eventually be winners and losers. The decisions that Manfred and TV and digital executives make will determine who they are and how successful they are.
1️⃣1️⃣ If you ask me how well-positioned, I’d give you a baseball analogy. Manfred and company are standing at the plate with a 2-1 count. It is a favorable position, but there are no guarantees.
Quick Clicks
On NFL Network’s Chiefs-Dolphins game, I would have liked to hear what Dan Orlovsky and Jason McCourty could have done with a play-by-player other than Rich Eisen. Eisen is a studio guy and doesn’t have the rhythms of calling games down due to his lack of experience. That said, it is difficult in such a spotlight game to throw three people together and have it sing. … ESPN has signed play-by-player Mike Monaco to a new three-year deal, according to sources. Monaco has moved up the ESPN ranks, calling hockey, college football and basketball. ESPN has allowed top young play-by-players get away, specifically to Fox with Adam Amin, Jason Benetti and Joe Davis. Monaco, 30, is part of ESPN’s immediate future.
… YES’ Ian Eagle and MSG’s Mike Breen shared the New York Sports Emmy for play-by-play. Eagle has won it eight straight times and nine in 11 years, which is the most ever. The New York baseball philosopher I spoke of earlier, John Sterling, presented the award. The presentation is classic Sterling. … I reported last week that Breen has a new four-year contract extension, which means if ESPN retains the Finals, he is contracted to call them for the next six years. He would have 24 Finals under his belt at that point. Bang! … Fox’s Lachlan Murdoch said on the company’s earnings call this week that he doesn’t envision having its free streaming service, Tubi, offering live sports.
Clicker Book Club
Kenny Albert’s “A Mic For All Seasons (My Three Decades Announcing the NFL, NHL, NBA, MLB, and Olympics)” takes the reader into the world of broadcasting, highlighting his duties and challenges from his childhood as Marv’s son to his current broadcast roles, which includes being Warner Bros. Discovery’s Stanley Cup game-caller. Papa Clicker gives Albert’s tome 4.25 out of 5 clickers.
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